HMA Insights: Your source for healthcare news, ideas and analysis.
HMA Insights – including our new podcast – puts the vast depth of HMA’s expertise at your fingertips, helping you stay informed about the latest healthcare trends and topics. Below, you can easily search based on your topic of interest to find useful information from our podcast, blogs, webinars, case studies, reports and more.
The 24th annual Medicaid Budget Survey conducted by The Kaiser Family Foundation (KFF) and Health Management Associates (HMA), in collaboration with the National Association of Medicaid Directors (NAMD), was released on October 23, 2024in the report As Pandemic-Era Policies End, Medicaid Programs Focus on Enrollee Access and Reducing Health Disparities Amid Future Uncertainties: Results from an Annual Medicaid Budget Survey for State Fiscal Years 2024 and 2025.
At the end of state fiscal year (FY) 2024 and heading into FY 2025, states were wrapping up the unwinding of the pandemic-related continuous enrollment provision, focusing on an array of other priorities, and facing uncertainty about the stability of state revenues. States were also looking ahead to federal and state elections in November and the potential implications of those elections for Medicaid enrollees, states, and providers. As states have emerged from the now-expired COVID-19 Public Health Emergency, which profoundly affected Medicaid enrollment and spending, many are focused on using Medicaid to address long-standing health disparities (often exacerbated by the pandemic), improve access to behavioral health services and long-term services and supports (LTSS), address enrollee social determinants of health, and implement broader delivery system and value-based initiatives. The report includes key take-aways on provider rates and managed care, benefits and prescription drugs, and social determinants of health and reducing health disparities.
In this webinar, attendees learned the essential methods and practices to enhance Star ratings through the HMA Stars Accelerator program. The session explored how to leverage data analytics to effectively track current star performance and identify areas for improvement. Additionally, it covered stratification techniques that allow for targeted focus on key measure opportunities throughout the year to ensure optimal results.
Learning objectives:
Learn how to implement proven strategies and best practices
Understand how to leverage data analytics to monitor and assess trends
Provide focus areas to measure opportunities and enhance performance
Uma Ahluwalia, managing principal at HMA, discusses the importance of keeping families at the center of children’s health and welfare services and highlights how government should provide services in support of the family unit. The conversation emphasizes that addressing family issues like poverty, trauma, and lack of resources is key to improving child welfare. She also explores the need for integrated services—across health, behavioral health, education, and safety—to address the interconnected challenges families face. Uma shares why it’s so important to sustain the commitment to long-term transformation, proper funding, and enabling local governments to provide holistic, family-centered care.
This webinar discussed the importance of expanding affordable and accessible housing for persons with disabilities. Persons with disabilities face enormous challenges in finding affordable and accessible housing for two main reasons. First, they struggle to afford housing. Second, it’s not easy to find accessible housing. Join us as experts share their key insights into the state of affordable and accessible housing for persons with disabilities and contributions to expanding the housing supply.
Learning objectives:
Understand the impacts of affordable and accessible housing for persons with disabilities through an equity lens.
Examine the state of affordable and accessible housing for persons with disabilities.
Broaden your understanding of the impacts of race, income, disability, and geography on access to affordable and accessible housing.
Learn from experts about ways to expand housing for persons with disabilities.
Featured speakers:
Allie Cannington, Director of Advocacy, The Kelsey R. Feynman, Director of Advocacy, Disability Policy Consortium, Boston, MA Olivia Richard, Disability Rights Advocate, Boston, MA Barry A. Whaley, MS, Project Director of the Southeast ADA Center, Syracuse, MA
This week, our In Focus section reviews the release of the 2025 Medicare Advantage (MA) Star Ratings and pivots to the actions that Medicare Advantage Organizations (MAOs) could take to improve performance in future rating cycles.
Background
Newly released MA Star Ratings information is based on the 2025 Star Ratings published on the Medicare Plan Finder on October 10, 2024. Star Ratings are largely based on the quality of care, member satisfaction, and retention.
