How Payers Can Enhance Risk Adjustment with FHIR-enabled Data Activation

Written by Team IndiBlogHub  »  Updated on: June 24th, 2024

How Payers Can Enhance Risk Adjustment with FHIR-enabled Data Activation

Precise risk adjustment is critical for health plans (payers) operating in the value-based healthcare system. It guarantees equitable compensation according to the intricacy of the insured population's health. In the past, risk adjustment was dependent on claims data, which frequently lacked essential clinical information. This resulted in inadequate patient images and, perhaps, inaccurate risk assessments. However, for payers looking to maximize risk adjustment, the advent of FHIR (Fast Healthcare Interoperability Resources) presents a potent option.

This article explores how payers may greatly increase the precision and effectiveness of risk adjustment, resulting in improved patient care and cost management, by utilizing data activation platforms and FHIR, a standard for healthcare data exchange.

What is FHIR?  

Fast Healthcare Interoperability Resources, or FHIR, is a standard protocol that enables various electronic health record (EHR) systems to communicate with one another. Think of it as a universal language that connects various computer applications. This makes it possible for medical professionals to safely retrieve a patient's medical records from other organizations, even if they employ different software. Compared to previous techniques, FHIR's adaptability and flexibility make data interchange simpler. FHIR enables clinicians to have a more comprehensive view of a patient's health, enabling them to make more educated treatment decisions.

Need for Timely Access to Accurate Patient Data

In order to effectively adapt to risk, timely access to reliable data is essential. Its absence can lead to penalties resulting from errors in encounter data submissions, infrequent, or inadequate reporting. Incorrect data submission can have negative effects such as audit failure, Centers for Medicare and Medicaid Services (CMS) repayment, and even legal repercussions.

CMS announced in an advance notice from January 2020 that it would be using more encounter data to determine Medicare Advantage payments. In accordance with the Bipartisan Budget Act, CMS recently extended the additional benefits to Medicare members who are chronically ill. Medicare Advantage plans now have to take non-clinical data into account when determining risk-adjusted payments for enrollees who are chronically sick.

Payers want a comprehensive data repository to handle risk-adjustment and reporting in addition to easily accessible and reliable data in order to comply with existing CMS proposals and future ones. Risk adjustment coding based on thorough data can benefit value-based contracting, care coordination, chronic illness management, population health management, and social determinants of health (SDoH) initiatives. 

Improving risk-adjusted payments with a FHIR-enabled Data Activation Platform

Through the use of an FHIR-enabled Data Activation Platform, payers can impact a health plan's bottom line and enhance population health management. This assists in making well-informed decisions about premium pricing, membership expansion, bid rate calculation, and other areas by applying analytics to data from disparate sources. It also gives healthcare professionals access to real-time patient feeds, helping them recognize issues, co-morbidities, prescriptions, etc.

Payers can use it to find underutilized diagnosis codes or to investigate possible down-coding in order to assess the real effect on income and risk-adjusted savings. With customizable and automated workflows, risk coding, and built-in analytics, it simplifies the data documenting process. Furthermore, it can assist healthcare networks in effectively assessing risk, appropriately reflecting the severity of medical disorders, and justifying admission and treatment—all of which will contribute to improved financial results.

How Does It Benefit Risk Adjustment?

Identify missed codes: FHIR-enabled Data Activation Platform precisely maps patient actions throughout the network, assisting payers in integrating clinical and claims records and finding missed codes.

Prioritize patients with high risk: The software makes an estimate of the possible impact on down-coding so that payers can motivate their provider networks to give high-risk patients priority.

Accurate risk computation: The analytics module of the FHIR-enabled Data Activation Platform uses HCCs in conjunction with unique risk scoring techniques to calculate and modify risk scores, hence improving accuracy.

Point-of-care support to physicians: To increase reimbursement, the FHIR-enabled Data Activation Platform alerts doctors to diagnosis codes that were removed from earlier records and recommends more precise codes.

Automated workflows: The platform helps doctors construct effective and automated workflows by providing a list of all patients who have been miscoded or require attention from all payers.

Dashboards and tracking: The platform provides comprehensive and easily navigable dashboards for monitoring overlooked codes, confirming the correctness of completed submissions, and obtaining insight into pooled savings and total return on investment.

Real-Time Risk Stratification: FHIR makes it possible to obtain up-to-date patient data, which facilitates dynamic risk categorization. This gives payers the ability to recognize high-risk members and direct actions toward them with the goal of enhancing their health outcomes and lowering ongoing expenses.

Coding Compliance Support: Platforms guarantee accurate risk scores and lower audit risk by offering real-time coding recommendations and compliance checks.

Beyond Financial Benefits: A Holistic Approach to Care

Beyond just financial profits, FHIR-enabled data activation offers several benefits. Through cultivating a more comprehensive perspective of members' health, payers can support:

  • Improved Population Health Management: Payers can create focused population health efforts by spotting trends and patterns in member health data. In order to enhance the general well-being of members, this may entail addressing socioeconomic determinants of health, encouraging preventative care, and working with providers.
  • Member Engagement: Having access to all patient information enables members to receive tailored communications. Payers can use this information to personalize outreach campaigns, offer learning materials, and encourage members to actively participate in their health care.
  • Fraud Identification and Preventive Measures: Access to comprehensive clinical data in real-time can enable payers to spot potentially fraudulent claims or inefficient medical procedures.
  • Value-Based Care: Value-based care is another benefit of this holistic approach. The move toward value-based care models encourages healthcare providers to offer high-caliber, economically viable services. Through the use of FHIR, payers may give physicians a more complete picture of their members' health, which will improve collaboration and care coordination and, in turn, patient outcomes.               Implementing FHIR: Considerations for Payers

Even though FHIR has a lot of potential, considerable thought must go into its implementation. Payers should consider the following important factors:

  • Standardization: Ensure that suppliers and providers consistently embrace FHIR standards throughout the healthcare sector. This minimizes interoperability issues and promotes smooth data sharing.
  • Data Governance: To guarantee data security, privacy, and quality, implement strong data governance policies. Maintaining openness and trust with members and suppliers requires doing this.
  • Technology Infrastructure: Make the required investments in the technology infrastructure to facilitate the smooth integration of FHIR-enabled data platforms with current systems. This includes strong security procedures, analytical tools, and data management skills.
  • Change Management: To guarantee support from all parties involved in the implementation of FHIR, organizational change management is necessary. This entails educating employees on new data analysis methods and workflows.


Payers have a revolutionary opportunity to completely revamp risk adjustment procedures with the help of FHIR-enabled data activation. Through the utilization of extensive clinical data, payers can enhance care management tactics, obtain more precise risk assessments, and ultimately promote the well-being of their member base. A payer's ability to prosper in the future depends on their ability to embrace FHIR as the healthcare sector continues to shift toward data-driven decision-making.

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