By Elizabeth McElhiney, MHA, CHPS, CPHIMS, CDH-L, CRIS, CC
Director of Government Affairs and Policy
Verisma
June 23, 2025
The Centers for Medicare and Medicaid Services (CMS) announced an initiative late last month to rapidly complete outstanding Risk Adjustment Data Validation (RADV) audits while expanding the parameters of new RADV audits by September 1. The audits ensure the accuracy and integrity of health plan data, and the effort is part of the federal government’s effort to eliminate fraud, waste and abuse (FWA) in Medicare Advantage (MA) programs – impacting providers and patients.
While you’re familiar with Medicare Risk Adjustment (MRA) reviews, it’s unlikely you’ve seen a RADV audit. So, what’s the difference?
- Annual MRA audits, issued first, are used by MA plan to determine patient risk adjustment factor (RAF) to predict healthcare costs by reviewing medical records, evaluating diagnoses, and assessing demographical information including age and gender to determine health status and provider payments. The higher the RAF, the more money CMS pays the MA plan.
- RADV audits, issued second, are for data validation to gauge if insurance companies have correctly calculated RAF scores. These audits ensure treatment leading to diagnosis in a RAF score is documented in the medical record, removing risk MA plans don’t say patients are sicker than they are. If the government finds a RAF score is calculated incorrectly or doesn’t receive records to audit, it can recoup the overpayment from the MA plan and the facility. Recent changes to the RADV program will let CMS extrapolate the overpayment amount for a health plan from the sample and then recoup that total amount. These changes are similar to how the RAC program can recoup overpayments.
Why am I just hearing about this?
RADV audits have been around since 2002’s Improper Payments Information Act (IPIA) and the program has been modified multiple times. Because CMS is several years behind completing these audits, the Trump administration wants to finish all remaining RADV audits for payment years (PY) 2018 to 2024 by early 2026.
This initiative received widespread attention because efforts to detect and eliminate FWA are high priorities for the current administration. CMS will hire approximately 2,000 coders in the upcoming months and deploy enhanced technology to meet this deadline. At the same time, CMS is increasing the number of medical records it will audit from 35 records per health plan to 200, and its audits from 60 MA plans annually to all (approximately) 550 plans – a 900 percent increase.
While your practice or organization probably sees many MA patients, the odds of encountering a large number of RADV audits has always been low. Selected records are based on MA plan participation and these patients could have been treated by any provider. The only commonality is their MA plan.
Preparing for RADV Audits
It’s important to remember RADV audits need to be returned to the health plan and not CMS. This can be confusing for new ROI specialists and health information (HI) professionals because the request packet will come with a CMS letter. HI professionals must comply with these requests quickly, ensuring records are provided to the requestor by the due date.
Preparation is key. Here are some steps healthcare providers can take:
- Maintain Accurate Records: Ensure all diagnosis data is accurately documented and updated.
- Regular Training: Provide ongoing staff training on proper documentation practices, releasing appropriate records, and RADV compliance requirements.
- Create an Action Plan: Train staff to identify RADV audits and notify management when they’re received. Examine whether you can handle additional audits with existing staff or if you will need to supplement with external resources.
RADV audits are a critical component of the healthcare system, ensuring MA payments are accurate and payment is made only for the services and diagnoses documented. By understanding the importance of these audits and taking proactive preparation steps, healthcare providers can navigate the process smoothly and maintain compliance with CMS regulations.