Ford Motor Co sues Blue Cross Blue Shield in antitrust case over ‘astronomical’ profit

By Mike Scarcella

(Reuters) – Ford Motor (NYSE:) Co sued Blue Cross Blue Shield Association in U.S. court on Wednesday, accusing it of a price-fixing conspiracy that caused the automaker to pay inflated costs for health insurance products for its employees.

The lawsuit Ford filed in Detroit federal court accused the insurer and its regional Michigan branch of unlawfully dividing up parts of the country in a scheme to reduce competition with each other in order to drive “astronomical profits.”

The allegations from Ford, employing more than 170,000 workers worldwide, relate to a $2.7 billion settlement that Blue Cross Blue Shield Association and its three dozen member companies reached in 2020 with corporate and individual policy holders in Alabama federal court.

Ford opted out of that settlement, which is now on appeal at the Atlanta-based 11th U.S. Circuit Court of Appeals, in order to pursue its own claims. The appeals court agreed to fast-track its consideration of the settlement.

A spokesperson for defendant Blue Cross Blue Shield Association declined to comment on pending litigation. A representative from Blue Cross Blue Shield of Michigan also declined to comment.

Ford did not immediately respond to a message seeking comment about the lawsuit, and a lawyer for the company declined to comment.

In the 40-page complaint, Ford said the alleged scheme to curb competition among Blue Cross Blue Shield organizations deprived the vehicle manufacturer of “the opportunity to purchase health insurance products and services from a lower cost competitor and/or at a price set by the free market.”

The lawsuit seeks to bar Blue Cross Blue Shield’s alleged anticompetitive conduct, and it also seeks triple damages and other remedies.

Ford said it had spent more than $500 million on premiums since 2009 for “fully insured” products for employees in designated areas in the state, according to the complaint.

Ford’s lawsuit said Blue Cross Blue Shield of Michigan is the country’s ninth largest insurer based on its 4.5 million enrollees.

The case is Ford Motor Co v. Blue Cross Blue Shield of Michigan Mutual Insurance Company and Blue Cross Blue Shield Association, U.S. District Court for the Eastern District of Michigan, No. 2:23-cv-11286-LVP-EAS.

For Ford: J. Travis Mihelick of Dinsmore & Shohl

For Blue Cross: No appearance yet