Impact and response: Changes in Medicare Stars for 2023 and beyond
by Jeff Cox
With my focus on risk adjustment and quality here at Belong Health, I often find myself immersed in the data end of the pool — intensely focused on measurements of how well and how often our members are interacting with their primary care providers (PCP) and other clinical resources.
Are they getting their preventative screenings? Are they managing their chronic conditions? Do they have the regular support they need?
The answers to these kinds of questions translate into important facts and figures, sure, but I never forget they’re always tied to personal stories, too. To needs, fears, triumphs, and relief.
To a family like my own.
My dad is a 77-year-old prostate cancer survivor. As might be expected, he often looks to me to help make sense of his medical needs. Simultaneously, he keeps me mindful that everyone deserves someone who can help simplify the complex.
So, in the same spirit of those dinner table chats with my dad, I’m eager to be of help to you, as all of us in healthcare brace for complex changes in the year ahead — including a new methodology for the Star ratings system.
Realignment of the Stars
First, some background.
In 2020, prompted by the COVID-19 pandemic and by an era in which fewer people were visiting with their PCP, the Centers for Medicare and Medicaid Services (CMS) implemented a disaster provision that fundamentally changed the ways in which Star scores were assessed. Beginning that year, plans were allowed to select the best of their own scores, including those that had been awarded during a range of pre-COVID years, as indicators of their current performance.
Because of this methodology, however, an overall inflation of resulting Star scores yielded historically high ratings across the industry. Where typically only 25% of contracts increased each year, the year 2022 (which reflected the 2020 performance year) saw a staggering 62% of contracts enjoy such a performance boost.
In response to this unprecedented boom, CMS officials determined changes to the evaluative process were necessary. They elected to tweak that landscape towards what they believed to yield clearer, fairer assessment.
As a result, four key adjustments are already underway — and they’ll each have big impacts on Star ratings in 2024 and beyond.
- The disaster provision implemented in 2020 has been allowed to expire. Plans can now no longer leverage the “better of” methodology to inform their overall scores.
- Patient experience measures (a key component in Star assessment) have doubled in weight, from 2X to 4X. This change, likely implemented to champion a focus on people over process, will deliver varying degrees of impact on Medicare Advantage organizations.
- CMS “cut-point guardrails” are now in place. These parameters impose clear limits on how much a cut-point can change, year after year. In the past, for example, a plan which once needed 15% of its members screened for colorectal cancer in order to achieve a 3-star rating might have, the following year, suddenly needed 65% of its members screened in order to secure the same Star result. For 2024, however, CMS is clamping down on those wild swings in percentages.
- The Tukey Outlier Deletion Method, resulting from a statistical modeling change, will be implemented in Star rating year 2024, to reflect the 2022 performance year. With the help of this new method, seemingly higher-performing plans will no longer be “propped up” by lower-performing outlier plans.
All told, this collection of scoring adjustments already points to an upcoming 3% change in cut-points for four-and-a-half star ratings. In other words, relative to recent years, it will soon be more difficult for plans to secure a 4-Star or better rating. This will have significant impacts to Quality Bonus payments and the potential for year-round enrollment.
