Blue Cross Blue Shield (BCBS) has participated in a landmark class action settlement in the United States involving the health insurance and administrative services sectors. The settlement is valued at $2.67 billion and will provide financial relief to millions of customers. The lawsuit stemmed from allegations that the BCBS Association and its member companies entered into agreements not to compete with each other and to restrict competition in the sale of health insurance and administrative services.
The settlement was initially granted final approval on August 9, 2022, but appeals were filed against it. The Supreme Court dismissed these appeals on June 24, 2024, finalizing the settlement. Claim notices are now being issued to eligible claimants, and if there is a dispute regarding premium payments, objections can be filed within 30 days of receiving the notice.
Table of Contents
Who is eligible for the settlement?
Eligibility for this settlement primarily applies to individuals, insured groups, and self-funded accounts that used Blue Cross or Blue Shield health insurance or administrative service plans. Eligibility is divided into two main categories:
Eligibility Details
| Eligibility Type | Who Is Eligible | Coverage Period | Notes |
|---|---|---|---|
| Fully Insured Class Members | Individuals and insured groups (employees only) | February 7, 2008 – October 16, 2020 | Dependents, beneficiaries, and non-employees are not eligible |
| Self-Funded Class Members | Self-funded accounts and employees | September 1, 2015 – October 16, 2020 | Dependents, beneficiaries, and non-employees are not eligible |
Fully Insured Class Members
- This category includes individuals and insured groups who were covered under a Blue-branded commercial health benefit product between February 7, 2008, and October 16, 2020.
- This category excludes dependents, beneficiaries, and non-employees.
- The purpose is to ensure that only directly affected members receive payments.
Self-Funded Class Members
- Self-funded accounts and their employees who were covered between September 1, 2015, and October 16, 2020.
- This category also excludes dependents, beneficiaries, and non-employees.
- Payments will be based on the administrative fees paid by these members.
Blue Cross Blue Shield Settlement Amount and Distribution
Of the total $2.67 billion settlement fund, approximately $1.9 billion has been allocated for payments to class members. The remaining amount covers administrative costs and attorneys’ fees.
Distribution Details
- Fully Insured Claimants: 93.5% of the fund is allocated to these members. Payments will be based on the total premiums they paid.
- Self-Funded Claimants: 6.5% of the fund is for these members, based on their administrative fees.
- Administrative Costs: $100 million
- Attorneys’ Fees: $667.5 million (25% of the settlement)
The settlement aims not only to provide financial relief but also to ensure transparency from insurance companies and protect customer rights.
How to File a Claim
Claimants were required to submit a claim by November 5, 2021. Claims could be filed online or by mail.
Mailing address for claims:
- Blue Cross Blue Shield Settlement,
- c/o JND Legal Administration,
- PO Box 91390, Seattle, WA 98111
Additional Documentation
If a claimant applied for an alternative contribution percentage instead of the default option, additional documentation may have been required. This was to ensure that all claims were verifiable and transparent.
Payment Options
Claimants had the following options for receiving payment:
- Venmo
- PayPal
- Prepaid Card
- Check (mailed to the address on file)
The settlement was designed to ensure that payments reached as many affected customers as possible in a simple and timely manner.
Important Dates
- Claim Filing Deadline: November 5, 2021
- Payment Date: The Settlement Administrator will issue payments after the claim review process is complete. The Need for the Class Action Settlement
The lawsuit alleged that the Blue Cross Blue Shield Association and its member companies colluded to restrict competition, thereby impacting customer choices and benefits in the market. This settlement was reached to avoid the lengthy legal process and costs of a trial.
This settlement also sends a message that large health insurance companies must be accountable to their customers and the law.
Settlement Fund Breakdown
| Component | Amount / Percentage | Purpose |
|---|---|---|
| Payments to Class Members | $1.9 Billion | Compensate eligible fully insured and self-funded members |
| Settlement Administration Costs | $100 Million | Cover administration and processing of claims |
| Attorneys’ Fees | $667.5 Million (25% of total settlement) | Legal representation for the class action |
| Total Settlement Fund | $2.67 Billion | All-inclusive for payments, administration, and legal fees |
Final Advice for Customers
- Regularly check the status of your Blue Cross or Blue Shield account, payment details, and claim notices.
- If you are eligible to file a claim, be sure to complete your claim on time.
- Receive your payment after the settlement process is complete and keep your records safe.
- When choosing health insurance plans in the future, compare premiums and terms carefully.
Conclusion
The Blue Cross Blue Shield $2.67 billion class action settlement not only provides financial relief but also represents a significant step towards transparency and consumer rights in the health insurance industry. It ensures that large insurance providers are held accountable to the interests of their customers. Millions of eligible customers will receive benefits according to their claims, and this settlement also sets a strong precedent for protecting consumer rights in the future.
FAQs
Q. What is the Blue Cross Blue Shield settlement about?
A. The $2.67 billion settlement resolves allegations that BCBS companies conspired to limit competition in selling health insurance and administrative services.
Q. Who is eligible to receive a payment?
A. Individuals, insured groups, and self-funded accounts that had Blue Cross or Blue Shield coverage between 2008 and 2020 may be eligible.
Q. How much money will class members receive?
A. Fully insured members will share 93.5% of the $1.9 billion payment fund, while self-funded members will share 6.5%, based on their premiums or fees paid.
Q. When will eligible members get paid?
A. Payments will be issued once the settlement administrator completes the review of all claims.
Q. What does this settlement mean for customers?
A. It reinforces consumer rights, ensures fair competition among insurers, and provides financial compensation to millions of affected policyholders.
