CMS Considering Changes to Medicare Advantage Star Rating System to Account for Socioeconomic Status

CMS officials have publicly indicated that they intend to adjust the Medicare Advantage star rating system to account for the socioeconomic status (SES) of a plan’s beneficiaries.  Under the current ratings system, health plans serving largely low-income individuals have expressed concerns that they are unfairly penalized for the differential effort required to serve high proportions of low SES beneficiaries.


According to a report by Modern Healthcare, acting CMS Administrator Andy Slavitt stated that CMS research “shows that there are statistically significant results for low-income and disabled beneficiaries in certain measures. We are now considering what the appropriate policy responses should be to these findings.”


Deputy Administrator Sean Cavanaugh later indicated that CMS intends to put forth a proposal to address the ratings issue in an upcoming request for comment regarding updates to the 2017 program.


While affected health plans are applauding CMS’s announcement and recognition of the issue, there remains concern over the extended timeline given to actually implement a solution, and whether CMS’s forthcoming proposal will be sufficient to encourage plans to serve low SES communities.


In the meantime, Senators Casey and Portman have introduced S. 2104, the Preserving Medicare Advantage for all Medicare Beneficiaries Act of 2015, which is aimed at providing affected health plans with temporary relief.