Major changes are happening in risk adjustment. The continued scrutiny of health risk assessments (HRAs), the full implementation of the Centers for Medicare & Medicaid Services (CMS) Hierarchical Condition Category (HCC) Model Version 28, and other changes are a reflection of how the risk adjustment landscape is constantly evolving. Leaders need to anticipate and adapt strategies to match the changes on the horizon, and plans should be thinking of comprehensive transformation, not just incremental compliance.
Organizations that formulate a strategy focusing not just on 2026 but the years following will be best positioned for success. Here, we will review long-term trends that emphasize the enhanced scrutiny of documentation practices and coding accuracy (model V28, HRAs) as well as latest updates (with the recent Big Beautiful Bill) and their impact on Medicaid and ACA populations, as well as risk adjustment strategies
The impact of enhanced coding scrutiny
The transition to V28 represents a fundamental shift in how CMS approaches risk adjustment, looking to move from prioritizing volume to precision, and the operational impact is profound. Under the new model, 2,294 diagnosis codes were removed while expanding HCC categories from 86 to 115.
For example, consider heart failure documentation. Today, a claim needs to include details such as ejection fraction percentage, acute versus chronic status, systolic versus diastolic clarification, and more. Under V28, these sorts of clinical indicators can no longer be retrospectively coded or added a significant amount of time after the fact—they need to be noted at the point of care. As such, the V28 model rewards organizations that can capture genuine clinical complexity at the point of care in real time.
Plans should prepare for this change by making sure they have an integrated risk adjustment framework that combines prospective, concurrent, and retrospective approaches. This includes investing in technology and analytics for real-time documentation and audit protection. Educating providers on these changes should also be part of this strategy, so everyone understands the reason behind the increased focus on specificity and timeliness. Plans should also enhance clinical documentation improvement (CDI) programs and adapt financial and operational metrics to this new reality.
Upcoming ACA and Medicaid changes
Another major change coming up in 2027 is the One Big Beautiful Bill Act, which is positioned to fundamentally alter Medicaid risk adjustment dynamics. Despite being two years away, the operational changes required for it demand immediate attention.
A major part of the Act requires adults to complete 80 hours of work or community service activities per month to qualify for coverage. It also will shift redeterminations from every 12 months to every six months, profoundly affecting timelines for data capture. Many states also prohibit supplemental file submission for Medicaid risk adjustment, bringing encounter data into question—when a member loses eligibility at month six, any uncaptured diagnosis represents permanently lost revenue.
Consider this scenario: A member with diabetes and congestive heart failure enrolls in January. Standard processes identify them in March, and schedule assessment for May. They then lose coverage in June due to work requirement noncompliance. Those diagnoses are therefore lost, with no retrospective recovery possible. The resulting situation is a combination of shortened capture window and elevated risk profiles.
Further, variations will compound the complexity of these new changes, since each state has differing submission rules, exemption criteria, and implementation timelines. Plans should therefore strategize for operational models per each state to ensure the ability to meet these changes.
Strategies should prioritize concurrent and prospective risk adjustment workflows, aligning provider documentation and EHR systems to capture accurate member risk in real time. Invest heavily in provider education and process automation so that every diagnosis is documented and submitted timely during member coverage periods. The window to capture risk is short, with variation across days and populations, so planning and adaptation must start now to safeguard payment accuracy and risk adjustment program integrity.
Trends on the horizon
The No UPCODE Act is an acronym for “no unreasonable payments, coding, or diagnosis for the elderly.” The intent of this bill is to revise how Medicare Advantage plans assess patient risk overall, aiming to reduce overpayments and save taxpayer dollars in the Medicare program.
There are three changes included in the No UPCODE Act. The first would ban the use of diagnosis codes collected from chart reviews, as well as in-home health assessments or HRAs that are a key driver for risk score calculation and payment adjustment. This change would fundamentally eliminate retrospective review as a possibility to correct incomplete or inaccurate code capture, putting additional pressure on real-time data capture for accurate diagnoses.
The second change is that CMS would use two years of patient diagnostic data instead of the existing one-year model. The third is that CMS would be required to calculate and publish the differences between traditional Medicare and Medicare Advantage plans, with the aim of ensuring adjustments account for unrecognized coding pattern differences.
If this bill were to be enacted, plans need to shift retrospective and supplemental efforts to near-immediate efforts, ensuring coding accuracy before that data is submitted to CMS.
Preparing for 2026 and beyond
In looking toward the future, plans should be thinking about how they can adjust to the immediacy and intricacies demanded by these new regulations. Concentrating on proactive efforts, rapid data capture, and provider education are just some of the ways that plans can ready themselves for the upcoming regulatory environment.
For more information on structuring your plan for risk adjustment success in the new year and beyond, watch our full webinar, Risk adjustment in 2026: Key updates and strategic readiness.
