Medicare Advantage star ratings this year represent 'final fallout' from COVID-19

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Fewer Medicare Advantage plans made the 5-star rating for 2024, and there were surprises among those that were on, and off, the MA and Part D list this year.

Gone from this year's 5-star list were Kaiser Permanente's Kaiser Foundation Health Plans. The large California-based health system is frequently held as a model for how integrated care results in better quality of health and lower costs, with the results showing up in the star ratings.

Kaiser had five plans in the top ranking in 2023, out of a total of 57 contracts that made the top spot last year.

Some of the big insurers such as UnitedHealthcare, Humana, Highmark, UPMC Health Plan and UPMC Health Network had 5-star plans represented on the 2024 list, as they did last year.

Another lesser-known name, Devoted Health Plan of Ohio, was on last year's list, but stood out this year for having two plans that earned 5 stars, again in Ohio and in Florida.

"The thing that stood out to me was Devoted Health," said Ashley McNairy, senior product director at Cotiviti, a company that works with healthcare organizations. "It's the fastest growing MA plan … two contracts had 5 stars."

Devoted Health, a company integrated with Devoted Medical, was founded in 2017 by brothers Todd and Ed Park in Waltham, Massachusetts. Devoted Medical is a virtual and in-home medical group aimed at the Medicare population. MA plans are offered in select counties in Alabama, Arizona, Colorado, Florida, Hawaii, Illinois, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee and Texas. 

Centene again had plans - four contracts this year - at the bottom of the list, at 2 stars. 

For 2024, the number of plans earning 5 stars for both MA and Part D contracts was 31. In 2023, 57 plans got 5 stars, a year after a jump to 74 plans earning 5 stars in 2022. This compares to 2021, a year representing rankings prior to the COVID-19 pandemic. Twenty-one plans got 5 stars in 2021.

What's going on is that this year represents a return to pre-COVID-19 numbers.

"This is the final fallout from the COVID policies," McNairy said. 

Two years ago, the industry saw a lot of inflation in MA star ratings due to the Centers for Medicare and Medicaid Services relaxing its measures, she said.
For 2023, insurers were expecting a bigger dip in the number of plans at 5 stars, McNairy said. 

This year, the bottom fell out.

"We're now truly seeing the fallout," McNairy said. "Now we're back to three years ago."

WHY THIS MATTERS

The bonuses matter.

The financial impact of a lower star rating means losing millions.

"The difference between a 3-star and 4-star plan, it's millions of dollars," McNairy said. "It is a big deal when they lose a star."

Plans that drop from 5 or 4 ½ to 4 stars see a 5% decrease in bonus payout, according to McNairy.

Five-star and 4 ½-star plans get the same bonus rebate. Plans with at least 4 stars get some bonus payment. The funds go into plan enhancements, which in turn gets more members to enroll.

Enrollment attraction, and for 5-star plans, the ability to hold open enrollment year-round, is an even bigger deal than the bonus payments to McNairy.

There's more competition in the Medicare Advantage market, with most consumers having a choice among plans.

Close to 75% of Part C and D plans this year earned 4 stars.

"If everyone is at 4 stars, you see more competition," McNairy said. "The amount of competition has continued to grow."

THE LARGER TREND

Clinical outcomes and effectiveness of care are essential factors that impact Medicare Star ratings. These measures assess how well Medicare Advantage and Medicare Part D prescription drug plans manage and prevent diseases, provide timely care, and minimize readmission rates.

CMS bases the star ratings on an estimated 40 measures in categories related to mortality, safety of care, readmission, patient experience, and timely and effective care.

But each year CMS changes not only the measures, but their weight.

These 40 clinical and nonclinical measures are each assigned a star rating based on cut points, Cut points are the ranges that a plan scores on a particular measure. They fall within a star value. CMS assigns the cut points based on all data submitted to them.

In the past, CMS would look at the data and average it out, McNairy said. This year, CMS removed the lower- and higher-range outliers, creating the Tukey outlier deletion.

As finalized in rulemaking in 2020, the 2024 star ratings introduced Tukey outlier deletion when calculating the cut points for all non-Consumer Assessment of Healthcare Providers and Systems (CAHPS) measures to improve predictability and stability in the star ratings. 

The bottom line is the new methodology makes it harder to get 5 stars, McNairy said.

For instance, a plan may have maintained its measure for blood sugar control, but because the methodology changed, the measure this year may not have the same weight as last year.

If plans used last year for predictive cut points, McNairy said, they were over-inflating what they thought they'd end up with for star ratings. 

"To get to 5 stars," she said, "you need to be improving measures each year."

Insurers, especially those new to the market for Medicare Advantage plans, can find it challenging to focus on all 40 quality measures. 

"We know that it's a challenge to track all of the changes and what will have the biggest impact on star ratings," McNairy said. "There are so many changes happening now."

Newer plans entering the market generally have a harder time achieving higher stars, McNairy said, which played out in CMS data about this year's list.

"Generally, higher overall star ratings are associated with contracts that have more experience in the MA program. MA-PDs with 10 or more years in the program are more likely to have four or more stars compared to contracts with less than five years in the program," CMS said.

This year, six contracts with less than five years of experience made it to 5 stars compared to 22 plans that had 10 or more years of experience.

The Centers for Medicare and Medicaid Services released the Medicare Advantage, Part C and Medicare Part D Star Ratings on Friday. 

Twitter: @SusanJMorse
Email the writer: SMorse@himss.org