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The complex landscape of state and federal healthcare regulations continues to evolve, requiring payers to invest in technologies that support their compliance efforts. Next-generation Core Administrative Processing Systems (CAPS) can be adaptable and scalable solutions that help provide resilience to market changes.

1. Coverage and Pricing Transparency

Regulations like the No Surprises Act (NSA) and Transparency in Coverage Final Rule focus on protecting health plan members from surprise out-of-network costs. Compliance requires that payers have access to accurate and updated pricing data in order to configure relevant services and deliver personalized information to members. To ensure compliance, health plans must be able to easily implement payment policies and deliver accurate and automated payments.

2. Interoperability and Prior Authorization

Increasingly, healthcare regulators are emphasizing the importance of interoperability and streamlined data sharing. Technology adoption skyrocketed after the COVID-19 pandemic, highlighting the need for integration between care management solutions and other health technologies. This includes leveraging Fast Healthcare Interoperability Resources (FHIR) across digital solutions to enable seamless and secure data exchange, as well as support compliance to the CMS Interoperability and Prior Authorization Final Rule (CMS-0057-F).

2025 is also a year of preparation for health plans, as they improve prior authorization processes ahead of the finalized enforcement anticipated in 2027.

3. Increase Market Visibility with New Lines of Business

Health plan members—especially Medicare members—have a variety of choices when it comes to healthcare coverage. And their expectations for a health plan experience are high. To retain and attract members, payers are increasingly looking for ways to improve member experiences and build their trust.

Health plans have new opportunities to debut and expand lines of business. Whether to meet new demands from the Centers for Medicare & Medicaid Services (CMS) or take advantage of the rise of individual products and exchanges, health plans must stay on top of industry shifts to maintain their market positions. Updated healthcare CAPS can help payers bring new and differentiated benefits to the market in less time, giving payers more flexibility to meet a variety of member needs while remaining competitive.

Next-Generation CAPS Features that Support Compliance

These are just a few of the regulations health plans must abide by. Noncompliance results in expensive fines and increases abrasion with providers and members—especially when it comes to government lines of business. To meet these demands, payers are investing in digital technologies that can break down data siloes, deliver actionable insights, and streamline workflows to reduce manual operations.

Three key CAPS features that support regulatory compliance include:

Flexible configuration options. Payers must be able to easily configure payment policies for NSA, out-of-network, and emergency services based on member needs.

Automated claims adjudication. Flexible payment structures allow payers to make accurate and automated payments using accurate and timely data.

Personalized price comparison tool. A next-generation CAPS can empower payers to deliver personalized cost-sharing information to members.

Gain Access to Advanced Compliance Support with HealthRules® Payer

The HealthRules® Payer solution delivers the agility and adaptability payers need to maintain regulatory compliance, design and implement benefit plans, and serve the needs of members and stakeholders. Real-time API empowers payers to generate accurate claims details before scheduled services and increase payment automation.

HealthRules Payer, designed specifically for complex needs of healthcare payers, leverages the exclusive HealthRules Language™ to facilitate necessary configuration changes.

What else is HealthEdge doing to support health plans to maintain regulatory compliance? When it comes to the HealthRules Payer solution, our team is dedicated to monitoring state and federal regulations to identify new guidance that may impact our payer customers.

See how your health plan can leverage a modern CAPS to stay flexible and maintain a competitive edge in the healthcare market. Read our blog post to learn more: Leverage Next-Generation CAPS to Drive Competitive Advantage and Adaptability

The Centers for Medicare & Medicaid Services (CMS) has raised performance benchmarks for Medicare Advantage (MA) and Part D plans, raising the bar for achieving high Star Ratings. By excluding the lowest-performing plans from calculations, CMS has effectively raised the “cut points,” meaning that health plans must improve their performance across multiple measures to attain or sustain a 4+ Star Rating each year.

Adjustments to the 2025 CMS Star Ratings

Due to annual adjustments to CMS Star Ratings, health plans are operating in an increasingly competitive environment and must elevate their overall performance to succeed. Examples of the impact of the 2025 Star Ratings include:

• Decline in High-Rated Plans. In 2025, only 40% of MA plans with drug coverage earned four stars or higher, compared to 42% in 2024. Yet, when weighted by enrollment, about 62% of Medicare Advantage-Prescription Drug (MA-PD) enrollees are in plans with four or more stars, a drop from 74% the previous year.
• Fewer 5-Star Plans. Only seven contracts received a 5-star rating in 2025, down from 38 in 2024. This signals a dramatic shift for some health plans, potentially affecting new member enrollment and CMS payments.

The decline in quality ratings reflects that CMS continues to focus on improving overall healthcare quality rather than measuring the advances of individual health plans.

Implications of CMS Star Rating Changes for Health Plans

The 2025 Star Ratings pose several challenges for health plans:

• Difficulty and Volatility to Achieve High Star Ratings. Over 60% of cut points have risen, which means plans must improve performance across many measures to maintain ratings.
• Reduced Bonus Payments. Fewer plans are expected to achieve 4+ stars, limiting bonus payments and potentially funds for supplemental benefits, which are important for attracting and retaining members.
• More Focus on Member Experience and Care Management Quality. With increased emphasis on member service, access, and medication adherence, plans need more robust digital engagement and personalized care to enhance outcomes.
• Need for Real-Time Adjustments. Ongoing regulatory changes demand real-time analytics to identify care gaps and adjust strategies quickly.
• Competitive Landscape. Stricter standards may prompt members to switch to higher-rated plans, complicating the member retention efforts of health plans.

How GuidingCare® and Wellframe™ Support Star Rating Improvement

Health plans can enhance Star Ratings by focusing on improving member engagement and streamlining care management to improve the quality of care. By adopting next-generation digital solutions, health plans can improve performance through exceptional care coordination, personalized member outreach, and data-driven insights that directly address key Star Rating measures.

Care-Wellframe is an integrated solution that combines HealthEdge’s care management platform, GuidingCare, with the Wellframe digital member experience platform to transform how health plans serve their members. The following are key ways that the integrated Care-Wellframe solution helps health plans elevate performance:

Enhanced Member Engagement

• Personalized Digital Care:Wellframe’s mobile-first programs and daily checklists improve member engagement, satisfaction, and outcomes, which are vital to Star Ratings. By providing reminders and self-service content tailored to individual needs, Wellframe enhances engagement.
• Medication Adherence: Wellframe’s tools include medication reminders, improving adherence which directly impacts Star Ratings.
• Access to Care: Digital communication channels reduce barriers to quick intervention and enhance member satisfaction by enabling seamless access to care teams.

Streamlined Care Management and Coordination

• Efficient Workflows: Care-Wellframe centralizes member data to enable seamless coordination and reduce administrative burdens.
• Automated Processes: GuidingCare supports care teams by streamlining caseload management, assisting with adherence to CMS requirements, and facilitating consistent follow-ups with members.
• Integrated Communication: Care-Wellframe enables seamless communication among members, care teams, and providers. This facilitates proactive management of high-risk conditions, screenings, and overall care quality.
• Holistic Care Management: By integrating physical, behavioral, and social determinants of health (SDOH) data, Care-Wellframe provides a comprehensive view of member needs, supporting coordinated, whole-person care.

Continuous Quality Improvement

• Real-time Analytics: Care-Wellframe offers advanced analytics that help health plans track compliance and close care gaps.
• Predictive Tools: The solution’s predictive capabilities help identify high-risk members and prioritize interventions, helping care teams take the right actions to improve compliance with care plans and achieve better outcomes.