Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Blue Cross allegedly conspired to deny in-network status to healthcare facility, (Feb 5, 2016)

By Michael Menzhuber, J.D., LL.M.

A health care limited liability company has filed a complaint in the federal district court in Tulsa which alleges that the exclusion of one of its health facilities from in-network status by Blue Cross and Blue Shield (BCBS) was the result of conspiracy between BCBS and other area healthcare facilities (Bristow Endeavor Healthcare, LLC v. Blue Cross and Blue Shield Association, February 2, 2016).

According to the complaint, Bristow Endeavor Healthcare, LLC owns and operates three health care facilities in the Tulsa/Northeast Oklahoma area: (1) Bristow Medical Center (BMC); (2) Cimarron Healthcare Center (CHC); and (3) Center for Orthopaedic Reconstruction & Excellence (CORE). BMC was an in-network provider for BCBS at the time Bristow Healthcare requested the addition of CHC as an in-network provider.

CHC was not required to enter into a separate agreement with BCBS and the request was granted under blended rate terms which drastically reduced the billings rates that Bristow Healthcare had been receiving. In contrast, several area healthcare facilities (collectively, “Hillcrest Healthcare System”) were being reimbursed for in-network, covered services at rates well above what Bristow Healthcare was receiving, the complaint alleges.

Bristow Healthcare later opened CORE and, pursuant to the provider agreement, notified BCBS of the facility and its desire to add CORE as an in-network provider under the BMC provider agreement. Even though BCBS had added CHC under the BMC provider agreement, it stated that a separate agreement and national provider identifier number were required and CORE was denied status as an in-network provider.

BCBS also told Bristow Healthcare that all BCBS members should use in-network facilities and a BCBS representative threatened physicians with network agreement terminations if they referred patients to out-of-network facilities such as CORE.

The complaint further alleges that Hillcrest Healthcare System and several other area healthcare facilities (collectively, “Ardent Health Services”) met regularly, along with BCBS, to discuss how to prevent CORE from becoming an in-network provider with BCBS. To date, CORE has still not been added as an in-network provider.

Bristow Healthcare alleges claims against BCBS, Hillcrest Healthcare System, and Ardent Health Services for conspiracy under the Section 1 of the Sherman Act and the state antitrust law, and tortious interference with business and contractual rights.

The complaint seeks a judgement of compensatory damages, treble damages on antitrust claims, punitive damages, pre- and post-judgment interest, the costs of the suit include attorneys’ fees and expenses, and a permanent injunction barring the defendants from entering into, or from honoring or enforcing, any illegal conspiracy, combination, or contract that has been entered into in restraint of trade.

The case is No: 16-cv-57-CVE-JPC.

Attorneys: Michael Burrage (Whitten Burrage) for Bristol Endeavor Healthcare, LLC.

Companies: Bristow Endeavor Healthcare, LLC; Blue Cross and Blue Shield Association; Health Care Service Corporation; Hillcrest Healthcare System, Inc.; AHS Hillcrest System, LLC; AHS Hillcrest Medical Center; AHS Medical Holdings LLC; Ardent Health Partners LLC; Arden Medical Services, Inc.

News: Antitrust OklahomaNews