Blue Shield Beats Lawsuit Over Hepatitis C Drug Coverage

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Jacklyn Wille

Blue Shield of California is free from a lawsuit challenging its failure to cover hepatitis C drug Harvoni as a federal judge dismissed patients’ claims against the insurer ( Homampour v. Blue Shield of Cal. Life & Health Ins. Co. , 2016 BL 428020, N.D. Cal., No. 3:15-cv-05003-WHO, 12/22/16 ).

The lawsuit challenged certain limitations Blue Shield placed on Harvoni coverage before 2015, when it amended its criteria and later invited patients who had been denied coverage for the drug to reapply. This move rendered the patients’ lawsuit moot, the judge found on Dec. 22, because it represented a broad policy shift that made it “unlikely” that the challenged practices would reoccur.

In the past year, Anthem Blue Cross Life and Health Insurance Co., Blue Cross and Blue Shield of Florida Inc. and United Healthcare Services Inc. have settled similar lawsuits by agreeing to cover Harvoni with fewer restrictions. Related claims are pending against Health Care Service Corp. and BlueCross BlueShield of Illinois.

The judge hearing the case against Blue Shield of California first granted the insurer’s motion to dismiss in August, but he allowed the patients an opportunity to restate their claims. In his latest ruling, the judge found that Blue Shield’s decision to remove coverage restrictions for Harvoni rendered most of the lawsuit moot.

The judge also found that the patients had no valid claim against Blue Shield Life because none of them had shown that they were participants in a Blue Shield Life-insured health plan. He similarly rejected the idea that the two Blue Shield companies should be treated as a single entity.

Judge William H. Orrick of the U.S. District Court for the Northern District of California wrote the opinion.

Kantor & Kantor LLP represented the patients. Manatt Phelps & Phillips LLP represented Blue Shield.

To contact the reporter on this story: Jacklyn Wille in Washington at jwille@bna.com

To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bna.com

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.

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