Blue Cross Blue Shield Settlement

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Details regarding a settlement stemming from the antitrust lawsuit “Blue Cross Blue Shield Antitrust Litigation” have continued to emerge since a preliminary settlement was drafted in the Fall of 2020, including a $2.67 billion financial component.

Recently, however, a formal application process has been opened for individuals and employers who have accessed insurance through Blue Cross Blue Shield health plans to apply to become participants in the settlement.

What Was the Lawsuit All About?

The plaintiffs in this case alleged that the Blue Cross Blue Shield Association violated antitrust laws (think laws established to promote open market competition) by preventing individual BCBS health plans to compete with each other and adhere to strict rules regarding the amount of revenue BCBS plans can bring in from other non-BCBS ventures these health plans may also participate in.

What was the Outcome of the Lawsuit?

There was no court decision arrived at confirming nor denying wrongful action by the BCBS Association as the lawsuit is being settled outside of court.  The BCBS Association denies all allegations of wrong doing and assert that their conduct results in lower healthcare costs and greater access to care for their customers.

While the settlement is preliminary, currently, class members are being requested to step forward prior the Court deciding whether or not to approve the settlement.  The Court settlement hearting is scheduled for October 20, 2021.

How do I Know if I am Eligible to Participate in the Settlement?

The settlement outlines that all individuals, insured groups and group self funded accounts are eligible if they had BCBS health insurance coverage during specific periods of time.

Fully Insured Employers & Individuals

Fully insured employers and individual consumers of BCBS health insurance with coverage at any time between February 7th, 2008 and October 16, 2020 are eligible to participate in the settlement.  Employees getting coverage through their fully insured employer are also eligible to apply to be class members in the settlement.  However, employers are not obligated to notify employees of their eligibility nor are they obligated to provide supporting documentation of premiums paid nor of the cost share that was in place.

Self Funded Employers

Self funded employers with BCBS administered health coverage obtained at any time between September 1, 2015 and October 16, 2020 are eligible to participate in the Settlement.

Excluded Classes

Individuals or entities excluded from the settlement class include government accounts, Medicare & Medicaid accounts, and the BCBS defendants themselves.

Is There a Way for Me to Confirm My Eligibility?

If you are still not sure if you are included in the settlement class, you may contact the settlement claims administrator at [email protected] or call toll-free at (888) 681-1142.

What if I am Eligible But Do Not Apply?

Those who do nothing will remain a member of the settlement class, be bound by the settlement, but will not qualify for any of the settlement proceeds.  By remaining a member of the settlement class you are legally bound to not sue or be part of any other lawsuit against the BCBS Association. 

What Does the Settlement Provide?

There are two main components of the settlement.  One is financial and the other is market-related, namely, permitting BCBS plans to compete with each other in certain situations.

Financial Component of the Settlement

The settlement provides monetary payments to eligible participants.  The total amount of settlement funds that will be disbursed is just under $2.7 billion dollars.  However, after covering attorney fees and expenses, the net settlement dollars to be disbursed is $1.9 billion dollars.  Of this amount, 93.5% is being allocated to fully insured class members, including those who purchased individual or group health insurance products.  The remaining 6.5% ($120M) is being awarded to self funded employers.

In both cases, the amount of the settlement award an individual or employer can expect is proportional to the amount of premium (or admin in the case of self funded employers) relative to the total pool of funds made available for each Class (Fully Insured vs Self Insured).  Without knowing how many members will ultimately participate in the settlement class, it is impossible to estimate a specific monetary amount for a class member at this time.

In addition, the monetary allotment to fully insured employers to be awarded will be split into two amounts, recognizing both the employer and the employee typically contribute toward the total premium cost.  The application process allows the employer to demonstrate the premium cost sharing split in place for the time period they had BCBS coverage to determine this split.  If the cost-share split isn’t provided, in fully insured cases, the settlement will default to an allocation of 15% of single premiums collected to be distributed back to employees with single coverage and 34% to be distributed to those with family coverage.  In self funded cases, the default employee cost share assumption is 18% for single coverage and 25% for family coverage employees.  In both cases, the remainder of the financial award would be allocated to the employer.  

If the total payment toward any class member is less than or equal to $5.00, no distribution will be made.  Further, no distributions will be made until there is a final resolution of all determinations and disputes that could potentially impact the settlement payout.

Competition Component of the Settlement

The settlement also involves some changes to the way the BCBS Association will do business moving forward in an effort to increase competition in the market for health insurance.  Specifically, the settlement would remove a BCBS Association rule requiring BCBS companies from placing a primary focus on Blue branded business rather than separately branded member companies. 

Additionally, the settlement gives certain self funded national employer groups having 5,000 or more employees geographically disbursed across the nation the opportunity to receive a second bid from a different national BCBS company than the default BCBS plan typically assigned based on the company’s headquarter location.  The settlement committee has provided an online directory outlining national employer groups that have been identified as eligible to receive a second Blue bid.

How do I Apply to be a Class Member?

The BCBS Settlement committee has established an online claim form for individuals and employers to utilize to apply to participate in the settlement class.  There is also a paper form available that can be mailed instead, if preferred.  For those interested in assistance walking through the application process, Consiliarium has prepared a video that walks through the application.

What is the Settlement Timeline?

The following dates outline the timeline as it stands today for individuals and employers participating in the settlement:

  • May 31, 2021: Notices to class members deadline
  • July 28, 2021: Settlement objections deadline
  • October 20, 2021: Court’s final ruling on the settlement
  • November 5, 2021: Claims filing deadline where funds are scheduled to be distributed within 30 days of this date.

Where Can I Get More Information?

Individuals or employers looking for more information should access the settlement website.  Also, please don’t hesitate to use the contact us button below to reach out to the Consiliarium team with specific inquiries or to contact your dedicated account executive.


About the Author

Ben Lewis resides with his wife and four kids in Rochester, NY where he has lived since coming to Rochester for college in 2001.  After completing his Bachelors of Science in Mathematics at Rochester Institute of Technology in 2005, Ben went on to work at Excellus BlueCross BlueShield where he developed insurance rates for large fully insured and self funded employers.  During these years Ben also obtained his MBA in Finance from RIT.   With industry experience coming from a variety of rolls in finance, benefits consulting, marketing and even a brief stint as an HR Benefits Manager, Ben joined Consiliarium Group as a partner in April, 2019.  Brought on as the Strategic Healthcare Practice Leader, Ben’s responsibilities include heading up the Self Funded business unit, vetting emerging healthcare technology or vendor solutions, and championing the marketing efforts at Consiliarium.  

Ben’s ambition is to help employers empower individuals to pursue personal well-being by working with HR and Finance teams to employ smart, sustainable benefit solutions that meet individuals where they are at and simplify the journey for where they want to go.  When individuals are informed and empowered to become better consumers of healthcare, the results make it a win for everyone.