Official says new CMS rules will highlight quality Advantage plans, punish lower-value ones

New rules will reward Medicare Advantage insurance plans that CMS has deemed high quality and punish those rated as lower quality, according to the program's senior insurance regulator.

Plans rated with five stars may market and enroll new beneficiaries throughout the year, beginning on Jan. 1, 2012, and not just during the traditional fall enrollment period, Jonathan Blum, deputy administrator of the CMS and director of Medicare, said at the annual meeting on Medicare and Medicaid of America's Health Insurance Plans. The CMS is expected to announce in October the number of plans that have achieved the highest rating but their numbers are expected to increase beyond the three existing five-star plans, he said.

Conversely, the CMS will begin requiring the use of “icons” in the marketing information of plans that have fewer than three stars to denote that the agency considers them low-performing plans.

“Our goal is to use the enrollment processes to encourage the beneficiaries to seek out the high-quality plans, while at the same time provide strong incentives in payment and non-payment for plans to go up the scale,” Blum said, about the changes.

The new initiatives came as Medicare Advantage enrollment continues to grow at a faster rate than the main Medicare program, according to Blum.

The new carrots and sticks are part of an initiative by CMS Administrator Dr. Donald Berwick to place a greater emphasis on plan quality and to encourage Medicare Advantage beneficiaries to choose the higher quality options from the plans available to them, Blum said.