US · guidance
CMS Pub. 100-16, ch. 7, § 20
Purpose of Risk Adjustment
Risk adjustment allows CMS to pay plans for the risk of the beneficiaries they enroll, instead of
an average amount for Medicare beneficiaries. By risk adjusting plan payments, CMS is able to
make appropriate and accurate payments for enrollees with differences in expected costs. Risk
adjustment is used to adjust bidding and payment based on the health status and demographic
characteristics of an enrollee. Risk scores measure individual beneficiaries’ relative risk and risk
scores are used to adjust payments for each beneficiary’s expected expenditures. By risk
adjusting plan bids, CMS is able to use standardized bids as base payments to plans.
History
(Rev. 114, Issued; 06-07-13, Effective: 06- 07-13, Implementation: 06-07-13)
Provenance
- Source
- cms.gov
- Retrieved
- 2026-08-25
- Edition
- iom-2026-08-25
- Content hash
6d86ea604a112e381a4094e5459f28dc07d0641e32502bbeb42375ef222ef206
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