For Medicare Advantage (MA or Part C), CMS operates the Star Rating System. This system provides a relative quality score to Medicare Advantage Organizations (MAOs) on a 5-star scale based on their plans’ performance on selected criteria, and is now used to determine whether or not an MAO will receive bonus payments and/or rebates for their enrollees.
What do Medicare Advantage plan's star ratings mean?
Medicare Advantage plans are rated from 1 to 5 stars, with five stars being an "excellent" rating. This means a five-star plan has the highest overall score for how well it offers members access to healthcare and a positive customer service experience. Here's a look at what each star rating means to help you better understand a five-star rating.
Does Medicare Advantage offer much advantage?
Medicare Advantage plans must offer everything Original Medicare covers except hospice care, which is still covered by Medicare Part A. Some Medicare Advantages plans offer extra benefits, such as prescription drug coverage, routine dental, routine vision, and wellness programs.
Is Medicare Advantage better than Medicare?
The MA program helps address social determinants of health and improve health equity: "...over 95 percent of Medicare Advantage beneficiaries have access to meal services, telehealth, transportation, dental, fitness, vision, and hearing benefits.
Is Medicare Advantage really to your advantage?
Overwhelming majorities of Medicare beneficiaries in both traditional Medicare and Medicare Advantage were satisfied with their care. The researchers discovered that the Advantage plans didn't substantially improve beneficiaries' health care experiences compared to traditional Medicare, but did offer somewhat more care management.
How do star ratings work?
Summary star ratings are an average of a provider's question level star ratings. Patient star ratings are calculated by dividing the patient's aggregate mean score by 20. For clients using only one question in the patient star rating, the star rating would simply be the individual question score, divided by 20.
What is CMS star rating based on?
The Centers for Medicare & Medicaid Services (CMS) uses a five-star quality rating system to measure the experiences Medicare beneficiaries have with their health plan and health care system — the Star Rating Program. Health plans are rated on a scale of 1 to 5 stars, with 5 being the highest.
What do Medicare stars mean?
Medicare plans are rated on a scale of 1 to 5, with a 5-star rating being the highest score a plan can receive. More stars indicate better performance and quality: 5-star rating: Excellent. 4-star rating: Above Average. 3-star rating: Average.
How often are Medicare star ratings calculated?
each yearStar Ratings are calculated each year and may change from one year to the next. If you're enrolled in a Medicare plan, you should check your plan's Star Rating every fall.
How are CMS stars calculated?
For the Overall Star Rating, Z-scores were produced by subtracting the national mean score from each hospital's measure score and dividing that by the standard deviation across hospitals. Standard deviation is a number that measures how far data values are from their average.
Who sets standards for Medicare star ratings?
The Centers for Medicare & Medicaid Services (CMS) publishes the Medicare Part C and D Star Ratings each year to measure the quality of health and drug services received by beneficiaries enrolled in Medicare Advantage (MA) and Prescription Drug Plans (PDPs or Part D plans).
What are the four main categories of stars ratings measures?
More stars indicate better performance and quality:5-star rating: Excellent.4-star rating: Above Average.3-star rating: Average.2-star rating: Below Average.1-star rating: Poor.
What is a star rating system?
Star classification is a type of rating scale utilizing a star glyph or similar typographical symbol. It is used by reviewers for ranking things such as films, TV shows, restaurants, and hotels. For example, a system of one to five stars is commonly used in hotel ratings, with five stars being the highest rating.
What states have 5-star Medicare Advantage plans?
States where 5-star Medicare Advantage plans are available:Alabama.Arizona.California.Colorado.Florida.Georgia.Hawaii.Idaho.More items...•
How do I increase my star rating for Medicare Advantage?
7 Ways to Improve Your Star RatingEnsure Medication Benefits Are Central to the Consumer Onboarding Experience. ... Develop Targeted Outreach Programs Around Medication Adherence and Preventive Screening. ... Make Every Interaction Count. ... Be Proactive with Consumer Feedback. ... Communicate Consistently and in Different Channels.More items...•
How can I improve my star rating?
5 Ways To Improve STAR Ratings With Member EngagementEmploy a more thoughtful approach to onboarding. ... Engage members at strategic touchpoints throughout the year. ... Mitigate your CTM occurrences. ... Take a new approach to training. ... Employ the right people for your engagement center.
What is the best way to compare Medicare Advantage plans?
