CMS finalizes Medicare Advantage star ratings overhaul, sending billions of dollars more to insurers

Key Points:

• The Trump administration finalized a rule overhauling the Medicare Advantage (MA) star ratings system by cutting 11 administrative metrics and rolling back the Biden-era health equity index, aiming to focus ratings more on clinical outcomes.
• The changes are expected to significantly increase insurers' star ratings and associated bonus payments, potentially costing taxpayers over $18 billion in the next decade, up from an earlier estimate of $13 billion.
• The rule eliminates certain quality measures, including those related to call center performance and appeals, while retaining the eye exam metric for diabetic patients after industry pushback; most changes will take effect in 2027 and impact 2029 ratings.
• MA industry groups praised the simplification and clinical focus of the new system, but the rollback of health equity initiatives removes requirements for plans to address disparities or include health equity experts in utilization management.
• Additional clarifications include linking debit cards for supplemental benefits to specific eligible services, banning marijuana products as benefits, and rescinding requirements for mid-year notifications on unused supplemental benefits and restrictions on marketing their dollar value.