CMS is appealing its court loss that led to boosts in Clover Health’s 2026 Medicare Advantage star ratings.
The case will now move to the U.S. Court of Appeals for the Eleventh Circuit, according to a July 21 court filing.
Clover sued CMS in November, opposing measures it said contributed to its largest MA contract’s 3.5-star designation. The complaint said the rating put roughly $120 million in payments at stake. Plans typically have to secure a 4-star rating to land quality bonus payments. The 2026 ratings from the fall will affect 2027 bonus payments.
In May, U.S. District Judge Lisa Godbey Wood ruled partially in Clover’s favor, determining CMS improperly included 20 measures in the calculation. CMS had to recalculate the contract’s rating, elevating it from 3.5 to 4.5 stars. In the weeks that followed, CMS voluntarily issued updated ratings to other insurers, as well. That move has since spurred more legal battles, with Elevance Health suing CMS in July over differences between Clover’s and the other plans’ recalculations. Shortly after, SCAN Health Plan and Alignment Health filed lawsuits of their own, arguing CMS’ fix did not go far enough. Each is seeking a bump from 4 to 4.5 stars.
The appeal came the same day CMS announced plans to release the revised ratings. Ratings remained the same for 61%, increased for 9% and decreased for 30% of contracts. Overall ratings will only update if a contract saw a boost, with updates coming through “on or about July 22, 2026,” according to a letter from CMS to Medicare Advantage organizations.
In January, CareFirst BlueCross BlueShield also sued CMS over how the 2026 ratings were calculated. Other insurers — including UnitedHealthcare, Humana, Centene, Louisiana Blue, Florida Blue and BCBS Massachusetts — have all brought their own star ratings cases in recent years and have been met with mixed outcomes. Like the recent Clover case, victories for Elevance and SCAN resulted in broader recalculations in 2024.
“While we are restricted in our ability to comment because we are in litigation, what we can say is that we believe that Judge Wood’s decision was thorough and well-reasoned and should be upheld,” Clover told Becker’s. “We will vigorously defend the company’s rights as we continue in our mission to bring affordable, high-quality care to all seniors on Medicare.”
A CMS spokesperson told Becker’s the agency does not comment on litigation.
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