Managed Care Outlook 2025

Litigation trends - judicial scales icon

Read time: 3 minutes

For years, Medicare Advantage (MA) plans went through the process of receiving their Star Ratings, generally accepting them and moving on to the next year. However, in recent years, CMS has systemically tweaked the ratings methodology with the stated purpose of driving down the Stars Ratings and the corresponding quality bonus payments.

CMS’s drag on ratings has resulted in a consistent decline of Star Ratings across the country, straining plan revenue and threatening member benefits. Starting in late 2023, plans went on the offensive against CMS, with Elevance and SCAN Health leading the charge, suing CMS under the federal Administrative Procedures Act for violating its own regulations in calculating Star Ratings. The result was a significant legal victory for the plans, and CMS ultimately changed the 2024 Star Ratings for all plans – leading to higher ratings for 40 plans and CMS paying an additional $1.3 billion in bonuses.

The 2023 Star lawsuits opened the floodgates to litigation challenging the Star Ratings. So far in 2024, at least five plans – UnitedHealthcare, Humana, Elevance Health, Centene and Blue Cross Blue Shield of Louisiana – have filed. The 2024 lawsuits are vastly different from the 2023 cases, as the theories advanced by each plan are wide-ranging and challenge various aspects of Star Ratings. For instance, United and Centene challenged a single phone call that impacted their Call Center measures, while Humana and Elevance Health have brought broader challenges to different aspects of how CMS calculates ratings.

Key takeaways
  • CMS has systemically made higher Stars more difficult to achieve, leading to lower ratings and reduced quality bonus payments
  • In 2023-2024, Medicare Advantage plans sued CMS over Star Ratings, leading to higher ratings for 40 plans and $1.3 billion in bonuses
  • Plans have sued over 2025 Star Ratings, a trend likely to continue due to their complexity and financial impact
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