Report to Board of Administration

Transcription

1 Report to Board of Administration Agenda of: DECEMBER 13, 2011 From: Alex Rabrenovich, Chief Benefits Analyst ITEM: VIII-A SUBJECT: MEDICARE STAR QUALITY RATINGS Recommendation: That the Board receive and file this report Discussion: LACERS offers four Medicare Advantage plans to its Medicare-eligible retirees: Kaiser Permanente Senior Advantage, Anthem Blue Cross (Anthem) Medicare Advantage LPPO, UnitedHealthcare (UHC) Medicare Advantage HMO, and Senior Care Action Network (SCAN) Medicare Advantage HMO. The Centers for Medicare and Medicaid Services (CMS) posts quality ratings of Medicare Advantage plans to provide Medicare beneficiaries with additional information about the various Medicare Advantage plans offered in their area. The Patient Protection and Affordable Care Act (PPACA) of 2010 required the ratings to be used to award quality based payments to Medicare Advantage plans, beginning in The CMS rates Medicare Advantage plans on a scale of one to five stars, with five stars representing the highest quality. The CMS defines the star ratings in the following manner: 5 Stars = Excellent performance 4 Stars = Above average performance 3 Stars = Average performance 2 Stars = Below average performance 1 Star = Poor performance PPACA requires that CMS payments to Medicare Advantage plans be restructured in a way that may reduce funding for Medicare Advantage plans. However, beginning in 2012, plans may receive additional CMS funding through rebates and bonus payments, with more funding being made available to plans with higher quality ratings. Board Report 1 December 13, 2011

2 Quality Bonus Payments and Rebates Based on Star Ratings Star Rating Quality Bonus Payment* Rebate 5 5.0% 5.0% 5.0% 70% % 5.0% 5.0% 70% 4 4.0% 5.0% 5.0% 65% % 3.5% 0.0% 65% 3 3.0% 3.0% 0.0% 55% <3 0.0% 0.0% 0.0% 50% *Rebates are based on the plan bid (the plan s cost of providing Medicare Part A and Part B benefits in its county) and the bonus payment. The Medicare Advantage plans offered by LACERS recently received their quality ratings for Kaiser Permanente was distinguished with a 5-star rating, the only California plan to achieve such a rating. UHC received a rating of 3.5 stars and SCAN received a rating of 4 stars. Because the Anthem LPPO plan is new, there is not enough data for CMS to assign a quality rating at this time. Kaiser Permanente will present to the Board information about the 5-Star Program, its rating, and what it means to LACERS. This report was prepared by Alex Rabrenovich, Chief Benefits Analyst, Health Benefits Administration Division. AR:ar Attachment: 1) Kaiser Permanente Presentation: Medicare Star Quality Ratings Board Report 2 December 13, 2011

3 December 13, 2011 Medicare Star Quality Ratings: LACERS Board

4 Background on Medicare Star Ratings For several years the administrator of Medicare The Centers for Medicare & Medicaid Services (CMS) has required Medicare plans to report on quality and service measures With health care reform, CMS created the Medicare Star Quality Rating System The goal is to drive plans to deliver better quality care and service to Medicare beneficiaries CMS also wants beneficiaries to base their health plan choice on quality On Medicare.Gov, Medicare 5 star plans are designated with this icon 2

5 Five Categories Make Up the Star Quality Ratings Staying Healthy Managing Chronic Conditions Member Satisfaction Customer Service Pharmacy Benefits Individual star quality ratings are assigned to 53 measures Overall rating is the weighted average of the individual items 3

6 Star Ratings: Kaiser Permanente Performance in California Kaiser Permanente is the highest rated Medicare Advantage plan in California. Currently, there are approximately 7,000 LACERS retirees enrolled in a Kaiser Permanente Medicare plan in California. 100% of 5-star Medicare beneficiaries in California are Kaiser Permanente members. There are no other 4.5 or 5 star plans in California. According to CMS*, only nine Medicare plans in the country earned 5 stars for the overall 2012 Medicare star quality rating. Of those nine 5-star plans representing 1,070,815 Medicare beneficiaries 944,391 members (88 percent) are enrolled in five KP regions: Northern California, Southern California, Colorado, Hawaii, and the Northwest. * Based on 2012 Medicare Star Ratings (Medicare.gov) 4

7 Summary Kaiser Permanente is strongly committed to continuing in the Medicare Advantage market. Kaiser Permanente Medicare members benefit from KP s commitment to quality and service excellence. For more information on the Medicare Star Quality Ratings, please visit kp.org/medicarestars.