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21 of the 30 contracts that received the LPI in 2011 either improved their ratings this year, or had their contracts withdrawn or consolidated.