Most Medicare Advantage drug plan enrollees in high-quality plans, US government says
HUM•About 71% of Medicare Advantage prescription drug plan enrollees are in contracts rated four stars or higher for 2027, the government said. Humana shares rose about 14% in extended trading, while UnitedHealth and CVS Health shares fell about 0.5% and 4%, respectively.
1. Ratings and payments
The Centers for Medicare & Medicaid Services rates Medicare Advantage and prescription drug plans on a one-to-five-star scale. About 37% of Medicare Advantage prescription drug contracts offered in 2027 earned four stars or higher overall. Higher ratings lead to government bonus payments; CMS will pay insurers more than $13 billion in bonuses in 2026.
2. Insurer results differ
About 95% of Humana members were enrolled in plans rated four stars or higher, a 53% improvement from the prior year, according to an Oppenheimer calculation. Analyst Michael Wiederhorn said improved scores could add $3.6 billion in revenue for Humana and provide greater visibility into future earnings. He said average ratings for UnitedHealth and CVS declined 15% from the prior year, while Elevance and Centene fell 10% and 9%, respectively.
3. Low performance warning
The government flagged a California prescription drug plan operated by CVS Health's Aetna unit with a low performance warning. Aetna President Steve Nelson said the ratings reflected progress in clinical services and improved health outcomes for members. The 2027 ratings will appear during Medicare open enrollment from October 15 to December 7 and affect 2028 quality bonus payments.
