To improve Medicare Advantage star ratings requires strong focus on patient outcomes, medication adherence, preventive care, and member experience. The Centers for Medicare & Medicaid Services (CMS) Medicare Advantage plan star ratings were created to measure how well health plans support members through preventive care, chronic disease management, medication adherence, and overall satisfaction.
Plans that deliver better outcomes, close care gaps, and address broader social drivers of health are rewarded with stronger star ratings, expanded growth opportunities, and long-term financial sustainability. However, the path to earning and maintaining high ratings is becoming more complex.
In this article, we’ll provide an overview of CMS star ratings, explain how they impact payer growth and financial performance, and explore how remote patient monitoring (RPM) and remote therapeutic monitoring (RTM) solutions can help plans improve outcomes, close care gaps, and meet health equity standards.
What Are CMS Medicare Advantage Plan Star Ratings?
The CMS star ratings program evaluates the quality and performance of Medicare Advantage and Part D plans. Plans are rated on a 1 to 5-star scale, with 5 stars representing the highest level of performance.
Payer star ratings are based on how well a health plan performs in the following categories.
- Helps members stay healthy (through preventive screenings, tests, and vaccinations).
- Manages chronic conditions (such as diabetes, hypertension, and heart disease).
- Delivers positive member experiences (measured through CAHPS satisfaction surveys).
- Handles member complaints and service problems (including timely issue resolution).
- Provides effective customer service (such as processing appeals and supporting member needs).
- Supports medication adherence (for chronic conditions, under Part D coverage).
Each measure contributes to an overall star rating that reflects a plan’s ability to meet needs in each category. Higher star ratings are tied to bonus payments, greater rebate retention, and expanded enrollment opportunities.
2024 Medicare Advantage Plan Star Ratings
The chart below shows the distribution of Medicare Advantage Prescription Drug contracts by CMS star ratings for October 2024. These results show how competitive and challenging it has become to maintain top-tier ratings. Achieving 4 or more stars is necessary for payers seeking bonus payments, higher rebate retention, year-round enrollment opportunities, and a stronger market position.
Only 39% of rated contracts achieved a score of 4 stars or higher, a decline from 2023.
These numbers reflect that payers have work ahead to protect and improve Medicare Advantage star ratings. Scalable technologies like remote patient monitoring and remote therapeutic monitoring are one solution to consider to meet increased quality demands.
Higher Star Ratings & Financial Impact
To maintain or improve Medicare Advantage star ratings directly strengthens both topline revenue and financial sustainability. That is because achieving a 4.0-star rating or higher earns a 5% quality bonus added to a plan’s base per-member payment. In designated double bonus counties, that incentive can rise to 10%.
- For instance, with a base payment of $950 per member, a 5% bonus translates to an additional $47.50 annually per member.
- For a plan managing 18,500 members, this would generate approximately $878,750 in bonus revenue without requiring membership growth.
Star ratings also impact rebate retention, which determines the share of CMS benchmark savings a plan can keep. Plans rated 4.5 stars or higher retain 70% of their savings; those with 4.0 stars retain 65%; and plans at 3.5 stars drop to 50% retention.
To illustrate:
- If a plan bids $920 against a CMS benchmark of $1,000, it generates $80 in savings per member.
- A 5-star plan would retain $56 of that savings, while a 3-star plan would keep just $40.
- That is a $16 difference per member.
- Across 15,000 members, that gap would translate to $240,000 in additional revenue each year.
Membership Growth Opportunities
Higher star ratings also create growth advantages. For example, 5-star plans can enroll new members year-round instead of waiting for traditional open enrollment restrictions. Industry analyses have shown that improving star ratings by even 1 star can drive 8–12% higher membership growth year-over-year, with corresponding revenue gains estimated as high as 17%
As an example:
- In a 5-star plan with 17,500 members gaining a modest 6% (about 1,050 new members) would generate approximately $997,500 in new annual revenue at an average CMS payment of $950 per member.
In a competitive Medicare Advantage landscape, star ratings are quality signals and they are core to payer growth strategies.
Increased Star Ratings Performance Measures in 2027
CMS is introducing a Health Equity Index in 2027 to measure how well plans address social risk factors like income, education, housing, and transportation. Tighter guardrails on measure cut points will further raise the standard for performance. Success will no longer be based solely on clinical interventions, but on a payer’s ability to engage members holistically and equitably across every dimension of health.
Meeting this new standard will require new strategies, new tools, and scalable approaches to care delivery. Modern care management solutions, including remote patient monitoring (RPM) and remote therapeutic monitoring (RTM) adherence platforms give provide payers and providers the capabilities needed to deliver better care, support underserved populations, and meet rising expectations for outcomes and equity.
RPM & RTM: Improve Medicare Advantage Star Ratings
If bigger bonuses, stronger rebates, and faster enrollment growth are the goals now, how do payers reliably improve star performance in a this competitive system? RPM and RTM adherence tools offer powerful, scalable solutions that align directly with the following CMS star rating priorities. Both RPM and RTM programs support clinical outcomes and medication adherence, which are two critical areas for achieving higher Medicare Advantage Part D star ratings.
1. Close Care Gaps
RPM and RTM provide real-time visibility into patient conditions and medication adherence, allowing faster interventions for preventive screenings, chronic disease management, and compliance, all of which are star measures.
2. Improve Clinical Outcomes
Continuous monitoring helps reduce emergency department visits, prevent hospital readmissions, and maintain better control of chronic conditions like hypertension and diabetes, which can increase HEDIS measure scores.
Recent research explains the effectiveness of RPM for improving patient outcomes and reducing costs. A 2024 systematic review published in NPJ Digital Medicine found that there was a consistent trend toward reduced hospitalizations, shorter length of stay, and improved adherence across many RPM interventions.
One RTM example of technology supporting both medication adherence and outcomes improvements is Tenovi’s Smart Pillbox solution. The device uses a built in light system to remind patients to take their medications. The patient’s provider is notified each time the pill compartment is opened or refilled. Providers track adherence remotely and improvements in medication-takin behavior can be quantified and correlated to better outcomes. With early intervention, plans perform better across both clinical and medication-related CMS rating measures.
3. Enhance Member Experience
Remote engagement tools improve patient satisfaction, leading to higher CAHPS scores, which now weigh heavily in overall star rating calculations.
4. Advance Health Equity Efforts
Remote monitoring reaches underserved and rural populations, helping to close gaps exacerbated by social risk factors. This supports payer performance under the new Health Equity Index framework.
Patient Outcomes First; Revenue Follows
With CMS phasing out “better of” methodologies, enforcing guardrails, and removing outliers from performance calculations, maintaining or improving star ratings will require proactive, technology-driven strategies. Payers relying on outdated, manual processes will struggle to keep pace with the increasingly data-driven and equity-focused CMS environment.
RPM and RTM adherence solutions have become solutions for closing care gaps, improving member outcomes, advancing health equity, and securing the financial incentives tied to star ratings. At its core, CMS’s star rating system still rewards what matters most, which is better health outcomes for members.
Remote patient monitoring and medication adherence solutions empower payers and providers to deliver higher-quality, more equitable care, while simultaneously protecting and growing their financial performance.
Want to see how Tenovi’s remote monitoring solutions can help you meet the new demands of Star ratings? Book your free demo.
