CMS star ratings; compounding bill passes Senate, heads to Obama

Hub on Policy and Advocacy

Pharmacists can improve Medicare plan star ratings

What are Medicare star ratings, and why do they matter to pharmacists? CMS assigns Medicare Advantage and Part D prescription drug plans an overall star rating of one to five stars based on the plans’ performance on quality measures, many of which are affected by pharmacists’ patient care services. 

The star ratings help Medicare patients choose plans based on quality, in addition to cost and coverage. Five stars is the highest rating. On October 8, the 2014 star ratings were published on the Medicare Plan Finder ( based on 2012 data.

Star ratings were part of the 2003 legislation that established Part D. In 2010, the health care reform law added a quality bonus payment system for Medicare Advantage plans that score well on star ratings. These bonus payments must be used by the health plan to improve its care delivery system. Standalone Part D plans do not receive a quality bonus payment, but Part D plans should still pay attention to the stars because enrollment is affected by star ratings, according to David Nau, PhD, BSPharm, FAPhA, President of Pharmacy Quality Solutions. A CMS study published in the January 16, 2013, JAMA showed that people tend to pick the higher-rated plan—plus, Part D plans with five stars have open enrollment year-round. 

The federal government and other large purchasers are striving for better value, which means optimizing quality while controlling costs. Physicians, hospitals, and home health agencies now all have financial incentives related to quality. Payment tied to quality scores is known as pay for performance. “If you try to align the financial incentives for better quality, you ultimately get people to produce better quality because they have that financial incentive to do so,” Nau said. While the health care system has been moving in this direction for more than a decade, “community pharmacy is really one of the last entities to be folded into this value-driven model.” 

“We’re moving to a value-based health care system where providers, hospitals, and other organizations are going to be paid based on their ability to both generate positive outcomes and control costs,” said APhA Vice President of Professional Affairs Anne Burns, BSPharm. “This is an opportunity for pharmacists to get on board with: How can I help a health care entity, how can I help a physician, how can I help an ACO [accountable care organization] meet their quality measures?”

Pharmacists’ impact on quality measures

For 2014, Medicare Advantage plans with prescription drug coverage (MA-PD) plans are rated on up to 48 quality and performance measures, and standalone prescription drug plans (PDPs) are rated on up to 15 measures, according to a CMS fact sheet. Each individual measure is assigned a star that CMS then rolls up into the plan’s overall star. 

Five quality measures from the Pharmacy Quality Alliance (PQA) account for almost one-half of a Part D plan’s star rating, according to Nau. PQA measures make up about 20% of an MA-PD’s overall star. 

For the 2015 stars that will come out next year based on 2013 data, CMS has indicated its intent to make the comprehensive medication review (CMR) completion rate a star measure. “Any MTM [medication therapy management] activity during this year will be affecting that star rating for the CMR,” Nau said.

PQS is a spinoff of PQA that provides EQuIPP, a Web-based platform that takes in data from health plans, calculates performance scores for the plans as well as every pharmacy in their network, and makes that available to pharmacies that want to track their performance. “We found that when the pharmacies do focus on the star measure and get performance feedback, they can find ways to improve performance,” Nau said. “We’re advocating that all health plans should think about their pharmacy as another source of help or another collaborator who can help drive improvements in the medication-related star measures.”

At Kaiser Permanente Northern California, Jamie Chan, PharmD, Drug Use Management Leader, helps to drive a lot of the work that gets done in Kaiser’s pharmacies with respect to the Medicare stars program. “There are five clinical Part D measures that I am the most familiar with,” she said. Three of those five are related to medication adherence to drugs for diabetes, hypertension, and high cholesterol; a fourth measure is around high-risk drugs that older people should avoid (for more information, see article on page 40); and the fifth measure is around patients who have both diabetes and hypertension. 

“I would say where the clinical pharmacists can have a huge impact is multifold,” Chan said. For instance, medication adherence is “a very important area for pharmacist involvement,” she explained. “I think every pharmacist can play a role when they’re filling prescriptions on explaining what the medication is for, how to take it, and the importance of continuing to take these medications for their chronic conditions.” 

Kaiser is an integrated system where its physicians and pharmacists work together and its electronic medical record provides “pretty good real-time data that feeds into how we’re doing on these measures on a day-to-day basis,” Chan said. “So being able to harvest this information, and then push it to the right pharmacist or physician group to help intervene and then track performance, is really critical to our success in improving our performance on these measures.” According to Chan, in the 2014 star ratings, all the Kaiser Permanente regions attained five stars.

Business implications for pharmacies

Health care plans are starting to evaluate the performance of the pharmacies in their networks and align the incentives for better quality for those pharmacies. 

Pharmacists “should, at a minimum, learn more about the star measures to learn how [their pharmacies are] being evaluated,” Nau said. Pharmacies’ performance on star measures may determine if they’re eligible for a bonus payment and may also determine whether that plan includes the pharmacy in a preferred network. 

John Sykora, BSPharm, MBA, owner of Abrams & Clark Pharmacy in southern California, said that a health care plan contacted him directly for help with improving its star ratings. “I thought we would have to go to the health care plans and tell them we have an adherence model that will help you with your star ratings. But they were a lot faster on this. They said: You have the adherence plan. We need the star ratings now,” he told Pharmacy Today. “I think it may happen more.”

Compounding, track-and-trace bill heads to Obama

The Senate passed the Drug Quality and Security Act (H.R. 3204) by voice vote on November 18. The compounding and track-and-trace bill now heads to President Barack Obama for his signature. 

H.R. 3204 passed the House by voice vote in September. “There will be no differences between what passed out of each chamber and the president will not veto the bill,” explained APhA Senior Lobbyist Michael Spira. 

When debate began in the Senate on November 12, Sen. Tom Harkin (D-IA), Chair of the Health, Education, Labor, & Pensions (HELP) Committee, specifically recognized and thanked four or five groups, including APhA, for supporting the legislation in his remarks on the Senate floor, according to Spira.

“APhA has been heavily involved in the drafting of this legislation through dozens and dozens of meetings, phone calls, and e-mails,” wrote APhA Executive Vice President and CEO Thomas E. Menighan, BSPharm, MBA, ScD (Hon), FAPhA, in a CEO Blog post on

APhA backs the legislation. “Our members were concerned about being forced to register with the FDA and this legislation would allow traditional pharmacies to continue to be regulated by state boards of pharmacy while creating outsourcing facilities that would be subject to FDA oversight,” APhA wrote in an October 22 letter of support addressed to leaders of the Senate HELP Committee. 

While most pharmacy groups support H.R. 3204, the Academy of Managed Care Pharmacy on November 20 released a statement expressing concern that “with the bill’s limited scope, only those [outsourcing] facilities that volunteer to register [with FDA] will be subject to the FDA, which will leave the public no better off.”

In related news, APhA government affairs staff attended a Bloomberg Government conference on November 5. The keynote speaker, FDA Commissioner Margaret A. Hamburg, MD, touched briefly on the compounding bill to say that FDA supported the bill, according to Michael Ghobrial, PharmD, JD, APhA Associate Director of Health Policy. 

Hamburg said that H.R. 3204 is not as comprehensive as FDA would have hoped but that the measure will help. She noted that FDA is concerned with the current regulatory oversight of compounding pharmacies, but clarified that the concern is with very large volume drug compounders shipping high-risk products, such as sterile injectables, across state lines—not with compounding in traditional “mom and pop” pharmacies.

Hamburg ended her comments by highlighting the value of large volume drug compounders to hospitals, clinics, and patients.