Blue Cross Blue Shield of Michigan's subsidiary, Blue Care Networks of Michigan, abandoned its attempt to purchase Physicians Health Plan of Mid-Michigan after the Department of Justice informed the companies that it would file an antitrust lawsuit to block the acquisition, according to a DOJ news release.
According to the release, if Blue Cross-Michigan had purchased PHP, the company would control nearly 90 percent of the commercial health insurance market in the Lansing area. The DOJ said that this would result in higher prices and a reduction in quality of commercial plans in the area. The acquisition also would have given Blue Cross-Michigan the ability to control physician reimbursement rates in a manner that could harm the quality of healthcare delivered to consumers, according to the release.
The DOJ also argued in the release that competition between Blue Cross-Michigan and PHP had resulted in lower prices, better service and more innovation in healthcare services in the region.
Read the DOJ's release on Blue Cross-Michigan.