Case Description
USDOJ and Montana sued to prevent agreement between BCBS of Montana and New West, two of three competitors in the Montana health insurance market. Five of the six hospital owners of New West had agreed to purchase health insurance from Blue Cross exclusively for six years. once the five hospital owners stopped purchasing health insurance from New West, they likely would have significantly reduced their support for New West and its efforts to win commercial health-insurance customers. These anticompetitive effects would have been exacerbated by a provision in the parties’ agreement that requires Blue Cross to give the hospital owners two seats on Blue Cross’ board of directors if the hospitals do not compete with Blue Cross in the sale of commercial health insurance. DOJ and Montana required that New West promptly divest its remaining commercial health-insurance business to an acquirer with the intent and capability to be an effective competitor. The hospital owners must enter three-year contracts with the acquirer to provide health-care services on terms that are substantially similar to their existing contractual terms with New West. At the acquirer’s option, New West and the five hospital owners must also use their best efforts to assign the health-care provider contracts that are not under their control to the acquirer or to lease New West’s provider network to the acquirer for up to three years. Under the proposed settlement, Blue Cross must notify the department and the state of Montana before it uses exclusive contracts with health-insurance brokers, or exclusive or most-favored-nation provisions in its agreements with health-care providers.
