On February 2, 2022 CMS published the Advance Notice of Methodological Changes for Calendar Year (CY) 2023 for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies (Advance Notice). There is an extensive list of proposed changes, recommendations, and areas where feedback is requested. 

The Advance Notice’s significant theme and focus centers on how the healthcare industry can realign incentives and commitments to better support health equity goals. Recognizing this is strongly influenced by unmet social needs, CMS also has proposed changes that subsidize investments in this space. In addition, the commitment to monitoring and driving improvements in patient experience and satisfaction is further reinforced by adding additional ways to define and stratify this category. An almost 8% payment increase supports these proposed changes, which reinforces CMS’ support

This article highlights some of the key proposals and themes threaded throughout the Advance Notice. Recognizing these items have yet to be finalized, we anticipate extensive comments and changes to some of the sweeping proposals advanced by CMS. 

Health Equity Is Central to the Advance Notice

CMS has strong interest and support for advancing health equity, noting at the outset of the Advance Notice that “CMS is committed to advancing equity in health and healthcare for all individuals and addressing inequities that exist in our policies and programs that serve as barriers to equal opportunity.” 

Progressing this initiative can be done by collecting more data on beneficiary race, ethnicity, and social determinants of health (SDoH), adding additional quality measures that focus on addressing these areas, and ensuring Medicare dollars are spent in ways to close these gaps. 

Together with health equity, Social Risk Factors (SRFs) are a target for potential Star changes. Star Ratings may be influenced by the beneficiary SRF mix, creating unintended consequences for member health outcomes and misaligned incentives. With this recognition, CMS is looking for ways to construct incentives to promote addressing SRFs and reduce disparities.

To further its health equity commitment and support plan investments to eliminate SDoH barriers, CMS has developed a health equity index as a methodological enhancement to Star Ratings which summarize through a single score contract performance with SRFs in multiple measures. While data is already available for those with a disability and who receive a low-income subsidy and are dual-eligible (LIS/DE), additional SRFs may influence this score. 

CMS is looking to understand what other indicators should be included as part of this index. Central to this proposal is tiered scoring dependent on contract performance in a health equity measure, which would be a subset score for each of the Medicare Advantage Star Ratings measures. 

Consideration is also being given to deploy the health equity index as a replacement for the current reward factor so those contracts could receive a reward factor linked to a higher index score. Fundamentally, this aims to promote investments that help reduce care disparities. The health equity index is separate from the CMS Office of Minority Health Health Equity Summary Score (HESS), which will coexist and be refined to support quality improvement efforts separately. 

Continued Focus on Member Satisfaction and Performance

Over the last several years, CMS has increased the Patients’ Experience and Member Complaints Star Rating measure weights from 1.5 to 4, reinforcing the focus on and commitment to member satisfaction. CMS reinforces this goal and maintains the momentum by soliciting feedback on including the Lead Marketing Misrepresentation subcategory 1.30 as part of the future measure specification. This subcategory targets issues around beneficiary confusion arising from marketing materials or personnel. This would be added to category 2.30, which is currently included as part of the Complaints against Health/Drug Plan measure specification. As noted in the proposal, this change would decrease current Star assignments for 24% of MA-PD contracts (although this is partially attributed to the increase in types of complaints contained in the dataset). Since this is a substantive change, there is a proscribed timeline and structure for adoption and implementation.

The Beneficiary Access and Performance Problems (BAPP) measure is currently on the display page to evaluate poor plan performance that culminates in CMS action. The data to measure this is derived from CMS’ Compliance Activity Module. Prior to being added to the display page, the BAPP data included CMS enforcement actions and plan sanctions. Even with prior criticism and support, CMS is requesting feedback on whether to promote it as a future Star measure and if the BAPP should include enforcement actions and plan sanctions. 

Specific to CAHPS, CMS recognized the need to increase beneficiary response rates. Currently, it is testing a new approach to targeting responses which include:

  • Sending a pre-notification letter 
  • Following that, enrollees would receive an invitation to a web survey (if an email address is on file)
  • Sending a reminder notice one week after the initial invitation
  • If the enrollee hasn’t completed the survey via web, another reminder via mail would be sent out
  • A phone call will be attempted if the survey still has not been received at 30 days after the mail survey is sent 

CMS is also exploring whether new topics or questions should be included as part of the CAHPS survey, including questions on sexual orientation and gender identity (SOGI).

