Judge rejects Elevance Health’s lawsuit over medicare advantage ratings

[medicare word written on wood block and stethoscope on a pink background]
Alena Zharava/iStock via Getty Images

Elevance Health has lost its legal battle against the federal government over the way quality ratings are calculated for its Medicare Advantage plans, a decision that cost the insurer roughly $375M in revenue.

On Tuesday, U.S. District Judge Mark T. Pittman ruled that the Centers for Medicare & Medicaid Services correctly applied its methodology when it gave one of Elevance’s contracts a 3.5-star rating rather than 4 stars.

The dispute centered on a contract that received a numerical score of 3.749565. Elevance argued the score should have been rounded up to 4 stars, claiming the agency failed to follow its own rules for rounding calculations.

Pittman dismissed this claim, noting that CMS’s process was consistent with its regulations and criticizing the company’s legal reasoning as unconvincing.

He added that Elevance had not identified any significant flaws in CMS’s highly technical rating approach that would merit judicial intervention.

Government lawyers countered that siding with Elevance would invite a wave of annual lawsuits from insurers narrowly missing higher ratings, threatening the consistency of the rating system.

Other insurers have filed similar suits over the 2025 ratings, including Humana (HUM [https://seekingalpha.com/symbol/HUM]), whose case was dismissed last month by another federal judge in Texas on procedural grounds.

MORE ON ELEVANCE HEALTH

* Elevance Health: CEO Buys As CareBridge Drives Strong Growth [https://seekingalpha.com/article/4803951-elevance-health-ceo-buys-as-carebridge-drives-strong-growth]
* Elevance Health, Inc. (ELV) Q2 2025 Earnings Call Transcript [https://seekingalpha.com/article/4801972-elevance-health-inc-elv-q2-2025-earnings-call-transcript]
* Elevance Health, Inc. 2025 Q2 - Results - Earnings Call Presentation [https://seekingalpha.com/article/4801970-elevance-health-inc-2025-q2-results-earnings-call-presentation]
* Medicare Part D premiums will sharply rise in 2026 - report [https://seekingalpha.com/news/4473025-medicare-part-d-premiums-will-sharply-rise-2026]
* Elevance Health downgraded at Argus on profit margin pressure [https://seekingalpha.com/news/4469437-elevance-health-downgraded-argus-profit-margin-pressure]