By Amina Niasse
NEW YORK (Reuters) -The U.S. government announced quality ratings for 2025 Medicare health and prescription drug plans on Thursday, the first indication of which large health insurers, including CVS Health (NYSE:CVS), UnitedHealth Group (NYSE:UNH) and Humana (NYSE:HUM), will get bonus payments in 2026.
Sixty-two percent of people currently enrolled in Medicare Advantage plans that cover prescription drugs are covered by plans rated four or more stars, the Medicare agency said in its release, down from 74% last year.
About 40% of plans being offered are four stars or higher, down from 42% in 2024.
The agency scores health plans between one to five stars, with five being the highest performing.
Low ratings can discourage older Americans from renewing their Medicare coverage with certain insurers and reduce plan enrollments, said Joanna Gajuk, a research analyst at Bank of America, in a note.
Research firm KFF said in September that the government was on track to pay out nearly $12 billion in star ratings-related bonuses to Medicare Advantage plans in 2024.
Performance for some metrics are returning to pre-pandemic levels, the agency said. Prescription drug plans saw the greatest quality improvements in areas including call center services and complaints about the plan.
Humana is “likely to track in line” with its estimates last week, which pointed to only a quarter of its members to remain enrolled in 2025 for its 4+ rating plans, compared with 94% in 2024, Oppenheimer analyst Michael Wiederhorn said in a note.
