A federal court set aside one plan’s rating. The reasoning reaches every Medicare Advantage contract. Here is what to know and what to do before October.
On May 27, 2026, the U.S. District Court for the Southern District of Georgia set aside Clover Health’s 2026 Star Rating and ordered CMS to recalculate it. The relief reaches one plan. The reasoning reaches the entire Star Ratings program.
On June 5, RISE brought together three experts to break down what the ruling means: Stars strategist Melissa Newton Smith, compliance and policy advisor Ana Handshuh, and WilmerHale partner Kevin Lamb.
If you run a Medicare Advantage (MA) plan, the question they kept returning to is no longer whether this touches you. The question is how much, and what you do about it before the 2027 ratings are published this fall.
Here are the seven things our faculty said every MA leader should take from the ruling.
1. The ruling is narrow. The reasoning is not.
The court set aside Clover’s 2026 rating and nothing else. No other plan’s rating changes today, and there is no opt-in. But the two legal theories behind the decision apply to measures sitting in every MA contract. Read this as a program-wide signal, not a one-plan headline.
2. Two holdings drove the outcome, and both have teeth.
Holding one: Star Ratings data must come from Section 1395w-22(e), which the court read as HEDIS®, HOS, and CAHPS only. That knocked out 10 measures built on Prescription Drug Event data, CMS call center monitoring, Independent Review Entity data, Part D plan reporting, and Part D CAHPS.
Holding two: the annual measure specifications set a substantive legal standard tied to payment, so they require notice-and-comment rulemaking. CMS never ran that process, which made another 10 measures procedurally invalid.
3. Part D carries the heaviest exposure.
Much of the Part D measure set runs on PDE data, plan-reported data, and Part D CAHPS. Strip the first 10 measures and an MA-PD contract loses the Part D improvement measure, then the Part D summary rating, then the overall rating. The faculty put the point plainly: remove the first 10 or all 20, and there is no Part D improvement measure, no Part D summary rating, and no overall rating for anyone. A contract with too few measures receives a “not enough data” result and no star rating at all.
4. Twenty measures sit directly in play. Every measure sits indirectly in play.
The ruling names 20 of the 43 measures. The first 10 fall on the data-source theory: medication adherence (three), statin use in persons with diabetes, both call center measures, Part C appeals decisions, MTM completion, and two Part D CAHPS measures. The second 10 fall on the rulemaking theory, including the CAHPS and HOS-based patient experience measures. But those were just the measures Clover chose to challenge. Applying the same logic to other potential cases would put more measures at risk, among them Appeals Timeliness, COB, Poly-ACH, CTMs, Disenrollment, and SNP Care Management. Build your impact view around the full measure set, not only Clover’s list.
5. Stars is an enterprise issue, not a Stars-team task.
The faculty were direct: Star Ratings is an enterprise revenue lever and belongs in a C-suite office with budget and authority. Stand up a cross-functional response team now. Pull in Legal, Finance, Actuarial, Compliance, Enterprise Risk, Investor Relations, Government Affairs, Operations, and Stars. Move your Stars team to a direct C-level reporting line. Expert legal, policy, and Stars advisory capacity is thin and often conflicted, so secure yours early.
6. Model the scenarios before CMS makes its move.
You need numbers, not narrative. Remodel every open payment year under measure-removal scenarios: the first 10 measures, the first 10 plus adjacent vulnerable measures, the second 10, all 20, and all 20 with adjacencies. Recompute improvement measures, the reward factor, and your Part C and Part D summary ratings under each. Account for relief already baked in from the COVID extreme and uncontrollable circumstances policy and the Tukey recalculation.
7. Expect prolonged uncertainty. Build for it.
CMS is highly likely to appeal both holdings, and an Eleventh Circuit decision lands an estimated 12 to 24 months out. Watch four clocks: the appeal decision, the October 2026 release of the 2027 ratings, the next rulemaking cycle in early 2027, and copycat litigation from other plans and other stakeholders. Do not abandon the affected Part D measures. The underlying activities serve your members, and the ruling might be reversed. Size the investment with eyes open, and put your incremental dollars in the HEDIS, HOS, and CAHPS core that carries most of the rating weight and the least legal risk.
What to do next
Plans that treat this as a compliance footnote will lose ground to plans that rebuild their Stars operating model around durable data and senior ownership. Start with three moves this month: name an executive owner, stand up the response team, and put scenario models in front of your leadership team and your board.
RISE keeps convening the legal, actuarial, quality, and Stars leaders working through this in real time. Our Star Ratings and quality programming will track the appeal, any CMS response, and what both mean for your contracts. Bring your questions and join the room where the industry works out what comes next: Qualipalooza on June 28-30, 2026 in Dallas.
RISE provides industry education, not legal or compliance advice. Consult your organization’s legal or compliance advisors regarding your unique circumstances.