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What the CMS Hospital Star Ratings Mean for Care Quality, Patients

Hospitals must understand how the CMS Hospital Star Ratings are calculated in order to make an action plan to improve care quality and patient experiences.

Five-star ratings aren’t just helpful for vacationers looking for a hotel or hungry families trying out a new restaurant. These symbols of quality are also essential in an increasingly consumer-centric healthcare industry, especially as patients play a bigger role in managing their own care.

At the Centers for Medicare & Medicaid Services, the CMS Hospital Star Ratings system uses this simple, easily recognizable five-star format to help consumers shop for the highest quality care.

The star ratings for hospital quality were launched in 2007 and feature on the CMS Hospital Compare website.  The website allows consumers to understand more about the performance rates of their local facilities.  CMS encourages consumers to use the website - one of several for different types of facilities - as a jumping off point for making decisions about their care.

“In an emergency, you should go to the nearest hospital,” CMS says on its website. “When you are able to plan ahead, the Hospital Compare overall hospital rating can provide a starting point for comparing a hospital to others locally and nationwide. Along with the overall hospital rating, Hospital Compare includes information on many important aspects of quality, such as rates of infection and complications and patients’ experiences, based on survey results.”

While CMS has been steadily expanding its price transparency efforts to support consumerism in healthcare, the agency has not yet released data showing how many consumers have used their patient-facing website or how many consumers have used the star ratings to make a healthcare decision.

Nonetheless, medical experts agree that healthcare quality transparency is essential, especially as the industry embraces consumer-centricity.

While the CMS Hospital Star Ratings are primarily targeted at healthcare consumers to aid in care decision-making, they are also a crucial tool for hospitals. Hospitals that wish to remain competitive and earn high ratings must understand how CMS calculates the ratings and how to use the ratings for practice improvement.

How does CMS calculate the Star Ratings?

CMS uses the Hospital Inpatient Quality Reporting (IQR) and the Hospital Outpatient Quality Reporting (OQR) programs to gather data to inform their star ratings.

Some hospitals submit more data points than others, CMS explained, although there is a minimum amount of data a hospital must submit in order to receive a star rating.

“Only hospitals that have at least 3 measures within at least 3 measure groups or categories, including one outcome group (mortality, safety, or readmission), are eligible for an overall hospital rating,” CMS says on its website. “Not all hospitals report all measures. Therefore, some hospitals may not be eligible for an overall rating.”

Some hospitals submit up to 57 data points. The average number of data points hospitals submit is 39, CMS reports.

Hospitals can report on measures spanning 7 different performance areas, each of which receives a different weight. Those performance areas include:

  • Mortality (22 percent)
  • Patient safety (22 percent)
  • Readmission rates (22 percent)
  • Patient experience (22 percent)
  • Effectiveness of care (4 percent)
  • Timeliness of care (4 percent)
  • Efficient use of medical imaging (4 percent)

CMS also uses 10 HCAHPS measures to determine thea patient experience scores for their star ratings. Those HCAHPS measures include:

  • Nurse communication
  • Doctor communication
  • Responsiveness of hospital staff
  • Communication about medicines
  • Discharge information
  • Care transition
  • Cleanliness of hospital environment
  • Quietness of hospital environment
  • Hospital rating
  • Willingness to recommend hospital

CMS then averages those different categories, gives hospitals a score, and translates that score into stars.

The most common star rating is three stars, with just over 27 percent of hospitals receiving a three-star rating, according to data updated in January 2019.

Are Star Ratings accurate portrayals of care quality?

The CMS Hospital Star Ratings have generated a considerable amount of controversy. Clinicians and hospital leaders across the country have critiqued the rating system, stating that 57 clinical quality measures cannot possibly be boiled down to a five-star rating and still portray the nuances and complexities of care quality.

The American Hospital Association (AHA) has stood out as the CMS Hospital Star Ratings’ harshest critic, often speaking out against agency decisions to update and promote the Star Ratings.

“The AHA has long supported transparency and continues to share the Centers for Medicare & Medicaid Services' goal of making the data on Hospital Compare easier for consumers to understand,” AHA says on its website. “However, CMS’s flawed approach to star ratings undermines this goal by providing an inaccurate, misleading picture of hospital quality.”

Some research does give merit to AHA’s position. A 2017 research letter published in the Journal of the American Medical Association concluded that the CMS Star Ratings may inadvertently favor some hospitals over others.

“Critical access hospitals and some specialty hospitals (ie, certain cancer centers) are exempt from reporting-based payment incentives through the CMS Inpatient Quality Reporting system and may not collect many measures used in the star ratings,” the researchers said. ”Consequently, specialty and critical access hospitals reported systematically fewer measures.”

While there is no way for a hospital to “game the system,” the industry must consider these system biases lest they lead to “apples to oranges” comparisons.

“Because the measures used as the basis for calculating the star ratings differed by hospital type, failure to account for these differences may limit the utility of the star ratings, particularly when comparing different hospital types,” the team asserted.

A separate 2015 study published in Health Affairs assessed the accuracy of the CMS Hospital Star Ratings against three other hospital quality rating systems, finding limited agreement among the systems. Out of more than 800 hospitals, none were ranked as top performers in all four of the rating systems, and only 10 percent were ranked as top performers in two rating systems.

The CMS Hospital Star Ratings do have their defenders, who assert that star ratings are essential for empowering patients with the information necessary to make decisions about care. Care quality transparency is a core tenet in consumer-centered healthcare, some advocates say.

