If you’re still waiting for your share of a landmark $2.67 billion Blue Cross Blue Shield settlement, you may want to stop sitting by the mailbox waiting for the check. In October 20022, several employers, including Home Depot, objected to the settlement. The court overseeing this settlement promised it would quickly review and rule on the matter. But in federal court, “quickly” is a relative term.
During December 2022, oral arguments, Home Depot’s lawyers argued that the settlement “sold out” some class action members. This settlement compensated class members for some rather complicated antitrust violations, which are outlined below.
The 11th Circuit Court of Appeals should issue a decision sometime in the spring of 2023, but that date is just a semi-educated guess. Additionally, if the court overrules this objection, that decision simply allows distribution of the settlement funds. Who knows how long that will take and how many companies will object to the distribution plan.
Like most other health insurance companies, Blue Cross Blue Shield is not a single “company.” Instead, it’s basically a network of independent insurance agencies which have exclusive rights in certain territories.
According to the BCBS lawsuit, which was filed in 2013, Provider A couldn’t muscle in on Provider B’s territory. Each provider had a monopoly, which allowed that provider to charge whatever it wanted to charge.
That requirement is clearly an antitrust violation. But BCBS is not the only health insurance company in America. Consumers who didn’t like BCBS’s services or prices could go somewhere else. We could spend the rest of this post reviewing the arguments and counter-arguments. Suffice it to say that it’s complicated.
Aside from monopolizing, price fixing and bid rigging are the most common antitrust violations. Other violations include boycotting, or agreeing not to sell certain products to certain people, and tying (e.g. you cannot buy a scoop of chocolate ice cream unless you also buy a scoop of pistachio). Once again, these cases are very complex.
Once the court approves the settlement, Individual, Insured Group and Self-Funded Account customers between February 2008 and October 2020 are eligible for a share of the settlement. Different class members can expect different settlement amounts, mostly depending on the type and length of plan purchased.
Class action settlements like this one include every eligible class member who doesn’t opt out of the settlement. Class members who opt out could sue the company individually. But that’s an uphill climb, partially because federal courts are procedural nightmares, and partially because res judicata or another abstruse legal doctrine might apply.
Many people criticize class action matters. Consumers get enough to buy a few scoops of chocolate ice cream and lawyers get millions of dollars.
This criticism is out of place. Believe me when I say that these lawyers earn their fees. Consumers get more than they would have received otherwise, and companies like BCBS think twice before they violate individual economic rights.
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