BCBS of Texas ordered to pay 2 hospitals $108M

A court ordered Blue Cross Blue Shield of Texas to pay more than $108 million in damages and attorney fees to two closed rural Texas hospitals.

Court filings in the U.S. Bankruptcy Court for the Western District of Texas showed that BCBSTX was ordered to make the payments to Little River Healthcare, which had hospitals in Rockdale and Cameron, Texas. The hospitals went into bankruptcy in 2018.

Former Texas Supreme Court Justice Harriet O'Neill, an independent arbitrator, awarded the amount to the hospitals during arbitration proceedings. Little River had argued BCBSTX breached its contracts for lab services and violated state laws, while the insurer claimed Little River committed fraudulent billing in its lab services.

BCBSTX is also in court-ordered arbitration with Knox County Hospital District in Knox City, Texas, over a $21 million lawsuit. 

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