Shares of CVS Health tumbled early Friday after the company said a large Medicare Advantage plan took a hit on the government’s quality rating a week before a key enrollment window opened.
The healthcare giant said its Aetna National PPO fell to 3.5 stars from 4.5 stars in 2023, released Thursday by the Centers for Medicare and Medicaid Services.
According to CMS, programs are rated on a scale of 1 to 5, with 5 being excellent. The ratings are published annually and reflect the experiences of those who participated in the program.
The drop means that the program will no longer be eligible for the CMS Quality Bonus. It could also affect registration, as some shoppers incorporate ratings into their coverage decisions.
The Aetna program covers all 50 states with nearly 2 million people enrolled, accounting for more than half of Aetna’s Medicare Advantage enrollment. Aetna is the health insurance arm of CVS Health, which also operates a national chain of pharmacies and administers prescription drug insurance.
CVS Health said the main reason for the decline was a scoring system based on survey results from 976 clients, or well below 1 percent of the program’s enrollment.
A Medicare Advantage plan is a privately run version of the government’s Medicare plan for people 65 and older or with certain disabilities. The annual admissions window for the 2023 program will open in October. 15th and continues until December. 7.
Shares of Woonsocket, Rhode Island-based CVS Health Corp. fell 4.7 percent, or $4.65, to $93.93 before the market opened on Friday.