Elevance Health Faces Medicare Enrollment Suspension Amidst Data Reporting Issues

The Centers for Medicare & Medicaid Services (CMS) intends to suspend enrollment in Elevance Health’s Medicare Advantage prescription drug plans, effective March 31, 2026, due to ongoing issues with data reporting. This action represents a significant sanction that could have substantial financial consequences for the company if unresolved. The suspension will not impact the 1.9 million individuals already enrolled in Elevance Medicare Advantage plans as of this year.

What Prompted the CMS Action?

CMS stated that Elevance failed to submit required information to federal regulators over a seven-year period. Reuters reports that the government believes Elevance can avert the suspension if it takes corrective steps this month.

Recent Legal Battles and Star Ratings

This action follows a recent legal defeat for Elevance. In August 2025, a federal judge ruled against Elevance in a lawsuit challenging the Centers for Medicare & Medicaid Services (CMS) over Medicare Advantage star ratings. Trending Insurance News detailed how the judge, appointed by President Trump, criticized Elevance’s arguments, stating the company “ignored basic math.” The lawsuit stemmed from Elevance’s disagreement with how CMS calculated its quality ratings, a decision that initially threatened $375 million in potential bonus revenue.

Market Reaction

News of the potential enrollment suspension triggered a negative market reaction. STAT News reported that Elevance’s shares tumbled more than 8% on Monday, March 3, 2026.

What are Medicare Advantage Star Ratings?

Medicare Advantage (MA) star ratings are a crucial component of the Medicare program. CMS assigns star ratings (from 1 to 5 stars) to MA plans based on a variety of quality and performance measures. These ratings influence plan enrollment, as higher-rated plans often receive bonus payments and attract more members. Plans with lower ratings may face sanctions, as is the case with Elevance.

Implications for Medicare Advantage Insurers

The CMS action against Elevance underscores the increasing scrutiny of Medicare Advantage plans. The industry has been actively challenging CMS’s ratings calculations, seeking to protect billions of dollars in potential revenue. This case, and others like it, highlight the ongoing tension between insurers and the government regarding quality measurement and accountability within the Medicare Advantage program.