Florida Blue defeats Oscar antitrust challenge

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A federal judge dismissed insurer Oscar Health’s antitrust lawsuit against Blue Cross and Blue Shield of Florida on Friday, ruling that Florida Blue’s “exclusivity agreements” with brokers are legal under a law that exempts certain activities of insurance companies from antitrust liability.

“Florida Blue’s contract with its brokers requiring them to sell insurance only for Florida Blue at the risk of losing access to all of Florida Blue’s product lines is lawful, and Florida Blue has the right to enforce the agreement,” U.S. District Judge Paul Byron wrote in the opinion.

New York-based Oscar in November 2018 filed a lawsuit challenging Florida Blue’s policy of prohibiting its brokers from selling other insurers’ plans. Oscar alleged that the policy harmed its business and was designed to keep Oscar from selling plans in the state, where Florida Blue is the dominant insurer.

The U.S. Justice Department in April 2019 sided with Oscar, arguing that Florida Blue improperly applied the McCarran-Ferguson Act, which exempts the “business of insurance” from antitrust scrutiny.

But Byron disagreed.

“It is hard to imagine a relationship more squarely at the core of the business of insurance than the one described by Oscar as existing between Florida Blue’s brokers and ACA consumers,” he wrote, further explaining that Florida Blue’s exclusive arrangements with brokers help it to create a broad risk pool; allowing Oscar access to the brokers would siphon away members and impact Florida Blue’s ability to spread risk.

“Oscar is disappointed in the court’s decision but remains committed to offering Florida consumers a health insurance option that makes their care easier to navigate, more transparent, and more affordable,” an Oscar spokeswoman said in an email.

Florida Blue, meanwhile, said the “lawsuit never distracted our teams from supporting our contracted general agents across the state to deliver on our mission of helping people and communities achieve better health.”

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