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Five strategy considerations for Medicare Advantage success

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Building a smarter Medicare Advantage program

Medicare Advantage plans are growing at a tremendous pace and enrollment in these plans has doubled over the last decade.1

Many consumers are drawn to Medicare Advantage plans—also known as Medicare part c— because of convenience. It’s an alternative to Original Medicare with additional benefits, like prescription drug coverage (part d) and other services to promote wellness. In fact, many Medicare Advantage plans can include covered services such as hearing, dental and fitness. Consumers also have peace of mind knowing the plans are approved, rated and regulated by the Centers for Medicare & Medicaid Services (CMS).

Around 20% of the United States population is projected to be over 65 years old by 20302, and the penetration of Medicare Advantage plans is expected to reach 40% by 2025.3 That means there are expanding opportunities for healthcare payers willing to commit resources to Medicare Advantage plans.

An elderly man looking at the camera

Yet as the popularity of Medicare Advantage plans grows, the competition between plans is becoming fierce. Around 78% of Medicare Advantage beneficiaries are enrolled in plans that have ratings of 4 stars or higher.4 The average plan rating for these plans has also increased from 4.02 in 2017 to 4.16 in 2020.5

If your payer organization wants to succeed in the Medicare Advantage market, you’ll need a plan to stand out. Read on to learn about the five key elements you should consider including in your Medicare Advantage strategy for enrollees.

Implement a thoughtful approach to CMS compliance

CMS regulations are designed to protect consumers and ensure they receive high-quality care.

Failing to meet CMS requirements can lead to lower star ratings, financial penalties and other impacts that will make it more challenging to develop a competitive program. However, CMS regulations are complex, there are fluctuating requirements and your organization can be selected for audit at random. So how can you prepare?

The answer is to encourage perpetual compliance practices within your organization. You can form a Medicare operations committee that leads an enterprise-wide initiative to continuously prepare for audits. This group can conduct mock audits and practice walkthroughs to help identify potential pitfalls. They can also collect data and monitor trends with healthcare analytics to cultivate an ongoing focus on compliance.

A doctor with a concern look in his face looking at the computer
Automating key compliance tasks and automating tests of your program’s universe files also help you stay ahead of compliance requirements.

As you know, audits revolve around being able to produce accurate universe files. These files must include all of the data CMS requests to test program compliance, and it’s critical to be prepared to pull the right data into the right reports every single time. Regular tests can help you spot missing data elements and fields prior to an audit.

There are solutions available to help your organization build excellent compliance practices. But compliance isn’t the only area in which data and technology can make a difference for your Medicare Advantage program.

Pursue operational efficiency

The quality of a Medicare Advantage program depends heavily on the member experience you deliver.

a gif of a computer dashboard

That member experience often reflects how smoothly your program is operating behind the scenes. That’s why it’s important to collect metrics and data that show how well different program operations are performing.

Exploring your data on claims, health services, customer interactions and other aspects of your program can help you uncover opportunities to make processes more efficient.
Software tools that offer customizable reports and analytics dashboards can make it easier to spot those opportunities in your data and make meaningful health program improvements.

You can also use automated report features and monitoring to track your progress and maintain any beneficial changes you’ve made. These reports could be especially useful for helping your organization make informed decisions about which goals should be prioritized as you aim to achieve a higher star rating.

Achieve 4- and 5-star ratings

Older adults looking for high-quality plans are familiar with the rating system used by CMS.

Maintaining a 4- or 5-star rating can give your plan a competitive advantage by making your plan more appealing to consumers. There are also financial benefits, such as increased rebates and the 5-star special enrollment period.

A woman analysing papers
Advanced analytics can help you sift through the complex data that goes into ratings and quickly identify trends you can use to create performance goals.

The ratings incorporate multiple types of data ranging from clinical effectiveness measures like the Healthcare Effectiveness Data and Information Set (HEDIS) to administrative data like call center performance or complaint volume. Typically, all the data is collected and validated by a health plan before it’s loaded into software to calculate some baseline measures. Then the health plan collaborates with network providers during a chart review process to gather supplemental data and close gaps in the data. Once the supplemental data is processed, the full results can be calculated.

