How the Tukey Method Could Impact Star Ratings


In the couple months that followed the 2023 Star Ratings release, there was a flurry of information breaking down trends from measurement year (MY) 2021, anticipating changes for 2023 and beyond, final rules and advanced notice releases. One of the definite changes is the move to the Tukey methodology for identifying performance outliers when determining Star Ratings as stated in the Final Rule applicable effective June 5, 2023.

Centers for Medicare & Medicaid Services (CMS) will begin using the Tukey method in Star Ratings year (SR) 2024. In other words, Tukey will ultimately influence how your plan is judged on specific measures from MY2022 and beyond. Medicare plans must understand the shift in how measure benchmarks are calculated to not find themselves falling short on measures that must be continuously nurtured throughout the year.

With so much change on the horizon and this new mathematical equation that could initially negatively impact a plan’s ratings, let’s dig into the nuts and bolts of the Tukey method and what your plan can do now to secure four and five Stars.

It Starts with Cut Points

In Star Ratings, cut points define the assignment of ratings to measures. Each measure has unique cut points based on overall market performance. Cut points are used to determine the Star score the plan receives on a one to five scale for a specific measure. These thresholds change each year and are subject to the collective performance data from all Medicare contracts. Thresholds aren’t determined until after the measurement year ends and data collection is complete. For plans, that means meeting a goal can sometimes feel like an unknown, moving target.

The Tukey Methodology

The Tukey outlier deletion method, sometimes referred to as Tukey fences, identifies and removes outliers from a data set before cut points are determined. The purpose is to stop statistical outliers from influencing cut points by removing extreme high and low scores, which affects performance for all plans, their Star Ratings and quality bonus payments.

CMS is using the commonly accepted Tukey methodology which means that outliers to be removed they must be far outside the mean. Even so, the new methodology will generally make it more difficult for plans to earn and maintain four- and five-Star overall ratings. Most outliers are on the lower performing end of the spectrum. Removing them will generally shift cut points to a higher range and require plans to perform even better on individual measures than without Tukey.

“It is imperative that plans utilize the Tukey recalculations provided by CMS to determine their performance prior to its implementation and after the calculation is added,” says John Willis, Vice President of Consulting & Professional Services at Healthmine  “Projecting future cut points will require significant lift to future proof your Star Rating. What was once considered an unrealistic goal will now become the standard.”

CMS Aims to Stabilize Cut Points

Previously, CMS has leveraged guardrails for cut points in attempt to limit the variation in cut points from year to year and provide Medicare plans with more predictability as they work to improve measure performance. This strategy was used in SR2023 and prevented cut points from changing by more than 5%. According to CMS, the downside of guardrails is the potential for preventing cut points from being responsive to Medicare Advantage (MA) market performance, which is the purpose of cut points.

Within the Final Rule, CMS stated they would decide on eliminating guardrails in a Second Rule still to come. Should this change be codified, Tukey fences and a mean resampling should achieve cut point stability going forward and allow cut points to reflect how the market is performing.

How Plans Can Prepare for the Change

Now that we know Tukey is here to stay, the key to success is in how MA plans establish measure-level goals that are high enough and continuously assess performance all year. You can’t solve for challenges you can’t identify first. Here’s where to start:

  1. Partner with your Stars, quality and other internal teams to determine your data gaps and find a way to fill them.

  2. Leverage surveying tools all year long. Incorporate mock-CAHPS (Consumer Assessment of Healthcare Providers and Systems), pulse surveys, health risk assessments and Health Outcomes Surveys to better understand your members and where they are in their health journey.

  3. Spend time understanding your member data and deploy targeted communication strategies to the members that will have the most impact on measure performance, likely those in the middle of the pack that are more easily persuaded and require fewer touchpoints to complete a health action.

“With the wave of changes coming to the Star Ratings program, quick execution of operational enhancements will be needed to be a high-performing plan,” Willis says.  “A strong Star governance model, with executive oversight, along with ensuring accuracy of data can aid in improved performance for your plan.”

Healthmine can partner with your MA plan to strategize and implement solutions that help you meet your performance goals and earn or maintain your Star Ratings. In SR2023, 75% of Healthmine clients secured quality bonus payments. Our digital solutions offer you a way to gather member feedback and data, analyze it and deploy targeted member communications that close care gaps and improve the member’s experience with their plan. Contact us for a demo.

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