GS Labs Countersues Blue Cross Blue Shield of Minnesota:  Federal Court Filing Accuses Insurer of Antitrust Violations, Conspiring With Cartel of BCBS Affiliates, Violating CARES ACT, False Advertising and Consumer Fraud



David Leibowitz


BCBS of MN’s Anti-Competitive Actions Risk Minnesotans’ Lives During Pandemic By Creating Illegal Barriers To COVID-19 Testing

Minneapolis – GS Labs, a leading provider of COVID-19 rapid tests in Minnesota and across the nation has filed new counterclaims in the company’s ongoing legal battle against multi-billion-dollar insurance giant Blue Cross Blue Shield of Minnesota.

The June 29th filing in U.S. District Court for the District of Minnesota flatly denies all prior allegations made by BCBS of Minnesota against GS Labs. GS Labs has also alleged 21 counterclaims against BCBS of Minnesota detailing a scheme to harm competition in violation of the federal antitrust laws, resulting in COVID testing shortages in Minnesota, by conspiring with other Blue insurance companies in a cartel to fix prices and illegally boycott quality testing labs.  The countercomplaint also sets forth factual allegations showing that BCBS of Minnesota committed consumer fraud by misleading Minnesotans in need of COVID testing, tortiously interfered with GS Labs’ business relationships, and violated the CARES Act by refusing to reimburse GS Labs for thousands of COVID tests for its insureds.

In October 2020, BCBS of Minnesota and its affiliate Blues agreed to pay $2.67 billion to settle a class action alleging collusion among the Blue affiliates in violation of federal antitrust laws. That settlement agreement included operational changes meant to enhance competition among Blue insurers. However, BCBS of Minnesota’s conduct raises new concerns that it and its sisters Blues continue to engage in anticompetitive behavior.

“Throughout the pandemic, GS Labs has been there to provide fast and accurate testing for more than 300,000 Minnesotans,” said Jen Rae Wang, a representative for the company. “While insurance companies across the U.S. have paid GS Labs for these services, BCBS of Minnesota has colluded with other Blues to suppress testing, boycott GS Labs, and price-fix across the state and the nation. That anti-competitive act of greed has made it harder for residents to get critical medical information and has dangerously impacted public health.”

The filling alleges that BCBS of Minnesota, “joined forces with other BCBS affiliates to exchange competitively sensitive information and fix the purchase price of COVID-19 diagnostic testing services at unsustainable cut-rates, and to boycott providers like GS Labs that do not accede to the BCBS cartel’s fiat prices.” The countersuit additionally details how the Blues worked together through the BCBS Association and their joint participation in the American Health Insurance Plans (“AHIP”), a national trade association for health insurance companies which counts among its Board of Directors eight members who are senior executives of BCBS affiliates.

The filing describes BCBS’s, “concerted and willful actions to exclude and suppress output and reduce the quality of testing capacity by fixing prices, engaging in a boycott to withhold reimbursement, and spreading disinformation to steer subscribers away from GS Labs takes Minnesota in the opposite direction, harming competition, consumers, and GS Labs in the process. In other words, the reason for the long lines and broken testing regime is Blue Cross.”

“The countersuit demonstrates Blue Cross and Blue Shield’s greed and deception amidst a massive public health emergency,” said Wang. “BCBS of Minnesota has violated the law, deceived Minnesota residents, and banded together with other Blues to spike profits and suppress testing capacity at the expense of their members and the public’s health. These disgraceful, unethical and illegal actions should never be tolerated.”

David Leibowitz, a GS Labs spokesperson, also highlighted an irony regarding BCBS’ original lawsuit against GS Labs: On the very day that BCBS of Minnesota sued GS Labs for fraud and abuse, it also extended an invitation to GS Labs to become an in-network participating provider.

“Only a mega-billion-dollar insurance company would sue for fraud a legitimate testing business that’s helped over one million people with life-saving medical information, then in the same breath ask that provider to become an in-network partner,” said Leibowitz. “Apparently, BCBS of Minnesota would have been all too happy to work with GS Labs, but only at cut-rate price that would have bankrupted the provider while the insurance company got fatter and happier.”

The CARES Act makes clear that insurance carriers must pay for COVID-19 testing for insured members. Section 3202(a) states: “If the health plan or issuer does not have a negotiated rate with such provider, such plan or issuer shall reimburse the provider in an amount that equals the cash price for such service as listed by the provider on a public internet website, or such plan or issuer may negotiate a rate with such provider for less than such cash price.”

GS Labs is seeking full payment for unpaid bills that currently total tens of millions of dollars, plus legal fees, investigative fees and compensation for lost goodwill. The company also seeks three times the actual damages for each of Blue Cross’ antitrust violations, together with costs and disbursements, including reasonable attorneys’ fees, compensatory damages, interest and legal fees.

