Elevance sues government over $115 million tied to Medicare Advantage star ratings

July 3, 2026 - 00:12

Health insurance giant Elevance Health has filed a lawsuit against the federal government, alleging that the Centers for Medicare and Medicaid Services mishandled the calculation of its Medicare Advantage star ratings. The dispute centers on approximately $115 million in quality bonus payments that Elevance claims it is owed.

In the lawsuit, Elevance argues that CMS failed to properly apply its own methodology when determining the company's star ratings for the 2024 plan year. The star rating system, which ranges from one to five stars, directly impacts how much bonus money insurers receive from Medicare. Higher ratings lead to larger payments. Elevance contends that errors in CMS's calculations unfairly lowered its scores, resulting in the loss of tens of millions of dollars.

The insurer is seeking a court order to force CMS to recalculate the ratings and release the disputed funds. Elevance also argues that the agency did not provide adequate notice or opportunity for the company to challenge the ratings before they were finalized. This legal action comes as the Medicare Advantage market faces increasing scrutiny over billing practices and quality measurement accuracy. CMS has not yet commented on the pending litigation. The case highlights ongoing tensions between private insurers and regulators over how to properly evaluate plan performance and distribute taxpayer-funded bonuses.