Medicare Advantage Star Ratings were designed to help consumers compare plan quality. Today, amid elevated utilization and tightening margins, they have become something far more consequential: a mission-critical financial lever.
At the same time, palliative care—once viewed as a niche or late-stage service—has emerged as one of the most effective ways plans can influence the outcomes Star Ratings now reward most heavily. For both national carriers and regional plans, the convergence of these two dynamics is reshaping how leaders think about performance, investment, and risk.
Star Ratings operate on a financial cliff
Star Ratings are not a smooth continuum. They are a cliff.
CMS assigns fixed cut-points to each measure. Plans receive the same score whether they narrowly miss a threshold or fall far below it. Final ratings are then rounded to the nearest half-Star—meaning a 3.74 becomes 3.5 Stars, while a 3.76 becomes 4 Stars.
That half-Star difference is economically decisive.
From 2015 to 2025, Star-driven payments to Medicare Advantage plans more than quadrupled, growing from roughly $3 billion to over $13 billion annually. For a plan with 100,000 members, earning just half a Star more can unlock nearly $40 million in incremental cashthrough Quality Bonus Payments and higher rebate percentages.
In a market where most plans are tightening budgets and scrutinizing every dollar, that margin can determine whether a plan can reinvest—or simply tread water.
Margin pressure makes Stars unavoidable—for everyone
Recent Star performance volatility at large national carriers has underscored how sensitive enterprise value has become to Star outcomes. But the implications extend well beyond the largest players.
National plans may have the balance sheets to absorb a year or two of Star disruption. Regional and mid-sized plans often do not. Already facing utilization pressure, adverse risk dynamics, and limited pricing flexibility, even modest Star declines can force painful trade-offs in benefits, care management investment, and growth strategy.
As pricing pressure intensifies across Medicare Advantage, Star Ratings are no longer a quality department issue. They are a core operating constraint.
CMS has shifted the game toward outcomes
CMS has been explicit about where Star Ratings are headed.
Over the past several years, weight has shifted away from administrative and experience measures and toward outcomes and continuous improvement. In the 2024 measurement year (used for 2026 Star Ratings), CMS cut the weight of Experience and Access measures in half. Additional administrative measures are expected to be removed in future cycles.
The implication is clear: sustainable Star performance now depends on measurable clinical impact, particularly for high-risk, high-cost members.
This shift has exposed a structural weakness in many traditional care management models. They were built to document activity—not to change trajectories for patients with serious illness.
Why palliative care has become strategically essential
This is where palliative care has taken on new strategic importance.
High-quality, outcomes-driven palliative care directly aligns with several of the most heavily weighted Star measures, including all-cause readmissions, chronic condition exclusions for advanced illness, and physical and mental health outcomes measured through the Medicare Health Outcomes Survey (HOS).
When delivered at scale, palliative care stabilizes symptoms, improves post-discharge coordination, reduces avoidable utilization, and supports functional and emotional well-being over time. Importantly, it targets the same members who drive a disproportionate share of cost, utilization, and Star risk.
Empassion operates the nation’s largest integrated palliative and hospice care network, partnering with Medicare Advantage plans across dozens of states. By combining home-based clinical teams, advanced analytics, and a national provider footprint, Empassion has demonstrated measurable outcomes at scale —translating serious-illness care into improved utilization patterns and Star-relevant performance.
Stars must be an institutional priority
Plans that consistently outperform in Star Ratings treat them as an institutional priority—not a reporting exercise.
That means investing in programs capable of moving outcomes for the sickest members and integrating those programs into the core operating model. As Star Ratings increasingly reward real clinical impact, palliative care is shifting from an adjunct service to a foundational capability.
