Blue Cross Blue Shield plans have agreed to a $2.8 billion settlement to resolve legal allegations from a slew of providers who claim the insurers colluded to prevent competition and lower reimbursements.
The settlement, tentatively reached in Alabama federal court, would bring a decade-long legal battle to a close should it secure final approval. Providers first sued the Blue Cross Blue Shield Association (BCBSA) and 33 of its affiliates in 2012, arguing that they worked together to split up geographic regions so they did not compete against one another.
This collusion, the providers argued in the lawsuit, decreased their reimbursements and led to higher insurance costs.
In a statement to Fierce Healthcare, the BCBSA said it denies the allegations in the lawsuit.
"However, to reach a settlement and put years of litigation behind us, we have agreed to make some operational changes and a monetary payment to the provider class involved in the case," a spokesperson said.
“Our members and health care provider partners can rest assured that Blue Cross and Blue Shield companies continue to be strong and ready to deliver exceptional services," according to the spokesperson. "We remain committed to providing access to affordable, high-quality care and improving the health of the communities we serve, just as we have for 90 years."
The settlement is pending approval from Judge R. David Proctor. An agreement was reached Oct. 4, according to court documents filed Monday.
Any provider who treated a BCBS member from July 24, 2008, to Oct. 4 is eligible for the settlement if they agree to join. According to the filing, $100 million in funding from the settlement will be set aside for notification purposes and to administer the settlement.
Along with the financial elements of the settlement, BCBS plans agreed to make changes to the BlueCard program. The provider-facing platform is used to track claims, make prior authorization requests and submit questions to the health plan.
As part of the settlement, BlueCard will move to cloud-based, and Blues plans have agreed to make payments promptly and with interest should payments fall outside of the set window.
The settlement echoes a 2020 agreement to resolve a class-action suit from consumers, who also alleged that Blues plans worked together to avoid competing against one another. The Supreme Court declined to hear a challenge to that $2.7 billion settlement over the summer.