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United Healthcare Files Lawsuit Against the City of Birmingham Disputing Contract Award To Blue Cross

Posted Jul 17 2013 10:49pm

This is not the first time the company has filed a lawsuit as the most publicized was the Tri-Care contract in which the company sued the Department of Defense and we have never heard details of exactly why that was but they got the contract.  United Healthcare has truckloads of subsidiaries an as in the Tri-Care bidding situation they create yet another new subsidiary for business they want to pursue.

Update: UnitedHealthcare Sues Department of Defense Over Tri-Care Contracts–They Said They Would Do This – Is This A Case Of My Algorithms Are Better Than Yours?

This is not the first battle of such as other lawsuits have been filed over contract awards where they are contested.  In the Tri-Care case it literally put the Blue Cross subsidiary out of business and then United awarded some of the subsidiaries of Blue Cross that were set to go away, contracts.  Using tiered subsidiaries is how a lot of insurance companies stay under the radar today.  The link below has a lot of information about subsidiary actions as well as a number of government contractor businesses the company has bought, even the one who is doing the Federal Data Hub , which they bought 2 weeks after HHS awarded the contract to QSSI. 

Health Insurance Business Under the Radar With Tiered Subsidiaries–Where All the Action Takes Place With Mergers, Acquisitions and Profit Centers-Subsidiary Watch

Last year the state of Louisiana rejected United’s Protest over their contract award to Blue Cross/Blue Shield too.

State of Louisiana Rejects United Healthcare’s Protest Over Awarding Blue Cross/Blue Shield Contract To Manage State Employee Health Insurance–Battle of the Insurance Algorithms Continues..

Steve Larsen who used to work at HHS left and took a Vice President job with the agency last year as well.  In November of 2011 the company hired the US Assistant Attorney General from Minnesota as General Counsel so it appears he is busy and did money talk? 

United Healthcare Opens Retail “Employer Benefits” Store in Queens New York And Hires Former Minnesota US Assistant Attorney General As General Counsel

At some point with all the lawsuits that have arisen some might be thinking twice before inviting them to bid as if they don’t get the contract they’ll take you to court and tell you how to award your contracts.  BD


UnitedHealthcare Services Inc. has filed a lawsuit against the city of Birmingham, claiming a new benefits agreement between the city and Blue Cross and Blue Shield of Alabama violated Alabama's competitive bidding laws.

The lawsuit, filed July 1 in Jefferson County Circuit Court, asks a judge for an injunction to prevent the city from carrying out a new health care benefits contract with Blue Cross – the state's largest health insurer.

Officials with the city and UnitedHealthcare were not available to comment Monday.

The case stems back to January, when the city sought bid proposals for a third-party medical plan administrator. In the lawsuit, UnitedHealthcare claims it was determined to be the low bidder and the winner of the contract.

According to the lawsuit: "Later that very day, UnitedHealthcare was advised that its contract award had hit a snag – BCBS had received a termination letter, but was subsequently allowed to revise its proposal."

Several days later, the lawsuit claims, a meeting was held to discuss a joint contract between Blue Cross and UnitedHealthcare, the filing said. Each provider was to be awarded components of the contract, but after a review by a city committee, the city awarded the contract to Blue Cross alone, UnitedHealthcare claims in the lawsuit.

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