By providing risk adjusted payments, CMS can make more appropriate and accurate payments for beneficiaries with differences in Expected Costs. Risk-adjusted payments are payments that are adjusted based on the expected costs associated with a particular patient's care.
This means that the payments are adjusted based on the patient's expected costs, taking into account any additional costs associated with the patient's care. This could include costs associated with a higher severity of illness, a longer length of stay, a more complicated diagnosis, or any other factors that may lead to increased costs.
By adjusting payments based on expected costs, CMS can ensure that providers are not being overpaid for services for patients with higher costs, and that providers are adequately compensated for services for patients with lower costs. This provides an incentive for providers to provide quality care to all patients, regardless of their expected costs.
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