Blues Fined $1.6 Million For Fraudulently Concealed Fees – PPO Access Fee of 13.5%?

A circuit court jury has ordered Blue Cross Blue Shield of Michigan to pay the city of Holland $1.6 million for wrongfully charging it excess fees as part of an employee insurance program.

An Ottawa County Circuit Court jury ruled Blue Cross “fraudulently concealed” a 13.5 percent access fee on city employee
claims. For example, City Attorney Andy Mulder said, if an employee incurred a $100 medical bill, Blue Cross would charge the city for $113.50 without disclosing the administrative markup, reported the Grand Rapids Press.

Holland officials said they didn’t know about the fee until 14 years after hiring Blue Cross to run the program, as similar cases
against the insurer and other municipalities around the state went to court, the Holland Sentinel reported.

There have been at least 30 cases filed against Blue Cross over the fees throughout Michigan. “Most of them are pending in some fashion,” whether awaiting trial or on appeal, Holland attoney Aaron Phelps said, adding that Blue Cross hasn’t won any cases, noted the Sentinel.

Blue Cross said it will appeal the verdict. Spokesperson Helen Stojic said Holland officials knew of the network access fee
up front, despite claiming they were unaware for 14 years. “Not only were these fees known, the City of Holland received substantial discounts in hospital services which resulted in millions of dollars in savings in hospital costs for Holland taxpayers,” Stojic said, according to the Grand Rapids Press.

Editor’s Note: How does a consultant spread-sheet this?

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