Medicare Advantage ratings season kicks off with some drama

Modern Healthcare – Wednesday, September 17, 2025
By Nona Tepper

The Centers for Medicare and Medicaid Services is not scheduled to publicly release the Medicare Advantage Star Ratings for several weeks. The drama, however, already has begun.

On Sept. 9, the Centers for Medicare and Medicaid Services provided insurers with a private preview of their individual ratings, but accidentally disclosed every company’s preliminary rating in the file, according to sources familiar with the matter. Afterward, regulators emailed carriers that had downloaded the information, instructing them to delete the data, sources said. CMS retracted the initial dataset and published new preview files, according to the sources.

The same day the email preview went out, CVS Health’s shares dipped after company executives reportedly declined to comment on Aetna’s star ratings at a private investor conference.

The next day, Tuesday, UnitedHealth Group’s shares popped after UnitedHealthcare notified investors that 78% of their membership will be enrolled in plans that qualify for the maximum quality bonus payment. On Wednesday, Humana’s scores sank after a data firm said it is getting harder for insurers to achieve high scores. The same day, Alignment Health reported that all of its members will be in plans that qualify for bonuses.

And on Thursday, Centene’s shares jumped after executives told investors that it performed slightly better than expected in the program. Also that day, CMS sent a memo to companies, urging them not to disclose their score ahead of the official release.

CMS did not respond to questions about the draft ratings. The ratings are not finalized and can change, an agency spokesperson wrote in an email.

How the star ratings program works

Under the annual star ratings program, CMS assesses some 30 patient health, care access, plan administration and other metrics to determine a Medicare Advantage insurer’s quality on a five-point scale. CMS assesses quality on a curve and determines the threshold – or “cut point” – needed to achieve each score by how the market performed as a whole. The better that more insurers do on a measure, the harder it is to achieve a high rating.

CMS takes the weighted average of all the scores to determine an insurer’s final rating.

Insurers that achieve at least four stars receive the maximum 5% bonus, which carriers rely on to pay for supplemental benefits and reduce enrollee cost-sharing. Companies will pocket at least $12.7 billion in bonuses this year, up 7.5% from 2024, according to a June report by KFF, a healthcare research firm.

CMS is scheduled to publicly release how companies performed for the 2026 plan year around Oct. 9.

Preliminary federal data indicates the average rating across the industry is essentially the same as it was last year, said Jeff Schoenborn, founder and CEO of Baltimore Health Analytics, a star ratings data firm.

“There are winners and losers, always. Now that we know that United and Centene didn’t suffer, who’s on balance?” Schoenborn said.

What to expect

Draft data indicate the threshold for achieving top ratings will reach the highest point in the program’s 18-year history, according to an analysis the actuarial firm Wakely published last week. The increased thresholds reflect insurers’ improvement in the program and the phased implementation of a controversial statistical tool that removes program outliers, according to the actuarial firm’s report.

“People don’t see this as a period of good star ratings. What we’re going to get is, ‘Here we are, where we were last year,’ when people were very disappointed,” said Dwight Pattison, founder and principal advisor at QPAdvantage, a consulting firm focused on health plan quality performance.

The high benchmarks also reflect companies such as Humana and Aetna discontinuing low performing plans last year, Schoenborn said. “Plans that would have scored poorly, some of them are no longer in the mix because they shut down a year ago,” he said.

Insurers had until Tuesday to notify CMS of any initial mistakes in their 2026 star ratings calculations.

Last year, carriers felt emboldened to sue over low scores after Scan Health Plan and Elevance Health won separate star ratings cases, leading to an industrywide recalculation.

At least one issue is likely to bubble up in insurer lawsuits in 2026, said Mick Twomey, CEO and cofounder of star ratings data firm Hyperlift Logic, owned by Press Ganey.

Regulators improperly calculated how much plans improved their annual overall performance in the quality improvement measurements, he said. Because those measures carry the highest weight in ratings calculations, they are critical for determining an insurer’s score, Twomey said.

The continued high threshold to achieve high call center services scores could also attract lawsuits from insurers, said Ryan Langston, vice president of healthcare research at the investment bank TD Cowen.

“CMS is going to continue to make star ratings that much harder to get every year,” Langston said. “Until we see otherwise, we’ll continue to believe that national star ratings are likely to disappoint.”

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