Oscar calls foul over BCBS' exclusive broker policy in Florida
- Insurance company Oscar alleges that Blue Cross Blue Shield of Florida is prohibiting brokers from selling its individual exchange plans due to a policy that bars brokers from selling competitors' plans if they have already agreed to sell Blue plans, effectively hampering competition.
- Oscar alleges the policy is harmful to shoppers because they're unaware Oscar's plans are less expensive and offer more robust coverage than Florida Blue plans. The exclusive broker policy undermines competition, Oscar alleges in a lawsuit filed in the U.S. Middle District of Florida Orlando Division.
- Florida Blue has warned brokers that if they sell Oscar plans in the Orlando area, they risk losing the opportunity to sell all product lines throughout the entire state, the lawsuit alleges. More than 190 brokers backed out of their agreements with Oscar after Florida Blue threatened to cut them off, the lawsuit claims.
The lawsuit adds to anecdotes of secret deals and agreements that undermine the free market within the healthcare ecosystem.
Ultimately, the Florida Blue policy stifles competition by preventing new competitors from attracting a large volume to effectively compete, the lawsuit alleges.
Yet, Florida Blue says there is no merit to the New York company's grievances and that exclusive contracts have been used for many years by many carriers — not just Florida Blue.
Brokers "are free to choose to contract with carriers that operate on an exclusive basis, or to choose carriers that do not," Florida Blue said in an email statement to Healthcare Dive.
Some brokers are considered independent contractors, Florida Blue said, and agents "may terminate their agreements with Florida Blue at any time if they wish to sell another carrier’s products."
Florida Blue contends that there are many agencies that are not contracted with Florida Blue that Oscar could use.
"There is also nothing about the Florida market which precludes any competitor – let alone a New York-based company with financial backing from Google and operations in nine states - from building an effective distribution channel," Florida Blue said.