Blue Cross Antitrust Lawsuits Consolidated in Alabama

These antitrust lawsuits against Blue Cross are starting to gain steam. The MDL panel last week created an MDL in Alabama for the slew of antitrust claims that allege that the insurer is stepping on the Sherman Act in the way that licensing agreements with its licensees are set up.

Basically, the lawsuits allege that certain licensees have struck “most-favored nations” deals with hospitals that would chill competition among health insurers, allowing Blue Cross Blue Shield the ability to increase premiums and lock out competing providers.

So a number of lawsuits have been filed, each challenging the way Blue Cross and Blue Shield
licenses the rights to use its trademarks to insurance companies within service areas set forth in the license.

Because all these lawsuits raise the same or similar antitrust claims under federal law, they are appropriate for MDL “sort of class action” treatment:

    Though only nine actions pending in three districts were included on the motion for centralization, this litigation has since grown to encompass potentially 21 actions involving allegations of complex anticompetitive behavior pending in fourteen districts. . . . Here, the actions involve substantial common questions of fact relating to the state BCBS entities’ relationship with the national association, BCBSA, and the licensing agreements that limit the Blue Plans’ activity to exclusive service areas, among other restrictions. All of the Blue Plans are alleged to be co-conspirators, even though some Blue Plans are named as defendants only in actions in their respective state. Centralizing these actions under Section 1407 will ensure streamlined resolution of this litigation to the overall benefit of the parties and the judiciary.

The theory is that more fair competition would create opportunities for consumers. Whether this is how it would play out is anyone’s guess.

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