Health insurers
suing tobacco
companies
Blue Cross and
Staff and wire reports
Blue Shield firms seek
compensationWASHINGTON -- The nation's largest network of health insurers today filed lawsuits against major tobacco companies seeking billions of dollars in compensation for treating smoking-related illness.
The Coalition for Tobacco Responsibility, representing 25 million Blue Cross and Blue Shield insurance policyholders in at least 35 states, said they had filed the suits in federal courts in New York, Chicago and Seattle.
"We've been working with other Blue Cross and Blue Shield providers for some months on this," said Fred Fortin, spokesman for the Hawaii Medical Service Association, a member of the coalition.
Fortin said the U.S. Treasury and American Cancer Society estimate annual damages from tobacco at $110 billion, with $60 billion in direct costs and $50 billion in lost productivity of workers.
If successful in getting money from the lawsuits, Fortin said some of it will be used to reduce HMSA dues and most of it will be used for smoking prevention programs.
The coalition gave no specific figure for the amount of damages sought but said it would be many billions of dollars.
"Millions of participants in our plans -- whether or not they smoke -- have suffered because the tobacco companies continue to produce and vigorously market an addictive product," Dr. Michael McGarvey, chief medical officer of Blue Cross and Blue Shield of New Jersey, told a news conference today.
"These suits are our effort to begin to improve public health by changing the behavior of the tobacco industry," he said.
The lawsuits allege conspiracy, fraud, misrepresentation, violation of federal racketeering and antitrust laws as well as other claims. They allege that the tobacco industry concealed the addictive nature of smoking, manipulated nicotine levels to make cigarettes more addictive and conducted research and marketing campaigns targeting teen-agers and children.
Steve Duchesne, a tobacco industry spokesman, declined comment on the lawsuits. Individual tobacco companies did not immediately return calls seeking comment.
Blue Cross and Blue Shield provides health care coverage for one in four Americans, or 68.7 million people, in all 50 states. It is the 19th largest employer in the United States.
The new lawsuits dramatically escalate the troubles of the tobacco companies, which are under attack from the federal government, states and public health advocates.
Tobacco companies had hoped to end most of the litigation against them in a proposed settlement they negotiated with states last June. But this month they abandoned efforts to get that agreement approved by Congress and instead vowed to defend themselves in court.
Yesterday, the nation's fifth biggest cigarette company, Liggett Group Inc., agreed to cooperate in the government's criminal investigation of the tobacco industry.
Prior to today only the Minnesota branch of Blue Cross and Blue Shield had filed a lawsuit against cigarette makers. That case is about to go to a jury in St. Paul. Minnesota Blue Cross Chief Executive Andy Czajkowski congratulated the coalition "for seeking to hold the tobacco industry accountable for its illegal conduct and lies."
Reuters, Bloomberg News and Star-Bulletin reporter
Jerry Tune contributed to this report.
