Risk Adjustment Across Multiple Lines of Business

Navigating risk adjustment across multiple lines of business isn’t just complex, it’s a balancing act of shifting regulations, diverse populations, and evolving models. In this episode, we break down the key differences between Medicare Advantage, Medicaid, and ACA, and explain why understanding these nuances is crucial for health plans that manage all three simultaneously. Whether you’re grappling with audits, coding accuracy, or technology gaps, this conversation offers real-world insight and practical strategies for managing multiple lines of business (LOB).

Host: Welcome to today’s episode, Risk Adjustment Across Multiple Lines of Business.  

We’re joined by Amanda Proctor. She knows firsthand what it takes to navigate risk adjustment across three very different lines of business. She’s helped health plans untangle the technical, regulatory, and operational nuances of Medicare Advantage, Medicaid, and ACA, and she’s here to help us understand what makes each one unique and how to tackle the challenges of operating three different lines of business under the same roof. Thanks for being here, Amanda.

Amanda: Thanks so much for having me. I’m excited to discuss such a big topic, with a lot of layers.

Host: So let’s start with the basics. We’ve got three lines of business: Medicare Advantage, Medicaid, and ACA. What makes them so different—and why should health plans care?

Amanda: Great place to start. At the highest level, all three models aim to predict healthcare costs using risk adjustment, but the populations, coding models, timing, and oversight vary drastically.

Medicare Advantage focuses primarily on seniors—65 and older. But, it also includes individuals with disabilities or ESRD. Interestingly, with the V28 model update, CMS actually added some pediatric conditions, which was a shift. That reflects how more young individuals are qualifying for Medicare due to disability status.

Medicaid, on the other hand, serves a different population: low-income individuals, pregnant women, children, and disabled adults. It spans birth to death, but is very state-specific in how it’s implemented. And then ACA, Affordable Care Act plans, which are sort of the catch-all. They cover working-age adults, their children, and often the entire family unit.

So the populations themselves drive different clinical conditions, social determinants, and even audit strategies.

Host: So different models, different conditions, and I’m guessing different strategies for managing?

Amanda: Yes, exactly. Each has its own HCC model. For Medicare Advantage, we’re dealing with Part C and D, so conditions and prescriptions are covered here, and V28 now includes 115 HCCs, up from 86.

ACA uses the HHS-HCC model, currently in version V07, with about 127 HCCs. This model leans more toward pediatric and maternity-related conditions.

Medicaid is the trickiest. Most states use CDPS or CRG models, but each state can tweak those models, blend them, or use modified versions. It’s like 50 different mini-programs with their own expectations.

Host: Each line of business sounds very nuanced. So, how do plans manage when they offer more than one line of business?

Amanda: You need standardization without oversimplifying. This involves educating teams on the differences between the models, leveraging configurable technology, and coordinating the submission and review of data.

For example, ACA is concurrent. You code and submit within the same year, and that diagnosis has to be linked to a claim, or it won’t count. Medicare Advantage is considered a prospective payment model. Meaning, plans get paid based on future predicted costs, so 2024 dates of service are for the 2025 payment year. Medicaid varies. Some states are concurrent, some are prospective. Most use encounter-based submissions, but it depends.

Host: And how do those timing differences impact operations or technology requirements?

Amanda: They’re huge. For ACA, because everything needs to be matched to a claim and matched quickly, you need strong claims linking. That means your coders shouldn’t just reviewing blindly. They’re validating against claim submissions to ensure the diagnoses will count.

In Medicare Advantage, claims linking is less critical. CMS only needs to validate a diagnosis once a year, so as long as it’s captured, you’re generally safe. Medicaid is starting to lean more toward claims linking as well, but again, it depends on the state.

Host: Let’s talk audits. Every line has its own version of an audit, right?

Amanda: Definitely. Medicare Advantage has two: the Part C Improper Payment Measure audit, which is broad and doesn’t carry penalties, and the contract-level RADV audit, which does, and can mean clawbacks.

ACA has the HHS RADV audit. This is a significant issue because it impacts payment redistribution. If your submitted HCCs aren’t validated, you have to pay into a shared pool. But if they are validated and you show higher-than-average risk, you may get funds back. It’s a serious financial incentive to get things right.

Medicaid audits vary widely. Some states closely follow CMS guidance, especially for managed care organizations. Others set their own rules. It takes local knowledge to stay compliant.

Host: Do plans struggle with the management of different states?  

Amanda: Absolutely. I once worked with a regional health plan that had expanded into three new states with Medicaid business. They were rock-solid on Medicare Advantage but quickly found out that their workflows didn’t translate. Coding guidelines were different. Encounter data didn’t line up. And the tech couldn’t flex across the three state models.

We had to build out custom rule sets in the platform, train the team on state-specific audit requirements, and create different timelines for submissions. It took months, but they avoided penalties and actually improved their risk capture year over year.

It taught me that you can’t just “lift and shift” from one line of business to another. You have to respect the nuances.

Host: Such a good reminder. Last question—how can health plans future-proof themselves if they’re managing multiple lines?

Amanda: It comes down to three things: First, education. Make sure your teams understand each model, each population, and what’s expected. Second, use a flexible technology platform that can handle multiple HCC models, claims linking, and submission strategies. And lastly, plans must align with a partner who has deep subject matter expertise and can facilitate collaboration between the coding vendor, analytics teams, and internal compliance teams.

We help plans configure their platforms to match each model's rules and adjust as state regulations and CMS evolve. It’s about being proactive, not reactive.

Host: That’s very practical advice. Thank you so much for joining us today and making plans aware of the complexities in running multiple lines of business across multiple states.  

Amanda: Thank you! It’s been a pleasure.

Host: If you liked this episode, be sure to follow the show on Apple or Spotify, and share with your colleagues on LinkedIn. As always, tune in each month when new episodes drop. We’ll be continuing real-world conversations with health plan professionals on how to keep your health plan running smart and staying compliant, across every line of business.