Horizon, NJ’s largest health insurer, is about to enter the for-profit health care business


New Jersey Skyline Blue Cross Blue Shield; The state’s largest health insurer cleared its latest hurdle late last week to expand into the health care business when the state’s Department of Banking and Insurance granted initial approval to change its corporate charter.

Banking and Insurance Commissioner Marlin Caride made a statement late last Thursday Horizon’s application to become a non-profit joint-stock company i“Full.”

The state’s vetting process, however, has not yet been completed. Caride said her office is conducting a health impact study to determine whether changing Horizon’s corporate charter would benefit its 3.6 million policyholders. A government spokesman on Friday did not know when that study would be made public.

About one-third of Horizon’s customers are on Medicaid, a state and federally funded insurance program for low-income and disabled people. Horizon was created as a not-for-profit health care corporation that was once considered the insurance of last resort for people who had no other way to get coverage.

Gov. Phil Murphy In the year It was signed into law in December 2020 Horizon paved the way to change the management structure And allow $13 billion for nonprofits to do more for for-profit competitors by eliminating for-profit subsidiaries and investing in new technology to track members’ health or buying doctor’s practices, among other options.

In a state change that would allow Horizon to reorganize, the company committed to paying the state $1.25 billion over 25 years to offset the loss of other tax revenue the Newark-based company provided.

The law requires Caride’s office to approve the change unless she determines the plan is “unlawful.” The joint holding company, which is a subsidiary of the reorganized insurer and the insurance company, affects safety or health. or does not benefit or treat the health care corporation’s policyholders fairly.

The bill requires the state to host three public hearings, all scheduled for October. The first in-person hearing is scheduled for October 6 at 11:00 a.m. at the State Department of Banking and Insurance offices, 20 West State Street, Trenton. The mock auditions will be held on October 11 at 6:00 pm and October 17 at 1:00 pm, said the Karid notice.

In a letter to Horizon President and CEO Gary St. Hilaire Carrey He asked several questions about the company’s future. The filing said the change in corporate structure will allow the company to “make strategic investments to cover the health care costs of our members that are currently covered solely by member premiums.” Caride asked how the company could keep premiums affordable “given the recent trend in medical inflation.”

She asked how the company would improve health care equity and “culturally competent care” for people of different races and ethnicities, a priority for the Murphy administration. Horizon transferred $300 million from its takeover insurance business to Horizon Mutual Holdings, its new parent company, and Karid questioned how the money would be spent.

Horizon spokesman Tom Wilson declined to answer Karid’s questions ahead of the hearing.

“For nearly ninety years, Horizon members have trusted us to help them achieve optimal health, improve quality with their doctors, and make care more affordable and convenient. “What our members want and demand from health care today is changing rapidly, and the nonprofit mutual benefit will better position Horizon to continue to meet their needs,” Wilson said in a statement.

“We are committed to continuing to work with the department to ensure the successful completion of this process and deliver the benefits the reorganization will bring to our members,” Wilson’s statement said.

Under the law, Horizon remains a “charitable and philanthropic institution,” and cannot convert to a wholly-owned for-profit company or be acquired by one unless the company applies to the state to do so. This language was added to assure consumer advocates that Horizon will not shirk its responsibility to its members.

Maura Collinsgru of Citizens Action of New Jersey, one of the consumer groups opposing Horizon’s plans, said she was disappointed the health impact study might not be ready in time for the hearing. It is a document that can shed light on a very complex process. Similarly, there are no details on the subsidiaries Horizon plans to create.

“There’s no meaningful data to review here,” Collinsgru said. “Some of the questions that the commissioner raised are good, but I would venture to say that there are more to be asked.”

Collinsgrue also pointed out that the law allows public hearings to be scheduled for more than 90 days. The pace “seemed rushed,” she said.

The Horizon app is available. over here.

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You can find Susan K. Livio at slivio@njadvancemedia.com. Follow her on Twitter. @SusanKLivio.





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