The Medicare Plan Finder on Medicare.gov is currently the most comprehensive tool for comparing Medicare Advantage plan benefits, prescription drug coverage and costs.
What are the problems with the Star Rating System?
The Star Rating System has had other unintended consequences resulting from poor program structure and misaligned incentives. Some of the biggest problems with the program structure relate to timing. The measurements that will be evaluated each year are determined and announced after both the period from when the measurements are taken and after contract submissions for the following year are due. This leaves plans unaware of what they’re being evaluated on, which makes it difficult to know what they should be doing or to make appropriate changes for the next year resulting in a two-year lag on adjustments by plans and their providers, at best. Another concern is that the retrofitting of the evaluation criteria could allow for CMS to pick winners and losers by selecting criteria that specific companies perform particularly well (or poor) on. Further, the bonus payments are based on the benchmark price and enrollment in the following year from when the measures were taken, which means plans are rewarded for patients they weren’t necessarily covering at the time the reward was earned. Finally, not making the evaluation criteria known ahead of time and delaying the reward is inconsistent with all theories on how to make reward incentive programs effective.
Why is the Star Rating System unfair?
Many have expressed concern that the Star Rating System—because of how measures are evaluated and rewards are paid —unfairly punishes both low-income enrollees and the plan sponsors primarily serving such enrollees. It is argued that a significant portion of the measures evaluated are influenced by a patient’s socioeconomic conditions, yet very few of the measures are risk-adjusted to neutralize the impact of such differences between patients, thus not allowing for a fair comparison between plans with high versus low enrollment of low-income individuals. This concern has led to calls for either establishing a separate rating system for Special Needs Plans (SNPs) or any MA plan in which enrollees are predominantly low-income, or providing a score adjustment for such plans in order to compensate for those patient differences. [19] The National Quality Forum, in its report released in August 2014, notes the well-documented link between patients’ sociodemographic conditions and health outcomes, and recommends that such factors be included in risk adjustments for performance scores. [20]
What is a reward plan?
Rewards are two-part: direct bonus payments to the plan operator and rebates which must be returned to the beneficiary in the form of additional or enhanced benefits , such as reduced premiums or co-payments, expanded coverage, etc.
What is MAO rating?
Ratings are set at the MAO contract level—not the plan level—meaning all plans under the same contract receive the same score. Stars are assigned to each contract for each individual measure being evaluated, based on relative performance compared to the other contracts. The overall summary score for each contract is then calculated by averaging ...
Why are all plans not able to achieve top ratings?
All plans will not be able to achieve top ratings, however, because the system uses relative scoring, essentially ranking plans in order of achievement— not everyone can be the best.
How many MA contracts received bonus payments in 2012?
In 2012, 91 percent of MA contracts received a bonus payment, but only 4 percent of the total bonus payments came from funds designated for these bonuses by the ACA—the rest of the bonuses were paid through the demonstration project which allowed for bonuses to be paid to 3-star plans. [12] Two thirds of total payments went to plans with less than 4-star ratings. [13]
Does MA Stars pay for performance?
The MA Stars system is not a typical pay for performance program. Since CMS does not directly pay care providers in MA, but rather pays insurers offering private coverage to Medicare beneficiaries, the reward is actually being paid to an intermediary in the provision of care.
How does Medicare's star rating system work?
You could choose from a wide range of Medicare Part C (now known as Medicare Advantage) plans as early as 1997. But you didn't have a good way to compare them until 2008. That's when the Centers for Medicare & Medicaid Services (CMS) first rolled out the star rating system.
What parts of a health insurance plan are rated?
The way that the CMS rates healthcare plans depends on what type of plan it is.
What is the standard rating for a Medicare plan?
Most Medicare plans have a good rating these days, but not all. According to the CMS, nearly 68% of Medicare plans with prescription drug coverage (MA-PDP) in 2022 have a four-star rating or higher. That’s up from 49% in 2021.
How to use the rating system to pick the best health insurance plan
In general, it's best to choose the highest-rated plan that you can afford. You can compare plans and their ratings on the Medicare Plan Finder website. On the Plan Finder tool, each plan has an overall star rating based on all the rated categories.
The bottom line
Choosing between different Medicare plans can be tough. But the star ratings can help you identify high-performing ones and those with higher scores in categories that may matter to you. The CMS rates each plan on up to 40 different factors to create a helpful picture of how well the plan treats its members and their healthcare needs.
