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A long-running $2.7 billion antitrust settlement against Blue Cross Blue Shield has been finalized in federal court.
U.S. District Court Judge R. David Proctor in Alabama handed up the order on Tuesday, with the settlement to go into effect in 30 days.
Proctor also awarded legal fees of $626 million to be paid out of the settlement fund and cost and expenses of $40 million. The $626 million represents 23.47% of the settlement fund.
On its website, BCBS said, “The settlement received final approval on August 9, 2022. Payments from the settlement will be made to Class Members who submitted valid claims only after any appeals – if filed – are resolved. Please check this website for updates.”
WHY THIS MATTERS
This is the final approval of the $2.7 billion antitrust settlement – pending any appeals, if filed by policyholders or employers – that was reached in October 2020.
The settlement resolves claims that the insurers violated antitrust laws by entering into an agreement not to compete with each other and to limit competition among themselves in selling health insurance, according to the BCBS settlement website. BCBS has denied all allegations of wrongdoing.
A number of employers and policyholders brought the proposed class action lawsuit in 2012.
As part of the settlement, BCBS companies agreed to make changes in the way they do business to increase opportunities for competition in the market for health insurance.
However, Home Depot has argued the settlement doesn’t go far enough in boosting competition among the Blue insurers, according to The Wall Street Journal.
The settlement does not change the Blues’ licensing setup that grants exclusive geographic branding rights to the companies, which was the main original focus of the litigation, the WSJ report said.
THE LARGER TREND
This settlement arose from a class action antitrust lawsuit that was reached on behalf of individuals and companies that purchased or received health insurance provided or administered by a Blue Cross Blue Shield company.
Class members who could be impacted by the settlement include individual employees as well as employers who sponsored health insurance plans that were insured with BCBS at any time between Feb. 7, 2008, and Oct. 16, 2020, under fully insured plans, or were covered by or enrolled in a self-funded plan any time between Sept. 1, 2015, and Oct. 16, 2020.
In October 2020, the Blue Cross Blue Shield Association and Blue Cross and Blue Shield companies said they had reached an agreement to settle a legal dispute challenging elements of Blue Cross Blue Shield Association licensing agreements.
The Blue Cross Blue Shield Association is a national federation of 35 independent, community-based and locally operated Blue Cross and Blue Shield companies.
In November 2020, Anthem said it would pay $594 million as its share of the antitrust settlement. Anthem operates Blue Cross and Blue Shield plans in 14 states.
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