The Honorable R. David Proctor of the Northern District of Alabama issued the Fourth Amended Scheduling Order in MDL 2406 in Re Blue Cross Blue Shield Antitrust Litigation.

Click to view the Order: 4th Amended Scheduling Order

JC REINDL | DETROIT FREE PRESS | 7:56 am EST March 8, 2019

The top boss at Blue Cross Blue Shield of Michigan has reached the pinnacle of executive pay in Michigan, getting more in total compensation than CEOs at several bigger for-profit companies across the state.

Law360 (March 7, 2019, 9:38 PM EST) — Anxious Blue Cross companies flirted with raising member breakaway costs to as high as $10 billion as Blue member Anthem Inc. pursued a doomed, $54 billion merger with Cigna Corp. the group’s president said Thursday during a Chancery Court trial on the two insurance giants’ damage claims.

Blue Cross Blue Shield Association President Scott P. Serota said the never-approved Blue member “re-establishment” fee hike, considered in 2015 and 2016, reflected defensive concerns that an Anthem-Cigna hybrid would exit the association, shed its geographic franchise restrictions and take on the remaining Blues nationwide.

Instead, the Justice Department won a suit to block the deal on antitrust grounds in early 2017. Anthem — the nation’s largest Blue insurer — and non-Blue Cigna immediately began pursuing billions in damage claims against one another in Delaware for the merger collapse. And the Blues associations’ own antitrust baggage, geographic franchise rules and business restrictions became part of the litigation scrum.

“The plans don’t want to hear that a member of the association is going to compete aggressively against them. That’s not something they would be excited about hearing,” Serota testified during the ninth day of the 10-day proceeding before Vice Chancellor J. Travis Laster. Restoring Blue-branded insurance in Anthem’s 14-state area, Serota said, would be a costly problem.

“I didn’t do the math, but it was a big number,” Serota said of the scale of the change considered by members, a move that could have weaponized fees established to finance replacement of Blue companies in the event of a departure. Association members also considered changes that would have prevented Cigna from accessing Anthem provider discounts, Serota said.

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Law360 (March 5, 2019, 10:34 PM EST) — A senior global communications company director on Tuesday detailed an alleged Cigna Corp. stealth public relations campaign aimed at derailing the health insurer’s proposed $54 billion merger with Anthem Inc., during the seventh day of a 10-day, multibillion-dollar Chancery Court damages trial.

Teneo Senior Managing Director Stephen Cohen testified that his company put together a multifaceted effort to paint a picture favoring Cigna and CEO David Cordani’s side of the dispute. The effort followed Cigna confidentially retaining Teneo to channel some communications through Cigna counsel Wachtell Lipton Rosen & Katz to provide cover for their plan to sabotage the merger, according to a court document.

Tactics were described as ranging from the mild to the serious. Teneo at one point was scouring records wherever it could in search of information that could be used to suggest that Anthem CEO Joseph Swedish violated U.S. Securities and Exchange Commission rules and oversaw a poorly run health insurance company.

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Law360 (March 4, 2019, 9:43 PM EST) — An Anthem Inc. attorney accused Cigna Corp.’s top officer Monday of running a covert campaign to overhaul or undermine a $54 billion merger, complete with the secret hiring of Wachtell Lipton Rosen & Katz LLP under a code name, during a Chancery Court damages trial.

Anthem attorney Glenn M. Kurtz of White & Case LLP highlighted the effort while questioning Cigna CEO David Cordani on the sixth day of the trial over the two companies’ collapsed deal and multibillion-dollar damages battle in Delaware, with Anthem accusing its prospective partner of ignoring contract duties to use “reasonable best efforts” to get the deal done.

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Law360 (March 1, 2019, 9:51 PM EST) — Cigna Corp. CEO David Cordani did “tremendous damage” to a $54 billion merger bid by Anthem Inc. during deposition testimony ahead of a successful federal suit to block the deal, a lead Anthem trial attorney testified Friday in Delaware’s Chancery Court.

Christopher M. Curran of White & Case LLP, counsel to Anthem, said the unexpectedly hostile position taken by Cordani ahead of the late 2016 trial “was a powerful moment” for the whole case. The testimony came during the fifth day of a 10-day Delaware trial over billions of dollars in competing damages claims by both insurers.

U.S. Department of Justice attorneys were “demonstrably giddy,” at Cordani’s negative views about the deal, Curran told Howard M. Kurtz of White & Case LLP. “They knew they were getting powerful, possibly merger-killing testimony and they loved it. The DOJ attorneys were ready to close the books, wrap up the deposition and go home before lunch.”

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By: Michael Johnson1

Dailykos.com

Blue Cross Blue Shield of Michigan revealed Friday that it paid CEO Daniel Loepp $19.2 million last year. Why so much? According to spokesman Andy Hetzel, “We are keeping health care affordable to the best of our ability here in Michigan. We think he earns the money that he makes.”

The insurer, which is a nonprofit, seems to have confused profitability for affordability. Loepp’s fat paycheck included a bonus of $16.2 million, which seems to have been a reward for the insurer’s massive $559 million profit in 2018—it’s highest in over 10 years.

That profit amounted to a tax of over $100 on every woman, child and man covered by BCBS of Michigan. The company’s profit margin on its insurance business in 2018 was over 6%, which is quite high for a health plan, let alone a nonprofit one.

When it comes to making profits, BCBS of Michigan has a history of utter ruthlessness. Under Loepp’s leadership the company previously cut secret deals with hospitals that were designed to increase health care costs. Here’s how a federal appeals court in 2016 described them:

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Law360 (February 28, 2019, 9:44 PM EST) — Former Anthem CEO Joseph Swedish testified Thursday he saw his company as “truly at war” with Cigna Corp.’s top brass in 2016 as a power struggle widened over the two companies’ doomed, $54 billion merger.

Testifying in a case with as much as $20 million in dueling damage claims at stake, Swedish, now a senior adviser and consultant to Anthem, said he included the remark in an email to himself summarizing conflicts with Cigna CEO David Cordani and Cigna’s board over post-closing management structure.

Anthem, the nation’s second largest health insurer and its largest Blue Cross Blue Shield company, announced an agreement to acquire fourth-ranked Cigna in July 2015 in a cash and stock deal. That agreement was soon torn by disputes over management choices and pressures created by a federal antitrust investigation and suit.

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Law360, Wilmington (February 27, 2019, 10:35 PM EST) — Cigna Corp. pointed repeatedly Wednesday to Anthem Inc. decisions to keep mum about some sale and reporting plans for their abandoned $54 billion merger, during the third day of a 10-day Delaware Chancery Court trial on competing damage claims that now top $20 billion.

During cross-examinations of Anthem witnesses, Cigna pressed its former merger partner on amendments to or submission of key reports without Cigna input and on undisclosed divestiture options that could have put pressure on Cigna customers to switch to Blue Cross Blue Shield policies.

Although Anthem considered rebranding Cigna plans to Blue-company versions or invoking “affiliate” language that would give Cigna customers access to better Anthem rates, the company tentatively set aside those options. That could have meant Cigna customers and employer-policy holders would have instead faced individual economic pressures to make the change.

Cigna, however, was not informed of Anthem’s decision as it took shape in 2016.

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