Several insurers are disputing CMS' Medicare Advantage star ratings.
For 2025, just seven plans received a five-star rating from CMS, down from 38 in 2024. The overall average rating was 3.92, down from 4.07 the previous year.
Humana filed a lawsuit Oct. 18 asking a federal judge to require CMS to "retract and recalculate" its 2025 star ratings.
In its lawsuit, the insurer argued that CMS did not follow its own regulations in its methodology for calculating ratings, and alleged the agency did not provide Humana with necessary data to determine why cut points moved upward for 2025.
CMS determines cut points, or thresholds, for every measure each year. The agency said for 2025, many cut points increased, meaning plans had to perform better to get higher star ratings.
Several factors influenced the tougher cut points, CMS said in an Oct. 10 news release. The agency removed extreme outliers from the lower end of performance, a more compressed distribution on scores and an increasing number of high-scoring contracts. Some measures are improving to pre-pandemic levels, increasing cut points, CMS said.
In a regulatory filing published Oct. 2, Humana reported a 94% decline in the number of members in contracts rated four stars or higher from 2024 to 2025. The drop was largely driven by a major contract falling from a 4.5-star rating to 3.5 stars.
The company expected the decline to hurt its 2026 earnings.
Other payers have taken issue with CMS' star rating calculations.
On an Oct. 17 earnings call, Elevance Health CEO Gail Boudreaux said the company will see the number of members in plans rated four stars or higher decline, due to one of its larger contracts missing a four-star rating by 0.0004 of a point.
"We have challenged our initial scoring with CMS, and are considering all our options," Ms. Boudreaux said.
In regulatory filings published Oct. 11, Centene said the number of members it has in stars rated 3.5 and higher increased. The company said it plans to appeal CMS' rating of its teletypewriter call accessibility.
At least two other insurers have taken their challenges to court.
HMO Louisiana, a subsidiary of Blue Cross Blue Shield of Louisiana, filed a lawsuit in U.S. District Court in Washington, D.C. The insurer alleged CMS used "arbitrary and unlawful" methods to calculate its star ratings.
In court filings, attorneys for BCBS Louisiana alleged that CMS used an "entirely different and new methodology that was not subject to any formal notice and comment rulemaking, and that directly contradicted the plain text of its own regulation."
According to the lawsuit, BCBS Louisiana consolidated two Medicare Advantage contracts at the beginning of 2024. CMS evaluates Medicare Advantage star ratings at the contract level.
In its lawsuit, BCBS Louisiana alleged that CMS allows plans to submit data from both the surviving and consolidated contract when plans are combined for two years after the plans merge. The company alleged CMS did not use data from both contracts on some measures, resulting in lower ratings.
BCBS Louisiana asked a judge to require CMS to recalculate its 2025 rating.
UnitedHealthcare is also challenging its star ratings, though on a different basis. The insurer filed a lawsuit Sept. 30 alleging that CMS downgraded its rating based on one secret shopper call. UnitedHealthcare argued the call should not have been included in its rating because the call never connected.
Insurers were also successful in challenging CMS star ratings last year. The agency recalculated star ratings for every Medicare Advantage plan in 2024 after courts sided with lawsuits from Elevance Health and the SCAN Group that argued CMS used incorrect methodology to calculate the ratings.