A New Jersey appeals court has upheld state regulators decision to allow Horizon Blue Cross Blue Shield of New Jersey's OMNIA tiered plans, reports NJ.com.
In September, the state Department of Banking and Insurance signed off on Horizon's tiered plan, which offers members greater discounts for choosing to undergo healthcare services at preferred tier 1 hospitals.
Lawyers representing 17 hospitals relegated to Horizon's tier 2 category challenged the department's decision, alleging state regulators failed to determine whether the plan would allow for reasonable patient access to lower cost hospitals. The hospitals also argued their tier 2 status harmed their facility's reputation and business.
The appeals court confirmed Tuesday the state insurance department conducted an "exhaustive and deliberate" investigation into plaintiffs' allegations and did its job to ensure the top tier included an adequate number of hospitals with certain specialties, according to a ruling obtained by NJ.com.
Appellate Judge Michael Haas said the state was not legally required to consider OMNIA's impact on hospitals' business or reputations. "There is also no requirement...that a carrier publicly disclose the criteria it used to evaluate the hospitals for inclusion in, or exclusion from, a particular tier," Mr. Haas added.
While spokespersons from Horizon expressed agreement with the court's decision, a former Department of Banking and Insurance commissioner said "legal issues surrounding Horizon's controversial OMNIA plan are far from resolved," according to the report.