Commonwealth Fund February 17, 2022
Background
Risk adjustment is a statistical method that seeks to predict a person’s likely use and costs of health care services. It’s used in Medicare Advantage to adjust the capitated payments the federal government makes to cover expected medical costs of enrollees. This, in turn, helps to ensure a plan’s contracted providers have sufficient resources to care for beneficiaries and don’t have incentives to avoid sicker and more costly patients.
Because higher risk scores mean higher payments, Medicare Advantage plans have financial incentives to thoroughly document beneficiaries’ diagnoses. Providers caring for beneficiaries enrolled in traditional Medicare do not have the same incentives to fully capture diagnoses in medical claims because they’re paid based on services they provide rather than the...
Today's Sponsors
Today's Sponsor