BCBS of Texas Ordered to Pay $21 Million for “Willful Conduct of Fraud”

A Texas judge has ordered Richardson’s Blue Cross Blue Shield of Texas to pay more than $21 million to Knox County Hospital……

Article Referred by Mark Flores

08/25/2019by Will Maddox Share Post

A Texas judge has ordered Richardson’s Blue Cross Blue Shield of Texas to pay more than $21 million to Knox County Hospital in unpaid insurance claims because of “acts to be willful conduct of fraud,” according to the Times Record News in Wichita Fallas.

Bobby Burnett, the presiding judge of the 50th District Court of Texas, also placed a temporary restraining order against BCBS, according to a release from Knox County Hospital District. The restraining order says it was placed because BCBS willfully secured funds that did not belong to them, they engaged in slanderous activities, breached duty of care, and violated insurance regulations of Texas.

The Knox County Hospital District says that BCBS stopped reimbursing payments in June of 2017, but claimed they were missing due to a computer glitch. The hospital continued to treat Blue Cross plan members and submit claims, and eventually sought intervention from the Texas Department of Insurance, according to the statement.

“The fact is that Blue Cross has not complied with the restraining order issued by a Texas District Court,” said Kelly Dawson, attorney for the Knox County Hospital District told the Times Record.

In a statement, Blue Cross Blue Shield disputed some of the claims made by the hospital district. “Knox County Hospital District filed suit in Knox County at the end of July without appropriate notice to Blue Cross and Blue Shield of Texas (BCBSTX).  At the time it filed the lawsuit, the hospital also obtained a ‘temporary’ order from the court. BCBSTX was not provided notice of these proceedings until after the order had already expired. The order was based solely on the hospital’s allegations without BCBSTX having a chance to dispute their claims. We intend to vigorously defend against the hospital’s allegations and hold the hospital accountable to its contractual obligations.”

The statement goes on,”The article does not accurately represent the current status of proceedings in that the state court order did not require BCBSTX to immediately pay Knox $21,000,000.  Additionally, there is no hearing set for September 10 in state court because the case is no longer in front of the state court and is now pending in federal court.”

The release said that BCBS has not yet paid the amount to the 14-bed acute hospital between Lubbock and Dallas after receiving the notice on August 15. The Times Recordreports that Blue Cross has filed a motion to move the case to federal court.

“Clearly the Court recognized the enormous financial harm that could be done to the hospital if Blue Cross Blue Shield continues to withhold monies due to the hospital since 2017 and expects us to prevail in court,” Dawson said to the Times Record.

“Blue Cross Blue Shield lied about a computer glitch. They later lied that payments were forthcoming. It is the height of arrogance to slander the hospital while unlawfully withholding funds owed for more than two years,” Dawson told the Times Record.

There will be a hearing for a temporary Injunction on Sept. 10.