Administrator Deemed To Be Fiduciary and Breached Fiduciary Duty on Self-Insured Plan

Case: Hi-Lex Controls Incorporated, et al, v. Blue Cross and Blue Shield of Michigan Case No: 11-12557.  Hon. Victoria A. Roberts presiding.

This is an action for alleged violations of the Employee Retirement Income Security Act of 1974 (“ERISA”). Plaintiffs filed suit on June 13, 2011. It is one in a series involving Administrative Service Contracts (“ASC”) with Blue Cross and Blue Shield of Michigan (“BCBSM”) for claims administration services and network access for self-funded employee health benefit plans.

Under the ASCs, BCBSM serves as third-party administrator for Plaintiffs’ employee health benefit plans. It processes and pays employee health claims; provides access to its network of physicians, hospitals, pharmacies, etc. for covered employees; and negotiates with hospitals and health care providers throughout the state. Plaintiffs reimburse BCBSM for claims paid on their behalf.

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