Officials: Horizon's Omnia will hurt urban, rural areas

Dec. 02--TRENTON -- Elected and hospital officials fighting Horizon Blue Cross Blue Shield's new health insurance plan aired a litany of concerns at a Statehouse oversight hearing Wednesday.

They said Horizon's goal of reducing health care costs through the Omnia plans is laudable but questioned how the insurer decided which hospitals were deemed Tier 1 facilities, which will have lower out-of-pocket costs for consumers. They said suburban hospitals that are part of large networks were included and that faith-based, urban and stand-alone facilities were excluded -- and that the latter group of hospitals now face an uncertain financial future.

"This is about access and affordable care," said Trenton Mayor Eric Jackson. "We also realize, if we're going to be honest, if you look at the maps, this is about ZIP codes."

"If the rules allow for something like this to happen, then the rules need to be changed, because in the drive to create tiered health care networks, the result is going to be we're going to end up with tiered communities. And that is not something we want in this state," said Assemblywoman Elizabeth Muoio, D-Mercer.

Warren County Freeholder Director Edward Smith said the problems aren't limited to cities. Neither of the two hospitals in Warren County are included in Omnia's Tier 1, which would force people to commute 40 minutes or longer to Flemington or Newton, he said. Moreover, there is no mass transit in the rural county, Smith said.

"This is a hollow attempt at affordable health care," Smith said.

Horizon, the state's largest insurer with 3.8 million members, announced in September that it would offer a new Omnia health insurance that will reduce premiums by an average of 15 percent and lower deductibles for customers who use Tier 1 hospitals and doctors.

Seventeen hospitals classified as Tier 2 appealed the state's approval of the Omnia plan, but the state Department of Banking and Insurance denied the appeal Monday. Omnia plans that go into effect Jan. 1 are already being sold to individuals and small businesses, said acting Banking and Insurance Commissioner Richard Badolato in the reply to the hospitals' appeal.

"Staying the sale and effective date of these plans would immediately trigger chaos," Badolato said.

Lawmakers said they were disappointed that Department of Banking and Insurance and Horizon officials declined their invitations to testify at Wednesday's joint hearing held by two Assembly committees.

Horizon officials testified at a joint Senate committee hearing in September. The hearing lasted four hours and was at times heated. The head of the New Jersey Chamber of Commerce criticized lawmakers for what he called an "egregious inquisition."

Among those who spoke in support of Omnia at the Assembly hearing was Jessica Fulginiti Waltman of Forward Health Consulting, a member of the New Jersey Association of Health Underwriters. She said tiered networks based on both cost and quality measures will be important because there is a 40 percent excise tax looming for the priciest employer-based plans under federal health care reform.

"Now is not the time to limit fully-insured plans from value-based design options, including appropriately structured tiered networks," Waltman said.

Michael Symons: (609) 984-4336; [email protected]

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