According to data recently released by the Centers for Medicare and Medicaid Services (CMS), nearly 70% of Medicare Advantage (MA) plans that offer prescription drug coverage will have at least a four-star rating in 2022. This is a sharp increase from the 49% of plans that had a four-star rating or higher in 2021.
MA plans with prescription drug coverage get an annual star rating between one and five based on up to 38 unique quality and performance measures, including patient satisfaction and screenings. MA plans without prescription drug coverage are rated on up to 28 measures and standalone prescription drug plan contracts are rated on up to 12 measures. Star ratings typically are calculated based on the prior year, so the 2022 ratings are based on data from this year.
CMS expects Medicare beneficiaries to compare quality through the Star Ratings, along with other information such as cost and coverage, on the online Medicare Plan Finder tool available on Medicare.gov.
CMS acknowledged that adjustments were made for the 2022 star ratings due to the possible impact of the COVID-19 pandemic, but also noted that the rise “reflects improvements in sponsors’ scores on several measures.”
“The Medicare Advantage and Part D Star Ratings are important tools in the toolbox for beneficiaries to use as they consider Medicare coverage options,” CMS Administrator Chiquita Brooks-LaSure said in a statement. “CMS’ annual ratings deliver meaningful information about the quality of each plan to help people with Medicare make informed healthcare decisions.”
It is expected that with the increase in plans with higher star ratings, more Medicare spending will be driven to the MA program. Currently, about 90% of patients enrolled in MA plans are enrolled in a plan that will earn four stars in 2022.
Medicare Advantage Bonuses
MA plans are eligible for bonuses if they reach quality ratings of four or more stars. A recent analysis by the Kaiser Family Foundation found that annual bonuses to MA plans quadrupled from 2015 to 2021: from $3 billion in 2015 to $11.6 billion in 2021.
“The rise in bonus payments is due to both an increase in the number of plans receiving bonuses, and an increase in the number of enrollees in these plans,” Kaiser said in its analysis.