This month’s CMS Advance Notice for Medicare Advantage 2027 didn’t just send share prices tumbling, it sent a message about where risk adjustment, and ultimately, value needs to happen in healthcare. At first glance, you’ll see headlines about flat rate increases and major market losses. But the real disruption is hidden in the details: with its latest policy, CMS is drawing a hard boundary around what counts as “real care” and what doesn’t.
From Paperwork to Patient Care
The core of the change is deceptively simple: if a diagnosis isn’t clearly tied to an actual patient encounter, it can’t be used to calculate risk scores. Gone are the days when plans could justify revenue by mining old records for “missed” codes, regardless of whether the patient ever actually saw a clinician for that condition.
Why does this matter? Because, for years, risk adjustment was as much a paperwork exercise as a care delivery one. Entire teams, and billions of dollars in technology, were dedicated to combing through backlogs of charts, looking for diagnoses that slipped through the cracks. Sometimes, those records weren’t even connected to a real visit, or they emerged from documentation quirks in the system.
The new CMS rule doesn’t just reduce the incentive for this type of chart chasing, it effectively closes the door. If you can’t demonstrate that the diagnosis was anchored in a real clinical encounter, it won’t count for risk adjustment. For many organizations, this isn’t just a compliance issue, it’s an existential shift.
The Impact: A Shift from Retrospective to Real-Time
Practically speaking, this means the highest value now lies in getting documentation right at the source: when the patient is in front of you, not months later through a paperwork audit. Retrospective reviews aren’t going away, but their function is changing. Instead of driving new revenue, they’ll become more about cleaning up, fixing errors, and ensuring documentation integrity for audits, not generating windfalls from codes discovered after the fact.
The most resilient organizations will be those who can bridge the gap between clinical reality and administrative necessity in real time. That’s not just a technical challenge, it’s cultural. It requires rethinking how clinicians, coders, and technology teams work together, and how we design workflows that make it easier, not harder, for care teams to do the right thing.
Why It Matters: For Patients, Providers, and Payers
The stakes are higher than just risk adjustment. This rule shift is a move toward a healthcare system where incentives better reflect what actually happens in the exam room. Patients benefit because their care is more likely to be properly documented and acted upon. Providers and care teams benefit from less administrative “catch-up.” Health plans benefit by building sustainable, audit-ready processes instead of racing to out-code their competitors.
For leaders, this is a call to action:
- If your model relies heavily on bulk chart review and code abstraction: it’s time to ask whether that’s sustainable.
- If your teams struggle to capture and link diagnoses in the flow of care: now is the moment to invest in tools, training, and workflows that support real-time, encounter-based documentation.
How Vim Fits In
At Vim, we’ve believed for years that the future of risk adjustment, and, more broadly, the future of accountable, value-driven care, is rooted in the point of care, which is when and where decisions are made. We focus on building technology that enables providers and care teams to capture what matters most in the moment, and to connect those insights directly to encounters, not to paperwork after the fact. The goal isn’t to win a game of “code scavenger hunt,” it’s to close the loop between care and data, so the incentives align and patients get the attention they deserve.
Final Thought: The Opportunity in Raising the Bar
This isn’t just a policy tweak. It’s a call to overhaul how care, documentation, and business sustainability intersect. The leaders who move now to hardwire real-time, encounter-based documentation into their workflows will set the pace for the industry, outperforming on audits, efficiency, and ultimately, patient outcomes.
Hanging on to retrospective fixes or waiting for another extension? That’s a recipe for shrinking margins and widening risk.
CMS is signaling the end of rearview-mirror coding. The next era belongs to those who make every encounter count, on purpose, not by accident.
