Maintaining a high hospital star rating from Medicare has become a priority for healthcare organizations, for a number of good reasons. But what are Medicare star ratings for hospitals, exactly, and how do higher ranks benefit providers? And how can telehealth-centered technology used to deliver remote patient monitoring (RPM) and chronic care management (CCM) services help get this important job done? Here’s a quick rundown of what healthcare providers should know.

Need a primer on telehealth terminology? Don’t miss: Defining Remote Patient Monitoring, Telehealth & Other Key Terms in Digital Health

What are Medicare Star Ratings for hospitals?

What are Medicare star ratings for hospitals? As defined by the Centers for Medicare & Medicaid Services (CMS), the Overall Hospital Quality Star Rating (or Overall Star Rating, as it’s also called) is a means to summarize how hospitals perform across a spectrum of patient care metrics.

There are dozens of specific criteria, all grouped within five primary categories:

  • Patient mortality (22% of a hospital’s total rating), including death rates for patients from heart attack, heart failure, stroke, COPD and a number of other conditions
  • Safety (22%), including the prevalence of infections and complications
  • Readmission (22%), including return days for all post-charge patients, as well as those with specific conditions like heart attack, heart failure, pneumonia and COPD, or who are recovering from surgery
  • Patient experience (22%), which measures patient feedback on factors like cleanliness, availability of assistance, and the quality of communication and help they receive
  • Timely and effective care (12%), including the timeliness with which patients receive certain types of care or recommendations, the percentage of vaccinated clinical staff, and other metrics

First announced in 2015 and then implemented over the following years, the Star Ratings system requires hospitals to report data directly to CMS through a variety of programs. These include the Hospital Inpatient Quality Reporting (IQR) Program, Hospital Outpatient Quality Reporting (OQR) Program, Hospital Readmission Reduction Program (HRRP), Hospital-Acquired Condition (HAC) Reduction Program, and Hospital Value-Based Purchasing (VBP) Program.

It should be noted that Veterans Health Administration (VHA) and Department of Defense (DoD) hospitals are exempt from Medicare star ratings. And almost 1,400 facilities — or 30.47% of the total number of hospitals in the United States — have yet to achieve a rating at all. These are usually “new or small hospitals” that haven’t yet reported all of the required data, as tells patients.

By way of comparison, as of July, 2022 there were 198 hospitals with a single star rating (or 6.34% of all hospitals), 702 with a two-star rating (22.49%), 895 with a three-star rating (28.68%) and 895 with a four-star rating. And 431 hospitals (13.81%) had a five-star Overall rating.

Why are Medicare Star Ratings important?

Medicare Star Ratings are important because they help organizations pursue improvements in outcomes and the patient experience by providing a clear framework of action to be taken. The ratings system has also become an important factor in the patient’s decision-making process, and a means for facilities to distinguish themselves from competing services.

The Overall Star Ratings system also provides a tangible way to measure patient satisfaction, which is a key metric for most organizations. “Patient experience” metrics are determined by the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey, giving care providers a chance to gain unique insight into what patients and residents like or dislike about their facilities.

Star Ratings for hospitals are also included in the search engines that Medicare patients use to choose new healthcare providers. As a result, Star Ratings are increasingly seen by consumers to reflect the quality of care they’ll receive at a specific facility. This can have a direct impact on market choice, and can easily affect an organization’s present value and future financial health.

Despite these advantages, though, Medicare Star Ratings for hospitals have always been controversial, with many organizations objecting to the findings and methodology. For instance, the American Hospital Association (AHA) recently called upon CMS to re-examine “the influence of social drivers” and to work to avoid contributing to bias against hospitals charged with the care of “structurally marginalized communities.”

Such feedback is actively solicited by CMS, which has updated the system a number of times in response. Yet the agency has also made it clear that the Medicare Star Ratings system isn’t going anywhere, leaving hospitals and health centers little choice but to get on board.

“Hospital quality measurement is going to continue, as evidenced by CMS’s continued commitment to improving the Star Ratings Program,” as the authors of an analysis by Deloitte have pointed out. “The health care system is moving toward a model that bases payment upon outcomes and quality. As this happens, quality measurement will become even more important.”

How can hospitals use telehealth to improve their Medicare Star Ratings?

Given the complexity and difficulty of reporting the data required by CMS, it’s understandable that so many hospitals have struggled with eligibility. What can these organizations do to comply, and then to enhance their Star Ratings? There are a number of tactics — and a few of them can he implemented with the help of telehealth technologies.

Noting that “differences in caseloads” are an important factor “over which hospitals have little control,” the Deloitte authors point out that hospitals and health centers seeking to improve their Star Ratings may want to drive “quality strategy by optimizing patient outcomes and experiences, quality areas that CMS consistently weighs more heavily and that show the highest variation among hospitals.”

Optimizing patient outcomes may seem easier said than done. Yet RPM and CCM programs have proven to be effective tools in doing just that. By helping keep a closer watch on high-acuity patients on a moment-to-moment basis, these services are designed to keep patient conditions from deteriorating by improving oversight and engagement. Mortality and readmission rates can be improved as a result.

Indeed, remote patient monitoring and its power to provide continuous or near-continuous, high-quality data enables the kind of proactive care that can “delay or reduce disease progression,” as Sarah Carroll, senior director of the Center for Care Transformation at AVIA, told HealthITNews. “Done well, remote patient monitoring can reduce the risk of avoidable hospital visits, long stays and readmissions.”

In addition, putting in place RPM and CCM services provides a clear framework for following CMS-approved methodology for treating high-risk patients. In doing so, facilities are more likely to be found in compliance with the Medicare Star Ratings guidelines around providing timely intervention and effective recommendations — and receive the maximum reimbursement for doing so.

As far as optimizing the patient experience, the HCAHPS Survey provides a clear blueprint to follow. Many of its criteria are based on the ability to communicate with doctors, nurses and hospital staff in general — or at least, the patient’s perception of the quality of that communication. Implementing CCM or RPM programs can help organizations make sure that they provide patients with the recommended time per month in consultation, and receive the appropriate reimbursement for doing so.

Get more details on RPM reimbursement here, and CCM reimbursement here

The Deloitte authors also advise investing “in technology and analytics tools to support quality improvement goals.” A core feature in leading RPM programs, analytical tools are designed to help leaders quickly and clearly understand what’s driving performance in each of Star Ratings category. They can also give doctors, nurses and other caregivers valuable insights into broader trends concerning population health, empowering them to make better, more informed decisions.

Find your telehealth solution with CareSimple

At CareSimple, we’re proud to pioneer virtual care technology that helps providers seize the power of remote patient monitoring, chronic care management and other telehealth-enabled solutions. Contact us today to see how we can put our expertise to work for your organization.

And if you’re looking for a full rundown of reimbursement rates and codes for RPM, CCM and other models of care, download our CareSimple Reimbursement Tree for a handy, single-page summary.