Achieving the highest ratings is becoming more difficult as plan performance is increasing across the board. Advanced analytics can help you sift through the complex data that goes into ratings and quickly identify trends you can use to create performance goals for your organization as well as incentives for members and network providers to make beneficial choices. By aiming to have a deeper understanding of the data that goes into the ratings, you can also identify the best areas to focus on for improvement.

Build a culture of continuous improvement

Achieving a high star rating is a team effort.

Three people wearing masks in a conference room

No single department or committee in your organization can achieve a 4- or 5-star rating alone, so it’s very important to encourage an organizational culture of continuous improvement.

You’ll want to focus on the areas that have the highest weight in the overall star rating score and do a deep exploration of the data that feeds into critical measures and domains.
You don’t want to completely discount other measures, such as the small percentage allotted for improvement, but it’s important to prioritize and set goals for each department in your organization based on your best opportunities and biggest risks.
Measuring your performance regularly is key to holding everyone in your organization accountable. Monthly reviews provide a good cadence for continuous monitoring and help keep everyone informed about progress.

You also don’t have to wait on final results from measures you have less control over, like survey data. You can create proxy measures and reach out to health insurance members proactively to get a preview of how your organization is performing. Staying in touch with members is also a very good practice to encourage in general.

Engage your members

Every touch point with a member is an opportunity to improve your program’s star rating.

Devoting resources to quality member engagement and education helps promote satisfaction with your health insurance program and could boost performance in other domains. However, engagement can be tricky because members have limited attention and you don’t want to overwhelm them with too much information.

Strategic use of data can help you identify not just gaps in care but also people who could benefit from early interventions to help them manage their health. Data integration and analytics that bring together healthcare claims, the socio-demographics of your members and other key metrics can help you understand your members better. The trends you find can help you prioritize outreach according to member needs as well as your own goals for improving your Medicare Advantage program.

a gif representing the AI-powered assistant

Technology can also help expedite communication between your program and your members. They might be curious about referrals, out of pocket costs, medical insurance and other basic questions your call center receives numerous times a day. An AI-powered assistant can provide personalized and dynamic responses that steer your members directly to the information they need the most. After the open enrollment period, a virtual assistant can learn and adapt to respond to members’ unique needs. It can also direct them to the correct department if they need additional assistance.

Remembering that members are at the center of your plan’s mission, and treating them as valuable allies in enhancing the reputation and ratings of your Medicare Advantage program is a smart business strategy for plans striving for consistent 5-star ratings.

Maintaining excellence over time

Building a competitive Medicare Advantage program is an ongoing project.

Once you’ve integrated these five key elements into your strategy, you’ll need to consider how they can be supported and improved year after year. After all, health insurance regulations can be updated, ratings can be adjusted and your members will have fluctuating needs.

Data and analytics can help guide you through those changes and make smarter decisions to help sustain the improvements you’ve made.

Next steps: As you explore technology and data solutions for healthcare payers, consider how forward-thinking they are and how they could evolve. With the right partner and solutions, you could not only build a better Medicare Advantage program now but sustain it for decades to come.


1. A Dozen Facts about Medicare Advantage in 2020, Kaiser Family Foundation, Apr 22, 2020. (link resides outside of ibm.com)
2. Medicare Advantage Strategies for Payers in a Pandemic, Oliver Wyman, May 7, 2020. (link resides outside of ibm.com)
3. A Dozen Facts about Medicare Advantage in 2020, Kaiser Family Foundation, Apr 22, 2020. (link resides outside of ibm.com)
4. A Dozen Facts about Medicare Advantage in 2020, Kaiser Family Foundation, Apr 22, 2020. (link resides outside of ibm.com)
5. CMS touts lower premiums and benefits of Medicare Advantage plans, Healthcare Finance, Sep 24, 2020. (link resides outside of ibm.com)

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