Dive Brief:
- New Jersey payers are fighting to change state regulations requiring them to pay for emergency and involuntary out-of-network treatment.
- Payers like Horizon Blue Cross Blue Shield of New Jersey want to reform the state's "hold-harmless" regs, which since 2000 have required fully-insured HMOs to offer in-network benefits and cost-sharing for consumers that need various types of emergency treatment.
- Horizon, the state's biggest insurer with a 48% market share, argues that the rule has given providers an incentive to jack up their prices substantially.
Dive Insight:
Whether fueled by hold-harmless regs or other forces, something does seem to be skewing healthcare prices in New Jersey. According to the Commonwealth Fund, the state's employer health plan premiums are among the highest in the US, averaging $17,396 for family coverage in 2013. Meanwhile, a study paid for by Horizon found that New Jersey's acute care hospitals charge an average 630% of Medicare, well above the 390% national average.
The question is what to do about the problem. According to an Avalere Health report sponsored by Horizon, out-of-network regs could be reformed in several ways, including having the state set payment benchmarks connected to a certain percentage of Medicare, develop its own fee schedule or set the out-of-network rate relative to a health plan or provider's average in-network rate.
Regardless, the New Jersey Hospital Association has been fighting hard to prevent changes in the status quo. It appears that the state's payers will be in for a tough fight if they hope to effect any substantial reforms to these regs.