Five-Star’s Early Adolescence and the Growing Pains that Go Along with It

December 2018 marked Five Star’s ten-year “birthday.” When you read its birth certificate, you’ll see its given name is: “Five-Star Quality Rating System,” though interestingly enough, the only direct measures of quality (the CMS quality measures) carry the least weight. Over the last ten years Five-Star has certainly matured considerably and if you believe it measures quality, then you are also likely convinced that nursing home quality has improved. (We at PointRight agree with you, but choose other ways to validate the long-term care industry’s improvement.)

However, for an accountable care organization (ACO), Five-Star is a confusing metric to use when measuring and monitoring nursing home performance. For better or worse, CMS has exaggerated the relevance of Five-Star by linking a variety of bonuses to a three-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 three, four and five-Star skilled nursing facilities (SNF). 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 processes, quality, length of stay, or satisfaction, a Five-Star rating does not prove a useful tool in successfully managing your post-acute network, nor is it a suitable proxy for financial performance of the facility. Perhaps worse, it might just lead you astray. Let’s discuss why.

Five Star Treats All People the Same

Recall that the primary goal in launching this nursing home rating system was to provide consumers with an easy way to understand quality of nursing home care and make informed decisions around placement. (Notice what is not listed on Nursing Home Compare: rehospitalization reduction, total cost of care, and patient satisfaction.) Yet a fatal flaw is that Five-Star doesn’t ask individuals being admitted to a nursing home upfront “why are you here?” Some people enter the facility as a patient with full expectations to return to the community, while others come in as residents and intend to live out the rest of their lives in the facility. These two types of people have vastly different needs, yet they and their outcomes data are comingled into and measured by the same system.

Not All Nursing Homes Are Alike

Not only are the people entering a nursing home/SNF unique, so too is each facility. Over the past 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 a select area of care, such as complex medical and post-surgical management, wound care, dementia, end-of-life 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 facility providing that care, causing a missed opportunity for understanding how the facility is truly performing due to a lack of this crucial information.

Five-Star Leads ACOs Astray

Creating and monitoring a post-acute network is often guided by principles of CMS’ Triple Aim: reduce costs, improve quality, and satisfaction. Yet CMS’ Five-Star has very low correlation to costly rehospitalizations, with less than one-point difference in adjusted rehospitalization rates between two- and four-Star SNFs. [ Join us January 22 for a live disucssion of Five-Star for ACOs. ]

The other challenge is that Five-Star is a bit of a moving target. Over the last ten years CMS made several important and appropriate changes to the system. These changes include the following:

    • Adjusting the cut points which determine Star rating within each domain
    • Changing the data source from which the Staffing Domain is calculated
    • Adding new Quality Measures to the Quality Measure Domain
  • Freezing the survey domain for about 18 months while new survey data outcomes are understood

What’s the Bottom Line?

CMS’ change to Five-Star results in both winners and losers. Some nursing homes, for instance, will lose their mandatory overall three-star rating and potentially not qualify for your preferred provider

network. For example:

When CMS transitioned from three to two survey cycles (November 2017):

  • 22% of the nation’s nursing homes saw a change in their survey star
    • 93% had a change of 1 star
    • 7% experienced a change of 2 or more stars

When CMS implemented changed data source for staffing (April 2018):

  • 68% SNFs remained the same*
    • 50% nursing homes declined
    • 82% nursing homes improved
    • 428 nursing homes lost their 3-star or higher overall rating

* controlling for impact of Survey and Quality Measure domain

There are anticipated Five-Star changes in store for 2019. CMS will ultimately decide how to include the outcomes from the new survey process into the Survey Domain. Survey outcomes data from November 2017 to the present is currently “in the freezer” and not being used in Five-Star calculations. However, you can see the outcomes data that is accumulating….and it’s not flattering. When analyzing this data, we see a greater number of deficiencies overall and a greater scope and severity across the majority of the nation. CMS will likely take good care to ensure these new data are managed appropriately by recalibrating the state cut points which generate a one- through five-Star rating. However, as long as Five Star is open for tinkering , some facilities stand to be hurt by having their rating dropped by a star or two, despite have absolutely no change in quality.

Steven Littlehale


Steven Littlehale
Executive Vice President and Chief Clinical Officer,




Hear Steven Littlehale Discuss Five-Star for ACOs in a Live Webinar Jan. 22! [ Register ]

About Steven Littlehale

Executive Vice President and Chief Clinical Officer Steven Littlehale has more than 25 years' experience as a long-term care professional beginning as a nurse assistant and leading to his work as an advance practice nurse, educator, researcher and consultant. He is a board certified specialist in gerontology and a nationally-known lecturer and consultant with numerous publications. Steven holds a Bachelor of Science from the University of Vermont and a Master of Science from Georgetown University.