RAF (Risk Adjustment Factor) is best explained to providers as a population-health and resource-planning tool, not a visit-level payment lever. In outpatient risk adjustment models, diagnoses and demographics are used to estimate the patient’s overall disease burden and the expected cost/resources required to meet that patient’s healthcare needs. When documentation accurately reflects active conditions and their specificity, the patient’s risk profile is represented more realistically. That improves care in practical ways: it supports appropriate allocation of care management services (e.g., nurse navigators, chronic care programs), helps organizations anticipate medication, testing, specialist, and follow-up needs, and improves fairness of performance benchmarking by comparing outcomes and costs against similarly complex patients. Option A is overly simplistic because RAF does not directly determine an individual provider’s reimbursement for a given encounter; it influences broader payment and benchmarking methodologies tied to attributed populations. Option C is not what RAF measures, and option D confuses RAF with medical necessity, which is based on clinical documentation and coverage rules, not a risk score.