Metropolitan News-Enterprise


Thursday, December 29, 2011


Page 1


City, County Share $2 Million Settlement From Blue Shield


From Staff and Wire Service Reports


Blue Shield of California yesterday acknowledged the settlement of a 2008 lawsuit by the City of Los Angeles that accused the major health insurance entity of wrongfully dropping sick policyholders and other unfair business practices.

The settlement was announced by Los Angeles City Attorney Carmen Turtanich. According to his statement, “As part of a final judgment and stipulation, Blue Shield has agreed to pay a settlement of $2 million, to be split between the City Attorney Office and Los Angeles County, as well as an agreement by the company to continue its Best Practices in underwriting and rescission determinations.”

The suit was originally filed by Trutanich’s city attorney predecessor, Rocky Delgadillo.

The insurer’s spokesman Steve Shivinsky said that they settled the suit that was brought three years ago to avoid the ongoing costs of litigation. Blue Shield did not accept blame in the settlement.

The City Attorney’s Office said the insurer is committed to taking aggressive, proactive steps to provide better access to health care.

In the original filing, the city also cited otherinsurance companies, including WellPoint, Inc., alleging violations of the Unfair Competition Law and the False Advertising Law.

“The more than 850 policy rescissions in California attributed to Blue Shield, which formed the basis of the City Attorney’s civil enforcement action, were considerably fewer than those of WellPoint and its California subsidiaries, Anthem Blue Cross and Blue Cross Life and Health Insurance Company,” according to Trutanich’s statement. The city attorney added that the city’s actions against these insurance organizations remain pending.


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