The Centers for Medicare & Medicaid Services (CMS) increased many measure-level cut points from the 2024 Star Ratings, requiring MAOs to achieve higher performance on these measures to receive a four or higher Star Rating. An earlier In Focus reviewed a white paper published by Wakely, an HMA Company, which provides an in-depth analysis of CMS’s latest policy and methodology changes that affect an MAO’s overall quality performance and Star Rating.
Topline Results
Significant attention is being given to the notable overall industry decline in Star Ratings. Specifically, only seven Medicare Advantage (MA) plans received an overall 5-Star Rating in 2025, compared with 38 in 2024. Only 40 percent of MA prescription drug plans achieved a score of four or five Stars versus 43 percent in 2024.
Key Considerations for Star Ratings, and What to Do About Them
The ratings significantly influence the financial and operational effectiveness of each MAO, directly affecting plan reimbursement and ability to enhance benefits. The 2025 Star Ratings will impact 2026 MA quality bonus payments. Health plans that earn four or more Stars are eligible for quality bonus payments and greater rebate percentage the following year. Plans may reinvest payments to make plan products more attractive to beneficiaries and emphasize a higher rating in their marketing efforts.
In the wake of CMS’s release of Star Ratings, an intense focus has shifted to each MAO’s specific overall Star Rating. Given the clear implications for population health and health plan sustainability, companies will need to quickly pivot to address opportunities for performance improvement. Key steps to optimize Star Ratings include:
Grow Foundational Knowledge – MAOs need to build broad organizational understanding of the domains and measures, the weights, the levers that can affect individual measures and domains, and the rating cycle.
Assess the Current Landscape – Organizations will benefit from having executive sponsorship, a governance structure, and overall leadership for each domain and measure. They should develop the ability to report on measures, and set interim goals. Assessments also need to ensure the network and bonus structure are aligned with Stars.
Develop a Roadmap –A calendar of events is critical for supporting performance improvement. This should include a preoperational and operational strategy as well as a year-over-year workplan to track, assess, and identify systems, technology, processes and people with a process for evaluation. Formulate a hiring and investment plan, if needed.
Prepare for Reporting and Oversight – Develop a reporting and oversight structure, including a cadence of reporting and structure for review, process, and timing of reports by measure/domain leads. Ensure dashboards are updated annually to include new measures and weights and that a process is in place for managing display measures.
What to Watch
The MA landscape is highly dynamic, with some companies leading in market share, while others are leaders on quality ratings. As companies adapt to regulatory changes and strive for higher quality ratings, we can anticipate further shifts in the coming years. This will be exacerbated by shifts we are forecasting based upon the Health Equity Index and upcoming changes in Star weights. Strategies and actions MAOs implement in 2024 and 2025 will affect their 2026 Star Ratings.
Connect with Us
HMA experts have conducted in-depth analysis on all contracts, domains, and measures that roll into the Star Ratings. For further analysis of the 2025 trends and plan-specific impacts, contact our featured experts below.
Explore The HMA Stars Accelerator Solution for additional insights into programmatic strategies, best practices for design of meaningful solutions to implement, and approaches to measure the effectiveness of these solutions.
Laguna Honda Hospital and Rehabilitation Center (LHH) is the largest publicly owned and operated nursing facility in the United States and has cared for those most in need for more than 150 years. Licensed at 780 beds, LHH serves patients with complex medical needs who are low or very low income as part of the San Francisco Health Network. Health Management Associates (HMA) was engaged by the San Francisco Department of Public Health (SFDPH) to conduct a comprehensive, top-to-bottom assessment in support of its effort to attain Centers for Medicare & Medicaid Services (CMS) recertification.
BACKGROUND
For this engagement, HMA brought together a team of experts with decades of national experience leading public health systems and organizations, including skilled nursing facilities. HMA’s subject matter experts included a long-term care physician specialist, a quality expert, long-term and acute care administrative and nursing leaders, a former California county public health official, and behavioral health specialists.
APPROACH
The assessment produced by HMA included:
An in-depth analysis of operations, leadership, governance, staffing, and the model of care to drive strategy planning, execution and attained favorable clinical results.
