WellPoint agreed to pay $90 million to settle a class-action lawsuit against its Anthem unit after accusations that it unfairly compensated former members when Anthem shifted from a mutual to a stock company.
If approved by a U.S. federal judge in Indiana, the settlement would resolve all claims asserted by the former employees, according to court documents.
The settlement would avoid a jury trial stemming from the complaint over the 2001 company conversion. The trial was scheduled to begin late June in federal court in Indianapolis, Reuters reported.
WellPoint, with 34 million members and serving 64 million individuals, is an independent licensee of the Blue Cross and Blue Shield Association serving members primarily through its Anthem subsidiary in California, Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, Ohio, Virginia and Wisconsin; and in New York.
The lawsuit was filed in 2005 on behalf of former owners and members of Anthem Insurance, a mutual insurer that demutualized in 2001.
In court filings, the plaintiffs proposed to send settlement notices to class members, with checks to be mailed to class members starting as soon as the settlement becomes final and fully in effect.
The class represented in the suit consisted of more than 700,000 residents of Indiana, Ohio, Kentucky and Connecticut, according to Reuters.
“While Anthem was prepared to vigorously defend itself at trial, we are pleased that we have reached an agreement to settle this dispute,” Anthem Spokeswoman Kristin Binns told Reuters. “We continue to believe that in all ways the company acted appropriately and in the best interests of its former members,” she said. “The Indiana Department of Insurance reviewed every aspect of the transaction and found it to be fair, reasonable and equitable to Anthem’s former members.”
Major health insurer to pay $90M to former Anthem workers via IFAwebnews .