(WASHINGTON) -- The U.S. Department of Justice is suing Blue Cross Blue Shield of Michigan (BCBSM), alleging that the group raises hospital rates and prevents other insurance companies from being able to enter the health care marketplace in the state. The Justice Department says BCBSM's behavior is in violation of the Sherman Act.
"The department's lawsuit alleges that the intent and effect of Blue Cross Blue Shield of Michigan's MFNs is to raise hospital costs for competing health plans and reduce competition for the sale of health insurance," said Christine Varney, Assistant Attorney General in charge of the Justice Department's Anti-Trust Division. MFNs are most favored nation provisions that grant favorable terms to selected providers, making competition difficult.
The suit was filed Monday in U.S. District Court in the Eastern District of Michigan.
The Department of Justice says that the court will determine a pretrial schedule for the case as soon as BCBSM files its response to the lawsuit.
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