Appeals Court Upholds $6.1M Fraud Judgment Against BCBS of Michigan

A $6.1 million fraud judgment against Blue Cross Blue Shield of Michigan has been upheld by the U.S. Court of Appeals for the Sixth Circuit, according to a National Law Review article.

In 2013, a federal court in Detroit held BCBS of Michigan had committed fraud by marking up hospital claims as much as 22 percent for employees of Hi-Lex Controls and Hi-Lex America, both based in Hudson, Mich. The court found over a 20-year period, BCBS of Michigan collected millions of dollars from the two companies through the use of the markups as well as hidden fees, according to the report.

On May 14, a federal appeals court agreed with the 2013 holding and stated BCBS of Michigan knew about the markups and hidden fees and misrepresented them to its customers. The court found BCBS of Michigan even trained its employees to downplay the hidden fees if one of its customers discovered them, according to the report.

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