Stay ahead of developments in federal and state health care law, regulation and transactions with timely, expert news and analysis.
Oct. 12 — Blue Cross Blue Shield of Michigan has again offered $30 million to settle antitrust claims against it for the way that it structured its contracts with health-care providers in Michigan ( Shane Grp., Inc. v. Blue Cross Blue Shield of Mich, E.D. Mich., No. 2:10-cv-14360, proposed settlement 10/11/16 ).
This is the second time the insurer has offered that amount to cover the $118 million in damages alleged by about 3 million to 7 million purchasers of health-care services in the state. The U.S. Court of Appeals for the Sixth Circuit sent the original settlement back to the district court in June, finding the court hadn’t permitted objectors sufficient access to the court filings to make a proper objection to the settlement (110 HCDR, 6/8/16).
“This case affects the legal rights of millions of people in Michigan,” Bryan R. Walters from Varnum LLP in Grand Rapids, Mich., told Bloomberg BNA.
Walters, the attorney for the class members who objected to the original settlement, said his clients intended to object again to the newly proposed settlement.
Representatives from BCBSM declined Bloomberg BNA's requests for comment. However, in the motion for settlement approval, class counsel told the court that “nothing has changed that would warrant the court reversing its conclusion two years ago that the settlement is a fair, reasonable, and adequate resolution of plaintiffs’ claims.”
The new settlement agreement includes nearly identical terms to the agreement that Judge Denise Page Hood of the U.S. District Court for the Eastern District of Michigan approved in March 2015.
The class members' motion for preliminary approval of the new settlement asserted the Sixth Circuit's reversal wasn't based on a rejection of the actual terms of the settlement but instead was based on the way that the court administratively handled the approval process.
The motion also noted the parties have worked hard to obtain consent from third parties to publicly file their previously sealed documents and their expectation that “before notice of the settlement is disseminated, much or all of the remainder will be unsealed by consent or court order.”
However, Walters expressed doubts about whether the new settlement conformed to the Sixth Circuit's opinion.
“One of the reasons the Sixth Circuit rejected the original settlement was because the entire process was shrouded in secrecy,” he said. “Now the plaintiffs and BCBSM propose the same settlement that was rejected by the Sixth Circuit without sharing a single new piece of information.”
The case involves the use by BCBSM of “most-favored-nation” clauses in its provider agreements. Under those provisions, BCBSM allegedly agreed to pay hospitals high rates as long as those same hospitals charged the same or even higher rates to the commercial health insurers that were competitors of BCBSM.
An earlier settlement attempt by the insurer and representatives for the class members garnered an objection from 26 self-insured companies who claimed the settlement wasn't fair because it included attorney fee agreements that resulted in the class members receiving only a fraction of their alleged damages. Additionally, the objectors claimed the district court had improperly sealed all the relevant court filings, which prevented them from effectively challenging the full settlement agreement.
After the Sixth Circuit's remand, Judge Hood again refused to allow the objectors to intervene and become separate parties to the case.
However, the judge did order the parties to include the objectors and to begin the process of unsealing the court filings, in anticipation of an amended settlement agreement.
The class is represented by Cohen, Milstein, Sellers & Toll in Washington, Fink + Associates Law in Bloomfield Hills, Mich., Gustafson Gluek PLLC in Minneapolis and the Miller Law Firm in Rochester, Mich.
BCBSM is represented by Hunton & Williams LLP in Washington, Dickinson Wright in Detroit and Bodman PLC in Detroit.
The objectors are represented by Varnum in Grand Rapids, Mich.
To contact the reporter on this story: Matthew Loughran in Washington at email@example.com
To contact the editor responsible for this story: Peyton M. Sturges at firstname.lastname@example.org
The proposed settlement agreement is at http://src.bna.com/jj0.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)