An in-depth review of nursing unit staffing, including clinical staffing mix, support staffing, leadership’s span of control.
Evaluation of the medical staff leadership, staffing and clinical affiliation models.
Identified key root causes of operational and regulatory challenges.
Developed and delivered a comprehensive month-long training curriculum for all 1,200 staff to address knowledge and skill gaps.
Evaluation and recommendations to drive the effectiveness of the quality management and performance improvement functions.
Reviewed policies and procedures and recommended restructuring based on evidence-based data, best practices, and stakeholder interviews, which are currently being implemented by the facility.
A full facility mock survey to serve as a baseline for identifying gaps and development of a compliance workplan.
TESTIMONIAL
“HMA is a trusted partner and has been vital in helping Laguna Honda Hospital’s CMS recertification efforts. Their guidance, expertise, and hands-on work contributed to our sustained improvements.”
Roland Pickens, MHA, FACHE, CEO, San Francisco Health Network
RESULTS
The team spent extensive time at the facility and on nursing units observing resident care delivery. They also conducted in-depth interviews with internal and external stakeholders, including clinicians, community leaders, union representatives, political leaders, advocates, and others.
The resulting efforts provided improvements for restructuring, governance and leadership development, quality management improvements, and organizational transformation necessary to enable successful and sustained CMS recertification of the facility in compliance with skilled nursing regulations. The facility was recently recertified by both Medi-CAL and CMS as a result of the improvements made through this project.
This week’s In Focus section previews key public policy issues affecting Medicare Advantage (MA) and Medicare Part D that could potentially be addressed under regulations issued by the Centers for Medicare & Medicaid Services (CMS) later this fall. CMS’s highly anticipated regulations—which include annual programmatic, policy, and technical updates to the MA and Part D programs for the coming plan year—are under review at the Office of Management and Budget and are expected to be released in the coming weeks ahead.
In addition to the proposed rule, healthcare organizations are closely tracking CMS regulations that are expected to be released later this year, which would impact MA plan payment rates as well as proposed regulations intended to streamline the prior authorization process for prescription drug coverage under Medicare. This annual regulatory policymaking process is getting under way as the Medicare Open Enrollment period begins October 15, 2024, during which Medicare beneficiaries will compare Medicare health plan and drug coverage options and select the coverage that best meets their health care needs. (See Table 1 for key 2024 MA dates.)
As the last major Medicare policy regulations from the Biden Administration, healthcare entities can expect a continued focus on regulatory policies and requirements that strengthen program oversight and enhance beneficiary protections, while also seeking to maintain stability in Medicare benefits offerings and plan choices.
Following are some of the key issues to watch for as CMS’s annual regulatory process begins this fall.
Health Equity
Ensuring health equity is a foundational element of CMS’s strategic plan and the agency seeks to advance health equity goals and improvements across all of its programs, including Medicare Advantage. Beginning next year, MA plans will be required to conduct an annual review and analysis of utilization management (UM) policies and procedures from a health equity perspective. By requiring public reporting and identifying any impacts on underserved populations, this requirement is designed to ensure MA plans’ UM policies and procedures ensure access to medically necessary care, especially for vulnerable, low-income populations, such as beneficiaries who receive the Part D low-income subsidy and those who are dually eligible for Medicare and Medicaid.
In addition, CMS has finalized rules to collect health equity data, including race and ethnicity data, and adopted changes to the MA quality measurement program that will provide incentives for MA plans to improve care for underserved and vulnerable populations, including beneficiaries with high social risk factors.
Stakeholders should expect CMS to continue building and strengthening policies to advance health equity goals while exploring new initiatives to reduce disparities and close gaps in care for vulnerable populations.
Consumer Protection and Oversight
Earlier this year, CMS launched a high-profile effort to increase transparency in Medicare Advantage, including the release of a request for information (RFI) to solicit public input on ways to improve data collection and enhance oversight over all aspects of the MA program. More details are available in the press release. In addition to seeking comments on improving overall MA data collection and public reporting, the CMS RFI on MA data collection solicited specific recommendations to improve data collection and accountability for MA plans’ provider networks and prior authorization process.
