V28 and Its Impact on Retrospective Risk Adjustment Coding

If you work in Medicare Advantage, value-based care, or health plan operations, you've likely heard about V28, the latest version of the CMS-HCC risk adjustment model. But what exactly is V28, and why is it such a significant update?

Let’s break it down clearly and concisely.

What Is V28?

V28 is Version 28 of the CMS-HCC risk adjustment model, released by the Centers for Medicare & Medicaid Services (CMS) for the 2024 payment year. It’s the most substantial update to the Medicare risk adjustment model in over a decade and represents a major shift in how risk scores are calculated for Medicare Advantage beneficiaries.

The CMS-HCC model predicts expected healthcare costs based on demographic and clinical data; primarily ICD-10 codes submitted on patient claims. These data points are mapped to Hierarchical Condition Categories (HCCs), which roll up into a risk score used to adjust payments to health plans. Simply put, the more medically complex a patient is, the higher their risk score, and the more a plan gets reimbursed to manage their care.

It is important to note that V28 is in full effect for Plan Year 2026. Planned as a phased approach, implementation started in PY2024 at 33%, then PY2025 at 66%, and now PY2026 at 100%.

Key Changes in CMS-HCC V28

V28 introduces several foundational changes that impact risk adjustment coding, HCC mapping, and Medicare Advantage payment accuracy:

ICD-10 to HCC Realignment
CMS removed approximately 2,000 diagnosis codes from mapping to HCCs, narrowing the focus to codes that are strongly predictive of future costs. This helps reduce coding variation and limits opportunities for upcoding.
Fewer HCCs, More Clinical Precision
The number of HCCs was reduced from 86 to 80. Some categories were combined or eliminated to better reflect medical relevance and consistency. This move prioritizes clinically significant conditions over loosely defined ones.
New Condition Weighting Structure
V28 updates the relative factors used to calculate risk scores. Some conditions like diabetes with complications, for example, carry lower risk adjustment weights than in previous models, which may decrease patient-level scores.
Stricter Clinical Grouping
Diagnoses are now grouped into condition categories based on clinical similarity and cost predictiveness. This increases transparency but also requires more precise documentation and coding practices.

How V28 Impacts Risk Adjustment and Medicare Advantage Plans

The ripple effects of V28 are wide-reaching. Here’s how it will impact stakeholders:

Risk Scores Will Likely Decline
Because fewer diagnoses map to HCCs and weights have been adjusted, many health plans will see a drop in average risk adjustment scores. This could reduce payments if plans don’t adapt.
Accurate Documentation Becomes Essential
V28 raises the bar on specificity. Vague or unsupported codes are more likely to be excluded from the risk score. That means providers need to document clinical conditions clearly and accurately.
Higher Audit Risk
With more scrutiny on risk adjustment coding, RADV audits (Risk Adjustment Data Validation) may become more rigorous. Plans and providers must ensure compliance with CMS coding guidelines to avoid claw backs.
Financial and Operational Implications
Since Medicare Advantage revenue is tied to risk scores, lower scores could mean significant changes in financial forecasting, resource allocation, and care management strategies.

Why V28 Matters

UST HealthProof translates healthcare complexity into clarity. V28 isn’t just an update, it’s a fundamental shift in how CMS approaches risk adjustment accuracy, program integrity, and cost predictiveness.

Whether you're a health plan leader, coding manager, or care delivery executive, understanding the implications of CMS-HCC V28 is critical. Now’s the time to assess your coding workflows, train clinical staff on documentation best practices, and update your analytics models to reflect the new risk landscape.

To learn more about V28, check out this webinar: The V28 Blueprint: Strategies for Adapting to Change and Mitigating Impact.