Chosen Solution

My battery health says 100% but it also says it needs to be serviced and that it is significantly degraded and needs to be replaced. What do I do? Is it a bug?

Is this an original battery or was already replaced in the past. Poor quality replacement batteries may give contradicting results in Battery Health wheras an original battery should be more consistent. Either way, the easiest thing to try is another high quality battery to see if it solves your problem.