A Michigan state court jury found that Blue Cross Blue Shield of Michigan must pay $4.5 million to an outpatient physical therapy company that alleged the state's largest health insurer tried to run it out of business.

According to a July 28 article in Insurance News Net, an Oakland County Circuit Court jury found the Michigan Blues breached its contract with TheraMatrix Physical Therapy because of a program TheraMatrix had with Ford Motor Co., and the Blues interfered with its business relationship with Chrysler Motor Co.

TheraMatrix, which provides cost-savings programs to Fortune 100 customers, sued the health insurer in 2008 for breach of contract and interference in its contractual relationship in physical therapy services provided to Ford workers and a similar contract it sought with Chrysler.

Helen Stojic, a spokeswoman for the nonprofit Blue Cross Blue Shield of Michigan, said the company is disappointed with the decision because "it isn't a reflection of the facts of the case."

"This was simply a business dispute" and was not a conspiracy or any of the other allegations TheraMatrix made, she said. The company is reviewing for grounds for appeal, Stojic said.

TheraMatrix's program saved Ford "millions of dollars" each year on small, outpatient physical therapy services for what they were paying prior under Blue Cross, said Robert Read, president and chief operating officer of the Pontiac, Mich.-based TheraMatrix.

Blue Cross Blue Shield threatened Ford and Chrysler that if they adopted the TheraMatrix "carve-out" model, they would lose millions in hospital discounts, Read said.

The program saved money "so they tried to put us out of business," he said. The company's program involves a national network of outpatient physical therapy providers in which TheraMatrix oversees utilization management and costs, Read said. It has 13 of the nearly 2,000 network providers under contract, he said.

According to TheraMatrix, the jury acknowledged the health insurer used anti-competitive practices and the trial proved that when it presented the program to save millions at Ford, Blue Cross Blue Shield breached the contract and then tried to put it out of business to avoid further competition.

The article is posted at http://insurancenewsnet.com/article.aspx?id=210812&type=newswires