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Risk Adjustment

Risk Adjustment is the method developed and used by the Department of Health & Human Services (HHS) to predict health costs of members enrolling in Affordable Care Act (ACA) or Medicare Advantage (MA) plans. Risk Adjustment prevents health plans from only attracting and enrolling healthy members; or adverse selection. Effective Risk Adjustment programs ensures members are receiving quality care and enable health plans to offer more comprehensive and affordable benefits to members.

Arkansas Health & Wellness is required by law to report complete and accurate diagnostic information on enrollees. This information is gathered from claims data and information obtained from medical record reviews and audits.

We encourage all providers to take every face-to-face encounter as an opportunity to provide comprehensive care and document chronic conditions, co-existing conditions, active status conditions, and pertinent past conditions using the applicable ICD-10 code and supporting the condition with proper documentation in the medical record.

Arkansas Health & Wellness is required to validate member diagnosis annually through Risk Adjustment Data Validation (RADV) audit. Health Plans also engage in chart review projects to ensure member diagnosis are being reported accurately.

Arkansas Health & Wellness engages providers through various incentive programs that reward providers for risk adjustment gap closure.

To see all coding tip sheets, please visit Coding Tip Sheets And Forms.