The lawsuits, filed March 4 in federal courts in Pennsylvania, California and Illinois, come after hospitals and other providers opted out of a $2.8 billion class-action settlement reached in October 2024 with BCBS. Physician groups, surgery centers and home health providers have also joined as plaintiffs in the new complaint.
The plaintiffs claim that BCBS companies conspired to divide geographic markets, restrict competition, and fix reimbursement rates, thereby limiting providers’ ability to negotiate fair contracts. The complaints allege that BCBS’s longstanding territorial agreements prevented the insurers from competing with each other, in turn artificially lowering payments to hospitals and physicians.
The new “opt-out” lawsuits follow two major antitrust settlements involving BCBS in recent years. The first, a $2.67 billion settlement in 2020, resolved claims brought by employers and individual members who alleged BCBS companies colluded to avoid competing for large contracts. That settlement required BCBS to change its association rules, allowing large employers to seek multiple bids from different BCBS companies. The second settlement, reached in 2024, addressed similar allegations from providers, requiring BCBS plans to implement operational changes and ease administrative burdens.
The new lawsuits challenge the adequacy of the 2024 settlement, with hospitals arguing that BCBS’s anti-competitive practices are still happening and continue to harm providers financially. The plaintiffs, which include CommonSpirit, Bon Secours Mercy Health, Temple University Health System, Penn Medicine, Geisinger Health, WellSpan Health, MedStar Health, and Northern Light Health, are seeking treble damages under federal antitrust law, meaning the court could award triple the amount of actual damages awarded to plaintiffs in the prior $2.8 billion settlement. The hospitals are also seeking injunctive relief to permanently ban BCBS companies from continuing their alleged collusive practices.
