TLDR
- Clover Health (CLOV) surged nearly 14%, closing at $4.89, after CMS upgraded its Medicare star rating to 4.5 Stars from 3.5 Stars.
- The upgrade followed a federal court ruling ordering CMS to recalculate the rating for Clover’s PPO Medicare Advantage plan, Contract H5141.
- The higher rating directly affects 2027 payment rates and unlocks eligibility for quality bonus payments from CMS.
- CLOV hit a new 52-week high of $5.14 intraday and extended its winning streak to a third straight day.
- The move came despite broad market weakness, with the S&P 500, Dow, and Nasdaq all trading lower on the day.
Clover Health (CLOV) stock closed up 13.99% on Wednesday at $4.89, touching a fresh intraday high of $5.14, after the company announced a major Medicare star rating upgrade from the Centers for Medicare & Medicaid Services.
Clover Health Investments, Corp., CLOV
The stock has now risen for three straight days and hit a new 52-week high during the session.
The catalyst: CMS recalculated CLOV’s 2026 Medicare star rating to 4.5 Stars, up from 3.5 Stars, following a favorable court ruling.
The upgrade applies to Contract H5141, Clover’s PPO Medicare Advantage plan, which covers more than 97% of its members.
The recalculated rating will directly influence payment rates for 2027, including eligibility for quality bonus payments from CMS — real dollars, not just optics.
The Legal Win Behind the Move
The rating change didn’t happen quietly. Clover sued CMS and the U.S. Department of Health and Human Services, arguing that the agency had used “improper” quality measures and methodologies when calculating its original 3.5-star rating.
Clover had argued the correct rating should have been 4.0 Stars, and that the downgraded rating would have cost the company millions in quality bonuses and government reimbursements, hurt its competitiveness, and weighed on future growth.
On May 29, 2026, the U.S. District Court for the Southern District of Georgia sided with Clover, setting aside the original rating and ordering CMS to redo the calculation.
CMS notified Clover of the new 4.5-star rating on June 9 — higher than even Clover had originally asked for.
Earnings Momentum Adding Fuel
The star rating news landed on top of an already improving fundamental picture.
Clover reported its first-ever positive GAAP net income in Q1 2026, with revenue rising sharply year-over-year.
Canaccord analyst Richard Close had recently raised his price target on the stock while keeping a Buy rating. He argued a rising tide in managed care was benefiting digital health companies.
That backdrop gave investors more confidence to act on Wednesday’s news.
The stock’s move was all the more eye-catching given the market environment on the day.
The May 2026 CPI report, released Wednesday morning, showed headline inflation jumping to 4.2% year-over-year — its highest level since 2023 — driven by a sharp rise in energy costs tied to geopolitical tensions.
The S&P 500, Dow Jones, and Nasdaq all fell during the session as a result.
CLOV bucked that trend cleanly, powered by a company-specific legal win with direct financial consequences.
CMS notified Clover of the upgraded 4.5-star rating on June 9, 2026.
🚨 Our MAY Stock Picks Are Live!
A new month means new opportunities. Our analysts have just released their top stock picks for May, highlighting companies with strong momentum that rank highly on our KO Score algorithm. We’re also now sharing trade ideas for both long-term and short-term investors, giving you more ways to spot potential opportunities in the market.
Sign up to Knockout Stocks today and get 50% off to unlock the full list and see which stocks made the cut.
Use coupon code Special50 for your exclusive discount!
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
