Dive Brief:
- The CMS is proposing to overhaul the Medicare Advantage star ratings system, including by culling a dozen quality measures and removing a health equity reward.
- In a proposed rule released Tuesday, the agency said it wanted to cut 12 metrics that focus on administrative processes where health plan performance is typically high and beneficiaries can’t easily distinguish between offerings, like customer service and appeal timeliness. Most of the cuts would go into effect in the 2029 star ratings.
- The CMS is also proposing to not implement the Excellent Health Outcomes for All reward, designed to incentivize plans to improve care for enrollees who are low-income or disabled. Additionally, the agency wants to add a quality measure on depression screening and follow-up.
Dive Insight:
The CMS publishes star ratings for MA and Part D prescription drug plans each year in a bid to help beneficiaries judge the quality of health plans before they enroll. The ranking system currently rates plans on up to 43 quality measures across categories like health outcomes, patient experience and access.
The ratings are also a significant financial concern for insurers, as stars are tied to lucrative bonuses and competitive advantages in the privatized Medicare program. Payers particularly want to reach a 4-star rating out of 5, so they can receive higher bonus payments.
Star ratings were largely flat for the 2026 plan year, a positive sign for insurers after the quality ratings generally declined for several years. Still, MA has become more challenging financially for payers, and insurers are exiting markets and cutting benefits next year in a bid to preserve profits.
Now, the CMS is proposing an overhaul to the star ratings system. The suggested changes would simplify the quality ratings and refocus the program on clinical care, health outcomes and patient experience, the agency said.
The proposal would cull a dozen quality measures, including metrics on reviewing appeals decisions, customer service, and availability of foreign language interpreters or teletypewriters at health plans’ call centers.
Additionally, the agency is proposing a new quality measure on whether beneficiaries were screened for depression and received timely follow-up care.
But the regulator doesn’t want to move forward with the Excellent Health Outcomes for All reward, a measure that was set to be implemented in the 2027 star ratings year and improve care for enrollees that are disabled, dually eligible for Medicaid or receive a low-income subsidy.
“Rather than incentivizing improvement among certain populations like those included in the HEI [Health Equity Index], CMS would instead incentivize improvement efforts on clinical care, outcomes, and patient experience,” the agency wrote in the proposed rule.
The Alliance of Community Health Plans, which represents nonprofit health plans, cheered the potential change, arguing the health equity measure left out patients in rural communities and penalized consistently high-performing plans.
“By reducing outdated process measures in MA Star Ratings to focus on health outcomes, we can put the focus back on what matters most—MA enrollees,” ACHP President and CEO Ceci Connolly said in a Tuesday statement.
The proposed rule also included other Medicare Advantage policies. For example, the rule proposes adding a special enrollment period that allows beneficiaries to change plans if their provider leaves their network in the middle of the year.
The CMS is also seeking public information on how to improve risk adjustment and bonus payments, noting the current system could lead plans to more intensely code patients’ illnesses to reap higher reimbursements. The agency said it was exploring a risk adjustment model that could use artificial intelligence, as well as ways to speed the quality measurement timeline.
The agency is also seeking more information on the growth of chronic condition special needs plans, and policies that could improve beneficiaries’ well-being and nutrition.
Finally, the CMS proposed several changes in a bid to lessen regulatory burden on health plans, including rescinding the requirement that MA plans send mid-year notices about unused supplemental benefits and cutting the requirement that MA quality improvement programs include work to reduce health disparities.
