Blue Cross North Carolina files legal challenge to win back state health plan contract

Blue Cross and Blue Shield of North Carolina is challenging the state's decision to hand its State Health Plan contract to Aetna in court. 

Blue Cross NC filed a petition in Durham County court and the North Carolina Office of Administrative Hearings Feb. 16, alleging the state used an arbitrary system to select the administrator for its health plan serving 740,000 employees. The contract includes healthcare spending of more than $17.5 billion over five years.  

"The filing highlights the oversimplified and arbitrary bid process that resulted in a more expensive contract with a smaller network of providers," the payer said in a Feb. 16 press release. 

Blue Cross NC priced its administrative costs at $17.505 billion, compared to Aetna's $17.522 billion, separating the two payers' costs by less than one-tenth of a percent. 

State officials said Aetna won out because it scored higher than Blue Cross NC on technical components of the bid, and better than UnitedHealthcare, the third bidder for the contract, on costs. 

Blue Cross NC said it has a larger provider network than Aetna. In a statement shared with Becker's Jan. 13, Aetna North Carolina President Jim Bostian said more than 98 percent of claims to the State Health Plan came from providers already in Aetna's network. 

In its petition, Blue Cross NC asks the court to order the contract be awarded to Blue Cross or order the state to conduct a "proper" request for proposals process. 

North Carolina state treasurer Dale Folwell said on Jan. 4 the state intended to award Aetna the contract beginning in 2025, which Blue Cross NC held for over 40 years. 

Blue Cross NC and UnitedHealthcare both filed appeals to the decision, which the state rejected on Jan. 20. 

In a statement, Mr. Folwell said his office is "disappointed, but not surprised" that BCBS North Carolina will pursue a legal challenge. 

"We are looking forward to vigorously defending the unanimous decision of the State Health Plan Board of Trustees — consisting of members appointed by the Governor, President Pro-Tempore of the Senate, Speaker of the House, and the Treasurer —  to accept the recommendation of the Plan's professional staff." 

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Top 40 articles from the past 6 months