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SEC filingClover Health disclosed CMS recalculated its 2027 Star Ratings, increasing PPO contract to 4.5 Stars and HMO contract to 4.5 Stars, boosting quality bonus payments.
On June 17, 2026, CMS issued updated guidance to voluntarily recalculate 2027 Quality Bonus Payment ratings for certain Medicare Advantage contracts, following a court ruling in Clover Insurance Co. V. HHS. For Clover Health, this resulted in the PPO Medicare Advantage contract H5141 being upgraded from 3.5 Stars to 4.5 Stars, and the HMO contract H8010 from 4.0 Stars to 4.5 Stars (based on 2026 Star Rating for payment year 2027). These upgrades are material because Medicare Advantage Star Ratings directly determine quality bonus payments from CMS, which can significantly boost revenue. The court judgment centered on a dispute over CMS's methodology, and the voluntary recalibration signals a favorable regulatory outcome for Clover. Investors should monitor the financial impact, as higher ratings may lead to higher reimbursement rates and improved profitability for Clover's Medicare Advantage segment.