The federal government released new quality ratings for 2027 Medicare Advantage insurers, with Humana emerging as the biggest winner. However, significant uncertainty persists regarding the quality measures that determine these grades. These ratings carry substantial financial weight, as tens of billions of dollars in extra revenue are tied to the performance of the highest-performing plans.
Alignment Healthcare has threatened to sue the government after its star ratings were downgraded. This legal challenge is a common occurrence for insurers dissatisfied with their grades. According to the Centers for Medicare and Medicaid Services, nearly 71% of Medicare Advantage enrollees are currently in plans that will hold at least four out of five stars for quality.
Plans achieving at least four stars trigger annual bonuses that total $13 billion across the industry. The ratings assigned for 2027 will result in bonus payouts in 2028.