Understanding Medicare’s 5-Star Rating System

As baby boomers continue to retire in greater numbers than past generations of seniors, many are living longer, more active lives. A greater number of older adults has translated to an increased number of joint replacement surgeries. If you or an aging loved one are pre-planning a surgery, it’s likely that your physician has or will recommend short-term rehab as part of your recovery.

One resource to help you evaluate the quality of each skilled nursing and rehab center is the Medicare 5-Star Rating System.

How did the Medicare 5-Star Rating System Begin?

In 1998, the Centers for Medicare and Medicaid Services (CMS) rolled out a system that provided consumers a platform for objectively evaluating skilled nursing and rehab centers who participate in Medicare. The program assessed each rehab center for the quality of care and services provided.

This project was called, Nursing Home Compare, and it made it easier for the general public to access and review how well each skilled nursing and rehab center performed on their state-mandated annual surveys.

In 2008, CMS added the 5-Star Quality Rating System. This component of the program took survey and patient/family complaint information and converted it in to a format that made it easier to review and compare the data. Since that time, CMS has continued to expand and improve the program each year.

Three Components Determine Medicare 5-Star Ratings

At the core of the program is a goal to “fairly and accurately represent the quality of care being delivered in skilled nursing and rehab centers across the country,” according to CMS.

The Medicare 5 Star Rating System is based on scores in three important quality areas and a combined score that is used to award an overall rating. One star is the lowest rank a skilled nursing and rehab center can receive and five is the highest.

The three quality scores include:

  • Health and Fire Inspections: To determine a rating for the state-mandated annual surveys, Medicare goes back three years to evaluate yearly state survey findings. It also takes in to account formal complaints filed by staff, residents and family members. Recent surveys are weighted more heavily. Fire safety inspections are also included.
  • Staffing: Because staffing levels are an important indicator of the quality of care a patient or resident of a skilled nursing and rehab center or nursing home receives, Medicare looks closely at staffing. In determining this star rating, CMS considers two measures to be the true indictors of quality. One is Registered nurse (RN) coverage and the other is overall staffing. RN hours per patient/resident day is important because patients/residents often have more complex health care needs. The other number combines all staff hours per resident day: RNs, Licensed Practical Nurses (LPN) and Certified Nurse Aides.
  • Quality Measure Data: This category is a combination of 11 different quality measures. (Recently changed from 19.) It includes both physical and clinical indicators ranging from how many people are re-hospitalized to the center’s fall rate statistics and percentage of residents who received the flu shot.

Drawbacks to Medicare 5-Star Rating System

As is true of most standardized rating systems, the Medicare 5-Star Rating System has a few shortcomings. They include:

  • The system doesn’t take in to account that some rehab centers may accept patients who have psychiatric illnesses or more complex medical conditions than other. The difference in a patient’s medical condition can impact both patient outcomes and the requirements necessary to maintain optimum staffing.
  • Some states are known to have tougher inspection processes than others. Because there are subjective factors in the evaluation criteria, lower quality rehab centers in some states may rank higher than better quality centers in states with tougher inspectors.

We hope you will stop back next month when we’ll be talking about how to select a skilled nursing and rehab center. An informed decision should be based on 5-Star Rating System and other important factors.

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