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Blue Cross Blue Shield of Michigan sued over alleged claims underpayment, denial

Blue Cross Blue Shield of Michigan Inc. was sued over allegations of underpaying and wrongfully denying claims connected to treatment for substance abuse and other behavioral health disorders of more than 4,000 patients.

The lawsuit was filed in the U.S. District Court for the Western District of Michigan on behalf of four substance abuse treatment centers: Serenity Point Recovery, A Forever Recovery Inc., Behavioral Rehabilitation Services and Best Drug Rehabilitation.

The lawsuit alleges that Blue Cross Blue Shield of Michigan cut reimbursement rates paid to inpatient and outpatient substance abuse treatment facilities without notice or justification, which led to private substance abuse treatment providers rejecting patients. In certain cases, patients received complete treatment only to get bills in the tens of thousands of dollars for services they thought were covered.

The complaint asks for compensatory damages of more than $40 million, punitive damages, disgorgement of profits, declaratory and injunctive relief, attorneys' fees and costs and other relief.

"We are currently reviewing this lawsuit that was just filed today," Blue Cross Blue Shield of Michigan said in an emailed statement. "It appears to be a complaint by four treatment facilities, three of which are not in our network, and are dissatisfied with their reimbursement. BCBSM is confident it followed all appropriate reimbursement methodologies."