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Two More Stars Suits

CVS’ Aetna has become the sixth health plans to sue the Centers for Medicare and Medicaid Services (CMS) over SY 2026 and/or SY 2027 Star ratings.

Aetna filed suit Monday in Georgia’s Southern District Court, the same that had the Clover suit. Aetna says 28 measures were “unlawfully adopted” and should have been excluded. The measures were adopted without notice-and-comment rulemaking and 12 also relied on data sources outside CMS’ statutory authority. The suit for SY 2027 challenges the 28 measures across 43 contracts. It relies on a great deal of the Clover decision.

Aetna says the CMS actions will likely cost it $2 billion in 2028 quality bonus payments and rebate retention. Aetna asks the court to declare the inclusion of the 28 measures unlawful, order CMS to raise its scores, and award $2 billion in additional bonus payments.

Scan also sued Monday on SY 2027. Scan’s suit essentially parallels its SY 2026 suit. The complaint argues that CMS improperly calculated ratings for four contracts by using the same 10 measures whose detailed specifications were never formally promulgated through the notice-and-comment. Scan argues that CMS has continued to use those measures for 2027 despite that ruling and its own objections.

Scan claims that removing the disputed measures would raise two contracts from 3.5 to 4.0 Stars and two others from 4.0 to 4.5 Stars, generating more than $152 million in additional payments and rebates for 2028. Scan filed again in the District of Columbia federal district.

Additional articles: https://www.fiercehealthcare.com/payers/alignment-healthcare-sues-cms-over-its-2027-medicare-advantage-star-ratings and https://www.beckerspayer.com/payer/medicare-advantage/5-payers-suing-over-2027-medicare-advantage-star-ratings/

#stars #medicareadvantage #cms #quality

https://www.modernhealthcare.com/insurance/mh-aetna-medicare-advantage-star-ratings-lawsuit

Humana’s Stars Rebound

Modern Healthcare has a good article on Humana’s Stars rebound. Always a great performer, it collapsed over the last few years and now is back on top of major health plans in Medicare Advantage (MA). It will gain $3 billion in 2028. Humana elevated its Star ratings by distributing its plans across many contracts, steering members toward top-rated plans and making high scores an enterprise-wide priority.

#medicareadvantage #stars #humana

https://www.modernhealthcare.com/insurance/mh-humana-medicare-advantage-star-ratings-2027

Centene Files Stars 2027 Lawsuit

We had four 2026 Stars measure lawsuits — Clover, Elevance, Scan, and Alignment.
We now have three 2027 Stars measure lawsuits — Alignment, Healthfirst, and Centene. Centene has become the latest insurer to sue over its Medicare Advantage 2027 Star ratings. Centene has filed in the same Georgia southern district as Clover and Elevance did in SY 2026.

Centene argues that CMS violated the Administrative Procedure Act in determining its 2027 ratings. Centene says that CMS ran afoul of “core statutory safeguards” in deploying 17 measures. Because of that, Centene says its 4 Star and greater enrollment dropped from 18% to 9% and cost the company $448 million in quality bonus payments for payment year 2028. Centene’s lawsuit parallels the Clover one.

Most importantly, Centene makes this fabulous point: CMS tacitly admits its methodology is wrong because it applied a different calculation to Clover in both 2026 and 2027.

While arguments in all these cases are similar (they argue statutory and/or regulatory deficiencies), the number of measures challenged in the lawsuits differ. Each rightfully is arguing to throw out certain measures so as to get the highest ratings.

Clover argues that 20 SY 2026 measures had statutory or regulatory problems and won.

Elevance argues it deserved the Clover measure set for SY 2026 as well, so essentially the same 20 measures.

Alignment and Scan argue that SY 2026’s CMS recalculation measure set needed 10 more measures thrown out to be consistent with the Clover judge’s decision. (An argument can be made that these cases essentially agreed with the 20 Clover measure deficiencies.)

For SY 2027, Alignment essentially argues similarly as it did in SY 2026.

Healthfirst wants 5 measures thrown out.

And now Centene argues 17 are deficient.

