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Medicare Advantage (MA) star ratings have become a hot topic for Humana Inc. (NYSE: HUM).
On Oct. 18, the company filed a lawsuit against the U.S. Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS) over its drop in star ratings.
The number of Humana MA plans rated 4-star or higher is expected to see a major decrease next year. The decline could impact the company’s bonus payments from CMS, as well as revenue generally.
The lawsuit alleges that federal regulators actions were “arbitrary and capricious” when it came to calculating Humana’s quality scores. Humana wants the court to vacate the company’s 2025 star ratings, and calls for a recalculation.
The company is also seeking greater visibility around calculations.
With this in mind, star ratings were a popular topic during the company’s third-quarter earnings call Wednesday.