---
kind: "section"
citation: "45 C.F.R. § 153.330"
title: "45"
number: "153.330"
heading: "State alternate risk adjustment methodology."
url: "https://uscodex.org/cfr/45/153.330"
---

# §153.330. State alternate risk adjustment methodology.

- (a) **State request for alternate methodology certification.**
  - (1) A State request to HHS for the certification of an alternate risk adjustment methodology must include:
    - (i) The elements specified in [§ 153.320(b)](/cfr/45/153.320.md?p=b);
    - (ii) The calibration methodology and frequency of calibration; and
    - (iii) **The statistical performance metrics specified by HHS.**
  - (2) The request must include the extent to which the methodology:
    - (i) Accurately explains the variation in health care costs of a given population;
    - (ii) Links risk factors to daily clinical practice and is clinically meaningful to providers;
    - (iii) Encourages favorable behavior among providers and health plans and discourages unfavorable behavior;
    - (iv) Uses data that is complete, high in quality, and available in a timely fashion;
    - (v) Is easy for stakeholders to understand and implement;
    - (vi) Provides stable risk scores over time and across plans; and
    - (vii) **Minimizes administrative costs.**
- (b) **Evaluation criteria for alternate risk adjustment methodology.** An alternate risk adjustment methodology will be certified by HHS as a Federally certified risk adjustment methodology based on the following criteria:
  - (1) The criteria listed in [paragraph (a)(2)](#a-2) of this section;
  - (2) Whether the methodology complies with the requirements of this subpart D;
  - (3) Whether the methodology accounts for risk selection across metal levels; and
  - (4) **Whether each of the elements of the methodology are aligned.**
- (c) **State renewal of alternate methodology.** If a State is operating a risk adjustment program, the State may not implement a recalibrated risk adjustment model or otherwise alter its risk adjustment methodology without first obtaining HHS certification.
  - (1) Recalibration of the risk adjustment model must be performed at least as frequently as described in [paragraph (a)(1)(ii)](#a-1-ii) of this section;
  - (2) A State request to implement a recalibrated risk adjustment model or otherwise alter its risk adjustment methodology must include any changes to the parameters described in [paragraph (a)(1)](#a-1) of this section.

## Notes

### Amendments

[77 FR 17248, Mar. 23, 2012, as amended at 78 FR 15528, Mar. 11, 2013]

### Authority

Authority: 42 U.S.C. 18031, 18041, and 18061 through 18063.

### Source

Source: 77 FR 17245, Mar. 23, 2012, unless otherwise noted.

### Amendments

[77 FR 17248, Mar. 23, 2012, as amended at 78 FR 15528, Mar. 11, 2013]