(Wichita Falls, TX, September 30, 2019) – The Knox County Hospital District has filed an amended complaint against Blue Cross Blue Shield of Texas (BCBSTX) in the U.S. District Northern District of Texas Wichita Falls Division which details the following causes of action against BCBSTX:

  • Breach of contract for failing to pay agreed upon rate
  • Violation of prompt payment laws according to the Texas Insurance Code
  • Improper recoupment from a provider in violation of Texas law
  • Retaliation
  • Business disparagement

The insurance giant steadfastly refuses to pay more than $21 million in unpaid insurance claims owed to the Knox County Hospital District since 2017. In an effort to avoid a trial in front of a Knox County jury, BCBSTX moved to have the case heard in federal court where the hospital submitted its amended complaint Friday.

“True to form, Blue Cross continues its bully pattern of delay, obstruction and stall tactics to avoid paying its debt to Knox County Hospital. We will vigorously fight their motion to dismiss the case. We are confident that the federal court find this matter deserves a full and thorough hearing in a court of law.

“Blue Cross Blue Shield of Texas is clearly in violation of Texas prompt pay statues and Knox County Hospital is due these payments that are more than two years old,” Dawson said. “We are determined to have our day court.”

On August 16, the Honorable Bobby D. Burnett, Judge of the 50th State District Court, entered a temporary restraining order on BCBSTX which included the following findings of fact:

  • Blue Cross Blue Shield has willfully and wantonly undertaken acts to secure funds which do not belong to them;
  • Blue Cross Blue Shield engaged in slanderous activities;
  • Blue Cross Blue Shield willfully and wantonly breached a duty of care;
  • Blue Cross Blue Shield willfully and wantonly violated the Insurance (regulations) of the state of Texas;
  • The Court deems these acts to be willful conduct of fraud.

BCBS stopped making reimbursement payments to Knox County Hospital in June of 2017. It wasn’t until October of 2017 that the company finally responded to inquiries by claiming it was a computer glitch. Knox County Hospital continued to treat Blue Cross Blue Shield subscribers and submit claims. Blue Cross Blue Shield continued to withhold reimbursement. The Knox County Hospital District then sought intervention from the Texas Department of Insurance which did not prove successful.


About Knox County Hospital District:

Knox County Hospital District provides healthcare services for residents of Knox County and surrounding areas. The hospital district offers a wealth of medical services, including 24-hour emergency care, advanced radiology services, a clinical laboratory, physical therapy, patient education and more. The Knox County Hospital is a 25-bed acute care critical access facility located in Knox City, Texas which is 78 miles north of Abilene. The District also operates two rural health clinics, an outpatient retail pharmacy, home health, emergency medical services (EMS), a nursing home and durable medical equipment (DME) services.



Contact: Chuck McDonald



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