Targeted by a class-action lawsuit alleging sex-based discrimination, Blue Cross of California has dropped a controversial exclusion on maternity benefits for new enrollees.
The Woodland Hills-based plan followed the lead of San Francisco-based Blue Shield of California, which dropped the exclusion in February. The California Blues plans are among the first to drop such exclusions from their policies as class-action attorneys prepare suits alleging sex-based discrimination against insurers in other states.
Both plans are co-defendants in the $200 million suit, filed in Los Angeles Superior Court. The suit alleges the plans violate state laws, including a law banning sex-based discrimination (Feb. 26, p. 61).
The plans excluded coverage for prenatal care and maternity benefits for new enrollees holding individual-as distinct from group-policies for a 12-month period.
The suit is proceeding against the Blues plans because they still impose special maternity deductibles during the 12-month period, said Robert McNeill of Ivie, McNeill & Wyatt, co-counsel for the class-action plaintiffs. In addition, the suit seeks to recover damages for the exclusions and deductibles paid by up to 500,000 women policyholders over five years, which would amount to at least $200 million, he said.
Jay Taylor, a plaintiffs' co-counsel, said Blue Cross has refused to provide the specific numbers of women who held the policies. Attorneys are seeking those numbers in a court proceeding set for April 15, he said.
Blue Shield has not been asked to provide that information, McNeill said.
Attorneys at Zimmerman Reed in Minneapolis, which has a national class-action practice, are planning to file suit against insurers in other states whose policies contain similar exclusions and deductibles, said Charles S. Zimmerman, a partner at the firm.
Blue Cross issued a release announcing it had dropped the maternity exclusion period. A spokesman said the company had no comment on the issue or on the suit.
A spokeswoman for Blue Shield said the company wasn't served with the suit until March 25 and cannot comment on pending litigation.