Risk Adjustment
Adjustment of payment to plans or providers based on the health status and demographic characteristics of the enrollee population.
1 min read · Last reviewed May 23, 2026
At a glance
- Category
- Compliance Program
- Primary sources
- 2
- Workspace handoff
- revenue audit →
Where this comes up
Compliance committees and practice managers operate at this level — written policy, workforce training, sanction policy, monitoring and auditing cadence, response and corrective action. The seven elements of an effective compliance program (OIG) are the scaffolding; this term lives somewhere on that scaffold.
Full definition
What it is in practice
CMS uses risk adjustment in Medicare Advantage, ACO models, and certain Medicaid programs. HCC coding is the primary mechanism in MA.
How it shows up in your practice
Annual chart review for chronic condition recapture is the operational practice. HCC-savvy coding training drives meaningful payment differences.
Sources
- CMS — Medicare Advantagehttps://www.cms.gov/medicare/health-plans/medicareadvtgspecratestats
- CMS — Quality Payment Programhttps://qpp.cms.gov/
Run HCC recapture in Revenue Audit
Open revenue audit →Related terms
- DocumentationHCC (Hierarchical Condition Category)The CMS risk-adjustment model that groups ICD-10 codes into categories used to predict the cost of care for Medicare Advantage enrollees.
- PayerMedicare Part C (Medicare Advantage)Medicare benefits delivered through private health plans contracted with CMS, often with additional benefits and a managed-care structure.
- Compliance ProgramValue-Based CareReimbursement models that pay providers based on quality and outcomes rather than fee-for-service volume.
- Compliance ProgramAccountable Care Organization (ACO)A group of providers that takes accountability for the quality, cost, and overall care of a defined patient population.
D3rx is a healthcare-billing and compliance research aid maintained by D3rx Inc. Articles are drafted by an LLM (Anthropic Claude) against primary HHS, OCR, CMS, eCFR, NIST, and state-regulator publications, and reviewed for restraint and source fidelity by the D3rx team.
Reviewer status: a named credentialed reviewer (CHC, CHPC, or healthcare attorney) is being engaged. Until that engagement is finalized, this page does not claim credentialed review.
Related across the archive
- GlossaryAccountable Care Organization (ACO)A group of providers that takes accountability for the quality, cost, and overall care of a defined patient population.
- GlossaryValue-Based CareReimbursement models that pay providers based on quality and outcomes rather than fee-for-service volume.
- GlossaryHCC (Hierarchical Condition Category)The CMS risk-adjustment model that groups ICD-10 codes into categories used to predict the cost of care for Medicare Advantage enrollees.
- GlossaryMedicare Part C (Medicare Advantage)Medicare benefits delivered through private health plans contracted with CMS, often with additional benefits and a managed-care structure.
- GlossaryReadmission Reduction Program (HRRP)CMS program that reduces payments to hospitals with excess 30-day readmissions for certain conditions.
- GlossaryQuality Payment Program (QPP)CMS framework that combines MIPS and Advanced APMs to tie physician Medicare payments to quality and value.
- BillingWhat to Do When a Payer Says You're UnderbillingGot a letter saying you're underbilling? Here's what it actually means, whether you should worry, and what action to take.
- ComplianceAmbulatory Surgery Center Compliance: CMS + State + Infection Control42 CFR Part 416 Conditions for Coverage, CMS State Operations Manual Appendix L, the ASC Infection Control Surveyor Worksheet, and where state ASC licensure tightens the standard.
This glossary entry is a research aid for billing and compliance staff. It does not provide legal, medical, or financial advice and does not replace counsel. References cited link to primary sources at HHS, OCR, CMS, eCFR, NIST, and the relevant payer or industry body.