Michigan Attorney General Sues Blue Cross Blue Shield Over Monopoly
Attorney General Dana Nessel filed a federal antitrust lawsuit alleging Blue Cross Blue Shield of Michigan operates an illegal monopoly that inflates costs and suppresses competition.
Michigan Attorney General Dana Nessel filed a federal antitrust lawsuit in the U.S. District Court for the Eastern District of Michigan against Blue Cross Blue Shield of Michigan Mutual Insurance Company. The state alleges the insurer operates an illegal monopoly, controlling 65% of the general health insurance market and 79% of the PPO market through anti-competitive agreements to allocate territories and restrict competition.
Nessel claims this market dominance has inflated premiums and out-of-pocket costs for employers while suppressing reimbursement rates for health providers. The lawsuit asserts these practices contributed to the closure of facilities like Sturgis Hospital. Additionally, the state alleges it was a direct victim of these practices when the insurer suppressed competition during the state's attempts to negotiate health care coverage for large employers.
Blue Cross Blue Shield of Michigan stated it was "blindsided" by the announcement and fundamentally disagrees with the characterization of the Michigan insurance market as uncompetitive, arguing that local and national insurers compete with them daily. The lawsuit seeks monetary damages, disgorgement, and a permanent injunction. Because Nessel is term-limited and leaving office in December, the progression of the case may depend on her successor.
