Star Ratings

Most of the health plans ranked by the National Committee for Quality Assurance received an overall rating of 3.5 stars or higher, according to the NCQA’s 2023 health plan ratings.

Of the rated plans, only two out of the 1,095 plans listed received five stars this year: Kaiser Foundation Health Plan of the Mid-Atlantic States and Independent Health Association, Inc. In the 2022 ratings, six out of 1,048 health plans earned five stars. Commercial health plans had a higher overall rating compared to Medicaid and Medicare health plans.

The CEOs of CVS Health Corp. and The Cigna Group on Sept. 12 downplayed the potential for PBM market disruption that could result from Blue Shield of California’s recent deal to unbundle its pharmacy benefit contracts. But both executives hedged by emphasizing their PBMs’ flexibility, and Cigna’s boss suggested that its Express Scripts subsidiary has an a la carte PBM menu.

CVS and Cigna leaders also said, during presentations at the Morgan Stanley Health Care Conference, that they are confident that their Medicare Advantage Star Ratings will improve, and they promised further MA growth. Both firms assured investors that their recent, multibillion-dollar provider transactions will lead to future growth. And both firms, which own two of the “Big Three” PBMs, said that biosimilars will be a boon to payers — with CVS promising as much as 80% savings on its forthcoming Humira (adalimumab) biosimilar line.

From reforming the Star Ratings program intended to steer consumers to the highest-quality plans to reducing gaming of the current risk adjustment system used to set insurer payments, the Alliance of Community Health Plans (ACHP) is envisioning the future of Medicare Advantage with MA for Tomorrow. While the new framework, released last month, comes at a time when the Star Ratings and other aspects of the MA program are under intense scrutiny, ACHP tells AIS Health, a division of MMIT, that it is the result of a multiyear collaboration with subject matter experts at its provider-aligned, not-for-profit health plans.

ACHP provides recommendations around five key pillars: raising the bar on quality, improving consumer navigation, advancing risk adjustment for care not coding, modernizing network composition and transforming benchmarks. And it says many of the provisions contained in these pillars can be implemented right away. AIS Health spoke with ACHP’s president and CEO, Ceci Connolly, and associate vice president for public policy, Michael Bagel, to learn more about the specific recommendations. (Editor’s note: This interview has been edited for length and clarity.)

In an effort to improve Medicare Advantage and Part D sponsors’ timeliness in processing Parts C and D coverage requests, CMS several years ago launched the Timeliness Monitoring Project (TMP) and began issuing fines to Part D plans with excessively high rates of “auto-forwarding” to the Independent Review Entity (IRE). And while CMS historically deducted one star from the appeals measure-level ratings based on IRE data integrity issues, the TMP also resulted in a scaled reduction intended to reflect the severity of the plan’s failures. Now, CMS is relieving MA organizations of that penalty by suspending the collection of Part C Organization Determinations, Appeals and Grievances (ODAG) universes for non-audited organizations that impacted the appeals measures.

Parts C and D sponsors are required to notify enrollees within specific time frames of their decisions on a coverage determination or redetermination. When plans miss that window, it’s considered an adverse decision, and sponsors are expected to automatically forward the case to the IRE within 24 hours. There are two Part C Star Ratings appeals measures that rely on data submitted to the IRE:

So as not to penalize Medicare Advantage plans serving a large proportion of enrollees with social risk factors (SRFs) that impact care quality, CMS has previously taken steps to adjust for within-contract disparities in Star Ratings performance among MA and Part D contracts. But beginning in 2027, insurers will be rewarded for their efforts to assess SRFs and address disparities in certain quality measures with the new health equity index (HEI). MA and Part D organizations must act now to assess disparities within their contracts' current performance and begin to pinpoint where their efforts can make the biggest impact in the two years of data leading up to the reward, according to industry experts who spoke at AHIP’s 2023 conference.

Since its inception as a technology-based “disruptor” in the Medicare Advantage space, Clover Health Investments Corp. has struggled to turn a profit. But after showing signs of momentum at the end of 2022, Clover leadership has declared 2023 as a year focused on profitability rather than growth. To speed that path, the insurtech this week unveiled two “business transformation initiatives”: (1) an agreement to transfer its core plan operations to UST HealthProof’s integrated technology platform, and (2) additional corporate restructuring actions that included a recent 10% workforce reduction.

As expanded supplemental benefits offered by Medicare Advantage plans continue to grow and attract enrollees, a new report from the Government Accountability Office (GAO) observed that there is still limited data on the extent to which beneficiaries are using these benefits. GAO suggested that CMS could do more to collect data on supplemental benefit use from MA organizations and recommended that it issue clarification on current encounter data reporting requirements.

“We’ve heard CMS Administrator Chiquita Brooks-LaSure say at pretty much every recent public appearance that they want to understand where the dollars are going, making sure that they’re getting good value for their investments,” remarks Tim Murray, a principal with the actuarial and consulting firm Wakely Consulting Group, an HMA company. “I think that has some read-through for risk adjustment, which is already playing out, but also of equal importance for the supplemental benefits. And I think if Medicare Advantage as an industry is going to be able to make a data-driven case that these supplemental benefits are actually driving sustainable value for members beyond marketing sizzle, then this issue will need to be addressed and remedied.”

Confirming a tie-up that had been rumored for months, CVS Health Corp. on Feb. 8 revealed that it struck a $10.6 billion deal to buy Oak Street Health, which owns primary care centers catering to Medicare-eligible patients. Executives of the two firms say the benefits of the proposed transaction abound for both CVS Health and Oak Street — including having the potential to help CVS Health-owned Aetna retain Medicare Advantage members — but industry observers say the acquiring firm still faces a bevy of risks as it seeks to incorporate multiple new care delivery assets.

During CVS Health’s conference call to discuss fourth-quarter and full-year 2022 financial results, CEO Karen Lynch and Mike Pykosz, Oak Street’s president, discussed the merits of the deal at length.

Each year, Deft Research surveys a panel of Medicare beneficiaries to better understand consumer decision making during the Medicare Annual Election Period (AEP) and help carriers and their partners strategize for the next plan year. Deft’s 2023 Medicare Shopping and Switching Study, the latest in the firm’s Senior Market Insights Service series, features responses from more than 3,000 seniors who were surveyed immediately after the AEP and an additional 1,800 individuals who were surveyed regularly during the October-December period.

While the overall switching rate among seniors shopping during the AEP was relatively unchanged from prior years at 11%, Deft observed that switching by Medicare Advantage beneficiaries reached 15%, up from 12% seen in the prior two periods. That wasn’t surprising given that Deft’s AEP Gut Check Study from July 2022 suggested seniors’ frustration with plan-offered flex cards and interest in Part B giveback benefits might inspire them to shop around.

In a sweeping proposed rule for the 2024 contract year, CMS last month took a strong stance on multiple aspects of the Medicare Advantage program, from misleading marketing and prior authorization to quality gains incentivized by the Star Ratings. As plans digest the many changes proposed in that rule, several major unknowns remain that could impact their revenue streams and ability to compete going forward. For our annual series of outlook stories on the year ahead, we asked a range of industry experts to weigh in on how doing business in 2023 might differ from previous years. Here’s the first installment on industry challenges and trends as told to AIS Health, a division of MMIT.