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Understanding Star Ratings

Before you choose a hotel or fancy restaurant, what do you do? You look at their ratings. Have you looked at the Star Rating for your Medicare Advantage (Part C) or Prescription Drug (Part D) plan?

What is the Medicare Star Rating?

It’s a system that measures the quality and performance of Medicare health plans – Medicare Advantage (MA) plans and Prescription Drug (PDP) plans. Ratings are reviewed every year by the Centers for Medicare & Medicaid Services (CMS). CMS is the federal agency that administers the Medicare program.

CMS rates health plans on a scale of 1 to 5 stars. Information comes from member satisfaction surveys, health plan, and health care providers. This combined data gives an overall Star Rating of a plan’s quality and performance. Here’s what each Star Rating means.

  • Excellent performance 5 Stars
  • Above-average performance 4 Stars
  • Average performance 3 Stars
  • Below-average performance 2 Stars
  • Poor performance 1 Star

The higher the better?

It’s true 5-star plans score higher in specific categories. But don’t just look at the rating. Ask yourself these questions.

  • Does the plan’s coverage fit my needs?
  • How much does this plan cost?
  • Are my prescription drugs covered?
  • Are my doctors, pharmacies, or preferred hospitals in-network?

Always pick your plan based on your health care needs. And what providers or facilities you want to use.

Plans and Star Ratings can change every year. So, it’s important you review your Medicare health and drug coverage every year. This way you can be sure your current plan still meets your needs. You don’t have to sign up for Medicare each year, but you still need to review your choices. You can join, switch or drop your Medicare health or drug coverage for the following year during the Annual Enrollment Period (AEP). It starts October 15 and ends December 7.

Did you know? Plans rated 2.5 stars or below in Part C or Part D or both for three years in a row are flagged by Medicare as Low Performing. These plans must include the Low Performing Icon on all their materials.

What’s rated?

For Medicare Advantage plans, the Star Rating is based on general categories, including:

  • Member experience: Measured by member ratings of the plan.
  • Customer service: How well the plan handles member appeals and requests.
  • Plan performance: Focuses on member complaints and changes in the plan’s performance. Includes how often Medicare found problems with the plan, how often members had problems with the plan, and how much the plan’s performance improved over time.
  • Chronic conditions: Based on how often members with certain conditions get recommended tests and treatments to help manage their condition.
  • Staying healthy: Measures whether members get various screening tests, vaccines, and other checkups to help them stay healthy.

For Part D plans, the Star Rating is based on:

  • Member experience: Measured by member ratings of the plan.
  • Customer service: How well the plan handles member appeals and requests.
  • Plan performance: Focuses on member complaints and changes in the plan’s performance. Includes how often Medicare found problems with the plan, how often members had problems with the plan, and how much the plan’s performance improved over time.
  • Drug pricing and patient safety: Measures how accurate the plan’s pricing information is and how often people with certain medical conditions are prescribed drugs in a way that is safer and clinically recommended for their condition.

Finding a plan’s Star Rating

Use Medicare’s Plan Finder tool . CMS releases new Star Ratings for all Medicare plans every October for the next calendar year. Plans new in the marketplace will not have a Star Rating until the following contract year.

Switching plans

If you find a 5-star Medicare Advantage or Part D drug plan in your area that fits your needs—you can switch. Medicare allows you to switch from your current plan to a 5-star plan once between December 8 to November 30.

If you’ve been enrolled in a consistently low-performing MA or PDP plan (meaning the plan has received an overall Medicare Star Rating of 2.5 stars or less for 3 consecutive years), you’ll have a Special Election Period (SEP). You can enroll into a higher quality plan throughout the year. You’ll receive a notice from CMS in late October saying you’re in a low-performing plan. You have the remainder of that year, and the following year to switch to a plan rated 3 stars or more. To use this SEP, you must call 1-800-MEDICARE directly.

Still have questions?

Remember, even if you want a plan with the highest rating, it may not be the best fit. Our licensed insurance agents will help you compare plan ratings, along with cost and coverage. Together you’ll find a plan that’s right for you.

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