“The BCBS buyers’ cartel for COVID-19 diagnostic testing has obtained its intended and predictable effect: namely, depressed reimbursements rates for COVID-19 diagnostic services provided by GS Labs have boosted Blue Cross’ profits,” the counterclaim explains. “The victims of this scam, however, are the suppliers of the testing who stood ready to provide additional output in order to alleviate national shortage, as well the pubic and patients who suffered severe documented testing shortages.”

GS Labs began offering COVID-19 rapid tests in October 2020. Many communities directly requested assistance from GS Labs, due to a lack of testing resources. By keeping testing centers open 12 hours a day during the height of the pandemic – and paying above-market salaries to hire experienced registered nurses and other medical professionals – GS Labs to date has safely and effectively tested more than 1.3 million Americans.


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As COVID-19 Surges in Washington, National Testing Lab Continues to Administer Professional COVID Tests For Multiple Purposes

At-Home Testing Has Become Popular, But May Not Be Completely Accurate; Travel, Work-Related Needs Drive Test Seekers To Get Professionally Administered Tests  

SEATTLE – As COVID-19 positivity rates again increase across the U.S. and the State of Washington and the White House shifts at-home tests funding to instead support vaccines and treatments, national testing provider GS Labs continues to test hundreds of patients daily who are seeking out professionally administered COVID-19 tests. With at-home rapid tests widely available on store shelves or by mail, what’s driving these patients to come to a private laboratory?

Four reasons, says Dr. Darin Jackson, GS Labs medical director: The peace of mind that comes from having a professional handle a medical test; to confirm a negative COVID-19 rapid test for patients who display symptoms of COVID-19; proof of positive COVID-19 status acceptable to employers; and proof of negative COVID-19 status required for travel to certain destinations.

“There’s absolutely a sense of COVID-19 fatigue out there for a lot of people – but not for everyone,” says Jackson. “People with high-risk family members or people who are at-risk themselves and show symptoms of COVID continue to come to us because they want the most accurate test results possible. There’s a lot of research on at-home testing now, and while the tests are accurate, they don’t quite measure up to professionally administered tests performed and analyzed by a laboratory. Additionally, results from at-home testing results are not being reported.”

In accordance with CDC protocols, it is standard practice for symptomatic patients who received a negative rapid antigen test to next to be tested via a PCR test. This “confirmatory PCR” identifies individuals who received a negative rapid antigen test result but are in fact positive for COVID. Recent confirmatory PCR results show that 15% of symptomatic GS Labs patients who received a negative test result by the rapid antigen test are actually positive. Together, this highlights the personal and public health necessity for follow-up PCR testing when a rapid antigen is negative.

Workplace and travel needs are also driving private tests, says Jackson, who notes that in Washington, about 25 percent of the state over age 5 is not fully vaccinated against COVID.

“In Washington, there’s still about 1.9 million residents over age 5 who haven’t been fully vaccinated,” says Jackson, noting that net number will grow given recent FDA approval for vaccines for ages 6 months and older. “We’re giving tests to people whose employers require a professional positive test in order for PTO purposes or to reimburse the employees for various items. Also, it’s important to note that many countries – including Canada – still require proof of full vaccination or a professionally administered negative COVID test from travelers seeking to enter the country.”

The U.S. State Department website keeps a worldwide list of travel entrance requirements:

In Washington, GS Labs’ weekly patient positivity rate began climbing in mid-April, from just over 2% to a sustained rate of more than 18% during the prior five weeks. This mirrors results from GS Labs’ nationwide lab network, where the most recent seven-day rolling positivity rate is 20% – approaching its highest-ever positivity rate of 23%, which was recorded during the Omicron peak.

“Fortunately, we continue to have ample tests and appointments for patients who need them,” says Dr. Jackson. “Our commitment to convenient and accessible testing remains unchanged, as does our top priority: providing critical health information to individuals across Washington state and beyond.”

Lab testing capacity and availability remains strong at GS Labs, which operates five Washington-state testing sites: Bellevue, Federal Way, Lynnwood, Seattle and Vancouver. GS Labs’ state-of-the-art custom technology platform is built to serve as many as 1,000 patients per day at each location. GS Labs’ digital platform allows patients to book within 15 minutes of their proposed appointment and to receive accurate rapid results in as little as 20 minutes after the completion of a rapid antigen test. Appointments for all tests must be made online prior to arrival at

Two tests are fully covered by insurance in the event the patient is experiencing symptoms or has had a recent exposure: a rapid antigen test for $179 – which typically returns results as quickly as 20 minutes – and a PCR test for $229 that returns results in 2 to 5 days. Both tests have no out-of-pocket cost with accepted insurance.

