On February 2, 2022, the Centers for Medicare & Medicaid Services (CMS) released the CY 2023 Advance Notice of Methodological Changes for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies (Advance Notice). Below are some of the highlights in the Advance Notice and invitation for comments from health plans. The last day for comments is March 4, 2022. Final Rate will be announced by April 4, 2022. 

CMS will continue to calculate risk scores using diagnoses submitted in MA plans’ encounter data and fee-for-service (FFS) claims. Close monitoring and validation of encounter data, especially when an MA plan (Sponsor) has a large network of capitated providers, are essential for accurate capitation revenues for their enrollees. The expected average change in revenue for CY 2023 is 7.98% which includes 4.75% in growth rate and 3.5% in risk score trend.1 

An overriding theme in the Advance Notice is the proposed development of performance measures to assess whether Sponsors are screening their enrollees for health-related social needs such as food, housing, and transportation. These and other social determinant factors of health (Social Risk Factors or SRF) will be incorporated into a Health Equity Index for the Part C and D Star Ratings as a single score to measure the overall performance of a contract.2 Star Ratings are not the only areas to be influenced by health inequity/disparity measures; CMS is also exploring using HCC (Hierarchical Condition Categories) risk adjustment to encourage plans to focus on and invest in correcting deficiencies related to socioeconomic statuses of enrollees. Sponsors offering Dual and Fully Integrated Dual Eligible (FIDE) Special Needs Plans are already collecting indicators for disability and low-income subsidy; other social factors could be barriers to health equity and care disparities. CMS is soliciting comments from Sponsors before determining composites for the Index.  

NCQA3-accredited health plans are aware that the HEDIS4 measure set is zeroing in on social determinants5 of health (SDOH): food, housing and transportation. For instance, taking medications regularly and timely (i.e., medication adherence) is not a high priority for patients who have food insecurity, cannot pay their rents or cannot commute to the community pharmacy to get refills for their chronic conditions. These barriers are accentuated with rapidly rising costs of living and social isolation due to fear of infection during a pandemic. Therefore, SRFs can differentiate quality of care manifest in Star Ratings. 

Frustrations resulting from unmet social needs may also be expressed in the form of complaints about the health plan or grievance calls to health plans. When a member calls to complain about waiting an hour or more for a ride from the transportation provider to a doctor’s appointment, or sounding upset about wait time for a scheduled appointment, the expressed dissatisfaction can become negative responses in a CAHPS6 survey or even result in a 1-800-MEDICARE call. Patients’ Experience/Complaints and Access measures will have a weight factor of 4 in CY 2023, from 2 for the 2021 measurement year.7 Enrollee complaints are collectible indicators for screening health-related social needs and member dissatisfaction that should prompt follow-up actions. 

Consistent with the goal of reinforcing the focus on and commitment to member satisfaction, CMS is considering adding category 1.30 (CMS Lead Marketing Misrepresentation: Allegation of inappropriate marketing) to the STAR measure specification in the future. The intent is to reduce complaints originating from enrollees’ confusion around misleading marketing materials and/or inadequate training of marketing personnel.8 This change would decrease STAR rating assignments for 24% of MA-PD contracts, which is a significant change. Sponsors’ comments are invited.9 

CMS expects MA and Prescription Drug Plans (PDP) to assist their enrollees find the best plan for their needs, help them understand the benefits being offered, provide enrollees with a favorable onboarding experience and during the contract year, keep enrollees continuously engaged, provide member outreach to understand any barriers or unmet needs and equally important, collaborate with providers to ensure positive enrollee experience. To track enrollees’ journeys through their enrollment year necessitates data collection, measurement, gap identification and corrective action. Improvements cannot be effectuated without measurements and measurements require data analytics. 

CMS stated on the front page of the 2023 Advance notice: 

“For MA and Part D, we are exploring ways to advance equity that include:  

Collecting more and improved data on beneficiaries’ race, ethnicity and social determinants of health”… 

Since 2008 Inovaare has provided healthcare organizations with cost-effective quality services to help them comply with Medicare regulations and improve their operations, thereby saving costs. Our data collection and analytical expertise can assist your organization to follow all the right steps and comply with all regulatory guidelines for all functional areas. Give us a call today to explore how we may be able to support your needs, promote member retention and enhance your healthcare organization’s compliance processes.  

FFor more details, please contact us at or 408-850-2235