I predict more lawsuits on SY 2027 to come and I certainly do not blame plans for defending their interests.

CMS and Congress have to repair all the deficiencies and end the lawsuit madness. They need to get together to lay out a program that makes policy sense and has all problems addressed. 35 million people rely on Medicare Advantage for their coverage. The program is already fluid enough due to rate and other variables. We do not need more Star noise.

I suspect CMS will load up the 2028 regulatory rule that will come out in draft form in November with fixes. But that will not be enough. Congress needs to weigh in, too.

Additional articles: https://thehill.com/policy/healthcare/6165587-unitedhealthcare-humana-medicare-advantage-cancellations-to-affect-1-million/ and https://www.modernhealthcare.com/insurance/mh-centene-medicare-advantage-star-ratings-lawsuit/

#cms #medicareadvantage #stars #quality

https://www.fiercehealthcare.com/payers/alignment-healthcare-sues-cms-over-its-2027-medicare-advantage-star-ratings

Employees See Healthcare Costs Surge

Healthcare policy group KFF’s annual employer survey finds that employees now pay $7,471 on average annually for family health coverage, up 9% or $621 from 2025. Overall premiums combining employer and employee shares increased 5% or $1,310 to $28,303.

Employees at small firms with less than 200 workers contribute $9,687 annually toward family coverage. That’s $2,847 more than workers in large firms.

KFF finds that family premiums and workers’ contributions have risen at similar rates (28% and 26%, respectively) since 2021. This is comparable to wage and inflation growth.

The average deductible for U.S. workers is approaching $2,000 before insurance kicks in.

In other news, the Commonwealth Fund’s biennial insurance survey finds that the uninsured rate for working age American increased to 11.2% from 8.9%. The uninsured rate of young adults (19-34) increased from 11% to 16% over the past two years. Decreases in Medicaid and individual market were the primary culprits.

Commonwealth says nearly half of working-age adults (46%) were inadequately insured in 2026, with 11% of those uninsured, 12% who had a gap in coverage during the year, and 23% who were underinsured.

Additional articles: https://www.fiercehealthcare.com/payers/kff-employer-family-premiums-5-28k-2026 and https://thehill.com/policy/healthcare/6166007-employer-health-insurance-costs-premiums-rise/ and https://www.kff.org/quick-insights/premiums-for-employer-sponsored-family-health-coverage-top-28000-in-2026/ and https://www.kff.org/private-insurance/workers-now-pay-7471-on-average-annually-for-family-health-coverage-up-9-or-621-from-2025-benchmark-employer-health-benefits-survey-finds/ and https://www.kff.org/health-costs/2026-employer-health-benefits-survey/ and https://www.beckerspayer.com/payer/uninsured-rate-rises-to-11-2-survey/

#employercoverage #healthcare #premiums #uninsuredrate

https://www.fiercehealthcare.com/payers/uninsured-rate-climbs-112-2026-commonwealth-fund

Elevance Reports Q3 Financials

Elevance Health is boosting its outlook for the year as it beat The Street for Q3 2026. Elevance earned $1.4 billion in profit for the quarter, up slightly from $1.2 billion a year ago. Profits through the first nine months of the year were $4.6 billion, down year-over-year from $5.1 billion.

Revenues were $50.4 billion in Q3, about the $50.1 billion from the prior year quarter. Revenues through three quarters were $149.8 billion, up from $148.3 billion a year ago.

Elevance says 2026 is a “trough year” for the company’s Medicaid business and that there are positive signs in 2027. Medicaid is now ahead of outlook. But Medicaid is facing looming turbulence from the massive budget cuts that have passed impacting the next ten years.

The overall medical loss ratio for the quarter was 90.6%, compared to 91.7% a year ago. The insurance unit was slightly ahead on revenue, with services unit Carleon having strong growth.

In related news, Elevance wisely is requiring hospitals to identify the physical location where care was provided on billing forms and adjust reimbursement for certain off-campus services. This will apply to commercial, Medicare Advantage and Medicaid and will be rolled out through 2027. Providers complain of the administrative costs, but it is all about maintaining preferred rates and battling the overturn of site neutrality nationally.

