The Medicare Advantage Quality Bonus Program (QBP) was introduced in 2012 to improve the quality of care provided by Medicare Advantage (MA) plans. Under this program, plans are rated on a five-star scale, and those that receive a rating of four stars or higher are eligible for bonus payments. The hope was that these bonus payments would incentivize plans to improve the quality of care they provide. However, recent studies suggest that the QBP still needs to achieve this goal.
One of the primary problems with the QBP is that plans take more work to receive a four-star rating. According to a report from the Government Accountability Office (GAO), 91% of MA plans received a rating of four stars or higher in 2020. This suggests that the QBP needs to be more effectively differentiating between high-quality plans and those not providing adequate care.
Furthermore, the criteria to rate plans under the QBP may need more meaningful plan quality indicators. For example, one of the measures used to assess plan quality is the percentage of members who receive an annual flu vaccine.
Vaccination is an essential preventive measure but may not strongly indicate overall plan quality. Similarly, another step assesses the percentage of members who receive a diabetes screening test. While this is an important test, it may reflect something other than the overall quality of care provided by a plan.
Moreover, the QBP must consider differences in the populations that MA plans adequately serve. For example, plans that serve sicker or more complex populations may need help achieving high ratings, even if they provide high-quality care. Conversely, plans that serve healthier people may have an easier time achieving high ratings, even if they offer a different level of care than plans that serve sicker populations
Another issue with the QBP is that it may incentivize plans to focus on measures that are easy to achieve rather than those that are most important for improving the health of their members. For example, plans may focus on ensuring that members receive an annual flu vaccine, as this is a relatively easy measure to achieve. However, they may neglect other important aspects of care, such as ensuring that members receive appropriate treatment for chronic conditions like diabetes or heart disease.
Finally, the QBP may not be effective in incentivizing plans to improve quality because the bonus payments are relatively small. A plan’s maximum bonus payment is 5% of its revenue, which may need to be more to motivate plans to invest in significant quality improvement initiatives. In addition, bonus payments are not guaranteed, as they are subject to annual appropriations by Congress. This uncertainty may discourage plans from making long-term investments in quality improvement
While the Medicare Advantage Quality Bonus Program was introduced to improve the quality of care provided by MA plans, it has not been effective in achieving this goal. The program’s criteria for rating plans may not be meaningful quality indicators and need to adequately account for differences in the populations served by MA plans. Additionally, the bonus payments are relatively small and subject to annual appropriations, which may need more to incentivize plans to make significant investments in quality improvement. To improve the quality of care provided by MA plans, policymakers must reexamine the QBP and develop more effective strategies for incentivizing intent to provide high-quality care.