Increased Focus on SDoH, Socioeconomic Status (SES), and Sociodemographic Status (SDS)

CMS is seeking feedback on whether changes can be made to the CMS-HCC risk adjustment methodology to address SDoH and whether to incorporate additional factors to better calibrate costs and risk adjustment.

Particular mention is made to risk adjusting certain medication adherence measures for SES and SDS. These include medication adherence for:

  • Diabetes Medication
  • Hypertension (RAS Antagonists)
  • Cholesterol (Statins)

CMS is considering whether to expand its approach for reporting differences in contract performance on additional Star Rating measures for beneficiaries with SRFs. Process, outcome, and CAHPS measures may be stratified by these variables. CMS is soliciting feedback on whether this should be included as a display measure.  

The CY 2023 Medicare Advance and Part D Proposed Rule (Proposed Rule) released in January contained requirements for assessing D-SNP social needs. As part of this Advance Notice, CMS is considering developing a performance measure based on a social needs assessment screening. 

This continues to further CMS’ goal of improving health outcomes for at-risk beneficiaries. With NCQA’s new measure for assessing food insecurity, housing and transportation needs, and referring beneficiaries to appropriate resources for those who report these barriers, CMS is also considering including NCQA’s measure in the future.

Display Page Changes

The Display Page publishes proposed or updated measures before formally including them as part of the Star Ratings. Key proposals for 2023 include:

  • Adding the HEDIS Cardiac Rehabilitation measure
  • Modifying the Physical Function Activities of Daily Living (PFADL) display measure to adjust for characteristics the health plan cannot control that impact physical functioning (age, education, gender, living alone)  
  • New data for the Aggregate Score Analysis in the HOS module, which includes beneficiaries with a BMI of 30 or greater, percent of beneficiaries reporting 14 or more Physically Unhealthy Days, and percent reporting 14 or more Mentally Unhealthy Days  

Other Key Proposed Changes

  • With the expansion of age ranges recommended for colorectal cancer screening, CMS is considering expanding the denominator for this group’s Star measure by extending to age groups 45-49. 
  • CMS introduced a new measure that utilizes electronic data for the Controlling Blood Pressure Star Rating as opposed to continuing to use a static blood pressure reading. 
  • As highlighted in the recently Proposed Rule, CMS continues its focus on the D-SNP population through the Care for Older Adults measures. Currently, three measures make up this category, which include Medication Review (C06), Pain Assessment (C07), and Functional Status Assessment (this is on the display page for the 2023 Star Ratings). CMS is evaluating whether data that supports these measures may be collected in digital format. 
  • Several proposals relate to the vaccine measures. Specifically, for pneumococcal and influenza, CMS is looking at whether it should move away from the CAHPS data source to the HEDIS results. In addition, CMS has asked for perspectives on how to address the COVID vaccination and whether a new measure on the display page is appropriate at this time. It also mentioned in the February 4th stakeholder call that it is continuing to work through whether CMS will consider at-home COVID tests a supplemental benefit. 
  • With an increasing number of organizations moving to value-based arrangements and the associated improved health outcomes, CMS is examining whether to include a measure that reflects plans entering value-based contracts with their provider networks. There also is interest in how this would be collected and measured.

Payment Changes

As part of the Advance Notice CMS published the following as the payment impact from the policy changes:

2023 Advance Notice
Effective Growth Rate
Change in Star Ratings
Medicare Advantage Coding Pattern Adjustment
Risk Model Revision
MA Risk Score Trend
Expected Average Change in Revenue

This notice follows a Congressional letter, with record-setting support, urging for a more stable payment policy. The letter also recognizes the increasing diversity in the beneficiary population noting “Forty percent of Medicare Advantage enrollees make less than $25,000 per year, [with] racial and ethnic minorities eligible for Medicare also increasingly [choosing] Medicare Advantage, with the greatest growth among Black and Hispanic enrollees.” This data provides additional support for the increased funding required to implement the proposed changes (with 2022 experiencing a 4.08% payment increase).

The Advance Notice proposes sweeping changes to address some of the fundamental issues that exist in healthcare access and delivery. The industry supports the health equity and SDoH focus stating, ​​“[w]e agree that MA plans play an essential role in improving health equity and addressing the social determinants of health that impact millions of seniors and people with disabilities. We support CMS soliciting input on ways to advance these important goals.” 

While the proposal’s practical implications may dissuade industry support and adoption, CMS has signaled that changes are needed to continue to advance the evolving health and social needs of MA beneficiaries. 

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