Medicare Prepares To Go Forward With New Hospital Quality Ratings

Jul 24, 2016

Despite objections from Congress and the hospital industry, the Obama administration said it will soon publish star ratings summing up the quality of 3,662 hospitals. Nearly half will be rated as average, and hospitals that serve the poor will not score as well overall as will other hospitals, according to government figures released Thursday.

The government says the ratings, which will award between one and five stars to each hospital, will be more useful to consumers than its current mishmash of more than 100 individual metrics, many of which deal with technical matters. The hospital industry, however, fears the ratings will be misleading and oversimplify the many types of care at the institutions.

The Centers for Medicare & Medicaid Services said it would release the ratings “shortly.” In a preemptive effort to rebut criticisms, it noted its analysis showed “hospitals of all types are capable of performing well on star ratings and also have opportunities for improvement.”

The stars are based on 64 individual measures of hospitals that are already public on the government’s Hospital Compare website. Those include mortality rates, the number of readmissions, patient opinions, infection rates and frequency of medical scans like MRIs.

Medicare said that based on its current data, 102 hospitals would receive the best rating of five stars, 934 would get four stars, 1,770 would receive three stars, 723 would be awarded two-stars and 133 would get the lowest rating of one star. Another 937 hospitals would not be rated because the government did not have enough data to properly evaluate them.

“The star ratings provide people a broader picture,” Medicare officials said in a statement. “CMS used a similar approach to simplify complex quality information on other healthcare quality reporting websites, such as Nursing Home Compare, Home Health Compare, Dialysis Facility Compare and Medicare Plan Finder.”

The ratings factor in the mix of patients at a hospital, so those with a high proportion of sicker patients are not supposed to rate lower than those that handle more run-of-the-mill cases. The analysis showed hospitals of different sizes also did about the same, and critical access hospitals — small, mostly rural facilities — performed slightly better overall.

Medicare did not consider the relative wealth of patients. Its analysis showed hospitals serving large swaths of low-income people tended to receive lower star ratings. An analysis by Kaiser Health News of the hospitals that CMS rates shows 22 percent of safety-net hospitals were rated above average — four or five stars — compared with 30 percent of hospitals overall. Twenty-nine percent of safety-net hospitals were rated as below average, with just one or two stars, while 22 percent of other hospitals received those lower ratings.

Teaching hospitals also received lower scores on average. A third were rated with only one or two stars, while only a fifth of other hospitals received fewer than three stars, according to the KHN analysis. The teaching hospitals include large academic medical centers that often top the lists of best hospitals put together by groups like Healthgrades and U.S. News & World Report.

Dr. Janis Orlowski, an executive at the Association of American Medical Colleges, said the fact that so many prestigious hospitals fare poorly in the star ratings is a signal that Medicare’s methods are flawed.

“These are hospitals that everyone in the know tries to get into, so we need to be careful about the consequences, that this star rating can be misleading,” Orlowski said. “Putting the information out at this time is not in the patient’s interest.”

The American Hospital Association also expressed continued concerns.

The government originally planned to release the star ratings in April but postponed it after a majority of members of Congress echoed the industry’s concerns. Debra Ness, the president of the National Partnership for Women & Families, a nonprofit in Washington, urged Medicare to post the ratings before the end of the month.

“We believe great thought and care went into development of the Hospital Star Ratings Program,” she wrote on the group’s website.  “If needed, the program can be adjusted over time. But now is the time to move forward and give consumers a tool that will allow them to assess which hospitals do the best job of providing the care they need.”