Medicare Advantage plans are growing in popularity as a choice for aging baby boomers and payers are expanding their MA offerings. As traditional Medicare spending increases faster than MA, payers see opportunity in the MA market. However, increasing star ratings is key to attracting more enrollees and driving revenue. A Navigant analysis found that improving a plan's rating by one star can increase annual enrollment by 8-12% and improving from 3 to 4 stars can boost plan revenue by 13-17%. To improve ratings, plans need to invest in closing care gaps and sharing quality initiatives with providers.

1. navigant.com
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TREND #2: MEDICARE ADVANTAGE’S RISING STAR
Ongoing ACA insurance exchange uncertainty has payers saturating an
already crowded Medicare Advantage (MA) market. A new Navigant
analysis shows how MA star ratings improvements can grow plan
enrollment and revenue.
2018 HEALTHCARE OUTLOOK
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1. Medicare Advantage 2017 Spotlight: Enrollment Market Update; Kaiser Family Foundation; 6/6/17..
www.kff.org/medicare/issue-brief/medicare-advantage-2017-spotlight-enrollment-market-update/
2. The Facts on Medicare Spending and Financing; Kaiser Family Foundation; 7/18/17.
www.kff.org/medicare/issue-brief/the-facts-on-medicare-spending-and-financing/
3. Anthem To Buy Medicare Advantage Plan In Lucrative Florida Market; Forbes: 9/20/17.
www.forbes.com/sites/brucejapsen/2017/09/20/anthem-to-buy-medicare-advantage-plan-in-lucrative-florida
4. CMS releases star ratings for Medicare Advantage and drug plans, Kaiser earns top marks; Healthcare Finance; 10/11/17.
www.healthcarefinancenews.com/news/cms-releases-star-ratings-medicare-advantage-and-drug-plans-kaiser-earns-top-marks
MA plans are appealing to aging baby boomers, providers,
and payers, and they’re growing in popularity.
INPATIENT SPENDING2
2006 2016 2006 2016
Medicare
Benefit MA
2004 2017
13% 33%
= 19M
enrollees
MA ENROLLEES1
WITH THE NATION’S LARGEST COMMERCIAL PAYERS
AGGRESSIVELY EXPANDING MA OFFERINGS3
AND CHALLENGING
PLAN GROWTH...
2X
INCREASING MA STAR RATINGS IS
KEY TO ATTRACTING NEW
ENROLLEES,4
DRIVING REVENUE.
MA
Traditional
Medicare
Traditional
Medicare
1/3
WHAT PAYERS NEED TO DO
Improvements
3-4
RATING
Navigant MA Star Ratings Analysis*
*From publicly available data on 500 MA contracts, 2012-2016
MA plan attractiveness often connected to providers that
INVEST RESOURCES TO CLOSE CARE GAPS
$
Plans should seek provider arrangements to
SHARE QUALITY AND EFFICIENCY IMPROVEMENTS
that enhance plan satisfaction, financial benefits
Increase collaboration with providers
Improving from a 3-star to 4-star rating
could increase plan revenue 13%-17%
+1
RATING
1-star rating improvement could increase
annual plan enrollment 8%-12%