2024 Star Ratings, which CMS released on October 13, 2023, has forced the industry to reflect upon and restrategize the path forward with newer evaluation dynamics at play. The resulting turbulence has clearly underscored the fact that auto-pilot mode is not attainable. Close monitoring, continuous innovation and strategy recalibration are essential.

Market Observations

MA enrollment growth between 2023 and 2024 has been flat, which is distributed across fewer health plans and contracts in 2024 compared to the previous year. National payers attracted most of the enrollment growth, followed by Blues and other large payers. Blues scored a higher density of 4 Star and above enrollment than national payers, whereas most new contract additions are associated with other large payers. More membership was distributed across lower Star ratings in 2024 compared to 2023. The small-to-mid payer segment witnessed the maximum displacement of population to below 4 Stars in 2024.

• Takeaway – The market will witness higher churn and enrollment switchovers during 2024 OEP from the small-to-mid payer segment to higher-rated plans for a more consistent and stable experience.

Summary Ratings

2024 witnessed a significant displacement of previously 5-Star rated MAPD enrollments to less than 4-Star contracts. There are fewer MAPD contracts compared to 2023; however, the growth in enrollment is mainly concentrated within MAPD contracts. On the other hand, PDP contracts significantly lost 4 Star and higher-rated population from 2023.

• Takeaway – The market will continue consolidating, driven by a heightened focus on optimizing enrollment growth during 2024 OEP. The small-to-mid segment impacted the most would be acquired by national and other large payers to deliver the growth numbers.

Domain Ratings

Clinical measure domains (HD2 and DD4) are severely impacted in 2024 Star ratings compared to other domains. Pharmacy clinical measures attributed to DD4 continued to be a common problem between 2023 and 2024. Relatively operational customer service domains HD5 and DD1 showed weak performance in 2024 compared to 2023.

• Takeaway – Clinical domain and measures (HEDIS® and PDE data sources) are back in focus with the addition of three new measures in 2024 and more in the pipeline for the next 2 years. CMS’s decision to reduce CAHPS weightage from 4X to 2X for 2026 Star ratings would further skew health plan focus and resources for improving clinical and operational domains.

Measure Ratings

Overall underperformance in 2024 Star ratings is primarily driven by poor performance across HEDIS and PDE measures. The resulting outcome is driven by underperformance across three new HEDIS measures that were introduced in 2024. Star ratings were amplified with poor performance in 5X weighted improvement measures due to a decline in year-over-year performance across most of the HEDIS measures.

• Takeaway – Expanded clinical data sharing arrangements with network providers, timely acquisition of high-accuracy clinical data, continuous proactive monitoring, along with timely communication of gap closure insight at the point of care are pivotal strategies for positively influencing clinical measures. Accomplishing all the above at scale requires significant focus and investments on multiple fronts.

Measure Score & Cut Points

New evaluation techniques involving Tukey outlier detection and Guardrail were implemented in 2024 Star ratings for non-CAHPS measures. As a result, 13 measures witnessed significant turbulence in their cut points. Six out of 13 impacted measures are associated with 3X and 4X weightages. The majority of impacted measures are either clinical (HEDIS data source) or operational (IRE, MBDSS, Call center data sources).  2 and 3 Star cut points were influenced significantly compared to 4 and 5 Star cut-points (Contracts which scored 3 Star and 2 Star at current score levels in 2023 slipped to 2 Star and 1 Star in 2024 owing to cut-point shift).

• Takeaway – The payer must invest in highly sophisticated AI infrastructure to project future cut points with high precision. AI/ML would also enable micro-segmentation across health equity/social risk parameters and prioritize cohorts for personalized interventions (Health Equity index-driven rewards planned 2027 Star ratings)

In a nutshell, the upgraded Stars evaluation mechanism, as implemented in 2024, which will continue to evolve, complemented with the 4-year Stars roadmap as laid out by CMS in April’2023 (final call letter) has laid out the directional journey ahead. It is time for the payer to acknowledge the change and re-evaluate the current Stars program end to end for future alignment. The scope may span across direct sources such as the Stars calendar, provider contracts, value-based arrangements, data sharing arrangements, proxy survey strategy, member satisfaction scoring, member and provider engagement, unified data and analytics, or indirect sources such as community services, supplemental benefits, and preventive education. Almost all core functions within the payer enterprise contribute to Stars Improvement. Payers need to invest in solutions enabling streamlining of intra and inter-departmental collaboration while channelling enterprise focus and energy towards a common realizable goal with a clear view of ROI.