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Risk adjustment is a method to offset the cost of providing health insurance for individuals—such as those with chronic health conditions—who represent a relatively high risk to insurers. Under risk adjustment, an insurer who enrolls a greater-than-average number of high-risk individuals receives compensation to make up for extra costs associated with those enrollees. The Risk Adjustment (RA) model uses a patient’s demographics and diagnoses to determine a risk score, which is a relative measure of how costly that patient is anticipated to be. Healthy patients have a below-average Risk Adjustment…

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