Blue Cross Blue Shield of Michigan has asked a federal judge to dismiss a Justice Department lawsuit alleging the insurer violated antitrust laws by requiring hospitals offer the lowest rates to its members, according to a release by Blue Cross Blue Shield of Michigan.
This provision, known as the "most favored nation" clause, is used in several industries and has never been invalidated by antitrust litigation, Blue Cross said. In calling for dismissal, the insurer stated the Justice Department failed to meet a requirement that antitrust lawsuits must allege specific facts demonstrating economic harm in specific geographic markets or within specific products.
The lawsuit, filed Oct. 18, alleges Michigan Blue Cross contracts require hospitals to charge insurers that are "significant competitors" of Blue Cross at least 25 percent more than Blue Cross pays.
Critics of the policy contend it contributes to higher healthcare costs by driving up the prices of competitors. But the company said locking in low prices is "a tool that Blue Cross uses to protect the affordability of health insurance for millions of Michiganders."
Read the release on Blue Cross Blue Shield of Michigan.
Read more coverage of most favored nation clauses and antitrust lawsuits:
- Michigan Blue Cross Defends Demand For Hospitals' Lowest Price
- Conn. Attorney General Informs Sec. Sebelius of Anthem's 'Most-Favored' Clauses
This provision, known as the "most favored nation" clause, is used in several industries and has never been invalidated by antitrust litigation, Blue Cross said. In calling for dismissal, the insurer stated the Justice Department failed to meet a requirement that antitrust lawsuits must allege specific facts demonstrating economic harm in specific geographic markets or within specific products.
The lawsuit, filed Oct. 18, alleges Michigan Blue Cross contracts require hospitals to charge insurers that are "significant competitors" of Blue Cross at least 25 percent more than Blue Cross pays.
Critics of the policy contend it contributes to higher healthcare costs by driving up the prices of competitors. But the company said locking in low prices is "a tool that Blue Cross uses to protect the affordability of health insurance for millions of Michiganders."
Read the release on Blue Cross Blue Shield of Michigan.
Read more coverage of most favored nation clauses and antitrust lawsuits:
- Michigan Blue Cross Defends Demand For Hospitals' Lowest Price
- Conn. Attorney General Informs Sec. Sebelius of Anthem's 'Most-Favored' Clauses