Blue Cross appeals dismissal of lawsuit over Idaho government employee health insurance plan

Originally published Nov. 18 on IdahoCapitalSun.com. Blue Cross of Idaho appealed an Idaho judge’s dismissal of its lawsuit that alleged the state of Idaho used an unlawful contracting process to switch government employee health insurers.

In September, Idaho 4th District Judge Joseph Borton ruled Blue Cross didn’t have standing in its lawsuit. Blue Cross filed its appeal Nov. 7 to the Idaho Supreme Court, court records show.

Since the lawsuit was dismissed, that meant Regence BlueShield of Idaho, a Lewiston-based insurer, remained Idaho’s government employee health insurer.

Meridian-based insurer Blue Cross, which held the contract since 2004, alleged Idaho used an unlawful, new process to award the now $1.1 billion contract and asked for the judge to invalidate it.

Though Regence was not a named party to Blue Cross’s lawsuit, Regence has defended the state’s process to award the contract as fair.

Even after the lawsuit was dismissed, Blue Cross has maintained the state’s process to award the contract was unlawful.

“(A)fter gathering responses from bidders for a year, the state disregarded the results and changed the rules,” Blue Cross spokesperson Bret Rumbeck told the Sun in a statement. “The highest level of trust and transparency should exist when it comes to a bid of this importance by our state government as stewards of Idaho taxpayer dollars.”

Idaho’s state health insurance plan covers around 62,000 people. That includes more than 25,000 employees and over 35,000 of their family members.

Blue Cross filed its lawsuit in March against Idaho’s government contract agency, the Department of Administration, and state contract officials.

The new, since-revoked contracting process used by the agency let bidding companies and the state negotiate after bids were submitted.

Regence and the Idaho Department of Administration declined the Sun’s requests for comment about the appeal.

Idaho used the new contracting process, called an invitation to negotiate, to award about 16 contracts, which state contract officials say saved costs.

In July, Idaho switched its government health insurance plan to being run by Regence.

That was the first time Idaho changed state government health insurers in almost two decades. Regence had previously held the contract before then, the Idaho Capital Sun reported.