Why do Medicare Advantage plans get stars?
Medicare Advantage plans receive a star rating based on performance measures that are intended to help potential enrollees compare plans available in their area as well as encourage plans to compete based on quality. All plans that are part of a single Medicare Advantage contract are combined when calculating the quality rating ...
What is the MLR for Medicare Advantage?
However, plans’ ability to keep these and other payments as profit is not unlimited – Medicare Advantage plans must meet medical loss ratio (MLR) requirements of at least 85 percent, and are required to issue rebates to the federal government if their MLRs fall short of required levels.
How much is the bonus for Medicare 2021?
UnitedHealthcare and Humana, which together account for 46% of Medicare Advantage enrollment, have bonus payments of $5.3 billion (46% of total bonus payments) in 2021. BCBS affiliates (including Anthem BCBS) and CVS Health each have $1.6 billion in bonus spending, followed by Kaiser Permanente ($1.1 billion), Cigna and Centene ($0.2 billion each).
What percentage of Medicare Advantage plans will receive bonus payments in 2021?
In 2021, 81 percent of all Medicare Advantage enrollees are in plans that receive a bonus payment from Medicare based on star quality ratings (or because they are new), substantially higher than the share in 2015 (55 percent). Annual bonus payments from the federal government to Medicare Advantage insurers have increased correspondingly, ...
How much is Medicare Advantage rebate in 2021?
Additionally, as more enrollees are in plans that are in bonus status, the average rebate per Medicare Advantage enrollee has more than doubled, rising from $184 per year in 2015 to $446 per year in 2021.
Why are bonus payments increasing?
The rise in bonus payments is due to both an increase in the number of plans receiving bonuses, and an increase in the number of enrollees in these plans. Because unrated plans also receive bonus payments, a total of 85 percent of enrollees are in plans that are eligible to receive quality bonus payments, and 81 percent ...
How much is the average bonus for 2021?
The average bonus per enrollee in an employer plan is $886 in 2021, more than 2.5 times higher than for enrollees in either individual plans ($351) or SNPs ($309). While average bonuses in employer plans have consistently been higher than for other plans, the gap has increased substantially in recent years, driven by a rapid rise in the average bonuses for employer plans. Both the high share of enrollees in group plans that receive bonus payments (98% in 2021), as well as changes to the payment methodology for group plans implemented starting in 2017 contribute to this trend.
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Every October since 2009, the Centers for Medicare and Medicaid Services (CMS) has released comprehensive data on Medicare Advantage (MA) health plan performance through its Star Ratings program. The program's goals are to incentivize health insurers to improve their MA plans and encourage consumers to enroll in high-quality plans.
Overall ratings have risen
In 2011, CMS introduced overall scores for MA Prescription Drug (MA-PD) plans, which account for the majority of all MA contracts.
Digging deeper into the ratings
Since the Star Ratings program's inception, the financial incentives offered to MA carriers have varied, and CMS has periodically altered its ratings methodology (e.g., by raising the cut points for various scores).
MA plans have also become more efficient
In a separate analysis, we found that MA plans have become more efficient than FFS coverage at providing Parts A and B benefits (Exhibit 7). Currently, the MA plans deliver Part A and B benefits at 90% of the costs of FFS coverage (or 92% if differences in risk coding are fully accounted for), compared with 102% in 2009.
Confounding factors
The Medicare Payment Advisory Commission and others have identified several possible isues with the Star Ratings program, including the potential for plan consolidation to "erode the validity of the Star Ratings system as a measure of plan performance in a given area." 14 14. MedPAC. Report to the Congress: Medicare Payment Policy. Chapter13.
Options for further improvement
Overall, these results show that, since the advent of the QBP system, MA plan quality (as measured by Star Ratings) has improved while controlling or reducing costs. Experience with Star Ratings indicates that health insurers can adjust and improve their performance over time based on incentives built into CMS-determined metrics.
Background: Evolution of the MA Star Ratings program
Any attempt to assess the impact of Star Ratings on the performance of MA plans overall must take into account three important variables: differences between the financial incentives offered in various years, the impact of plan consolidation, and requirements about data collection. We discuss each of these briefly below.
What does higher star rating mean?
Higher star ratings mean that a provider has either gone above and beyond the standard or that patient satisfaction is far greater for that provider compared to others.
What does it mean when your Medicare rating is lower?
Instead, a lower rating simply means that there may be better options available.