Socially vulnerable counties are less likely to have higher-rated Medicare Advantage plans, which is likely worsening health disparities, a new study found.
The study was published Tuesday in JAMA Network Open and was conducted by researchers at New York University, The Commonwealth Fund and Brown University.
Medicare Advantage enrollment is growing: more than half of all Medicare beneficiaries are enrolled in Medicare Advantage plans over traditional Medicare. Each year, the Centers for Medicare and Medicaid Services (CMS) gives Medicare Advantage programs a rating on a scale of one to five stars. The ratings, which are based on 40 indicators, are meant to inform beneficiaries on the quality of health plans. CMS also gives additional funding to plans with higher star ratings, which they can use to offer better supplemental benefits for members.
The researchers used CMS’ 2023 star ratings and mapped the availability of Medicare Advantage plans in 3,075 counties across the U.S. They also examined county-level characteristics using the Social Vulnerability Index from the Centers for Disease Control and Prevention. This index evaluates 16 social determinants of health, such as poverty, unemployment, education, disability, race and ethnicity, English language proficiency, housing, and access to transportation.
They found that disadvantaged counties were less likely to have plans with 4.5 stars or higher and more likely to have plans with 3.5 stars or lower.
“If the star rating is lower than relative to other plans, the plans will get paid less,” said Avni Gupta, the lead author of the study and researcher at the Commonwealth Fund, in an interview. “Then it is likely that they have lower resources than other plans to offer these [supplemental] benefits as well. If these low-rated plans are concentrated in areas that are already socially vulnerable, that shows us that it will just exacerbate the inequities. People who might benefit the most from these benefits … might only have options to enroll in plans that have lower payment rates.”
The study makes two policy suggestions. The first is to modify the quality bonus payments associated with the star ratings.
“The CMS plans to begin adjusting the star rating measures in 2027 using a health equity index, which will penalize plans that fail to provide equitable experience and outcomes to all their enrollees,” the study said. “Along with this critical step toward incentivizing equity, accounting for regional vulnerabilities in plan payments could also incentivize plans serving vulnerable regions and avoid higher payments to plans with higher quality ratings that do not serve vulnerable beneficiaries.”
The other recommendation is for CMS to provide plan-level star ratings rather than contract-level. Star ratings are currently published for contracts as a whole and apply to all plans within each contract. However, different plans within a contract may be serving different counties with different levels of health disparities.
“I think there is a clear data limitation here that we cannot directly associate a plan rating with quality. … We really want our study to kind of scope CMS’ thinking about modifying the star rating system and payment system,” Gupta said.
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