In October of 2020, Blue Cross Blue Shield (BCBS) Association and member plans reached an agreement to settle a class action lawsuit brought by subscribers alleging antitrust violations. While the companies denied the allegations, they agreed to the settlement to avoid further litigation costs and risks. The Court’s settlement terms will be reviewed on October 20, 2021, but class members have already begun to be notified.

As part of the settlement, the companies agreed to make operational changes and to provide payment to class members. The settlement class includes individuals and fully insured groups (and their covered employees) who were insured under a BCBS health plan from February 7, 2008 through October 16, 2020 as well as self-funded groups (and their covered employees) who were covered by an ASO contract from September 1, 2015 through October 16, 2020. It does not include dependents.

The net settlement amount of $1.9 billion will be divided into two separate funds, which will be distributed independently. The bulk of the settlement – $1.76 billion – has been allocated for individuals and fully insured groups and their members, while the remaining $120 million has been allocated to self-funded groups and their members.

When filing a claim, claimants can choose to accept the “default option” to calculate their contribution amount or choose an “alternate option” if they believe their total contribution was higher than the default percentage. Those choosing the default option do not need to provide any supporting detail when the claim is filed. Default percentages are:

  Single Coverage Family Coverage*
Fully Insured: 85% employer/15% employee 66% employer/34% employee
Self-Funded 82% employer/18% employee 75% employer/25% employee

*Family Coverage includes any non-single coverage type, regardless of the number of dependents.

All claim forms must be submitted online or postmarked no later than November 5, 2021. Additional information about the terms of the settlement and how to file a claim can be found at

Employers will, no doubt, have questions about what obligations they have regarding this settlement. Plan sponsors are not obligated to notify employees about the settlement or advise them on what to do, but since there are likely to be questions, employers can simply direct employees to the settlement website. Employers also do not have to provide historical claims or administrative fee data to employees who choose to file a claim under the alternate option.

Employers should be aware, though, that they may have fiduciary duties under ERISA regarding the use of any of the proceeds from the settlement. Under ERISA, plan assets must be held for the exclusive purpose of providing benefits to participants in the plan and their beneficiaries and defraying reasonable expenses of administering the plan. While the Department of Labor has not issued any guidance regarding the proper treatment of claim proceeds from this particular lawsuit, they have previously issued guidance related to the treatment of Medical Loss Ratio (MLR) rebates received under the terms of the Affordable Care Act. Unless and until specific guidance is issued related to the BCBS settlement, employers may want to use the MLR guidance as a reference when determining how to calculate what portion of the BCBS settlement proceeds should be considered “plan assets” and how those funds can be used.

As a final note, the BCBS settlement claims process is not complicated or time-consuming. Although you may receive solicitations from third parties offering to assist in filing a claim in exchange for a portion of the proceeds, it is unlikely that any professional assistance should be needed.