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How Updated Star Ratings Impact Your Hospital

The latest round of Overall Hospital Quality Star Ratings has been released by the Centers for Medicare and Medicaid Services (CMS) following a recent overhaul of the ratings methodology.

More than 4,500 hospitals received a Star Rating this year, with the majority at a three-star rating. Compared to the last round of ratings, 45 percent did not see a change in their score.

More hospitals scored four or five stars, but smaller rural facilities designated as Critical Access Hospitals (CAH) witnessed a distinct shift. While reporting is voluntary for CAHs, nearly half of CAHs that receive Star Ratings saw a decrease according to Modern Healthcare.

Overview of the Star Ratings Changes

After receiving public input, CMS finalized changes in late 2020 to the methodology to improve predictability of measures over time and to allow for ratings to be more easily compared among acute care hospitals. The long-anticipated update simplified the scoring and ensures that hospitals are compared to peers that are more similar to themselves.

Moving forward, CMS aims to release overall Star Ratings annually, using publicly available measure results from the Hospital Compare website.

Hospitals will be given a Star Rating relative to other facilities that report the same number of measure groups. In previous years, Star Ratings were based on hospitals’ performance relative to all other facilities. Beginning this year, CMS first assigns hospitals to one of three peer groups based on the number of measure groups they report; subsequently the methodology determines their final Star Rating relative to others in their group. This peer grouping approach will improve comparability across hospitals.

The rating is now calculated from five measure groups instead of seven. CMS calculates each facility’s performance by pulling from five categories:

  • Mortality
  • Readmission
  • Patient Experience
  • Safety of Care
  • Timely and Effective Care.

The categories include 48 measures, such as the rate of readmission for coronary artery bypass graft (CABG) surgery patients and the percentage of healthcare workers given an influenza vaccination.

The Star Ratings system weights the five categories to determine the total grade. Mortality, Readmission, Patient Experience and Safety of Care are rated at 22 percent each. The Timely and Effective Care category is weighted at 12 percent. If a hospital does not have measures in one of the measure groups, the weight percentage is redistributed proportionally to the other measure groups.

Each measure within a measure group score is equally weighted. Instead of using the prior Latent Variable Model (LVM) to calculate measure group scores, CMS’ updated methodology uses a simple average of measure scores to calculate measure group scores. Additionally, Z-score standardization is now used to standardize measure group scores. The shift to simple averages has been lauded as a clearer, more consistent means of measuring quality.

Hospitals must report a minimum number of measures to receive a rating. Hospitals must report three measures for at least three groups, one of which must be either Mortality or Safety of Care. With this reporting change, hospitals that do not meet the minimum threshold will not be eligible to receive a rating. In previous years, some facilities did not report on those measures, but still received a score.

Success in the Star Ratings is the result of a tech-enabled, clinically integrated model of care delivery.

As CMS updates its methodology, it’s even more important for executives to have a strong idea of how their organizations are trending so they can celebrate progress or course-correct as necessary. A data-driven data-driven dashboard that aggregates program measures in one place is essential so that providers can easily evaluate opportunity areas based on industry benchmarks.

With this actionable business intelligence in hand, providers can:

  • Target measures where performance gaps and failures are occurring.
  • Develop sustainable programs through the continuous monitoring of performance improvement efforts.
  • Streamline efforts in public ratings and payment programs so their improvement effects have maximum impact.

Now that Star Ratings measure group calculations are more standardized, reporting on each measure regularly via the dashboard will also enable teams to clearly understand their ratings performance in upcoming CMS reporting years.

Learn more about how Premier’s data, technology and expertise enable you to track and enhance safety and care – and succeed in Star Ratings.

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