Winning with Quality: How HEDIS & Stars Drive Payer Decisions
Updated: Sep 23
Turn Quality Measures Into a Payer Buying Strategy
Digital health companies often describe value in broad terms: better outcomes, higher engagement, lower cost, or improved access. Health plans make decisions through narrower mechanisms. A solution becomes easier to buy when it can be connected to a specific population, a measurable performance gap, a responsible internal team, a budget category, and a decision calendar.
HEDIS and Medicare Star Ratings offer more than evidence of plan quality. They provide a map of where performance is weak and where improvement may affect revenue, cost, compliance, or competitive position. The opportunity for a startup is to translate that map into a focused commercial strategy.
Begin with the measure, then trace the economics
A quality measure is not a value proposition by itself. The company must explain how its intervention changes the member behavior, clinical workflow, documentation, or data completeness that drives the measure.
The chain should be explicit:
Solution activity
Member or provider change
Measure improvement
Financial or strategic effect
A maternal-health platform, for example, might support postpartum follow-up, well-child visits, or immunizations. The pitch becomes stronger when it identifies which measure can move, which members are most likely to miss care, how the intervention fits the provider workflow, and how quickly improvement can appear in plan reporting.
This prevents the all too common error of promising to improve an entire quality portfolio. Payers are more likely to understand and evaluate a solution that targets one or two meaningful gaps. Focus makes ownership clearer and measurement more credible.
Public performance data can define the ideal customer
CMS and NCQA scorecards allow companies to compare plans, measures, and performance. Those data can turn a generic target list into a prioritized market.
The webinar’s Medicaid example compares plans with materially different quality scores and recommends examining the measures beneath the rating. A company should look for plans that have a relevant performance gap and enough affected enrollment for improvement to matter. A high-performing plan may have less room for the solution to create visible value, while a lower-performing plan may face greater urgency.
Geography adds another layer. Maternal-care deserts, access constraints, demographic patterns, provider capacity, and state priorities can explain why a measure is weak and whether a digital intervention fits. Public data should therefore be combined with local context rather than used as a simple ranking.
The result is an ideal customer profile grounded in buyer needs, such as the line of business, plan size, market, measure gap, population, and strategic priority.
Budget classification changes the buying process
Payer spending is often divided between medical and administrative categories. Clinical services that qualify as medical-loss-ratio spending may access a larger pool of funds and align with care delivery, but they require documentation and must satisfy regulatory and accounting standards. Administrative spending can be more flexible and support analytics, workflow, or customer experience, yet it is often more constrained and vulnerable when margins tighten.
This shapes product design and sales strategy. An in-home assessment or clinical intervention may be positioned within medical spending because it directly supports care and risk documentation. An analytics tool that identifies gaps may sit in an administrative budget and need to demonstrate staff efficiency or revenue capture.
Some companies can build a hybrid model. For example, they enter through a clinical service and later expand into administrative analytics, or combine a technology platform with a qualifying care component. That can diversify revenue and deepen integration, but it also increases operational complexity. The classification must reflect the actual service, not a convenient label.
Founders should understand the intended budget before pricing. A compelling clinical story can stall if the buyer must fund the product from a small administrative pool that is already committed.
Quality performance can affect both revenue and risk
For Medicare Advantage plans, Star Ratings can influence bonus payments, rebate levels, marketability, and enrollment. The financial effect can be substantial for a large plan, which gives quality initiatives a direct top-line dimension. In other lines of business, quality performance affects state procurement, employer perception, accreditation, and internal goals.
Risk adjustment and documentation create related opportunities, but scrutiny is increasing. Solutions that support accurate data capture, close legitimate care gaps, or improve clinical follow-up should be designed for auditability. A promise to increase coding without a strong clinical and compliance foundation creates risk rather than value.
This is another reason to connect the product to a precise workflow. The plan should be able to explain who received the intervention, why it was appropriate, what changed, and how the result entered the quality or risk system.
Enter the calendar before the work begins
Quality results are delayed. Medicare product bids are developed well before the benefit year, measures are captured over defined periods, and published ratings may reflect performance from earlier years. A vendor that begins selling when the plan wants the outcome is already late.
We recommend engaging roughly 12 to 18 months before the relevant work or procurement cycle. Medicare planning centers on the annual bid process. Medicaid contracts may run for several years, with state requests for proposals establishing priorities long before award. Commercial plans often operate through annual employer and product cycles.
The timing question should be concrete: when must the intervention be operating for the measure to change, when will data be available, when can the plan recognize the effect, and when is the budget decision made? A two-year path to financial recognition may still be attractive, but it needs an interim scorecard that shows whether the program is on track.
Fit the solution into build, buy, or partner
Large payers already have clinical teams, service businesses, analytics platforms, and innovation portfolios. A startup should not assume that a relevant problem means an external purchase.
The buyer will consider building internally, extending an existing asset, partnering, or buying a complete solution. The startup wins when it fills a gap the organization does not want to build and integrates with the capabilities already in place. In some cases, that means serving the final 20 percent of a workflow rather than replacing the entire system.
This positioning also influences long-term strategic value. A modular product that complements a payer’s service arm can become an integration partner or acquisition target. A rigid solution that requires wholesale replacement creates more resistance.
Make the business case legible across functions
A strong payer narrative lets several stakeholders see their part of the value. Quality leaders see the measure. Clinical teams see the intervention. Finance sees the revenue or cost mechanism. Operations sees the workflow. Technology sees the integration. Compliance sees the evidence trail.
The company should arrive with a focused population, baseline measure, expected movement, implementation plan, data requirements, timeline, pricing model, and evaluation method. It should also identify what the plan must contribute, including outreach channels, provider relationships, and claims or quality data.
HEDIS and Stars do not shorten every sales cycle, but they do turn an abstract benefit into a buyer-specific problem with an owner, a number, and a deadline. That is the foundation of a financeable payer strategy.
About the Speakers
Tarek Marei
Financial Consultant at UnitedHealthcare
Tarek is is a strategic finance and business operations leader with experience across UnitedHealthcare and Wells Fargo. At UnitedHealthcare, he has led cross-functional initiatives spanning financial planning, growth strategy, vendor optimization, workforce planning, and post-acquisition integration, contributing to more than $42 million in savings while supporting strategic decision-making across finance, sales, product, and operations. Connect with Tarek on LinkedIn.
Demi Radeva, MSc
Founder and Chief Strategist at Akros Advisory
Demi has more than a decade of experience across Medicaid, Medicare, and Commercial health plans, including leadership roles at UnitedHealthcare and Optum. She now advises HealthTech companies on reimbursement, payer strategy, market access, and commercialization. Connect with Demi on LinkedIn.
Comments