Additionally, GS Labs offers rapid PCR-NAAT and PCR-LAMP tests for $299 each, with results typically returned in about two hours. These tests, ideal for travel or screening testing, are available with cash payment only. Travel destinations may have different, specific testing requirements, so customers are urged to research which test is required before booking an appointment. A combination rapid antigen COVID and flu test is available for $199, also with cash payment only.

Since it began offering testing, GS Labs has tested more than 1.3 million patients across the country. To date, GS Labs has identified more than 230,000 patients positive for COVID-19. Headquartered in Omaha, GS Labs entered the COVID-19 testing space as the pandemic initially swept through Nebraska and the Midwest. At the time, loved ones and friends of the company’s partners could not find COVID-19 tests anywhere after being exposed to the coronavirus. From that initial location, the company has expanded across the U.S.; its current footprint includes more than a dozen locations in eight states.


Joann Schaefer, MD, Joins City+Ventures to Lead Health Care Businesses

Dr. Schaefer’s Experience will Expand and Diversify Heath Care


OMAHA, Neb. (March 28, 2022) – City+Ventures announced today that Dr. Joann Schaefer, former Chief Medical Officer (CMO) for the State of Nebraska and Executive Vice President (EVP) at Blue Cross Blue Shield (BCBS) of Nebraska, has joined the company as President of City+Ventures Health. In this newly established entity and role, Dr. Schaefer will lead and expand the company’s emerging health care sector work.

“Dr. Schaefer brings a wealth of experience as a regulator, a physician, a thought leader in healthcare, and a former health insurance executive,” said Chris Erickson, co-founder of City+Ventures. “Her leadership and vision will help shape growth for patient and business services in the health sector, and ensure we best leverage our established and growing resources to best serve ever-evolving patient needs.”

“I’m thrilled to be joining the City+Ventures team to lead City+Ventures Health,” said Dr. Schaefer. “This is a pivotal moment in health care with large, complicated issues to be solved for delivering services to people. I’m excited to bring my experience to these efforts, growing and diversifying our lines of business in a people-focused model.”

Bringing decades of experience in public health, health insurance and family medicine, Dr. Schaefer will drive the company’s expansion diversifying patient and provider services. City+Ventures’ flagship health delivery organization, GS Labs, has tested more than 1.2 million patients across the country and employs thousands of health care workers. GS Labs utilized cutting-edge lab technology and operations savvy to expand to meet public needs in the COVID-19 pandemic. These resources and expertise will serve as the foundation to grow City+Ventures Health to serve more communities and patients.

As the EVP of Health Delivery Engagement at BCBS Nebraska, Dr. Schaefer worked to transform payment models to value-based care utilizing technology, such as predictive modeling and digital care management solutions, to assist members in receiving care. Prior to her EVP role, Dr. Schaefer served as the State of Nebraska’s CMO. She was the longest-serving CMO and first woman CMO in the Governor’s Cabinet and in the state’s history. In this role, she safeguarded numerous public health programs serving the most vulnerable, enacted “Smoke-free Nebraska,” and regulated the health care entities and licensees across the state. She addressed pandemics, mass vaccinations, use of strategic national stockpiles, natural disasters, domestic terrorism, and transformed licensing and other systems from paper to online and electronic formats. Dr. Schaefer’s career began as a family practice physician after graduating from Creighton University.

Dr. Schaefer and her husband, Phil Haines, a retired U.S. Marine Corps gunnery sergeant and security expert, enjoy exploring the world, boating and spending time with family members and friends.


About City+Ventures:

City+Ventures is a premier development and investment company focused on building companies and communities. With Omaha roots but regional and national assets, City+Ventures owns and operates a wide array of businesses, including automotive dealerships; carwashes; a private jet management and charter company; real estate management; and construction-related businesses, in addition to holding a real estate portfolio. In August 2020, City+Ventures’ proven track record of reinvention and financial success earned it the No. 71 spot on the Inc. 5000 Company list.

About GS Labs:

GS Labs is a leading provider of COVID-19 rapid tests across the United States. It began offering COVID-19 Tests in October 2020 with a mission to offer convenient and quick testing options, with same-day appointments and same-day results, helping patients “test today, know today.” Headquartered in Omaha, Nebraska, where it launched its first two testing sites, this private company has invested tens of millions of dollars to build a national operation, including establishing testing sites, hiring nearly 3,000 essential workers, and developing infrastructure to handle internal billing, compliance, communications, marketing in multiple markets, and the labs’ hotline, staffed by registered nurses. GS Labs passed a significant milestone in January 2022, when the company served its one millionth COVID-19 patient.


Media Contact:

Calli Hite