Star Ratings and Medicare Enrollment

Health care can be mystery, and especially so for the elderly, who often have many health needs.  One purpose of quality data collection and public reporting is to aid consumers in having adequate information to make sound choices about either health care providers or health plans.  CMS has a number of public reporting programs for providers but also has established the star system for the health plans that participate in the Medicare Advantage program.  But all this data collection and reporting only has value if it appears that it is actually used by beneficiaries.  Research published in the Journal of the American Medical Association attempts to ascertain whether that linkage exists.   (JAMA Article)   The star ratings are based on patient satisfaction surveys, HEDIS data and other administrative measures.  The ratings in 2011 went from 2.5 to 5 stars, although only three plans got the coveted 5 star ranking.  Highly ranked plans have also gotten payment bonuses from CMS in recent years.

Looking at the choices of over 950,000 newly enrolling Medicare Advantage members and another 323,000 who switched MA plans in 2011, the researchers tested for an association between star rating and enrollment.  Some past research has suggested that enrollees have a low awareness of star ratings, but CMS has worked hard to create beneficiary awareness.  Adjusting for a variety of factors, the researchers did find an association, about a 9.5% percent greater likelihood of enrollment in a plan for each one point higher its star rating was.  This affect was strongest for older, non-African American, higher income and urban enrollees.  The effect existed for both new enrollees and people switching MA plans.  The effect did not occur much more strongly for the highest rated plan among all choices for first-time MA selectors but for switchers, going to a plan with at least as high a rating seemed important.  While not necessarily a causal relationship, the study does suggest that the underlying components of the rating may have a role in beneficiary decision-making, which would be good in helping to continue the momentum for improved quality.