Judge denies Oscar injunction over exclusive broker policies in Florida
- A federal judge in Florida declined to issue a preliminary injunction in Oscar's case against Blue Cross Blue Shield of Florida over allegations the Blue plan engaged in anti-competitive practices tied to exclusive broker contracts. An injunction would have barred Florida Blue from enforcing those exclusive contracts with brokers.
- Oscar, a new entrant in Florida's Affordable Care Act exchange market, claimed it did not sell as many plans to Florida residents as originally projected and blamed Florida Blue after it threatened to end its contracts with brokers who had signed up to sell plans for Oscar in addition to Blue plans, the lawsuit alleges.
- But Judge Paul Byron was not swayed and poked holes in Oscar's argument by pointing out consumers don't necessarily need brokers to purchase plans. Plan offerings may play a role in Oscar's low market share, he wrote in an order this week, pointing out that Florida Blue has substantially more plans (some of which have no deductible) and more primary care physicians and specialists in its networks compared with Oscar.
Not all insurance carriers have found success on the health insurance exchanges, created as part of former President Barack Obama's landmark healthcare bill.
While some have enjoyed profits, others retreated from the business altogether.
In refusing to issue the preliminary injunction, the judge pointed to the success of Centene, another Oscar competitor in Florida.
"For example, in 2014, Centene had 8,365 individuals enrolled in 3 counties, and by 2018 enrollment grew to 371,243 individuals covering 22 counties," Byron wrote in his order Tuesday.
Florida Blue told Healthcare Dive it was pleased with the ruling. "We believe that we presented compelling evidence to the court, and are pleased that Judge Byron found in Florida Blue's favor. In fact, we have already filed a motion asking the Court to dismiss the lawsuit in its entirety."
Oscar told Healthcare Dive it was disappointed with the denial of the preliminary injunction. "We look forward to further pursuing our claims on the merits," Oscar General Counsel Bruce Gottlieb said.
Oscar is a health insurance startup founded after the Affordable Care Act that sells plans in the individual and small business markets in nine states. It was co-founded by Josh Kushner, brother to Jared Kushner, President Donald Trump's son-in-law.
The ACA exchanges have been through some tumultuous years but experts say signs of stability are showing.
In the past year, the Trump administration has attempted to undermine the markets by cutting off the cost-sharing subsidies insurers used to help cover costs of sicker members and shrinking the open enrollment period and funding used to market the exchanges to consumers.
Lawmakers also got rid of the financial penalty for those who fail to get insurance. This year, some exchange markets are reporting steep enrollment declines, and some say the now toothless individual mandate is to blame.