Additional articles: https://www.fiercehealthcare.com/payers/elevance-health-posts-14b-profit-q3-earnings-beat and https://www.beckershospitalreview.com/finance/elevances-site-of-care-rules-put-revenue-cycles-on-alert/

#elevancehealth #healthplans #margins

https://www.healthcaredive.com/news/elevance-medicaid-momentum-q3-2026-elv/833559

House Bill Would Overhaul Medicare Advantage Stars

A House bill calls for the overhaul of the Medicare Advantage (MA) Stars program. Rep. Mike Kelly, R-PA, is sponsoring the Medicare Advantage Strengthening Transparency and Accountability in Rating Systems Act (MA STARS Act). It directs the federal government to rewrite Star ratings policy beginning with the 2031 contract year.

CMS would have to exclude any measure that is unrelated to clinical quality, outcomes, or experience. Member surveys would be reformed. Measures that no longer distinguish performance among most contracts would be barred. New measures could be added only if they relate to clinical quality, outcomes or experience.

The truth is that the Centers for Medicare and Medicaid Servies (CMS) has implemented most of the bill’s parameters. It has promulgated a rule that eliminates operational measures as well as those that do not have substantive differences between contracts. The CMS Stars restructure is scheduled to go into effect for Measure Year 2027/Star Year 2029. It faces litigation related to how it has promulgated Star requirements in the past as well as for statutory deficiencies in the current program. Lawsuits are pending for Star Years 2026 and now 2027. More are likely.

Star performance remains poor with the average rating in Star Year 2027 dropping from 4.01 to 3.99.

#stars #cms #medicareadvantage #quality

https://www.beckerspayer.com/payer/medicare-advantage/house-bill-targets-medicare-advantage-star-ratings-methodology/

Healthcare On The Trail

The midterms are two weeks away and Becker’s Payer covers how Democratic candidates are working healthcare issues into their policies and messaging and Republicans are defending themselves. Healthcare changes being discussed on the stump include:

• Exchanges enhanced premium subsidy reinstatement
• Rolling back Medicaid reductions
• Medicare for All endorsements
• Attacking vertical integration in healthcare
• Reining in AI-driven denials
• Price transparency
• Hospital prices

On the last issue, a Century Foundation survey of voters from earlier this year found that 67% think preventing hospitals from charging excessive prices should be a top federal priority when it comes to cutting costs. About 66% of Republicans and 71% of Democrats believe this.

A Modern Healthcare articles says Republicans are attacking fraud, waste, and abuse in Medicaid and the Exchanges as a key healthcare message. A healthcare policy group KFF poll finds that the messaging resonates with 44% of voters. At the same time, Florida and Texas have about 40% of all Exchange enrollments and the GOP could be hurt here due to enrollment losses.

Additional article: https://www.modernhealthcare.com/politics-regulation/mh-republicans-healthcare-fraud-midterm-elections/

#midterms #congress #healthcare #coverage

https://www.beckerspayer.com/policy-updates/from-medicare-for-all-to-medicaid-cuts-5-healthcare-fights-on-the-ballot-this-midterm-election

Proposed Rule Reforms Provider Directories, PBMs

The Centers for Medicare and Medicaid Services (CMS) proposed a far-reaching rule that tackles years-long issues with Medicare Advantage (MA) networks and provider directories, medication compliance, and pharmacy benefits manager (PBM) compensation. These provisions were largely in the 2026 appropriations bill.

In terms of provider directories and networks, CMS proposed these reforms for MA plans:

• MA organizations will need to verify provider directory data at least every 90 days, and they would need to check the data for hospitals and other facilities at least once each year.
• Beginning in 2028, MA organizations will need to grade their provider directory accuracy based on a provider sample. In 2029, CMS would publicly post these scores, and plans would need to show them in their directories.
• If an MA enrollee books a provider listed as in-network, that enrollee would pay no more than the lesser of the in-network or other cost-sharing. This would still apply if the provider ends up being out of network. This begins in 2028.

