Radiologists opt out of $2.8B Blue Cross Blue Shield settlement to pursue own litigation
Radiologists and other physicians have opted out of a settlement with the Blue Cross Blue Shield Association to instead pursue their own litigation.
Providers first sued the BCBSA and its numerous affiliates in 2012, claiming they divided the country into exclusive territories and agreed not to compete with one another. Such collusion drove down reimbursements for radiologists, other physicians, and hospitals while inflating the cost of insurance, attorneys charged.
The long-running case concluded in October, with BCBS agreeing to pay $2.8 billion to settle the antitrust suit. Providers had until July 29 to submit a claim to secure a share of the fund. However, physician groups, instead, have filed an “opt out” lawsuit against BCBS and its affiliates on July 25 in federal court.
Plaintiffs in the complaint include Radiology Partners and its affiliates, along with the Arkansas-based Highlands Oncology Group and Harvard Medical Faculty Physicians. RP, the country’s largest imaging group, shared a statement on its decision to opt out, while Highlands and Harvard did not immediately respond to a Radiology Business request for comment Wednesday.
“Radiology Partners and its affiliated practices stand with healthcare providers nationwide—including physician groups, hospitals and health systems—that are challenging the business practices of the Blue Cross Blue Shield plans and their association,” the Aug. 6 statement said. “For RP, this is not just a legal matter, it’s a healthcare access issue that directly affects patients and professionals alike. RP is committed to advancing a healthcare system that emphasizes clinical excellence, safeguards patient choice and ensures providers are treated fairly. We will continue to pursue legal actions and policy reforms that promote fairness, transparency, cost efficiency and improved outcomes for all.”
The Blue Cross Blue Shield Association said Wednesday it does not comment on pending litigation, but BCBSA and its affiliates shared a statement in October following the original case’s conclusion.
“We deny the allegations made 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,” the statement said. “Our members and healthcare provider partners can rest assured that Blue Cross and Blue Shield companies continue to be strong and ready to deliver exceptional services.”
Dozens of other hospitals and physician groups also have submitted opt-out suits, including the Bon Secours Mercy, Temple University and University of Pennsylvania health systems. Filed in the Eastern District of Pennsylvania, the new claim lists numerous RP affiliates, among them, Alaska Radiology Associates, vRad, Mori, Bean and Brooks Inc., and Singleton Associates.
Strategic Radiology—a coalition of 45 private radiology practices—has held discussions with its members about the case over the past several months. Its CFO Committee took the lead in evaluating the settlement and, “after thorough research and analysis,” developed guidelines to assist practices in gathering the necessary data to file a claim, according to SR spokesman David Howard, MBA. He could not say as of Wednesday how many had opted to seek restitution or pursue further claims in court.
Like the original lawsuit, the new complaint accuses the BCBSA and its affiliates of colluding for “decades” to restrict competition for the purchase of healthcare services. Its alleged goal was to “pay healthcare providers far less than they would have been paid in a competitive market.” This collusion among Blues plans was a violation of federal antitrust laws, RP and its co-plaintiffs charge.
They contend that local BCBS plans generally pay “significantly less” than other commercial payers. This is the result of a “coordinated effort” to help health plans operate “free of competition,” using a “scheme” that imposes geographic restrictions on trademark licenses granted to each affiliate.
“Absent competition, the defendant insurance companies have achieved significant market power and domination in the markets in their exclusive service areas,” the complaint charges. “The geographic restrictions have barred competition from the respective commercial health insurance markets and the market for healthcare provider services. Their illegal conduct has damaged and continues to damage healthcare providers.”
Rad Partners, Harvard and Highlands Oncology are seeking a jury trial to decide the matter. They’re asking for damages that would include attorney fees, pre-judgment interest, other injunctive relief to “prevent future loss or harm,” and a decree that BCBSA and its affiliates violated the Sherman Antitrust Act.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.