Implications of coding and risk-adjustment in primary care payment reform

Claire T. Dinh, Joshua M. Liao, Amol S. Navathe


Implemented by the Centers for Medicare and Medicaid Services, alternative payment models (APMs) provide financial incentives to clinicians and health care organizations (HCOs) for delivering high-quality, cost-efficient care to patients (1). In APMs, clinicians and HCOs are held accountable for specific clinical conditions, episodes, or populations. Whereas in the traditional-fee-for-service payment system, clinicians and HCOs have been financially rewarded for providing a high volume of services to patients regardless of their health status, APMs have promoted a shift toward payment that is linked to the cost and/or quality of care (2). APMs have demonstrated promising results in the quest for health care value, but they also present concerns. One issue critical to the success of APMs is ensuring appropriate and fair risk adjustment.