Elevance Health's Medicare Advantage ratings lawsuit rejected by judge.

Elevance Health's lawsuit over Medicare Advantage ratings has been rejected by a federal judge. The insurer claimed the government's rating calculation was flawed, resulting in a $375M revenue loss. However, the judge upheld the government's methodology, dealing a blow to Elevance Health's efforts to dispute the ratings.

A federal judge in Texas has ruled against Elevance Health in its lawsuit challenging the Centers for Medicare & Medicaid Services' (CMS) calculation of Medicare Advantage quality ratings. The insurer had argued that the government's rating process was flawed, leading to a significant revenue loss of approximately $375 million [1].

Elevance Health, which provides Medicare Advantage plans in the U.S., alleged that CMS improperly rounded down a score, resulting in a 3.5-star rating instead of the 4 stars it believed the contract deserved. The company contended that CMS had not followed its own regulations for rounding calculations [2].

However, U.S. District Judge Mark Pittman in Fort Worth, Texas, sided with the government, stating that Elevance had not identified any major problems with the calculations and that the process was too complex for the court to evaluate beyond that. The judge noted that allowing Elevance's challenge to proceed would open the door to annual lawsuits from insurers whose contracts just missed the cutoff for higher tiers, threatening the consistency of the rating system [3].

This ruling is a significant setback for Elevance Health, which had been one of several health insurers to sue after CMS released the 2025 star ratings. Last month, another Texas federal judge dismissed a similar lawsuit brought by Humana, finding that Humana had failed to exhaust all of its out-of-court options to challenge the ratings [2].

The Medicare star rating system is crucial for insurers, as higher ratings can lead to increased enrollment and financial bonuses from the government. The judge's decision upholds the methodology used by CMS, which is designed to assess the performance of Medicare Advantage plans [3].

References:
[1] https://www.reuters.com/legal/litigation/elevance-health-loses-bid-challenge-us-medicare-star-ratings-2025-08-19/
[2] https://www.geneonline.com/federal-judge-rules-against-elevance-health-in-medicare-advantage-star-ratings-lawsuit/
[3] https://seekingalpha.com/news/4487179-judge-rejects-elevance-healths-lawsuit-over-medicare-advantage-ratings