CVS Health’s operating will take up to a $1 billion hit in 2024 simply because low Medicare Benefit star ratings, the business stated in a Securities and Exchange Commission (SEC) filing right now.

Just 21% of the people today in the company’s Medicare Benefit plans have been in plans with 2023 star rating of four. or higher compared with 87% in the 2022 star ratings, the SEC filings stated.

The Centers of Medicare and Medicaid Solutions (CMS) makes use of its star ratings to decide which Medicare Benefit plans qualify for high quality bonuses. Plans with a rating of four. or far more can get the high quality bonuses to their premiums

The CVS’ 2024 operating revenue is impacted by the 2023 ratings simply because CMS makes use of the 2023 ratings to decide eligibility for the 2024 bonuses.

Modern day Healthcare was the 1st to report on the SEC filing.

The star ratings are primarily based on measurements of Medicare Advantage’s coverage of preventive care and chronic illness management as nicely as buyer satisfaction.

In the SEC filing, CVS stated the key driver of the precipitous drop in members covered with plans eligible for bonus payments was a 1-star lower in the company’s Aetna National preferred provider organization.