Due to the pandemic, the federal government had to contend with the fact that a significant amount of the data used for star ratings could not be collected remotely, and that in-person data collection wasn’t feasible.
CMS decided that the normal in-person data collection process could be dangerous and potentially divert staff away from their focus on addressing the pandemic. To address this, CMS used previously collected data (from 2019) for metrics that had to use in-person data collection, and only incorporated updated data that could be collected remotely. So the 2021 star ratings were based on a combination of new and previous data.
Three insurers that saw their star ratings decline in 2021 filed a lawsuit against CMS, alleging that their star ratings would have been higher if entirely new data had been collected and used.
In June 2021, a federal judge ruled against the three plaintiff insurers. The judge decided that the approach CMS took was reasonable, given the pandemic.
And for the 2022 ratings, CMS implemented some changes to essentially ensure that a contract’s rating would not decrease due to the pandemic. This is part of the reason that the number of 5-star plans grew so much for 2022, but CMS also noted that many plans simply performed better on other metrics as well.