25 health systems file ‘opt-out’ antitrust lawsuit against Blue Cross Blue Shield
Jakob Emerson
A group of 25 health systems encompassing more than 80 hospitals have filed an antitrust lawsuit against the Blue Cross Blue Shield Association and its 33 independent entities, alleging anticompetitive practices that led to suppressed payments to providers.
The lawsuit, filed March 4 in a federal court in Pennsylvania, comes after hospitals and other providers opted out of a $2.8 billion class-action settlement reached in October 2024 with BCBS. Physician groups, surgery centers and home health providers have also joined as plaintiffs in the new complaint.
The plaintiffs claim that BCBS companies conspired to divide geographic markets, restrict competition, and fix reimbursement rates, thereby limiting providers’ ability to negotiate fair contracts. The complaint alleges that BCBS’s longstanding territorial agreements prevented the insurers from competing with each other, in turn artificially lowering payments to hospitals and physicians.
The new “opt-out” lawsuit follows two major antitrust settlements involving BCBS in recent years. The first, a $2.67 billion settlement in 2020, resolved claims brought by employers and individual members who alleged BCBS companies colluded to avoid competing for large contracts. That settlement required BCBS to change its association rules, allowing large employers to seek multiple bids from different BCBS companies. The second settlement, reached in 2024, addressed similar allegations from providers, requiring BCBS plans to implement operational changes and ease administrative burdens.
The new lawsuit challenges the adequacy of the 2024 settlement, with hospitals arguing that BCBS’s anti-competitive practices are still happening and continue to harm providers financially. The plaintiffs, which include Temple University Health System, Penn Medicine, Geisinger Health, WellSpan Health, MedStar Health, and Northern Light Health, are seeking treble damages under federal antitrust law, meaning the court could award triple the amount of actual damages awarded to plaintiffs in the prior $2.8 billion settlement. The hospitals are also seeking injunctive relief to permanently ban BCBS companies from continuing their alleged collusive practices.
