2026 Medicare Advantage Star Rating Winners and Losers

Diving brief:

• Medicare Advantage’s average star rating for 2026 is essentially flat after a few straight years of declines — a good sign for the industry, which had been bracing for lower quality scores.
• The results of the main insurers nevertheless varied. The percentage of members in plans rated 4 stars or higher, an important threshold for payers, remained stable for UnitedHealthcare, fell for Humana and Aetna and improved for Elevance and Centene – the five largest publicly traded payers in the privatized Medicare program.
• Perhaps the biggest loser is Clover Health. The insurer’s largest contract covering nearly all of its MA members has fallen below 4 stars — a slip-up that could cost Clover tens of millions of dollars in profits, analysts estimate.

Dive overview:

The CMS quietly released the highly anticipated 2026 star ratings for MA insurers on Thursday evening. The agency normally issues a press release on the findings, but has not yet done so. Operations could be hampered by the government shutdown – HHS said communication would be affected in its contingency plan if appropriations are not used.

Nevertheless, the release of the 2026 data file showed that the weighted average of stars increased slightly, from 3.96 to 3.98, according to an estimate by investment bank TD Cowen. That’s better than many industry observers expected, given that regulators have made top ratings harder to achieve, including by raising standards after the coronavirus pandemic and eliminating outliers from their calculations.

Insurers aggressively compete for higher stars, which are directly linked to the lucrative premiums and competitive benefits of the MA program. It is especially important for payers that their MA contracts meet the 4-star threshold, as this translates into higher bonuses. Higher scores also result in larger discounts if plans submit bids below the CMS benchmark for the coming year.

UnitedHealthcare and Humana, the two largest MA insurers covering 10.3 million and 5.8 million members in the program, respectively, both reported their 2026 stars early. The final results were in line with their initial expectations, with UnitedHealthcare having more than 77% of its members in plans rated 4 stars or higher next year, roughly flat with 2025, according to an analysis Healthcare Dive of CMS data.

Nearly 20% of Humana members will benefit from a diet of at least 4 stars next year, compared to 25% this year.

CVS-owned Aetna, the third-largest MA insurer with 4.2 million members, will have about 81% of its members in top-rated plans. That’s down from 89% in 2025, although Aetna remains ahead of its peers in the category.

Aetna Chairman Steve Nelson said he was proud of the results in a statement released Thursday.

Meanwhile, 53% of Elevance’s 2.2 million MA members will have plans with at least 4 stars next year, up from about 40% this year. The improvement is mainly due to the move from a big contract from 3.5 to 4 stars.

Virtually all members covered by Kaiser, the fifth-largest MA insurer with nearly 2 million members, will remain in plans with at least 4 stars. Finally, Centene, the sixth largest player in the market, increased the percentage of its members in top-rated plans from 1% this year to more than 11% next year.

Beyond the largest MA insurers, results from other publicly traded insurers also varied, with Alignment Healthcare once again reaching 100% of its members in 4-star and above plans. The company bills itself as a state-of-the-art MA provider, better suited for quality and outcomes, and took CMS to court earlier this year to get regulators to increase its scores for 2025.

By comparison, Clover, an insurer and physician support company that offers MA plans in several states, fell below the 4-star threshold for its largest contract, which includes 97% of its members. This could wipe out all of Clover’s current profits before taxes and other adjustments, Leerink Partners analyst Whit Mayo wrote in a note Thursday.

In a press release Thursday, Clover criticized CMS’s methodology and said it “does not believe the overall star rating reflects the excellent health outcomes it provides to its members.”

Beyond Clover, there were no major surprises in the results, analysts said. Stock market reactions after the release of the stars were minimal.

Still, plans that have seen their ratings drop will see revenue declines from CMS and may choose to cut additional benefits or increase premiums to protect their margins, according to Ryan Langston, an analyst at TD Cowen.

This could further reduce the robustness of MA plans in 2027, at a time when major carriers are already cutting expenses in an effort to resurrect sagging profits. MA plans have historically been very lucrative for payers, but margins have declined in recent years as older adults rely more on medical care, health services become more expensive, and regulatory changes dampen reimbursement.

UnitedHealthcare, Humana and Aetna have all reduced the number of states and counties they serve by 2026 to try to recoup their margins. Large payers also prioritize plans with narrower networks and designs, passing more costs on to them. consumers.

The pressure to take additional action could increase on companies with lower star ratings.

However, there are steps insurers can take to mitigate the impact of stars on their business. Humana, for example, said it plans to continue “contract diversification” — juggling enrolling members in certain plans and assigning plans to certain contracts — to move members to higher-rated contracts, and get the higher revenue that implies, for 2027.