Health Plan & TPA Analytics: HEDIS, Stars, MLR, Network, Risk Adjustment

A typical regional health plan runs HEDIS through one vendor, Stars through a second, RAF audit through a third, network adequacy through a fourth, and MLR projections through an internal actuarial spreadsheet model. Each vendor pulls a copy of claims and enrolment data, applies its own logic, and produces output the plan stitches together manually. The total cost of these subscriptions often exceeds $1M annually before counting the staff time spent reconciling vendor outputs that disagree.

The 2024 Final Rule on Medicare Advantage Star Ratings introduced the Health Equity Index reward, expanded the Tukey outlier deletion methodology to additional measures, and raised the bar on member experience and complaints/appeals measures. Plans need to model the effect of each measure individually against the 3-star, 4-star, and 5-star cut points well before the annual Stars publication — and most can't do it without a vendor invoice.

Self-funded employer plans administered by TPAs face a different mix: stop-loss claim management, network performance for self-funded clients, large-claim trend, narrow-network steering, and pharmacy benefit manager reconciliation. Vizier supports both pure payers and TPAs operating self-funded plans on behalf of employers.

Medicare Advantage payments are heavily quality-tied: contracts at 4+ Stars receive a 5% quality bonus on the benchmark, which itself drives the rebate amount available to fund supplemental benefits. A 0.5-star drop on a 100,000-life MA contract can erase $4–5M in bonus revenue. The 2024 Final Rule on Stars introduced the Health Equity Index reward (replacing the Reward Factor in CY 2027), guardrail movements on certain HEDIS measures, and outlier-deletion methodology changes that affect cut points.

Medical Loss Ratio (MLR) rules require commercial plans to spend 80% (individual/small group) or 85% (large group, MA) of premium on medical care or quality improvement, with rebates to enrollees on underages. State-specific Medicaid managed care contracts add additional quality and reporting requirements (HEDIS submissions, Adult Core Set, Child Core Set, state-defined performance withholds). TPAs administering self-funded plans must reconcile stop-loss, high-cost claimant trend, and PBM rebates across multiple employer clients.