Fewer Medicare Advantage plans scored high quality ratings for their 2021 plans than the year before, according to the latest federal data.
Of the 400 Advantage plans with prescription drug coverage that received a rating, roughly 49% earned four stars or higher on a scale of one to five stars, with five being the highest. For 2020 plans, 52% scored four stars or more.
The stars are crucial for health insurers. Plans that score four stars or more receive a 5% increase to their benchmark, which is the maximum amount the federal government will pay, plus other advantages. Those extra dollars can be used to fund extra benefits for seniors, though it’s not a requirement. According to the Medicare Payment Advisory Commission, the quality bonus payments add about $6 billion to Medicare program expenditures each year.
Four-star or higher plans are also able to tout their ratings and potentially attract more customers. Fewer plans will have that advantage for 2021. The average star rating across all rated plans weighted by enrollment was 4.06, compared with 4.16 for 2020 plans. About 350 plans weren’t rated because they are too new or lacked enough data. CMS said 206 plans received 3.5 stars or less.
There are a few reasons that plans fared worse overall. Advantage plans are rated on up to 44 quality and performance measures. Some measures have to do with Medicare Advantage Part C and some pertain to Part D prescription drug coverage. There were no new measures for this year, but some of the measures were weighted heavier in the scoring methodology.
Melissa Smith, a Medicare Advantage stars expert and executive vice president of consulting and professional services at HealthMine, said insurers have struggled to perform well on the Part D measures, which include things like a member’s ability to get needed drugs or medication adherence for various chronic conditions.
Plans also had trouble with health outcomes survey measures and administrative measures, she said. Because of the COVID-19 pandemic, CMS eliminated the requirement that plans submit new data for the calculation of those measures and instead used the same data it did to score 2020 plans. For some insurers that was a blessing, but it was a headache for others that invested in improving those measures, Smith said.
At the same time, CMS jacked up the weight of measures for patient experience, complaints and access. Some plans weren’t ready.
“They didn’t realize that rule had already taken effect and they didn’t change their stars work plans and investments rapidly enough to cope with that,” Smith said.
Some of the dominant Advantage insurers fared worse. About 72% of UnitedHealthcare’s Advantage members are in plans with four stars or higher, compared with 82% the year before, according to an analysis by Evercore ISI analyst Michael Newshel.
Kent Monical, senior vice president at UnitedHealthcare for stars, quality and performance improvement, said in a statement that the pandemic created challenges but stressed that the insurer’s average rating is above four stars and three in four members are in those highly rated plans.
The analysis also found that 51% of Anthem’s Advantage members are in four-star plans or higher, down from 58%. An Anthem spokesman explained that “continued pressure in our pharmacy results negatively impacted our overall 2021 star ratings.”
The company moved its Medicare membership to its newly created in-house pharmacy benefit manager, IngenioRx, in January. An Anthem spokesman said the move enables Anthem “to directly influence and improve our seniors’ pharmacy experience and drive better outcomes as we move forward.”
A plan’s star rating can affect Medicare Advantage enrollees. A plan that drops beneath four stars will lose its quality bonus payment, which may mean that seniors in the plan will lose some benefits.
“At the end of the day, it will be the benefits they receive that are diminished when those plans lose quality bonus payments, and that’s just an unfortunate reality,” Smith said. “There are so many seniors that are loyal to their physicians and their health plan that it will be interesting to see whether those plans that dropped below four stars ultimately lose members.”
Meanwhile, the average star rating for standalone prescription drug plans was 3.58, improved from 3.5 stars the year before. Just 17% of enrollees in prescription drug plans are in contracts with four or more stars. Another 81% are in plans with 3.5 stars or higher.