3 takeaways for Medicare Advantage plans from the 2025 Star Ratings

Despite no major methodological changes being made this year, overall performance in the 2025 Medicare Advantage (MA) and Part D Star Ratings released on October 10 saw a third consecutive year of declining average ratings for MA plans. Indeed, the number of contracts achieving a coveted five-star rating plunged from 38 to just seven, while the number of contracts earning four stars or higher—the threshold to quality for quality bonus payments—dropped from 242 to 209 (Figure 1). Across all plans, the average rating dipped to 3.92, down from 4.07.

Figure 1. 2024 vs. 2025 Star Ratings performance. Source: CMS.

Weighted by enrollment, just over 62% of MA-PD enrollees are currently in contracts that earned four stars or higher—a major drop from more than 76% for the 2024 Star Ratings.

The release of this year’s ratings had an immediate impact on the MA market, with multiple major payers filing litigation in an effort to get the Centers for Medicare & Medicaid Services (CMS) to recalculate them, as it already did for the 2024 ratings earlier this year. As MA payers of all sizes look to digest these ratings and determine where they could have realistically performed better, here are three takeaways from the 2025 Star Ratings that can help.

Cut points are trending higher

Many of the measure-level cut points increased from the 2024 Star Ratings, meaning that overall, contracts had to achieve higher performance on these measures to receive a high Star Rating. This can be attributed to several factors, including: the elimination of low performance outliers through the Tukey outlier deletions, score distribution compression, MA plan performance returning to pre-pandemic levels, an increasing number of very high-scoring contracts for certain measures such as Breast Cancer Screening (BCS), and increase in scores for contracts at the lower end of the distribution for certain measures such as Colorectal Cancer Screening (COL).

To give an example, for the BCS measure, the two-star cut point increased from 43% in 2023 to 53% in 2025, while the five-star cut point increased from 77% in 2023 to 82% in 2025 (Figure 2). MA plans whose performance held steady in this measure—or even increased, but not by enough—achieved worse ratings.

Figure 2. Cut points for the Breast Cancer Screening (BCS) measure.

Both large and small MA payers are struggling

The smallest MA plans have the fewest resources to realize improvements in their quality scores and therefore must allocate their resources as strategically as possible. But this year’s results demonstrate that even some of the top five largest payers in the country struggled as well, with one alleging its Star Ratings were downgraded based on a single customer service call. For another major MA payer, a decrease in its overall Star Rating from 4.5 to 3.5—below the threshold required to receive quality bonus payments—could mean billions in lost revenue.

As competition between MA plans continues to get fiercer, healthcare utilization increases, and medical loss ratios rise, some plans are re-evaluating whether to even continue their MA lines of business, with the largest not-for-profit plan in Missouri exiting the market altogether.

Quality bonus payments are declining

While quality bonus payments increased by more than 400% from 2015–2023, as noted by KFF, they will decline by 8% or $1 billion in 2024 due to the expiration of COVID-19-related policies. This trend is expected to continue as policymakers look to increase the sustainability of the MA program. For example, the introduction of the Health Equity Index (HEI) in the 2027 Star Ratings is expected to result in more than $5 billion in savings over 10 years.

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