Fault Lies Not in the Stars But in Plans’ Implementation

Success in the Medicare Stars ratings system requires a culture that looks beyond short-term success to ensure long-term survival.

Vanessa Pawlak
Principal, Ernst & Young, LLP

The Medicare Five-Star Quality Rating System constantly challenges health plans to keep an eye on the future because they’re in a unique, unprecedented turning point in the industry. This turning point has been marked by resource constraints in the aftermath of an economic recession, the greatest amount of regulatory change in American health industry history, baby boomers entering Medicare age, and more government scrutiny than ever before.

Health plans that are disproportionately focused on weathering the storm rather than thinking about the future will find it difficult to foresee and predict changes with an evolving program like Stars.

Vanessa Pawlak

Now is the time for health plans to familiarize themselves with the changes in the Medicare star ratings program, says author Vanessa Pawlak.

The Stars system is no longer a demonstration project, and CMS has given plans ample time to familiarize their operations with Stars requirements and improve their performance. The bar has been set higher as Stars has become permanent and CMS’s expectations have risen.

Moreover, health plans have an added incentive to improve their marks now that a rating of four stars or better is required for quality bonus payments (QBP). But it’s also much harder for new plans to enter and earn a QBP without highly effective implementation of quality improvement and systems to measure it. As CMS changes the measures year to year, organizations will have to adjust to the new measures and CMS’s system for weighting certain measures more than others. These implementation efforts should not be taken lightly, particularly if a plan expects to stay competitive.

CMS also learned from the demonstration project to modify the methodology for calculating Part D measures, in addition to including measures for complex care, such as within Special Needs Plans (SNPs). Beneficiaries in SNPs are often elderly with multiple chronic conditions. Now that more is expected of health plans, more complex measures are being added, and seamless coordination is required to obtain a rating of four stars or better.

Ways to improve

To drive better Medicare star ratings, it is important to think about ways to enable increased integration of the medical and pharmacy benefit. Some of the highest-rated plans over the demonstration period were contracts that had more integrated health care benefit designs.

Influencing the medication therapy management program not only helps with managing chronic conditions, where plans have traditionally struggled, but also helps with the member experience, patient safety, and drug pricing. The idea is to enable programs and improvement initiatives that simultaneously impact the clinical, administrative, and operational aspects of the care continuum and the stakeholders within it.

Plans must also focus on improved data governance and management. Improvements here mean data integrity, the ability to drive timely insights through analytics, and the ability to make more accurate and informed decisions.

Communication is another area to focus on. Finding effective communication channels for frequent and relevant education for members and providers is essential to managing important issues and dynamics that may be outside the direct control of the health plan.

Health plans are starting to assign “practice managers” to their provider groups to establish a more direct connection to physicians and what happens inside the patient room.

Health plans must focus on two questions when it comes to members: First, what should be communicated and, second, the best means for communicating it. The “what” should be information that benefits the member’s health, such as reminders to schedule a routine mammogram. The “how” might be something as familiar and old-school as a birthday card with that reminder, or it could be new channels of connectivity, such as wearable technology or a text message. Especially with the volume of baby boomers aging into Medicare—who are more familiar with digital technology than their parents were, even if they can’t keep up with the millennials—digital and online communication is increasingly important.

Like someone trying to lose weight

Earning five stars means making the Stars program a priority and demonstrating real commitment. Health plans often start out with good intentions but fall short when it comes to follow-through and implementation. A continuous culture of quality is needed within the organization. All individuals in the health plan are quarterbacks of quality in their span of control and influence. An enterprise-run Stars model is how successful Medicare Advantage plans minimize the challenge of achieving five stars. This model is supported by data governance and management in which the architecture and access to data is infused and integrated across all functional areas touched by the Stars program ratings. Most health plans lack anything that is even close to that. Instead, they have a fractured data environment devoid of formal Stars purpose.

CMS is moving away from the imposed thresholds for stars measures. It’s a constructive change. Currently, the immediate motivations for plans are each measure’s target threshold. Plans push to reach a threshold number. At times, those efforts can mean using unsustainable methods, overworking their member services teams or sending a flurry of last- minute, untracked mass mailings. It is analogous to someone who wants to lose weight. If he targets a number, sometimes he’ll use drastic methods just to reach the target and soon gain the weight back rather than changing behaviors relating to diet and exercise gradually and in a way that can be sustained. Health plans and the Stars program are similar. They tend to look at each of the Stars measures in an isolated, siloed way and thus try to hit that target rather than working to improve the whole through end-to-end, systemic clinical, operational, and administrative behavioral changes.

What works

As the Stars program has progressed and evolved, we have seen some common threads to success. One is that not-for-profits tend to outperform for-profit health plans. Further, plans that have been in the Medicare business longer have also tended to fare better in the Stars arena. Why are the not-for-profit plans more successful? For one thing, they are more accustomed to the reinvestment of dollars into their organizations. Effectiveness with reinvestment is an essential component of improving stars ratings over time within the Stars program. Plans with Medicare experience are, as you might expect, more familiar with the kind of scrutiny that occurs in the Stars program and are more likely to have leaders who understand how to deal with CMS’s expectations, intent, and rules.

We’ve also found that health plans that perform better in the Stars program have, in fact, found ways to drive more effective care coordination and delivery. They’re also better at the integration of the medical and pharmacy benefit. Medicare Advantage plus Part D plans (MA-PD) are some of the higher scoring plans and the ones that have trended upward with scores over time.

Plans that do well are truly “member-centric” clinically, operationally, and administratively. These plans more effectively manage members holistically across their continuum of care, from the patients’ room to the member’s phone call to the health plan’s call center. Health plans that manage their members well are adept at working directly with members but also indirectly through providers and families.

A star-studded future

When we look at the Stars program in the context of the multitrillion dollar American health care industry, it may seem like just another program, a small fish in the sea, even if billions of dollars are at stake. However, the Stars program is cutting edge in the move toward a consumer-driven health care landscape. The incentives are strong enough so the Medicare market has responded to the Stars program, bringing the accountability and transparency that consumers—the American public—are coming to expect. It’s only a matter of time until the Stars program—or something very much like it—spreads to the country’s Medicaid programs, the ACA exchanges, and eventually to the employer-based market. We’re facing a star-studded future. Now is the time for health care organizations to familiarize themselves with the changes to the Medicare Stars ratings program, learn what it takes to drive higher scores, and make achieving Stars success a priority.

Vanessa Pawlak is a principal at Ernst & Young LLP and on the firm’s Global Advisory Health Sector team. The views expressed here are hers and do not necessarily reflect the views of Ernst & Young LLP.

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