While the formal comment period closed in May 2024, responses to the CMS RFI on MA data collection can inform and shape future regulatory policy direction, as CMS continues to examine ways to improve transparency and oversight over MA plans.
Quality and Star Ratings
CMS will soon release the Medicare Advantage Star Ratings, which measure the quality of MA plans based on a range of quality and performance metrics. The Star Rating system provides beneficiaries with crucial information to compare plans and select the coverage option that best meets their needs. High-performing plans receive bonuses—which provides incentives for plans to continue to improve quality of care for beneficiaries and patient outcomes. Last year, MA plans received $11.8 billion in bonus payments, and 74 percent of MA beneficiaries were enrolled in plans that achieved a rating of four or more stars. For more information, read the issue brief.
On the regulatory front, CMS recently adopted significant changes to Star Ratings that continue to have far-reaching impacts on MA plans’ quality performance, which, in turn, will continue to shape and inform their quality improvement strategies. Among the notable regulatory changes CMS has adopted is the new Health Equity Index, which rewards MA plans that provide high quality care to beneficiaries with social risk factors, including low-income beneficiaries and those dually eligible for Medicare and Medicaid. Though this policy change takes effect in 2027, MA plans can take steps now to prepare and enhance their capabilities to improve quality of care for beneficiaries with social risk factors, including using targeted care coordination programs.
As policymakers and stakeholders continue to monitor the impact of recently finalized changes to MA Star Ratings, CMS will continue exploring improvements to the MA Star Ratings system that further raise the bar on quality and ensure the program aligns with CMS’s broader goals and objectives.
Prior Authorization
As MA plans have increased the use of prior authorization and drawn scrutiny among patient advocates and providers, CMS has taken important steps to streamline and improve the prior authorization process to ensure timely access to care for Medicare beneficiaries. These regulatory policy changes—which include continuity of care requirements beneficiaries, increased oversight over UM practices, and ensuing evidence-based clinical decisions within MA are consistent with traditional fee-for-service (FFS) Medicare—are intended to ensure prior authorization and other UM tools do not create barriers to medically necessary care for Medicare beneficiaries.
Policymakers continue to look for ways to further improve the prior authorization process, and CMS has signaled additional interest in further regulatory standards to strengthen oversight and improve beneficiary protections. Potential policy options CMS could pursue include requiring more detailed reporting by MA plans (including number of prior authorization requests, denials, and appeals by type of service), extending prior authorization standards and consumer protections to prescription drugs covered by Medicare, and improving the timeliness of prior authorization decisions to avoid delays in necessary care.
Risk Adjustment Payment Policy and Coding
CMS has adopted significant changes to the MA risk-adjustment model, which continue to be phased in over a three-year period (2024−2026). These changes include important technical changes to improve the model’s payment accuracy, including a focus on conditions that are subject to more coding variation. Because CMS risk-adjustment changes will be fully implemented by calendar year 2026, policymakers and stakeholders are closely monitoring whether CMS will pursue additional regulatory policies to improve the accuracy of the risk adjustment program and address coding issues.
Since 2018, CMS—as required by statute—has applied a coding intensity adjustment that reduces MA risk scores by 5.9 percent annually to ensure consistency with Medicare FFS coding. However, MedPAC and others have continued to raise concerns that MA risk scores are higher than those for similar Medicare FFS beneficiaries, even after accounting for the 5.9 reduction in MA risk scores, which results in increased payments to MA plans. As policymakers continue to evaluate changes to ensure the long-term sustainability of the Medicare program, CMS could consider further changes in this area to equalize payments between MA and FFS Medicare through risk adjustment or coding changes.
Table 1. Key 2024 Medicare Advantage Dates
Date
Event
September 2024
CMS announces average premiums, benefits, and plan choices for MA and Medicare Part D for 2025.
Early-to-mid October 2024
CMS releases MA and Part D plan Star Ratings 2025.
October 15, 2024
Medicare Annual Election Period begins. Medicare beneficiaries can enroll in MA or Part D plans for CY 2025.
