The star ratings for 2013 Medicare Advantage plans came out last Friday, which for some of us at HealthLeaders-InterStudy is the equivalent of the release of the BCS College Football rankings.  My colleague Joel, an expert on MA thanks to his years in the trenches at Humana, peeked over at my cubicle with an exciting tidbit:

?Did you see that Humana's Medicare plan in Florida got 4.5 stars??

?You?re kidding,? I replied. We?re just not accustomed to seeing big, for-profit insurers get high marks in the new ratings system. But that should change because the imposition of medical loss ratio rules in 2014 means insurers will spend more on patient care, and thus, improve their ratings.

There are 65 MA plans nationally that got either a 4.5 or 5 star rating from Centers for Medicare & Medicaid Services for 2013, up from 55 in 2012. Most of the highly rated plans from 2012 were the usual suspects of nonprofit MCOs serving the northern states (such as Tufts, Excellus, Medica), or health plans with tightly integrated providers (Geisinger, Kaiser Permanente, KelseyCare). Many of these MCOs remain highly rated for 2013, but are now joined by a handful of for-profit insurers, the most notable being Humana's major Florida MA plan.

Humana Gold Plus (H1036) is the largest MA plan in Florida, with about 260,000 members in the Sunshine State, including more than 37,000 members in Miami-Dade County alone. In 2012, the plan had a 3.5 rating. What's the difference in that one star for Humana? In Miami-Dade County, where plans receive the nation's highest per-member, per-month reimbursement from CMS, a 3.5 star MA plan gets $1,267 per member, per month; a 4.5 star plan gets $1,287. That's a difference of more than $19.30 (1.5 percent) PMPM, which may not seem like much. But if Humana's enrollment in Miami-Dade remains at 2012 levels, that's an additional $8.7 million in federal reimbursement for 2013 from that one county.

These Miami-Dade rates are actually about 4.5 percent lower than last year's reimbursement rates, and are significantly higher than comparable urban counterparts such as New York City or Houston. Had H1036 remained a 3.5 star plan, Humana would have taken a $59.54 PMPM hit from 2012 to 2013 instead of limiting the drop to $40.24 PMPM by improving the rating.

Furthermore, while plans with 3.5 stars or less were eligible for bonuses from CMS this year, that particular demonstration project concludes in 2014, after which time lesser-rated plans receive no bonuses while 4 stars and above see bonuses of 5 percent
And, of course, beyond a financial and marketing level, the increase in the star rating does show that Humana is actually taking evidence-based steps to try to make their members healthier. Proper tests are conducted, certain medication adhered to, patient satisfaction considered.

This was no overnight decision for Humana. The 2013 Star Ratings are based on measures made back in 2011. Already heavily invested in MA, Humana pored over the data to see where measures could be improved. For example, one of the 37 measures on the medical side of the star ratings process is breast cancer screenings, so the insurer made a push to improve its numbers, even sending out mobile mammography clinics to perform tests.

While market share and profit margins are easy measures of success, the goal of the star rating program is better outcomes through stricter adherence to process. Which is why it's sort of surprising that a big, for-profit is able to improve on a large scale, something that is normally only done with smaller plans with tighter controls, such as Kaiser, which owns its own docs.

Florida Medicare, particularly in Miami-Dade, has a reputation of being a black hole for money, with rich benefits, prevalent fraud and physicians with little financial incentive to curtail unnecessary procedures and medication.

When you have the highest federal reimbursement in the nation for Medicare, you can afford to try out new methods to get your numbers up. Cigna's HealthSpring, which does business in Miami-Dade as Leon Medical Center Health Plans (H5410), is the single largest MA plan in the county with 38,583 members, and also saw a bump in its rating, up to 4.5 stars for 2013 from 4 stars in 2012.

Both Humana and Leon are using the high reimbursement to improve their star ratings, but they may also be using the high rate to pay for over-treatment. Right now, the star ratings focus on patient satisfaction, tests and adherence. When you have a stream of taxpayer money at your disposal, these metrics are low-hanging fruit. Can the star ratings be tweaked to preserve these measures while also encouraging cost efficiency?

The lessons learned in Florida can be applied to subsidiaries throughout the nation. With the nation's major insurers (WellPoint, Aetna, UnitedHealthcare, Cigna) all converging on south Florida for Medicare Advantage, perhaps the region can become a real-time laboratory for healthcare engagement with seniors.

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