Michigan Attorney General Dana Nessel has sued Blue Cross Blue Shield of Michigan, alleging anticompetitive practices increased insurance costs and reduced access to care.
The state says the insurer controls 65% of Michigan’s health insurance market and 79% of its preferred provider organization market.
Blue Cross disputes the state’s characterization, saying it faces strong competition from local and national insurers.
As healthcare costs continue to rise, Michigan Attorney General Dana Nessel has filed a federal lawsuit accusing Blue Cross Blue Shield of Michigan of maintaining an illegal monopoly that has left consumers paying more for health coverage while receiving diminished access to medical care.
The complaint, filed in the U.S. District Court for the Eastern District of Michigan, alleges violations of federal and state antitrust laws. Blue Cross Blue Shield of Michigan Mutual Insurance Company is the sole named defendant.
Nessel alleges the insurer worked with other Blue Cross Blue Shield entities to divide territories and customers, restrict insurance offerings, and suppress competition. According to the complaint, those arrangements also prevented meaningful competition for the contract to administer Michigan state employees’ medical benefits, allowing Blue Cross to overcharge the state.
For households and employers, the suit alleges the consequences include higher premiums and out-of-pocket expenses. The complaint cites 2026 annual premium increases filed by Blue Cross of 23.3% to 24% for individual plans and 11.2% for small-group coverage.
The state also alleges Blue Cross used its bargaining power to push payments to medical providers to unsustainable levels, sometimes below the cost of delivering care. Nessel’s office argues that those pressures contributed to staffing reductions, service cuts, and facility closures. These are allegations that have yet to be decided by the court.
Company response
Blue Cross challenged the attorney general’s account in a statement reported by the Huron Daily Tribune.
“We were blindsided by this announcement by the Attorney General,” the company said.
The insurer said it had not yet been served and could not address the case’s specific merits. However, it disputed the claim that Michigan’s insurance market lacks competition, saying strong local and national insurers compete with it daily. It also pointed to nearly 90 years of providing coverage throughout Michigan as a foundation of its success.
The lawsuit seeks a permanent court order stopping the alleged anticompetitive practices, along with damages, repayment of improperly obtained gains, and civil penalties. Nessel’s stated goal is to lower costs and improve access to health services for Michigan residents.