“Hitch Your Wagon to a Star,” Just Make Sure It’s Not Five-Star

This well-known phrase, attributed to the American philosopher and poet Ralph Waldo Emerson, is meant to inspire. Although I’ve also seen it applied to the laggard who attaches to someone else’s star-power with the hope of spill-over success. Regardless of your interpretation, just make sure your “wagon” isn’t hitched to CMS’ Five-Star Quality Nursing Home Rating to manage your post-acute care (PAC) preferred provider network (PPN). 

Creating and monitoring a post-acute network is often guided by principles of the Triple Aim: reduce costs, improve quality, and satisfaction. Yet CMS’ Five-Star has very low correlations to rehospitalization, with less than one-point difference in adjusted rehospitalization rates between 2 and 4-Star skilled nursing facilities (SNFs). By name, the “Five-Star Quality Rating System” suggests that quality measures must be a key driver, but they are not. In fact, the Quality Measure Domain is the weakest component of Five-Star, which is instead mostly driven by survey outcomes.

Thankfully many hospital systems, accountable care organizations (ACO), payers, and other stakeholders have migrated away from exclusively using CMS’ Five-Star to form their PPN. However, Five-Star ratings still appear in most dashboards, even if just in the background. CMS’ inflation of the Five-Star system appears to be directly responsible for its continued relevance.

What’s the Purpose of Five Star?

Recall that the primary goal in launching this nursing home rating system was to provide consumers with an easy way to understand quality and make informed decisions. Yet a fatal flaw is that Five-Star doesn’t ask individuals being admitted upfront “why are you coming to a nursing home?” Some people are coming in as patients and fully expect to return to the community, while others are coming in as residents and intend to live out the rest of their lives in the SNF. These two types of people have vastly different needs, yet they and their outcomes data are comingled into one system.

Not All Stars Are Alike

Not only are the people entering a SNF unique, so too are the SNFs. Throughout the last ten years, many facilities have emerged as de facto specialty care centers, focused on one or two highly specialized areas. While they still accept a broad range of people, their true value may lie in select areas of care such as complex medical management, wound care, or mental illness. CMS’ Five-Star system doesn’t account for the unique needs of the person requiring care, nor the specializations of the SNF providing that care, causing a missed opportunity for understanding how the facility is performing based on this crucial information.  

For better or worse, CMS has exaggerated the relevance of Five-Star by linking a variety of bonuses to a 3-Star rating. For example, in an alternative payment model, CMS will waive the requirement for a three-day inpatient hospital stay prior to a Medicare-covered, post-hospital extended care service for 3, 4 and 5-Star SNFs. This is great news for upstream financial stakeholders, the SNF, and dare I say the patient! However, without an apparent correlation to rehospitalization rates, care, quality, or satisfaction, a Five-Star rating of any scale does not prove a useful tool in successfully managing or choosing your PPN. 

Characteristics of Successful KPIs

There are superior ways to manager your PPN, and choosing the right KPIs is essential. It has been my experience that successful KPIs for managing your PPN feature transparency, concurrency, validity, and actionability. These are a great short list of qualities to run your current KPIs against and see how they stack up.

More about Characteristics of Successful KPIs