bcbs antitrust settlement: Everything You Need to Know

The BCBS antitrust settlement is a significant development in the healthcare industry, with far-reaching implications for consumers and providers alike. In 2010, the Blue Cross and Blue Shield Association (BCBSA) agreed to a settlement with the US government, resolving allegations of anticompetitive behavior.

The settlement was the result of a lengthy investigation by the US Department of Justice (DOJ), which found that BCBSA had engaged in practices that stifled competition and limited access to healthcare services. This included restrictions on BCBS's member plans from contracting with non-BCBS providers.

The settlement imposed significant changes on BCBSA, including the requirement to allow its member plans to contract with non-BCBS providers. This change aimed to increase competition and improve access to healthcare services for consumers.

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The settlement includes a $2.8 billion cash payment into a settlement fund, which is a significant amount of money that will be used to benefit providers and alleviate administrative burdens.

This cash payment is part of a larger agreement that requires all 33 independent Blues to invest hundreds of millions of dollars in system improvements for the benefit of providers.

The settlement also includes operational changes to the BlueCard Program, which will enable additional contracting opportunities for providers out of area and establish a compliance process to keep everything working efficiently.

The non-monetary part of the settlement will require Blue Cross to spend hundreds of millions of dollars on implementing changes, including creating a system-wide information platform to ease member benefits, eligibility verification, and claims tracking.

The settlement aims to increase transparency, efficiency, and accountability in the system, which will ultimately benefit providers and their patients.

The settlement covers U.S. healthcare service providers, including hospitals and some doctors, with Blue plan patients between July 2008 and October 2024.

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The BCBS antitrust settlement involved a class action lawsuit against the Blues, alleging anti-competitive practices in the BlueCard Program. The primary allegation was that the Blues allocated markets by using exclusive service areas to fix prices paid to providers.

The lawsuit was led by Whatley Kallas and its co-counsel, who spent approximately $100 million to develop the largest collection of healthcare claims data in any case in history. The law firm also assembled a work group of providers to provide input throughout the process.

The settlement includes a $2.8 billion cash payment into a settlement fund and requires all 33 independent Blues to invest hundreds of millions of dollars in system improvements for the benefit of providers. The goal is to alleviate and address the resource-draining administrative burdens and inefficiencies that providers experience.

The lawyers representing the plaintiffs and settlement class members are Michael Hausfeld of Hausfeld LLP and David Boies of Boies Schiller Flexner LLP. You do not need to hire a lawyer because Co-Lead Counsel is working on your behalf.

Here's a breakdown of the lawyers' payment: Settlement Class Counsel submitted an application for an award of attorneys' fees plus reimbursement of expenses and costs, for a combined total of 25% of the $2.67 billion fund.

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A lawsuit settlement class action is a type of legal proceeding where a group of people with similar claims join together to sue a defendant. In the case of Blue Cross Blue Shield (BCBS), the settlement involves a $2.8 billion cash payment and system improvements to alleviate administrative burdens on providers.

The settlement was reached after allegations that BCBS used exclusive service areas to fix prices paid to providers through the BlueCard Program, resulting in underpayments nationwide. This anti-competitive practice was investigated and evaluated using a large collection of healthcare claims data.

The settlement also requires BCBS to invest hundreds of millions of dollars in system improvements, including timely communication and payment, transparent decision-making, and timely claims status updates. The goal is to alleviate the resource-draining administrative burdens and inefficiencies that providers experience.

Co-Lead Counsel, Michael Hausfeld and David Boies, are working on behalf of the plaintiffs and settlement class members. You don't need to hire a lawyer because they are already representing you. If you wish to pursue your own lawsuit separate from this one, you will need to hire a lawyer.

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Here's a breakdown of the settlement fund and fees:

The Court held a Fairness Hearing on October 20-21, 2021, to consider whether the Settlement is fair, reasonable, and adequate. You didn't need to attend the hearing because Co-Lead Counsel attended and answered the Court's questions.

The Second Blue Bids process is a key part of the BCBS lawsuit settlement class action. Companies with 5,000 or more employees can now request a bid from a second BCBS licensee, giving them more options for administrative services.

This change comes after the settlement included a process for companies to request a bid from a second BCBS licensee, in addition to the initial proposal from the first BCBS licensee. The Second Blue Bids will be available starting April 1, 2022, or possibly later.

To determine if your company is eligible for a Second Blue Bid, you can use the lookup tool on the settlement website at https://www.bcbssettlement.com/secondbluebid. This tool will indicate whether your company has been designated as a Qualified National Account.

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