Elevance Health is suing CMS over its 2026 Medicare Advantage star ratings, arguing the agency gave competitor Clover Health a favorable recalculation after losing a court case to the insurer in May.
In its July 1 complaint filed in the U.S. District Court for the Southern District of Georgia, Elevance claims the ratings disparity will cost it about $115 million in 2027 quality bonus payments.
The suit stems from a May 27 ruling in which U.S. District Judge Lisa Godbey Wood found CMS improperly included 20 measures when calculating Clover’s 2026 star rating. The court ruled that CMS overstepped its legal authority on 10 of those measures by relying on data it was not permitted to use, and skipped required public rulemaking on the other 10. CMS later recalculated Clover’s rating, upgrading its PPO plan from 3.5 to 4.5 stars.
In its complaint, Elevance argued those same 20 measures factored into its own 2026 ratings, and that CMS cannot lawfully treat the measures as defective for Clover but sound for other plans. According to the suit, removing the 20 measures would raise the ratings on five Elevance contracts.
On June 17, CMS said it would voluntarily recalculate the 2026 ratings, but only for plans whose scores would improve, and it removed a different set of measures than the court addressed. Elevance alleges that approach was a “half measure” that pulled out measures on which it scored well, leaving its ratings essentially unchanged while competitors gained ground on their 2027 bids.
Elevance said it asked CMS in a June 22 letter to give it the same treatment as Clover, and that the agency refused a few days later. The insurer wants the court to throw out its 2026 ratings for the five contracts, order CMS to recalculate them without the 20 measures, and allow Elevance to revise its 2027 bids.
The case is Elevance’s third court fight over star ratings in recent years. In June 2024, a federal judge partially sided with the insurer over CMS’s use of the “Tukey” outlier method in the 2024 ratings, and the agency went on to recalculate ratings across the industry. A separate challenge by Elevance to the 2025 ratings was rejected by a Texas court.
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