October or November 2024
CMS CY 2026 Policy and Technical Changes to MA and Medicare Part D (CMS-4208).
November 2024
CMS Interoperability Standards and Prior Authorization for Drugs (CMS-0062).
December 7, 2024
End of Annual Election Period.
Next Steps
The imminent release of CMS regulations come at a critical time for the Medicare Advantage program, which continues to experience enrollment growth amid a challenging and ever-changing regulatory environment. MA plans and other stakeholders need to be prepared to engage in the formal notice and comment process as well as offer policy solutions and best practices to strengthen and enhance the program for the 33 million beneficiaries it serves.
The Health Management Associates, Inc. (HMA), team will continue to closely monitor the timing of the release of CMS regulations and will analyze the impact of the key provisions once these rules are released. We have the depth, experience, and subject matter expertise to assist organizations engaging in the rulemaking process and assessing their impact. HMA can also assist with tailored analysis and modeling capabilities to assess the policy impacts across the multiple rules and guidance.
If you have any questions about the forthcoming CMS regulations and potential impact on MA plans, providers, and beneficiaries, contact our featured experts below.
This week’s In Focus highlights a white paper that Wakely, a Health Management Associates, Inc. (HMA), company published in September 2024, titled “A Cut Above the Rest: Summary of 2025 Star Rating Cut Point Changes.” The paper provides an in-depth analysis of the latest cut point changes from the Centers for Medicare & Medicaid Services (CMS) to demonstrate how policies like the Tukey Outer Fence Outlier removal logic (Tukey), guardrails, and changes in overall quality performance have led to the highest Medicare Advantage (MA) Star Rating cut points in the program’s history.
Why Cut Points Matter
MA Star Ratings are a critical measure of the quality and performance of MA plans. The MA Star Ratings cut points are the thresholds CMS has set to evaluate the performance of MA plans. These ratings, ranging from 1 to 5 stars, are based on various quality measures, including clinical outcomes, patient experience, and plan administration. CMS applies methodologies such as Tukey to set the cut points and guardrails to stabilize them over time. MA plans are evaluated and earn a rating that is based on their performance against the cut points. Higher Star Ratings can lead to increased enrollment and higher payments from CMS, making them a key focus for MA organizations.
Key Findings
Wakely used the 2025 Star Rating Technical Notes to analyze measure-level cut point changes. The data summarize how Medicare Advantage organizations (MAOs) performed on various quality measures during the 2023 measurement year. Notably, the Tukey methodology was applied for the first time within the 2024 Star Ratings cut points. Initially, the full impact of this methodology was evident in the initial 2024 Star Ratings, but the updated 2024 Star Ratings restricted use of guardrails and spread the impact of Tukey over a few years.
The analysis reinforces expectations for changes in MA spending in 2026, in part because of changes in Medicare Advantage Prescription Drug Overall Star Ratings.
The Star Ratings have been on a steady decline over the last two years while CMS continues to refine and evolve its Star Ratings methodology and areas of focus. Key issues to consider in this climate include:
MAOs are experiencing significant reductions in quality bonus and rebate payments, which potentially affects opportunities to improve member health outcomes.
Strategies to enhance Star Ratings and elevate program quality are crucial for performance and meeting the unique needs of MA enrollees.
MA plans and other stakeholders also should consider that as plans optimize performance on certain traditional quality measures, CMS is placing increased emphasis on member experience with their health plan and providers during care.
The Star Ratings is an important tool CMS uses to redirect plan focus and resources.
CMS is scheduled to release the final scores and Star Ratings for Star Year 2025 in early October 2024. These ratings will be based on the performance data from the 2023 dates of service. This release will provide MAOs with updated quality and performance metrics, which are used to determine CMS Star Ratings and subsequent quality-based payments.
Connect with Us
For further insights into the Star Ratings and more information on the report, contact our featured experts below.
Strategies and actions MAOs implement in 2024 and 2025 will affect their 2026 Star Ratings. For further insights into programmatic strategies, best practices for design of meaningful solutions to implement, and approaches to measure the effectiveness of these solutions, explore The HMA Stars Accelerator Solution.
