The Blue Cross Blue Shield Association said it dropped a rule that limited competition among its member insurers, moving to implement a key aspect of an antitrust settlement the companies reached last year with customers.
The settlement hasn’t won final approval from the federal judge presiding over the litigation, so it isn’t being fully implemented. But last Tuesday the group of insurers formally lifted a cap on the share of the members’ revenue that could come from business not under a Blue Cross Blue Shield brand, one of the moves it had promised under the settlement.
Previously, the rule was that two-thirds of a Blue licensee’s national net revenue from health plans and related services must stem from Blue-branded business.
The Blue Cross Blue Shield Association includes 35 insurers, each of which typically hold exclusive rights to the Blue Cross and Blue Shield brands within a certain territory, a setup that would remain intact under the antitrust settlement.
However, lifting the revenue cap could allow the Blue insurers to compete more against one another by expanding their non-Blue businesses, experts said. Dropping the limit “certainly should increase competition,” said Tim Greaney, a professor at the University of California Hastings College of the Law, though he said it isn’t clear how quickly it would have an effect.