Blue Cross Blue Shield of Alabama had a policy for years of charging rates different from those filed with state regulators, a practice that violated state law according to attorneys suing the company in federal court.
The policy resulted in overcharges of $5 million for some small groups and undercharges of $35 million for others, according to depositions.
The practice came to light after U.S. District Judge David Proctor unsealed depositions on Oct. 18 in a massive anti-trust case against 38 Blue Cross Blue Shield affiliates, including Alabama. The central issue in the case is whether Blue Cross affiliates in different states conspired to limit competition in order to charge higher rates to subscribers and offer lower payments to medical providers.
“We believed and continue to believe Blue Cross is understating the amount of the overcharging,” said Barry Ragsdale, an attorney representing subscribers and providers.