How Health Plan Star Ratings May Mislead – And How To Fix The Problem

It’s open enrollment season for Medicare, but government health plan ratings meant to promote consumerism and value are less than totally open in the information seniors needs to make the right choice.

That’s important, because some 31 million Americans are now enrolled in nearly 4,000 Medicare Advantage health plans, or a record 51 percent of eligible Medicare beneficiaries, according to KFF, a non-partisan foundation. Moreover, almost three-quarters of enrollees chose a plan with at least a four-star rating.

Here’s the problem: while MA plans are offered on a county-by-county basis, the star ratings don’t show a local experience. Instead, the ratings actually reflect the plan’s contract with the government, which could cover part of a state, an entire state or multiple states, an official with the Centers for Medicare & Medicaid Services explained.

That information is not disclosed on the ratings page. Though I’ve been working in health care for more than three decades, neither I nor several colleagues whose opinion I sought had a clue.

The consequences of this disconnect can be significant. For example, suppose you live in Champaign, Illinois and are trying to choose between a plan from Health Alliance, based in Champaign, and one from Humana, based in Kentucky. Although both are four-star plans, there are differences in important individual measures such as the members’ rating of health care quality. It’s four stars for the Humana plan and five stars for the Health Alliance one.

But here’s the catch: who are those members doing the rating? Health Alliance, which serves 240,000 total members in five states, has a Medicare contract that includes counties in both Indiana and Illinois, a spokesman said Humana, meanwhile, serves close to 6 million Medicare beneficiaries with a cornucopia of MA contracts. One contract listed online included parts of Illinois and 22 other states!

It’s highly unlikely, to say the least, that the star rating for a measure like “members with heart disease get the most effective drugs to treat high cholesterol” reflects the exact same quality of care being provided by doctors in Champaign and Indianapolis, much less in 23 states in vastly different regions.

(A debate over whether plans actively “game” the entire rating system is a separate issue.)

The date of the information used in the CMS ratings also varies and that, too, is not disclosed. A CMS official said some of the data is from 2023 and some from 2022.

To add one final wrinkle, someone who notices that their plan’s star rating changed from last year can’t readily see that the methodology used to calculate this year’s ratings also changed. For plans, though that’s a big deal. MA plans accounted for $454 billion of Medicare spending, and part of that payment is tied to the star ratings.

If CMS wants to match its “consumer-centric” rhetoric with data, a fix is fairly straightforward. Disclosing in plain language who the ratings describe – my county? my state? vast areas of the country? – would be a simple way to modify the current misleading information. When U.S. News & World Report rates the best MA plans by state, it works with CMS data and it indicates in which counties in that state the plans are available, a spokesman said. However, CMS does not show the contracted counties, much less the ratings by county.

CMS could also provide online, drill-down menus allowing users to see in consumer-friendly form selected details such as the dates and sources of information.

Legislators also have a role. They should focus as much attention on quality transparency as on price. No one would choose a caregiver for their child or parent based on who’s the cheapest because of misleading or outdated quality information. No one should have to select a health plan that way, either.

And speaking of matching actions to words, the fastest fix to the star ratings situation would be for health plans to voluntarily share with the public more detailed and more timely information. They shouldn’t be shy: after all, new research shows that MA members experience better outcomes than those in traditional Medicare. So how about more granular information on each individual plan?

Here’s an idea: These days, voluminous quantities of sport statistics are constantly updated for the benefit of bettors on games. Perhaps former Jets quarterback-turned-MA-spokesman Joe Namath could provide updated health care stats for those of us who are betting our lives on MA plans.