Why Medicare Advantage Star Ratings Matter

Jacqueline Fellows, for HealthLeaders Media , January 16, 2013

The JAMA study seems to contradict the Kaiser study definitively, because the JAMA authors looked at real-time enrollment data in 2011 and studied behavior patterns among those who enrolled in Medicare Advantage plans. The Kaiser study was a random sample of 483 Medicare-eligible seniors.

However, the JAMA study authors admit limitations and do not make an absolute conclusion on the link between enrollment and the quality ranking.

That's because other factors may also play into the decision-making process, such as help from family and friends and year-round marketing tactics. One of the advantages of being a coveted five-star Medicare Advantage plan is that advertising to seniors is allowable all year, not just the period around fall's open enrollment.

Medicare Advantage plans are becoming more popular. In 2011, the year that JAMA study authors looked at, 11.9 million seniors enrolled in a Medicare Advantage plan making up 25% of the total Medicare population. Last year, enrollment in Medicare Advantage plans grew by 10% to 13.1 million.

With the aging baby boomer population as one of the major projected healthcare cost drivers, health plans that can maintain a high star quality rating may fare better in the future.  An earlier report noted however, getting the top rating—five stars—is no easy feat. Only 15 health plans reached that apex in 2012.

If there are still doubters of the impact of the quality rating system, health plans aren't noticing. They're investing in processes to make maintain or improve its "star" standing. The JAMA study reinforces this belief, and could even cross marketplaces, especially with growing consumerism and quality scores of hospitals becoming public.

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