Risk Adjustment Intelligence Center
CMS-HCC & HHS-HCC models — the single largest financial lever in Medicare Advantage, ACA Marketplaces, and MSSP/ACO programs
Source: CMS, MedPAC, OIG, HHS, academic research • Last updated March 2026
Key Takeaway for Leaders
Risk adjustment determines how much money flows to plans and providers based on patient health status. A single RAF score change of 0.01 can shift millions of dollars for a mid-size MA plan. The system is at a major inflection point: V28 is now fully phased in, CMS has proposed excluding unlinked chart reviews ($7.2 billion impact), and RADV audits are expanding to all 550 eligible MA contracts. Organizations that understand the mechanics, history, and strategic direction of risk adjustment will be better positioned to navigate what comes next.
CMS-HCC Annual Lifecycle
Medicare Advantage risk adjustment — from diagnosis capture to payment and audit
The cycle begins in January 2024 when providers start capturing diagnoses through patient encounters. Plans submit encounter data (EDS) to CMS on a rolling basis through early 2025. CMS runs an initial risk score calculation in mid-2024 (July), then a final sweep in March 2025 that incorporates late-arriving data. Monthly capitation payments begin January 2025 at an initial rate, then increase after the March sweep. A retroactive lump-sum true-up settles the difference around July 2025. Beginning in 2026, RADV auditors can review the payment year's claims — an audit window that remains open indefinitely.
Key Numbers
MedPAC 2025 estimate
V28 model (2024)
ACA Marketplace model
Statutory minimum (ACA)
Proposed exclusion
All eligible MA contracts
Two Ecosystems
This section covers CMS-HCC (Medicare Advantage & MSSP/ACO REACH) and HHS-HCC (ACA Individual & Small Group Marketplaces). They share common ancestry but differ in critical ways that affect strategy.
Explore the Intelligence Center
History & Timeline
From AAPCC (1982) through V28 and the 2027 proposals
Model Comparison
CMS-HCC vs HHS-HCC side-by-side reference
CMS-HCC Deep Dive
Medicare Advantage & MSSP model mechanics, RAF calculation, V28
HHS-HCC Deep Dive
ACA Marketplace model, concurrent scoring, metal tiers
RADV & Compliance
Audit landscape, OIG enforcement, compliance strategies
Strategic Questions
What leaders need to ask — MA, ACA, MSSP, and health systems
Current Intelligence
2027 Advance Notice, chart review exclusions, RADV expansion
V28 Transition Status
Risk adjustment content is updated on an annual cycle aligned with CMS rate announcements. Data sources include CMS, MedPAC, OIG, and peer-reviewed research.