Highmark, UPMC attack class-action lawsuit claims

An effort to define a class of health insurance consumers who were harmed by an alleged years-long Highmark-UPMC conspiracy has failed and should be thrown out of court, lawyers argued Monday.

The issue is key in how a federal lawsuit filed by South Hills real estate developer Royal Mile Co. Inc., Wexford tavern Cole’s Wexford Hotel Inc. and others will be litigated. U.S. District Court Judge Joy Flowers Conti has been presiding.

The Royal Mile lawsuit claimed that Highmark and UPMC conspired between 2002 and at least 2008 to inflate health insurance premiums by freezing national insurers out of the local market. Conti has dismissed two versions of the lawsuit, which was first filed in 2010, but left the door open for a third amended complaint.

But how much more did consumers have to pay for health insurance as a result of the alleged conspiracy and who were the people harmed by the arrangement? Highmark and UPMC lawyers focused on those issues in court filings Monday.

“No matter the cost of the alleged excluded low-cost insurer, it is implausible to believe every Highmark subscriber would have switched” to another carrier, lawyer Leon DeJulius from the downtown offices of Jones Day, argued in a court filing. “Plaintiffs, therefore, have a very slim reed to save their class.”

“The mere exclusion of low-cost competitors from the marketplace – without connection to harm to the plaintiff – is not cognizable.”
Royal Mile is seeking certification as a class action lawsuit, but Highmark lawyer Margaret Zwisler from the Washington, D.C., firm of Latham & Watkins LLP, in a filing said Royal Mile had failed to identify the class of people allegedly harmed by the scheme.

“It is apparent from the face of the complaint that the only way to ascertain the members of the proposed class would be through individualized mini-trials of each small group’s claim that, in a hypothetical world in which commercial insurers offered lower rates of some hypothetical amount in the market, those commercial insurers would have offered those hypothetical lower rates to each small group and each small group would have bought insurance from those other companies solely on the basis of those lower rates,” Zwisler wrote in a court filing Monday. “Therefore, this court can and should dismiss the class claims now.”

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