While I may not know much about history or biology, as the famous Sam Cooke song goes, I now feel like an expert on the Medicare agency’s hospital star ratings after I recently took an in-depth look at the system.

The Centers for Medicare & Medicaid Services this summer posted new star ratings on its Hospital Compare website, which the agency designed to show a facility’s overall quality. A special report on the system I wrote with my colleague Madi Alexander found relationships between a hospital's star rating and the demographic makeup of the facility's location.

We analyzed Medicare ratings data for hospitals and U.S. Census data for our report. The analysis showed that across the nation, hospitals with lower ratings are more likely to be located in counties with larger minority populations. Our analysis also found that in nine states, hospitals with low star ratings are significantly more likely to be located in counties with lower household median income.

Hospital industry executives weren't surprised that low star ratings correlated with serving larger minority populations and lower household incomes. Several of them told me the analysis highlights the need for the CMS to adjust the star ratings to account for patients' socioeconomic status.

In addition, the data the CMS used for the ratings tended to reward small hospitals with more stars, while large facilities that treat the most ill patients and offer more services generally scored lower, industry executives told me. Reporting on the system also unveiled industry concerns that the CMS may one day tie a hospital’s star rating to Medicare payment, a claim the agency denied.

What I included in this blog post only captures the highlights from our special report. Read the whole story to get all the details.

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