Blue Cross class-action to yield refunds 30,000 stand to benefit, most getting $25 to $50


December 18, 1997|By M. William Salganik | M. William Salganik,SUN STAFF

About 30,000 Blue Cross Blue Shield of Maryland current and former subscribers would be eligible for refunds -- most in the $25 to $50 range -- according to the terms of a proposed $2.3 million settlement of a class-action lawsuit.

The suit, filed in Baltimore County Circuit Court by three subscribers in 1995, accused Blue Cross of getting discounts from hospitals and other institutions but not passing them along to subscribers who had policies under which they paid a percentage of the charges.

Jeffery W. Valentine, director of corporate communications for Blue Cross, said the insurer had not pocketed any discounts, but "we've agreed to settle to avoid a pretty expensive legal battle. We'd prefer to give the money to members rather than to legal costs."

Two subscribers would receive checks in the range of $3,500 to $4,000 -- the largest settlements -- and "something less than 300" checks for $1,000 or more, said Kieron F. Quinn, lead counsel for the plaintiffs in the suit.

Before checks are issued, the proposed settlement must be approved by Baltimore County Circuit Court Judge Thomas J. Bollinger Sr., who has scheduled a hearing for March 23 to consider any objections.

Those who would get refunds are those who had policies between 1990 and 1996 in which they paid a fixed percentage of certain costs as a co-payment. Not covered are those in the federal employee program or in Blue Cross HMOs or covered by policies that do not have co-payments.

According to Quinn, if a patient was to pay 20 percent of a procedure that normally cost $1,000, but Blue Cross had negotiated a fee of $800, the patient would be billed for 20 percent of $1,000 (or $200), not 20 percent of $800 ($160).

Valentine said Blue Cross did not "pocket the difference," but reflected the actual amount paid when it charged employers or developed the experience ratings on which it based premiums.

Nearly all of those eligible have been identified from Blue Cross records and have received notices this week, Quinn said. Those who believe they are eligible but do not receive letters should contact Blue Cross, he said. Those who received notices do not have to take any further action to receive their checks.

The nearly 100,000 people who would be due less than $25 under the settlement will not get checks. Their share -- probably about 20 percent of the $2.3 million, according to Quinn -- will be contributed to charity, along with any unclaimed refunds.

Pub Date: 12/18/97

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