Just in time for open enrollment season, the Centers for Medicare & Medicaid Services has released its annual star ratings for Medicare Advantage, Medicare Cost, and prescription drug plans.
The five-year-old program is an effort to steer Medicare members to high performing plans that meet a checklist of quality and accountability standards. The ultimate goal is to lower the cost of Medicare services.
Plans are ranked with one (poor) to 5 (excellent) stars depending on their performance on 49 measures, including cancer and cholesterol screenings, glaucoma testing, controlling blood pressure, diabetes care, rheumatoid arthritis control, kidney disease control, hospital readmissions, and customer service.
The ratings are based on reviews of billing information, member surveys, and Medicare's regular monitoring activities.
This year CMS looked at 563 health plans and awarded five stars to only 15 Medicare health plans:
- Dean Health Plan (Wisconsin),
- Group Health Plan (Minnesota and Wisconsin),
- Group Health Cooperative (Washington),
- Gunderson Lutheran Health Plan (Iowa and Wisconsin);
- Health New England (Massachusetts);
- Humana (Wisconsin);
- Kaiser Foundation Health Plan (California, Colorado, Hawaii, Ohio, the Middle Atlantic states, and the Northwest);
- Medical Associates Clinic Health Plan (Washington);
- Medical Associates Health Plan (Iowa and Illinois)
A five-star designation is coveted and rare; only a dozen out of 446 plans achieved it in 2011. The plans have a combined total of about 1.2 million members.
Last year health plans with at least a 3-star rating shared in about $3 billion in bonus payments. The 2012 bonus amount is unknown; CMS has not responded to requests for the figures.
Those five-star, gold standard plans enjoy a sweet list of perks.
They can distinguish themselves in the crowded Medicare market by marketing for 12 months a year instead of only during the regular October and November open enrollment period and they can enroll members from the 26 lowest performing plans (2.5 stars or less) at any time during the year.
The high performers can also display a gold star icon on CMS's official Medicare Plan Finder site. Low-scoring, poor performing plans, which have posted 2.5 stars or less for three consecutive years, are marked with an LPI (low performing icon). While that's not quite a scarlet letter, it's another sign that CMS is determined that plans will not be permitted to ignore performance standards and continue as Medicare plans.
Some 21 of the 30 contracts that received the LPI in 2011 either improved their ratings this year, or had their contracts withdrawn or consolidated.
Overall, 119 of the plan contracts that received star rating last year and this year improved their star ratings for 2012, according to an analysis from Avalere Health.
Dean Health Plan, a gold-standard Medicare Cost plan, is similar to a Medicare HMO but offers its enrollees the option of receiving out-of-network coverage.
The plan was also recognized last year. The key to maintaining its status from year-to-year is a culture of customer service and a system wide focus on wellness and prevention, explains Pete Thompson, Dean's strategic marketing manager. Its 5-star plan, DeanCare Gold, has about 20,000 members in eight Wisconsin counties.
In an e-mail exchange, Thompson stated that everyone is "on the same page" because its physicians, hospitals and health plan are integrated into one system that shares the risks and rewards associated with patient outcomes. "The clinic, hospital, and health plan relationship facilitates a coordinated approach and high quality care at a lower cost."
The addition of Humana-Wisconsin among the 5-star plans marks the first time a for-profit health plan has cracked the top tier. In recent years Humana, WellPoint, and other for-profit plans have actively pursued improvement in their star ratings.
Last year, during a conference call with analysts, Michael McCallister, Humana's chair of the board and CEO, said Humana "plans to reinvest heavily in improving our stars' processes, procedures and infrastructure to position us for further improvements in star metrics."
Meanwhile, WellPoint has high hopes that CareMore, the Medicare Advantage plan it acquired last year, will lead to higher quality star ratings. This year CareMore posted 3.5 stars.
The star program is not without its detractors. The nonpartisan Government Accountability Office has expressed concerns about the CMS's authority to offer the bonuses. The GAO contends that the existing program is much more generous than the bonus program outlined in PPACA.
That could be but the combination of the carrot (money) and stick (loss of members) seems to have health plans taking notice.
Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.
