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Posted on: 01/12/13

Blue Cross Sued in Federal Court


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An Ada County woman has filed a federal lawsuit against Blue Cross of Idaho for engaging in practices which unfairly limit competition. Melissa Allen wants to get her case treated as a "class action" lawsuit so that all Idaho premium holders could benefit if she wins.

Allen notes in her lawsuit that Blue Cross commands 52% of the entire Idaho market. The next-largest competitor is Regence Blue Shield, which serves 22% of Idahoans with private health insurance.

Ms. Allen charges in her suit that Blue Cross' dominance is the result of an illegal conspiracy between various subdivisions of the Blue Cross Blue Shield Association, in which participant organizations have divided up the nation into exclusive territories free of competition.

It is through such a monopolistic arrangement that Blue Cross has amassed some $400 million in assets and profits, according to Ms. Allen.

Blue Cross officials told the media that they would vigorously fight the lawsuit.

The lawsuit has been consolidated with other, similar lawsuits in an Alabama courtroom.

Questions have been asked around the Idaho Statehouse about the lack of competition in Idaho's health insurance market for years. Those questions have become intense as Blue Cross has pushed legislators hard to create a state "insurance exchange". Regulators in other states have opposed such a move largely because they believe that Blue Cross' control of state insurance markets will only expand under governmental sponsorship of their product.

 


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