Medicare Advantage Quality Bonus Payments Will Total at Least $11.8 Billion in 2024

(By Jeannie Fuglesten Biniek, Meredith Freed, Anthony Damico, and Tricia Neuman for The Kaiser Family Foundation Published: Sep 11, 2024)

The quality bonus program, established by the Affordable Care Act, increases Medicare payments to Medicare Advantage plans based on a five-star rating system. Plans may, but are not required to, use the additional payments to cover the cost of supplemental benefits, including reduced cost sharing, extra benefits not covered by traditional Medicare (e.g., vision, hearing and dental), and lowering Part B and/or Part D premiums. The quality bonus program is intended to help consumers make informed decisions when choosing among Medicare Advantage plans and encourage plans to compete based on quality. However, the Medicare Payment Advisory Commission (MedPAC) and others have observed that the star ratings incorporate too many measures, do not adequately account for social risk factors, and may not be a useful indicator of quality because star ratings are reported at the contract rather than the plan level. Continue reading here…

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