The Medicare Five-Star Rating Program for Hospitals and Nursing Homes

When you go to a hospital or a nursing home, you want to get the best care. Medicare has established a five-star rating system that lets you know which facilities are performing the best. Does your hospital or nursing home rank high on the list?

Medicare Five-Star Ratings for Nursing Homes

Medicare does not pay for long-term care in a nursing home, but Part A pays for short-term stays in skilled nursing facilities and rehabilitation facilities after an inpatient hospitalization. Regardless, Medicare assesses the quality of nursing homes for both short-term and long-term stays through their Nursing Home Compare site. Facilities are scored on a one- through five-star scale across three categories. Nursing Home Compare allows you to see a star rating within each of these categories.

Health inspections: Medicare requires health inspections to be performed at least once a year at each facility, more often if a facility is performing poorly. This will include fire safety inspections and checks on emergency preparedness. Food storage and preparation will also be assessed as will medication management and the overall nursing home environment.

Staffing: Without an adequate number of staff to address the needs of nursing home residents, care could be compromised. Medicare specifically looks at staffing ratios, specifically, the number of hours worked by registered nurses, licensed practical nurses, licensed vocational nurses, nurse aides, and physical therapists divided by the number of residents in the nursing home. While this allows a quick glimpse at overall care ratios, it does not allow Medicare to see how many staff are working at any given time or how much care is given to each resident, i.e., some may require more care than others.

Quality of resident care: There are 17 metrics considered for both long- and short-term care in skilled nursing facilities. Without listing them all here, Medicare looks to see the frequency of falls, urinary tract infections, and pressure ulcers that develop at each facility. Medicare also looks to see how often someone is sent back to the hospital and how many residents are vaccinated to prevent influenza and pneumonia. Another useful measure is the Medicare spending per beneficiary. This compares Medicare spending at that facility with skilled nursing facilities nationwide. Simply put, are you getting your money's worth?

Medicare Five-Star Ratings for Hospital Systems

When it comes to hospital stays, you may want to refer to the Hospital Compare site. Medicare looks at a number of metrics across seven categories and weights them to calculate a score from one to five stars. This summary lists those categories, the number of metrics per category, but does not outline every metric within each category.

• Effectiveness of care (10 metrics): Are preventive measures taken to decrease the risk for illness, e.g., influenza vaccinations?
• Efficient use of medical imaging (5 metrics): Are appropriate tests being performed or are services being overutilized? Is testing medically necessary?
• Mortality rates (7 metrics): What is the 30-day mortality rate for people who have certain medical conditions or surgeries performed at that facility?
• Patient experience (11 metrics): Is the patient satisfied with the communication they have with their doctors and nurses? Does the patient understand their care plan?
• Readmissions (8 metrics): Are people with certain medical conditions more likely to be hospitalized for the same issue within 30 days?
• Safety of care (9 metrics): Are patients at higher risk for developing medical conditions as a result of their hospital stay, e.g., urinary tract infections or MRSA infections?
• Timeliness of care (7 metrics): How long do patients wait in the emergency room before being seen by a healthcare professional? How quickly do patients receive care for serious conditions like heart attacks or strokes?

The problem is that hospitals are not required to provide data for all seven categories. As long as they provide data for at least three categories (one of those categories must be mortality, readmission, or safety) and they supply data for at least three metrics within each category submitted, they qualify for a Medicare rating score.

More transparency is needed so that Medicare beneficiaries can make informed decisions about where to receive care.

How to Improve the Medicare Five-Star Rating System

Medicare is not the only rating system for hospitals and nursing homes. Consider the Leapfrog Group, Healthgrades, and U.S. News and World Report. Because they focus on different metrics, it could well be the case that a facility that gets a five-star rating from Medicare has a low grade from one of these other groups or vice versa.

It does not help that some nursing homes try to manipulate the system. A study in JAMA Internal Medicine looked at more than 4 million discharges from skilled nursing facilities for people on Medicare without other sources of health coverage, who were not on hospice, and who did not previously live in a nursing home.

The researchers found that there was a tendency to discharge patients on day 20 (the last day that Medicare offers full coverage) if they were ethnic minorities that lived in poor socioeconomic areas. The implication is that the facilities are trying to maximize the amount of dollars they receive from Medicare and could be prematurely discharging patients because of a concern they may not be able to pay for continued care. Not only is this practice controversial on moral grounds, but it could also skew results when it comes to scoring Quality of Resident Care in Nursing Home Compare.

Hospital rating scores are often skewed as well. A review in JAMA Internal Medicine found that hospitals that offer fewer services have a tendency to rate higher overall than those that offer more services. Nearly 2,800 hospitals were assessed in this study that included data from the American Hospital Association and U.S. News and World Report.

Specifically, hospitals that provided intensive care, cardiology, and neurology services tended to score lower. These hospitals often care for patients that are at higher risk for complications. In fact, many patients may be transferred from "five-star" facilities to one of these hospitals in order to receive a higher level of care. That being the case, a hospital that offers these needed emergency services could be penalized with a lower rating than a hospital that does not take on that risk. Ratings for hospitals, in that case, can be misleading.

Even Medicare understands that there are problems with these rating systems. For that reason, Seema Verma, current administrator of the Centers for Medicare and Medicaid (CMS), has announced plans to revamp the Nursing Home Compare rating system. Her plan addresses a number of areas, including strengthening oversight of state survey agencies, arranging for unannounced inspections, cracking down on staffing issues, and increasing transparency in Nursing Home Compare by making more information public. Here's hoping this makes the five-star rating system more meaningful and useful to those looking to get the best care.

A Word from Verywell

Medicare rates nursing homes and hospitals on a five-star scale based on a number of metrics ranging from quality of care to staffing ratios. While these metrics can help guide you towards facilities that offer better care, they are often incomplete and do not address all the issues you would face if you needed to stay in one of these facilities. CMS is currently taking steps to improve its rating system with a focus on quality measures and increased transparency. With more information available to the public, you will be better able to make decisions for your health.