Blue Shield Covered California Lawsuit

As of April 15, 2014, there were approximately 381,457 members of Blue Shield Covered California plans, the insurer’s healthcare plans that are subsidized by the government under the Affordable Care Act (ACA). Members of these plans pay more to see providers and obtain services that are out of the Blue Shield Covered California network. Some Blue Shield Covered California plans may deny coverage outright for out-of-network non-emergency care. It is important, then, for Blue Shield Covered California members to know if their physicians are considered in-network or out-of-network.

Lawsuit alleges Blue Shield provider tool inaccuracies

According to a class action lawsuit filed by attorneys with Gibbs Law Group LLP on December 17, 2014, “Blue Shield tells Blue Shield Covered California members, or prospective Blue Shield Covered California members, to use the provider finder tool on Blue Shield’s website to determine which physicians and providers are in-network for Blue Shield’s covered California plans.

The complaint goes on to state that “Blue Shield has told members that they will not cover out-of-network providers, even if Blue Shield’s website lists them as in-network.” As a result, the lawsuit alleges, “many Blue Shield members have had to pay hundreds or even thousands of dollars in additional fees for out-of-network services due to Blue Shield’s failure to maintain accurate provider lists.”

Covered California plans allegedly exclude large number of providers

According to the lawsuit, “when Blue Shield implemented its Covered California plans it chose to have a much narrower network of providers for its covered California plans than for its employer-sponsored plans. As of June 2014 Blue Shield’s network for Covered California plans had just 64% of the physicians that are covered in-network for its employer-sponsored plans. It is especially important to consumers that they be able to find out which providers are in-network for Covered California plans since Blue Shield’s Covered California plans exclude a large number of providers.”

“Many members have used Blue Shield’s provider finder tool to see if their physicians would be covered in-network, only to find out later that their physicians were actually out-of-network,” the lawsuit alleges.

Blue Shield’s alleged failure to maintain Covered California provider lists results in ‘a highly unacceptable consumer experience’

According to the complaint, “in the first six months that the plans were available, nearly 100 Blue Shield members complained to the California Department of Managed Health Care about Blue Shield’s inaccurate provider networks for Covered California plans.

The California Department of Managed Health Care conducted an investigation and confirmed that Blue Shield’s provider lists for Covered California plans are inaccurate. The California Department of Managed Health Care stated that Blue Shield’s failure to maintain accurate provider lists for Covered California plans ‘resulted in a highly unacceptable consumer experience’ and that ‘California consumers could not reach and/or did not have access to providers who were represented at being part of the Plan’s network.’”

According to the complaint, “sometimes members who were misled by Blue Shield’s provider finder tool were told by their providers before they could complete an appointment that the providers they wanted to see were out-of-network. Many Blue Shield members, however, visited providers after seeing that they were covered as in-network under Blue Shield’s website, only to have Blue Shield later deny or underpay their claims as out-of-network.”

Blue Shield Covered California members may pay full price for in-network doctors and services

In addition to Blue Shield Covered California members paying higher prices or even full-price for in-network providers and services, the lawsuit further alleges that “many members were forced to continue to pay for Blue Shield insurance despite inaccuracies in Blue Shield’s provider lists because they had to wait for an open enrollment period to select a new insurance company, and could not risk going without insurance until the next open enrollment period.”

“Blue Shield is aware,” the lawsuit states, “that there are a large number of complaints about the inaccuracy of their provider lists but has continued to treat members’ claims as out-of-network when their providers were actually listed as being in-network on Blue Shield’s website.”

The Blue Shield Covered California class action lawsuit, “Scarpo v. California Physicians’ Service, D/B/A Blue Shield of California,” has been filed on behalf of all former and current members of Blue Shield Covered California plans. The case is currently pending in California Superior Court in San Francisco County.