PBM reforms include:

• PBMs cannot set compensation in Part D to the list price of drugs or rebates and must charge fair market value for services provided. Flat-dollar, itemized service fees would be used. Rebates and related PBM compensation will have to be passed through to the plan sponsor.
• PBMs would have various transparency, reporting and disclosure requirements.
• PBMs would have to allow Part D plan sponsors to audit them at least once a year.
• Insurers would also have to disclose whether they own or have a controlling interest in the provider.

Regarding medication adherence, the rule codifies a reduction in generic drug copayments for dual eligibles at or below the federal poverty limit from a $1 maximum to $0, beginning Jan. 1. The removal is expected to improve medication compliance.

Additional articles: https://www.fiercehealthcare.com/regulatory/cms-proposes-ma-ghost-network-pbm-transparency-requirements and https://www.beckershospitalreview.com/legal-regulatory-issues/cms-proposes-public-scores-for-medicare-advantage-provider-directories-flat-fee-limits-for-pbms/  and https://www.cms.gov/newsroom/fact-sheets/medicare-program-implementation-sections-6219-6220-6224-consolidated-appropriations-act-2026-cms

#medicareadvantage #healthplans #pbms #providers #dualeligibles #partd #providerdirectories #networks #transparency

https://www.modernhealthcare.com/politics-regulation/mh-cms-medicare-advantage-provider-directory-pbm/

Medicare Advantage 2027 Retrenchment Examined

In a new analysis, actuarial and consulting firm Wakely finds that more than 6.3 million Medicare Advantage (MA) members (almost 19%) are affected by plan terminations or crosswalks for 2027. Wakely says approximately 3 million members (about 9%) are enrolled in plans that will close without an automatic transition to another plan. Others had their plan ended, but moved to another plan within the sponsor. In some cases, those plans fit the members’ needs. In other cases, they may not.

Wakely also reported on the major growth in Chronic Care Special Needs Plans (C-SNPs). They increased 34% from 2026 to 2027, following 56% growth in 2026. These are disease specific plans that do not have all of the strict compliance rules that Dual Eligible SNPs (D-SNPs) have. The government wants to force the C-SNPs to obey many of the same rules as D-SNPs.

Wakely also says HMO offerings increased by 63 plans to reach 2,531 plans (46%) in 2027. Local PPO offerings declined by 83 plans (now 32%), while HMO-POS offerings remained essentially flat (now at 21%).

Lastly, Wakely says about two-thirds of 2027 plan offerings have no member premium. General enrollment Part D deductibles increased from $363 to $493, while average Part C maximum out-of-pocket limits increased from $5,330 to $5,874.

#medicareadvantage #enrollment

https://www.wakely.com/blog/medicare-advantage-2027-beyond-the-plan-count/

Trump Admin Continues Culling Exchanges

The Trump administration announced two initiatives to further reduce Exchange enrollment. A new proposed rule would set stricter definitions of who qualifies for tax credits, toughen eligibility verification requirements, and further narrow access to financial assistance for noncitizens. Under the proposal, the federal government would not extend subsidies to people who lose Medicaid coverage due to noncompliance with the work requirements, regardless of income.

Further, the Trump administration announced it has cut subsidies for 189,000 people after it found duplicate beneficiaries on Medicaid and Medicare as well as enrollees who were deceased. About $738 million will be saved in improper payments. Another 3,500 could be culled.

Last, healthcare policy group KFF finds that enrollment on the Exchanges dropped by more than 4.5 million people over the past year. Enrollment fell from 25.2 million in 2025 to 20.5 million in June 2026, an 18 percent drop.

Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-irs-rule-aca-subsidies-eligibility/ and https://www.healthcaredive.com/news/trump-administration-boots-189000-deceased-duplicate-enrollees-off-aca-su/833037/ and https://www.fiercehealthcare.com/regulatory/cms-takes-aim-duplicative-aca-medicaid-enrollments and https://thehill.com/policy/healthcare/6149286-obamacare-enrollment-dropped-millions-kff-report/

#exchanges #coverage #enrollment

https://www.kff.org/affordable-care-act/individual-market-enrollment-continues-to-fall-through-mid-2026/