Oscar seeks preliminary injunction to bar Florida Blue from exclusive broker agreements

Oscar says it will suffer "immediate irreparable harm" if a court does not block Florida Blue from enforcing exclusive broker contracts. (Oscar Health)

A week after filing an antitrust lawsuit against Florida Blue, Oscar Health is asking a court to block the insurer from maintaining exclusive agreements with insurance brokers.

Citing “immediate irreparable harm” Oscar told a Florida U.S. District Court it has already lost market share in Orlando’s Affordable Care Act exchange where it began selling plans this year, and Florida Blue’s actions have jeopardized plans to enter the Jacksonville and Tampa markets next year.

“As a result of being foreclosed from a material percentage of the brokers in Orlando, Oscar stands to sell only a fraction of the plans this year that it had projected, which will have major repercussions on its competitiveness in future years in Orlando and other markets in Florida,” the insurer wrote in a legal filing (PDF) on Monday requesting a preliminary injunction for the company’s exclusive broker agreements.

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Last week, Oscar sued the Blue Cross Blue Shield plan, accusing the company of “monopolist” behavior by forcing insurance brokers to sell only Blues plans.

RELATED: Oscar accuses Florida Blue of violating antitrust laws by cutting off brokers

Testimony provided by Mark Israel, a senior managing director at the economic consulting firm Compass Lexecon indicated that Florida Blue’s operates a 91% market share in Orlando’s marketplace. Israel said Florida Blue “exploited its market power in an anticompetitive fashion” and will deter Oscar from entering other markets in the state.

“Oscar clearly has lost customers and revenue due to Florida Blue’s exclusionary conduct, and thus has suffered irreparable harm,” he said in written testimony.

Two insurance brokers in the state also testified on the lengths Florida Blue employees went to ensure brokers did not stray from the exclusive policy. William Sparks, a broker with Morse Insurance Agency, testified that Beau Shiflet, the Central Florida area manager for Florida Blue, threatened brokers at a meeting that their contracts would be canceled if they sold Oscar plans.

Another broker, Julio Rocha, of Rocha Financial Group, said his contract was canceled after he interviewed an Oscar representative on a radio show he hosts in the Orlando area.

“We saw and heard your radio program with Oscar leadership promoting them in the Orlando market and the recruiting of agents,” an employee wrote in an email, according to Rocha. “This is not what we are looking for in our business partners."

Florida Blue maintains that as independent contractors, insurance brokers are free to contract with whichever carrier they choose. A spokesperson also noted that exclusive arrangements have been used “for many years” in the insurance business.

“The New York company that claims to be a startup has 1,600 agents in Florida, operates in nine states, has billions in venture capital funding from Google and others, and hired one of the most expensive law firms in the country to bring a complaint that has no merit,” spokesperson Paul Kluding said in an emailed statement. “We are confident of our legal position, and we are confident about our ability to compete in the marketplace.”

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