CMS Adds Star Ratings System to Show Plan Quality on ACA Exchanges
CMS announces that ACA exchanges, both federal- and state-based, will be subject to a public, five-star rating system in PY 2020.
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- Plans on the federal health insurance exchange will publicly display quality ratings on a five-star system in plan year (PY) 2020, CMS announced. The quality ratings will be available for the 2020 open enrollment period, which begins on November 1, 2019.
CMS’s goals for the star rating system are to secure the best member experience for individuals on the exchange, to increase the accuracy and value of the information to the consumer, and to achieve better quality of healthcare overall through greater transparency. The system should also provide more oversight for health plans, the agency hopes.
“Knowledge is power, and for the first time, consumers will have access to meaningful, simple-to-use information to compare the quality, along with the price, of health plans on Exchange websites, including HealthCare.gov,” said CMS Administrator Seema Verma. “This addresses our strongly held commitment to equip consumers with the tools they need to find the best choice possible. Increasing transparency and competition drive better quality and cost, with consumers benefitting the most.”
State-based exchanges (SBEs) will have more flexibility with how and where they display their information but even states whose residents do not use HealthCare.gov will have to make their individual market qualified health plan (QHP) quality ratings available to the public online.
CMS said that it may not be possible for some regions to have a star rating, either because enrollment is low, the plan is new, or some other related reason, but cautioned that no rating does not mean poor quality.
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Officially, there are three major areas of evaluation for the star ratings.
When CMS rates a plan’s medical care, the agency will be looking at the providers’ effectiveness. CMS will observe whether physicians are regularly scheduling their patients’ screenings, vaccinations, and essential health services.
In order to ascertain the rating for member experience, CMS will survey plan members. The surveys will cover patient satisfaction and patient engagement by asking about the member’s access to a physician and to proper care.
For plan administration, the agency is interested in the plan’s management and organization. This covers a range of services from customer service, to the accessibility of information, to whether network providers are pursuing the best practices in acquiring tests and recommending treatments.
CMS has been working toward a national star rating system for the exchanges for the past two years. From 2017 through 2019, CMS has been conducting a rating system pilot, starting with Virginia and Wisconsin for the first two years and expanding into Michigan, Montana, and New Hampshire in 2019.
READ MORE: Beneficiary Engagement with Medicare Star Ratings Lagging
CMS has been using the star system in Medicare Advantage. However, public awareness of these star ratings has been very low. The system is also still receiving for a loophole which a payer may use to “crosswalk,” or consolidate, its lower-rated plans into higher rated plans.
Critics of expanding the star ratings systems to the exchange argued that the star ratings were too shallow to genuinely assist the consumer. There was no context for how the plans earned their ratings, the critics said.
CMS addressed this in the 2020 nationwide rollout by requiring that the three major categories of evaluation and their individual ratings be displayed on HealthCare.gov. When consumers compare plans on the exchange, they will see one to five overall rating stars at the top of the plan’s page and then the individual ratings for member experience, medical care, and plan administration. This information will be visible when viewing one plan or comparing up to three plans side-by-side.
For SBEs, the requirements are the same as the federal exchange except that these plans are permitted to display further quality information as desired and can customize their design, including the titles of the star ratings.
As part of this announcement, CMS also issued the results of the health insurance exchanges quality rating system (QRS) for PY 2019.
READ MORE: Only 22% of Medicare Advantage Customers Aware of Star Ratings
Each state product that meets the quality reporting criteria and submitted data is considered a “reporting unit.” These include both federally facilitated and state-based exchanges.
Of the 185 reporting units, 95 percent received three stars or more, 67 percent received four stars or more, and 19 percent received five stars.
For medical care, only eight percent of all reporting units received five stars. Three percent of the reporting units had five-star quality member experience and 12 percent were given five stars for plan administration.
All of the PY 2019 data is available on the CMS website along with exchange quality rating system guidance.
