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Report Finds Significant Geographic Quality Differences in Medicare Advantage Plans

Les Masterson, for HealthLeaders Media, December 7, 2009

Though nearly one-quarter of Medicare Advantage enrollees are in health plans with four or more stars, beneficiaries in many states don't have that luxury.

Kaiser Family Foundation reported Monday that less than 2% of beneficiaries in 25 states are in highly-rated plans, while more than half of Medicare Advantage enrollees in other states—Massachusetts, Oregon, and Hawaii—are in highly rated plans.

The researchers found that the average Medicare Advantage plan receives 3.27 stars on the CMS quality scale and quality ratings vary by plan types:

  • Private fee-for-service plans and regional PPOs have below average ratings and are "significantly lower" than HMOs and local PPOs

  • Nonprofit plans have "significantly higher average ratings" than for-profit plans

  • More experienced plans (those with contracts beginning before 2004) have higher ratings than newer ones

  • Average quality ratings vary widely among the largest organizations offering Medicare Advantage plans

The researchers wrote that the findings show that quality ratings are closely tied to plan type, plan experience, and whether they are nonprofit.

"If the star ratings are used in payment policy for Medicare Advantage plans, nonprofit plans and more experienced plans would be more likely to be rewarded," wrote Gretchen Jacobson, Anthony Damico, Tricia Neuman, and Jennifer Huang of the Kaiser Family Foundation.

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