Researchers Find Complex Issues with Medicare Star Ratings in Relation to Dual-Eligibles

Feb. 1, 2023
A team of healthcare policy researchers has done a thorough analysis of the Medicare star ratings program and found complexities around how hospitals caring for dual-eligibles are rated

Does the hospital star-rating program under Medicare end up disadvantaging the hospitals that serve poor patients? A team of healthcare policy researchers has examined the issue, and come up with mixed results.

The January issue of Health Affairs carries the article “Assessing Hospital Quality Scores By Proportion Of Patients Dually Eligible For Medicare And Medicaid.” Its authors are Steven B. Spivack, Li Qin, Jeph Herrin, Demetri Goutos, Michelle Schreiber, Lee A. Fleisher, Arjun B. Venkatesh, and Susannah Bernheim; they examine the situation involving star ratings in relation to Medicare-Medicaid dual-eligibles (individuals eligible for coverage under both the Medicare and Medicaid programs).

As the authors explain in the abstract to their article, “The Centers for Medicare and Medicaid Services has been reporting hospital star ratings since 2016. Some stakeholders have criticized the star ratings methodology for not adjusting for social risk factors. We examined the relationship between 2021 star rating scores and hospitals’ proportion of Medicare patients dually eligible for Medicaid. We found that, on average, hospitals caring for a greater proportion of dually eligible patients had lower star ratings, but there was significant overlap in performance among hospitals when we stratified them by quintile of dually eligible patients. Hospitals in the highest quintile (those with the greatest proportion of dually eligible patients) had the best mean mortality scores (0.28) but the worst readmission (−0.44) and patient experience (−0.78) scores. We assigned star ratings after stratifying the readmission measure group by proportion of dually eligible patients and found that a total of 142 hospitals gained a star and 161 hospitals lost a star, of which 126 (89 percent) and 1 (<1 percent) were in the highest quintile, respectively. Adjusting public reporting tools such as star ratings for social risk factors is ultimately a policy decision, and views on the appropriateness of accounting for factors such as proportion of dually eligible patients are mixed, depending on the organization and stakeholder.”

The researchers focus in on the fact that, “Although some of the measures included in star ratings account for social risk factors, the final star rating does not further adjust for any such factors at the patient or hospital level. Several studies have found that hospitals caring for patients with more social risk factors have lower star ratings. Hospital characteristics associated with fewer stars include receiving a greater percentage of disproportionate share hospital payments; caring for higher percentages of Medicaid and Medicare patients; treating more patients who are unemployed, African American, or non–English speakers; admitting poorer and less-educated patients; operating in more ‘stressed’ cities; and admitting more patients who are dually eligible for both Medicare and Medicaid. Some stakeholders have specifically identified the need to adjust star ratings for hospitals’ proportion of dually eligible patients. The Office of the Assistant Secretary for Planning and Evaluation (ASPE) in the Department of Health and Human Services concluded that dual eligibility status consistently had the strongest effect on quality performance among all of the various social risk factors examined. Partly in support of this recommendation, CMS proposed, but did not finalize, stratification of the star rating readmission measure group by dual eligibility status. This policy would have aligned with the approach used in the Hospital Readmissions Reduction Program (HRRP) by calculating separate readmission scores for quintiles of hospitals based on the proportion of dually eligible patients whom hospitals serve. However, CMS followed ASPE’s policy recommendation to not adjust publicly reported metrics such as star ratings for social risk factors.”

And there, we get to the nub of the measurement problem, which is that, “Even though hospitals caring for more socially vulnerable populations, including more dually eligible patients, have been found to have lower star ratings, these studies are limited by two important factors. First, nearly all prior work examined the association between social risk factors and the overall star rating score (that is, the final number of stars). However, before constructing an overall star rating, the measures are collapsed into five measure groups (mortality, readmission, patient experience, safety, and timely and effective care), and it is unclear whether the relationship between a hospital’s dually eligible population and star rating is driven by specific measure groups or whether the relationship is consistent across all measure groups. As a result, calls for social risk factor adjustment may focus on the overall star rating without evidence that this relationship is consistent across the different measure groups. Second, prior studies used an outdated version of the star rating methodology.”

So, can anything be done about this sub-optimal situation? The researchers note that, “In this study we found that CMS star ratings were lower, on average, for hospitals caring for higher proportions of dually eligible patients. However, the relationship between dually eligible proportion and star ratings was inconsistent across measure groups. Treating greater proportions of dually eligible patients was associated with better mortality scores, fairly similar safety and timely and effective care scores, and worse readmission and patient experience scores. Although hospitals in higher dual eligibility quintiles had lower mean overall star rating scores, there was substantial overlap within each of these measure groups, with large numbers of hospitals in the highest quintile performing the same as or better than hospitals in lower quintiles.”

Ultimately, the article’s authors note that “Hospitals caring for a higher proportion of dually eligible patients experienced lower overall CMS star ratings but performed just as well as, if not better than, their peers caring for a lower proportion of such patients on several of the underlying measures. Adjusting overall star ratings for dually eligible proportion assumes that caring for more dually eligible patients is part of the causal pathway that leads to worse performance on all the underlying star ratings measures, which is untrue. Yet for certain measure groups, such as readmissions, dually eligible proportion may be part of this causal pathway, explaining why hospitals with greater proportions of dually eligible patients perform worse on readmissions. Although stratifying the readmission measure group would improve star rating scores for hospitals caring for the greatest proportion of dually eligible patients, CMS ultimately decided that this was inappropriate for a public reporting program such as star ratings. Nevertheless, continued evaluation of disparities or differences in performance in star ratings should be an ongoing area of work for CMS.”

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