Oscar Appeals Dismissal of Anti-Trust Lawsuit Against Florida Blue
As health payer Oscar compiles its appeal brief in the anti-trust lawsuit, it will also expand its footprint into new counties in Florida.
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- Oscar Insurance Company of Florida (Oscar) has appealed the federal court’s dismissal of the company’s anti-trust lawsuit against Florida Blue, the company announced in an emailed release.
“Oscar is committed to consumer choice and refuses to stand by as Florida Blue enforces this anti-consumer, anti-competitive policy,” the health payer said. “We are confident that an appeal will lead to the termination of this policy and achieve several important goals.”
The payer has filed its notice of appeal and will follow up with a brief, laying out its dispute.
Founded in 2012, Oscar first entered the Florida healthcare system in 2019. The health payer says that it found the Affordable Care Act’s exchanges in Orlando completely dominated by Florida Blue, a Blue Cross and Blue Shield Association company.
Moreover, a Florida Blue exclusive broker policy prevented brokers in Orlando that offer Florida Blue plans from selling the individual plans of another payer.
It is not unusual for ACA exchanges to have only one payer option in a county. Such areas are called “bare counties” and they are the result of the payer exodus that took place in 2017 and 2018 due to regulatory turbulence and uncertainty in the ACA exchanges.
Florida Blue’s exclusive broker policy, however, does make the situation unusual.
Oscar filed its lawsuit in late 2018, claiming that Florida Blue’s exclusive broker policy effectively closed off the region to any competition. The Department of Justice (DOJ) supported the case in May 2019.
The federal judge’s decision to dismiss this case directly contradicted the DOJ’s statement.
“Florida Blue’s brokers provide services that spread the policyholder’s risk, and their work in providing guidance to ACA consumers is an integral part of the policy,” district judge Paul G. Byron wrote. “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. Florida Blue’s efforts at enforcing a lawful contract are not coercive, regardless of the tone or tenor of the language employed by Florida Blue.”
Florida Blue applauded the judge’s decision to, according the health payer, uphold the lawfulness of Florida Blue’s broker policy.
“Last month, after carefully considering our motion, the Honorable Paul Byron of the U.S. District Court for the Middle District of Florida dismissed all of Oscar’s claims with prejudice and held that Florida Blue’s contracts with its contracted general agents are lawful and enforceable,” Florida Blue told HealthPayerIntelligence.com in a written statement.
“We will continue to vigorously defend against this lawsuit on appeal, all the while continuing to support our contracted general agents who are striving to deliver on our mission of helping the people and communities of Florida achieve better health.”
Oscar, in contrast, believes that winning the lawsuit would free brokers to inform Floridians of the right choice among an array of plan options, not just leading them to consider Florida Blue when there are alternatives.
Oscar aims to be one alternative in the Orlando region and, through this lawsuit, to expand coverage options for Floridians.
The start-up says that by forcing an end to the exclusive broker policy, Oscar will “support the long-term health of Florida’s individual insurance market so that it continues to attract new entrants who, like Oscar, want to make the health care experience easier to navigate, more transparent, and more affordable.”
In 2019, ACA exchanges are starting to make a comeback, with studies predicting a 13 percent decrease in bare counties. This trend is thanks, in part, to start-ups like Oscar, which expanded its ACA exchange footprint in 2018. The payer increased its offerings in New York and California and entering three new states.
While Oscar compiles its appeal brief, the company will also be preparing to expand its footprint in 2020 to include markets in Miami, Tampa, Ocala, and Daytona.
