Healthcare
No matter how we manage our health, efficacy, risks and costing are top concernsThe U.S. Justice Department and Michigan’s attorney sues Blue Cross Blue Shield of Michigan in U.S. District Court
In the Monday, the U.S. Justice Department filed a lawsuit against Blue Cross Blue Shield of Michigan, accusing it of violating antitrust law by negotiating contracts with hospitals that bar the hospitals from giving Blue Cross’ rivals a better deal.
The Justice Department and Michigans’s attorney general’s office said in the paper filled in U.S. District Court for the Eastern District of Michigan to asked the court to stop Blue Cross Blue Shield of Michigan, which is a nonprofit, from including ‘most favored discount’ or similar clauses in contracts with hospitals.
According to court papers, there are two types of clauses critcized by the antitrust division included;
- required the hospitals to charges other commercial insurers more than Blue Cross is charged, and
- giving Blue Cross’ rivals a deeper discount than Blue Cross receives.
The company spokesman, Andrew Hetzel, said that if the lawsuit is successful, it could lead to pricier health care for Michigan residents.
According to court papers, the 70 hospitals involved operate more than 40% of Michigan’s acute care hospital beds.
The clauses caused “substantial harm to the marketplace”, said Christine Varney who head the antitrust division at the Justice Department. But she was not seeking monetary penalties.
She said, “We’re seeking injunctive relief”.
Varney said, “We will continue to monitor this important industry. If we uncover other health insurers with market power that use anticompetitive MFNs (clauses) to thwart competition, we will challenge them.”
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