Improving Medicare Advantage Star Ratings for Enrollees and the Medicare Program

Medicare Advantage (MA) — the private plan alternative to traditional Medicare — uses a star-based rating system to describe the quality of Medicare’s private plans. MA Star Ratings were originally intended to help Medicare enrollees compare and choose between available MA plans. The ratings also play another role—that is, as a basis for rewarding plans through the Quality Bonus Program (QBP), whose goal is to incentivize quality in MA by financially rewarding highly rated plans.

Starting with a look at how Star Ratings work today, this blog examines the system’s track record in meeting its original goals. It also explains why recently proposed changes are a missed opportunity to address the Star Ratings’ fundamental shortcomings.

How MA stars work today

Displayed on Medicare’s Plan Finder website, MA Star Ratings range from one star (poor quality) to five stars (excellent quality). Notably, while Medicare’s Plan Finder shows a quality rating next to each MA plan, Star Ratings are actually calculated for an MA “contract”—an administrative entity that typically includes multiple MA plans offered by an insurer, often with enrollees in different parts of the country.

Each year, the Centers for Medicare & Medicaid Services (CMS) assigns a single Star Rating to all MA plans within a contract based on a weighted average of plans’ scores on roughly 40 metrics. Those measures capture aspects of MA enrollees’ health outcomes and plan experiences, and the extent to which plan members are able to access needed care and prescription drugs. The Star Ratings’ metrics are also meant to assess whether MA enrollees are appropriately receiving certain preventive services and other types of care.  

Star Ratings can affect an MA plan’s appeal to prospective enrollees, and they determine the payments MA plans receive through the QBP. But the implications of MA quality ratings do not end there. For example, five-star plans can enroll members switching from lower-rated MA plans year-round (as opposed to only during Medicare’s designated enrollment periods), and CMS can terminate MA plans that achieve fewer than three stars three years in a row.

Falling short of intended purposes

Despite the significance of MA quality ratings, accumulating evidence indicates Star Ratings and the QBP have not met their original goals. As currently designed, Medicare enrollees seem to find limited value in the Star Ratings as a tool to make quality-informed coverage choices. Similarly, evidence suggests that, as currently implemented, the QBP has not generally resulted in improved quality in MA.

According to the Medicare Payment Advisory Commission (MedPAC) and other organizations examining the issue, a key reason for those failures is that today’s Star Ratings do not accurately measure MA plan quality. That is because of a range of flaws, including the following:

• Star Ratings are based on data from multiple plans, which makes it impossible for them to convey the quality of a specific MA plan or even plans in a local area.
• Star Ratings emphasize clinical measures of preventive care, limiting their relevance for a large share of Medicare enrollees who have multiple chronic conditions or serious illnesses.
• Star Ratings do not reflect documented issues many MA enrollees encounter, such as inappropriate prior authorization and claims denials, difficulty accessing high-quality care after a hospital stay, and problems accessing needed mental health care because of overly narrow provider networks.
• Star Ratings include too few measures of outcomes linked to the quality of care enrollees receive, such as avoidable hospital stays that result from enrollees’ chronic conditions not being effectively managed on an outpatient basis.

MA quality bonuses are costly to Medicare

Further compounding those issues, bonuses paid under the QBP add significantly to Medicare’s costs. Importantly, quality bonuses are a key driver of excess federal payments to MA plans that worsen Medicare’s financial outlook and lead to higher out-of-pocket costs for everyone with Medicare. As we explain in this animation, bonuses linked to Star Ratings can boost per-enrollee payments MA plans receive from Medicare considerably. In 2025, the program paid at least $13 billion for MA quality bonuses, over four times more than 10 years earlier.

In part, high spending on quality bonuses reflect the reality of a generous QBP. In 2026, the average MA quality rating is 3.98 stars—just barely below the four-star threshold required to earn a quality bonus—and very few plans have fewer than three stars. Similarly, while decreasing in recent years, the share of MA enrollees in plans receiving quality bonuses remains high, with 64 percent of people with MA enrolled in plans with a rating of at least four stars in 2026.  

Separately, the QBP, which does not financially penalize low-performing plans, is not budget neutral. This is unlike quality incentive programs in traditional Medicare, under which bonuses paid to high performers are offset by penalties to low performers.

Impending changes to MA stars

CMS recently proposed significant changes to the Star Ratings. Yet, while changes to the ratings are in order amid evidence of their inefficacy, those proposed present concerns for enrollees and do not go far enough in addressing the current system’s core shortcomings.

If finalized, a key update would significantly pare down the number of measures used to calculate Star Ratings, starting in 2028. But unfortunately, most measures proposed for removal reflect enrollees’ experiences with their MA plan (e.g., complaints filed by enrollees about the health plan, number of enrollees choosing to leave their plan) and aspects of how well MA plans support access to care (e.g., appropriateness of plans’ decisions when enrollees appeal a coverage denial, timeliness of plans’ appeals decisions). Those types of measures are critical markers of plan quality and often indicate whether, from an enrollee’s perspective, their MA plan works well.

CMS’ proposal would also suspend implementation of the QBP’s new Excellent Health Outcomes for All reward (previously called the Health Equity Index), an incentive that has the potential to improve care for vulnerable individuals by financially rewarding MA plans that reduce health disparities for enrollees at higher risk for poor health outcomes.

Notably, in what would be a positive step, CMS would add a measure of enrollees receiving depression screening and needed follow-up mental health care to MA Star Ratings’ calculations. 

A missed opportunity

While notable for moving MA quality ratings toward a more streamlined system, CMS’ proposal does not address Star Ratings’ and the QBP’s fundamental flaws. To achieve this goal, policymakers should ensure MA Star Ratings accurately measure MA plans’ quality and are meaningful and useful for Medicare enrollees by focusing on aspects of quality important to consumers. They should also take steps to ensure the QBP appropriately rewards plans with high quality performance while not contributing to excess federal payments to MA plans.  

Ultimately, with over half of the 69 million people with Medicare now in MA — and given predictions of continued MA enrollment growth — it is more important than ever to ensure Medicare enrollees have access to high quality MA plans and good information that enables them to choose the right plan for them.