How to use Medicare star ratings wisely during Open Enrollment

But few people on Medicare bother to look to the stars, according to the KFF health policy research group. “When asked whether these star ratings influenced their decision-making when choosing a plan, the majority of participants says no,” a 2023 KFF report says.

They’re making a mistake.

What Medicare star ratings can tell you

The star ratings, which you can find in the Medicare site’s Plan Finder tool comparing Part D and Medicare Advantage (the alternative to original Medicare) plans, offer a shorthand look at how plans measure up for quality and member experience.

“It’s an imperfect system at best, but it’s the best we’ve got,” says Dr. Sachin Jain, president and CEO of SCAN Health Plan, a large Medicare Advantage plan.

In the annual ratings bestowed by the Centers for Medicare and Medicaid Services (CMS), five stars means excellent, four means above average, three means average, two means below average, and one means poor.  On Medicare’s Plan Finder, a five-star plan gets extra prominence: a big star with the number 5 in it.

Data used to create those ratings is a bit dated—2025 ratings are based on the 2023 performance of plans, says Suzanna-Grace Tritt, a senior consulting actuary with the Wakely health care consulting firm.

Medicare Advantage insurers’ quest for four stars or more

Something else you might not know: Medicare Advantage plans (but not Part D plans) get hefty bonus payments from Medicare if they achieve at least four stars—more than $11.8 billion worth in 2024, according to KFF.

“If they get higher payments, they can potentially provide extra benefits,” says Jeannie Fuglesten Biniek, associate director for the Program on Medicare Policy at KFF. “But it’s not necessarily a one-to-one correlation that a five-star plan is going to have more benefits.”

Few Part D or Medicare Advantage plans get one or two stars, though. “In practice, it’s more like a 2.5 to five-star system,” says Jain.

How to spot a low performer

If a plan gets fewer than three stars for three consecutive years, Medicare can terminate it, so plans are incentivized to keep their quality up, says Tritt. Such low-performing plans show up on Plan Finder with an upside-down red triangle that has an exclamation point inside.

People in these low-performing plans can switch to ones rated three stars or better during Medicare’s Special Enrollment Period for Disenrollment between Jan. 1, 2025, and Dec. 31 (the entire year).

What goes into a Medicare star rating

Part D and Medicare Advantage star ratings comprise up to 40 or 30 quality and performance measures, respectively. Broadly speaking, ratings for both types of plans are based partly on member experience, customer service, and plan performance.

Part D ratings also assess prescription drug safety and pricing, while Medicare Advantage ratings also look at whether members are staying healthy and if ones with chronic conditions get the tests and treatments typically recommended to them.

“If I wanted to understand how well my experience would be with the plan, the star can be an indication of that,” says Tritt. “It’s not a direct indication of how good your benefits, or your [doctor’s or hospital] network, will be.”

Medicare’s five-star unicorns

If you’re the kind of person who would want to enroll only in a five-star plan, though, you’ll likely be out of luck.

CMS has revised the Medicare star rating methodology in recent years making it extremely hard for a plan to earn five stars, says Lisa Winters, a Wakely consulting actuary.

Star ratings were kept artificially high during the pandemic, so plans wouldn’t be faulted for quality issues out of their control.

In 2025, just 2% of people with Medicare Advantage/Part D plans and 5% in stand-alone Part D plans will be in ones with five stars, according to CMS.  There were far more five-star plans for 2024 than there will be for 2025.

When I gave Plan Finder a test run to see my Part D and Medicare Advantage choices in suburban New Jersey, I found zero five-star plans.

Tritt’s advice for people in open enrollment: “You’re likely going to be living in an area this year where you don’t even see a five-star plan.”

Easier to find four-star plans

It’s far less difficult to find a plan rated at least four stars. “More than 70% of people with Medicare Advantage are enrolled in them,” says Biniek.

The five-star Medicare Advantage plans don’t receive larger bonus payments than 4 ½-star plans, she noted, so insurers generally see little benefit to strive for five. A few insurers, however, push to get five-star plans because they use that as a marketing tool, says Biniek.

Medicare Advantage plans’ quest to earn at least four stars is why insurers like Humana, UnitedHealth Group, SCAN Health, and Elevance Health have challenged CMS in court to get their star ratings revised upward.

Medicare star-rating advice

Here are dos and don’ts from experts when evaluating Part D and Medicare Advantage star ratings during open enrollment:

• Don’t choose or reject a Part D or Medicare Advantage plan only because of its star rating. “I think the costs and access to services or health providers are potentially at least as important as what the overall rating of the plan is when a person is making a decision,” says Biniek. But a star rating could be your deciding factor when choosing between two plans with similar out-of-pocket costs and coverage.

• Don’t panic if a plan’s 2025 star rating is slightly lower than its 2024 rating. The downgrade could be due to a blip in the way the ratings are computed from year to year. “If you’re seeing your plan’s star rating bounce around, unfortunately, that will probably continue,” says Tritt. That’s why it’s best to look at a plan’s star-rating history over several years.

• If you’re fine with the cost and coverage of a Part D or Medicare Advantage plan but concerned about its overall star rating, click through the Medicare Plan Finder for the star ratings in subcategories. You’ll be able to see how the plan scored in the specific quality and member satisfaction yardsticks that matter to you.

“It’s common for plans to not ace everything,” says Tritt. “They almost always have a weakness.”

If you’re puzzled why a Part D plan got dinged because pharmacists scored poorly on helping members manage their medications, that’s because CMS grades the plans on medication adherence, says Tritt.

A low rating on that yardstick suggests the insurer’s preferred pharmacies aren’t doing a bang-up job ensuring members are following doctor’s orders.

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