For its part, CMS is working to revamp its star ratings and Hospital Compare methodologies. TheAt the time of publication, the agency has submitted a proposal to streamline the Star Ratings methodology to enable a more “like-to-like” comparisons between hospitals.

The agency would place hospitals into peer groups on the Hospital Compare website, meaning larger institutions would not necessarily be compared to smaller critical access hospitals.

Selecting star ratings improvement areas

In addition to increasing transparency, CMS intended for hospitals to use their star ratings to make practice improvements. After looking at their performance in different measure categories, hospitals in turn should select areas for improvement, CMS says.

Hospitals engaging in improvement efforts should note that there is not a single path to earning a high CMS star rating, according to healthcare consulting firm Deloitte.

“CMS designed the program to capture multiple aspects of quality and to offer a number of pathways for hospitals to achieve a five-star rating,” Deloitte wrote in a 2017 report on the subject. “Based on service mix and patient caseloads, hospitals can have data on different combinations of quality measures and achieve a five-star rating.”

However, there are some key factors to consider when designing improvement projects. For example, most five-star hospitals score well in heavily-weighted measures sets.

“It’s not a bad thing that CMS has put more weight on those measures because those are in fact what a lot of consumers say they care about as well as what physicians say they care about,” Sarah Thomas, managing director of Deloitte’s Center for Health Solutions, explained during an interview with “A lot of consumers and a lot of consumer advocates value outcomes more than processes and they certainly value the consumer experience.”

CMS also attributes a lot of value to the consumer experience, weighting the patient experience measure set with 22 percent of the total score.

Similarly, hospitals may wish to look harder at measures related to mortality rates, readmission rates, and patient safety, each of which are also worth 22 percent of thea CMS Hospital Star Rating score.

Thomas also recommended hospitals prioritize the areas in which they already have the resources to make meaningful improvements. Making low-cost improvements -- employing a new nurse communication strategy or implementing a patient safety checklist -- is a better use of resources than adopting a new technology to achieve a Star Ratings bump, Thomas asserted.

It is also important to prioritize quality improvements based on the unique needs of a hospital’s patient population.

“There are a lot of measures here and it’s hard to work on all fronts all the time,” Thomas advised. “Hospitals should be thinking about their own patient mix. Outcomes and consumer experience are important for everyone, but hospitals will also want to take a look at where they are low on all of the measures and then think about their patient population.”

Thomas recommended conducting internal surveys that follow up on the CMS Star Ratings. These surveys are essential for soliciting patient feedback and could direct organization leaders to an improvement plan.

At the same time, hospitals need to identify outcomes measures that patients may not see, such as adherence to some patient safety protocol.

“There is a lot that a patient can say that matters for their outcomes, but there are some things that patients might not be aware of that are also important,” Thomas noted.

While patient safety regulations impact whether a patient experiences a hospital acquired infection, for example, the patient may not pick up on the steps a provider took to prevent that infection. These areas can be easy to forget, but can make a meaningful impact on star ratings.

Finally, organizations may also wish to be mindful of clinical quality measures that impact their scores in other CMS programs they participate in, such as an accountable care organization (ACO).

“The Star Ratings Program is just one of CMS’s initiatives to improve healthcare quality; hospitals also may be measured as accountable care organizations, through payment incentive programs, and by other payers using different sets of quality measures,” the Deloitte report authors stated. “Thus, hospitals may be best served by focusing on their own population needs and areas for improvement, rather than having the Star Ratings Program drive their agenda.”

Creating a culture of hospital quality

Once a hospital has selected an area for improvement, it must create a culture of hospital quality.

Developing a strong culture of patient safety and satisfaction requires engaging all stakeholders across the organization.

While leadership should come from the C-suite, it will also be important to elicit input from clinicians, administrators, and clinical leadership. These individuals are most likely to be impacted by such changes.

“Individual clinicians drive the overall quality of services performed in a hospital,” the Deloitte report authors explained. “Thus, it is important to help them understand that they are a critical component of quality improvement. Leadership from the C-suite down to the clinicians at the bedside should communicate and promote a culture of quality. Hospital leadership should consider helping clinicians understand which areas need improvement and how they fit into the overall quality strategy.”

Organizations should embrace the goal of zero harm for patients, according to Gary Yates, MD, a strategic partner at Press Ganey.

“In order to prevent harm, in order to really make progress towards the goal of zero harm for patients, it requires an organizational commitment,” Yates explained in a previous interview. “That commitment includes a tightly aligned board, senior operational leaders, and senior physician leaders, all committing to what some would consider an audacious goal, but the right goal, which is a goal of zero harm to patients.”

Hospital leadership should consult with clinicians about the tools they need to improve patient safety, how those tools will impact their workflows, and how to avoid issues stemming from these changes.

Once leadership has determined its action plan, it must continue to assess progress and realign priorities where necessary. While the CMS Hospital Star Ratings and Hospital Compare are updated annually, organizations can run their own periodic check-ups that emphasize their target areas.

As healthcare organizations continue their work to improve their Hospital Star Ratings, it will be essential that they maintain a careful understanding of the methodology CMS uses to create these ratings. Identifying which measure sets are most heavily-weighted and important to patients will help hospitals determine their improvement plans.

From there, hospitals must assess their resources and other organizational goals, such as good performance in an ACO or other incentive program. These various needs may influence a hospital’s star ratings improvement plan.

Once the hospital has determined where they must improve, they can engage their different organizational stakeholders for input. Using key change management strategies will help organizations determine a clear path forward to improvement.

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