CVS’s Aetna is one of the latest payers to CMS over 2027 star ratings

Everybody wants star power. Health insurers are no exception.

CVS Health, parent company of Aetna, filed suit in the US District Court for the Southern District of Georgia against the Centers for Medicare and Medicaid Services (CMS) and the Department of Health and Human Services (HHS) on Oct. 26 over how CMS calculated its 2027 Medicare Advantage (MA) plan star ratings.

This is at least the fifth lawsuit challenging CMS’s methodology after the agency released its 2027 MA plan star ratings on Oct. 8. Scan Health Plan also sued on Oct. 26, Centene and its affiliates sued on Oct. 22, HealthFirst health plan on Oct. 19, and Alignment Healthcare on Oct. 9.

Star ratings determine the distribution of billions of dollars in bonus payments and rebates, meaning these suits carry high stakes for both the plans and the federal government, David Meyers, a health services researcher and health economist at Brown University, told Healthcare Brew.

Payers have received hundreds of millions of dollars in additional bonus payments after winning a rating readjustment in past lawsuits. Total bonus payments will top $13 billion in 2026, per KFF, over 4x higher than in 2015. But these growing sums have bolstered concerns that the federal government overpays MA and prompted calls for star system reform from consumer advocacy groups like the Medicare Rights Center.

“It’s very expensive for CMS to continue to pay out and recalculate these star ratings and pay more money in what’s already an expensive program to run,” Meyers said. “It’s bad for plans, having instability and uncertainty around what their ratings are going to be.”

The argument. CVS’s suit argues 28 measures were “unlawfully adopted” and shouldn’t have been included in 2027 star ratings, claiming that they either exceeded CMS’s authority, were added without following proper public notice and comment rulemaking procedures, or both.

It’s the same legal argument made by Centene in its lawsuit, though Centene is only challenging 17 measures.

CVS estimates the inclusion of those measures cost it over $2 billion in potential 2028 quality bonus payment and rebate retention. Centene’s suit estimates disputed measures cost “hundreds of millions of dollars in revenue.” In both cases, the companies argue that money could have gone toward improving care and reducing premiums for members.

CVS’s and Centene’s lawsuits cite as precedent a May ruling from the same district court ordering CMS to recalculate 20 measures for Clover Health. Clover raised arguments about 10 measures not going through proper public notice and comment period and 10 measures being based on data that the company alleged CMS did not have authority to use. CMS then voluntarily chose to recalculate the 10 measures tied to the unauthorized data allegation and several more for other plans’ 2026 ratings, too. The recalculations only applied if they increased payers’ scores.

CMS told Healthcare Brew it does not comment on topics related to pending litigation.

CVS and Centene referred Healthcare Brew to their respective complaints when asked for additional comment.

The implication. Plans have been suing CMS over star ratings for years. While payers such as Humana have lost star ratings suits, there have also been a series of successes. Clover’s victory this year and similar victories in prior years “opened up the floodgates” for more suits by showing “plans can effectively sue CMS and usually win to get huge additional payments as a result,” Meyers said.

As payments increase, critics point to research that suggests star ratings translate into paydays for plans but not necessarily better outcomes for patients. CMS retooled MA star ratings methodology this year so it “better reflects clinical quality, health outcomes, and patient experience,” the agency said in an April press release.

“It’s clear that maybe something needs to be done about reforming the star rating system overall because it just doesn’t seem like this can be maintained for many more years,” Meyers said.