Thomas Kelley/iStock Editorial via Getty ImagesA sharp decline in its Medicare Star Ratings for 2025 has prompted Humana (NYSE:HUM) to file a lawsuit in a Texas federal court, seeking a reversal of the cut, Bloomberg News reported Saturday. Humana (NYSE:HUM), the second largest operator in the Medicare Advantage market behind UnitedHealth (UHS), filed the lawsuit on Friday in federal court in the Northern District of Texas. The lawsuit blamed the U.S. Medicare program for the rating cut, noting that the agency was “arbitrary and capricious” in calculating Humana’s (NYSE:HUM) ratings. Judge Reed O’Connor, who has a history of siding with plaintiffs in cases challenging government regulators, is expected to take up the case. Previously, UnitedHealth (UHS) filed a similar lawsuit against Medicare in a Texas district court. The Medicare Star rating system, a much sought-after industry benchmark, is designed to reward MA plans with four or more stars with annual bonus payments. Humana (HUM) shares plunged early this month after the company said that only 25% of its members are enrolled in its top-rated MA plans for 2025 compared to 94% a year ago.