2027 Medicare Advantage & Part D Star Ratings Released

The Centers for Medicare & Medicaid Services (CMS) have released updated star ratings for Medicare Advantage and Part D plans for 2027, an essential tool for beneficiaries during the open enrollment period beginning October 15.

The newly released star ratings indicate trends in plan performance, with key implications for insurance professionals advising clients on their Medicare options. While 71% of Medicare Advantage plan enrollees are in contracts rated four stars or above, the number of top-rated contracts has decreased from 22 to 15, highlighting a need for careful consideration in plan selection. Notably, no standalone Part D plans received a five-star rating this year, a factor that advisors must communicate to their clients effectively.

Evaluating Plan Performance

CMS assessed 508 Medicare Advantage contracts for 2027. Despite a slight decrease from 516 contracts in the previous year, around 37% achieved four-star ratings or higher. The enrollment-weighted average rating has modestly declined from 4.01 to 3.99, underscoring the importance of analyzing these ratings in context. Interestingly, nonprofit contracts are statistically more likely to achieve four stars compared to their for-profit peers, making this a valuable consideration for beneficiaries.

Factors Influencing Ratings

The CMS uses up to 43 measures to evaluate plans, including preventive services, chronic care management, member experiences, and new considerations like opioid and benzodiazepine use. The introduction of additional measures indicates a continuous effort to adapt the ratings to current healthcare challenges and trends, helping beneficiaries make well-informed decisions.

"Year-over-year variations in Star Ratings are standard and anticipated, reflecting changes in what is measured and how."

— CMS Fact Sheet

Navigating Enrollment Implications

Open enrollment offers beneficiaries the opportunity to switch plans, which is particularly relevant for those in contracts bearing low-performance warnings. Insurance professionals should guide clients through potential changes that could affect coverage, such as shifts in service networks and the impact of special enrollment periods for high-performing plans.

• Current plans rated below three stars for three years include four Medicare Advantage contracts.
• Switching to a five-star plan is possible once a year, allowing for advantageous changes.
• Adjustments in a plan may lead to Part D late-enrollment penalties.

Looking Ahead

Professionals should not only focus on the star ratings but also help clients evaluate plans based on individual needs like formulary requirements, in-network providers, and copayment rates. As insurers may challenge ratings in court, advisors must also stay informed on legal developments affecting quality bonus payments for 2028.

By effectively communicating the complexities and components of star ratings, insurance professionals can empower beneficiaries to navigate the Medicare landscape during the open enrollment period from October 15 to December 7. This understanding can lead to informed choices that align with both healthcare needs and financial considerations.