New Jersey is one of the lucky states, experts have said previously. Residents still have two insurers in the Affordable Care Act marketplace.
This almost wasn’t the case.
Word on the street is, not too long ago, the state’s largest insurer, Horizon Blue Cross Blue Shield of New Jersey, was asked to buy what is now the remaining competition, AmeriHealth New Jersey. Why it fell through or whether the deal advanced at all is unclear.
But the tidbit does add some intrigue to the current battles in the state over the industry. Battles being waged by some of the state’s most powerful people, from the governor to members of the legislature, to officials in the health care industry.
The fights continued this week.
But just imagine if Horizon had acquired AmeriHealth.
Had the deal occurred, the grilling of Department of Banking and Insurance Commissioner Richard Badolato during the state’s budget hearings on Wednesday may have gone differently.
During the hearings, Badolato again answered questions about Horizon’s reserves of more than $2.3 billion.
Gov. Chris Christie’s attempt to raid $300 million from Horizon’s reserves to pay for his anti-opioid campaign has called two things into question: the market share and the size of the reserves of the largest player.
The concerns are not attached to any piece of legislation — though a draft is floating around — but they suddenly are taking a front-and-center position for some legislators. Many legislators, even those who have previously pitted themselves against the insurer, are vocally opposed to taking the company’s reserves.
Horizon was discussed extensively at both the Senate and Assembly budget hearings with Badolato.
“It feels like there’s an intense level of interest from certain legislators on the Horizon thing,” one insider told NJBIZ. “(Assemblyman) Gary Schaer with a million questions, as I understand it, on Horizon stuff. I get it’s important, but there hasn’t even been a bill that’s been introduced.”
Schaer (D-Passaic) questioned why Horizon was singled out when other insurers are also in the state.
Another source said that there may be no bill, but the governor’s draft — which many, if not all, legislators and reporters have a copy of — has been floating around and zero legislators have jumped on board to sponsor it in the few weeks it has existed.
That doesn’t mean there won’t eventually be movement.
“When you’re in the governor’s crosshairs, there’s never a day when you go home,” one source said.
Horizon isn’t the only insurer coming under question.
On Wednesday, Assemblyman John McKeon (D-Madison) brought up AmeriHealth of New Jersey — the other, smaller, marketplace player. One that Cooper University Health has invested in.
McKeon grilled both Badolato and Department of Health Commissioner Cathleen Bennett about it.
AmeriHealth could be a sudden political target because of the 20 percent stake from Cooper, whose board of trustees is chaired by George Norcross. The focus was on a not-for-profit entity investing in a for-profit entity.
Cooper invested roughly $13.5 million since 2013, but officials from the company have said that stake, due to the insurer’s losses, is now less than 1 percent.
One source said that is comparing apples to oranges, but others disagree.
QualCare first began as a hospital-owned, third-party self-insurance tool. It then grew to offer more products and services, and when it sold to Cigna, the hospitals were paid out based on their shares.
“Why one set of rule for Blue and another set of rules for Cooper and AmeriHealth?” one source asked.
Then there’s the squabble between state Sen. Richard Codey (D-Livingston) and Norcross. Some insiders feel that was behind McKeon’s comments.
Or, as another source said, “It’s obvious the whole McKeon and Codey thing” played into the Assembly budget hearing.
“I know McKeon is friends with Dick Codey, Codey’s brother or cousin or multiple friends are on the board (of Horizon),” one source said. “Codey came out early and attacked the (governor’s) Horizon plan, Codey hates George, so, it’s pretty interesting.”
One insider feels Horizon is helping to spur conversation about AmeriHealth to take attention away from the reserves issue.
The company appears to be fanning the flame of the controversy “when no one else is even talking about it.”
And the move put some heat on McKeon.
“It made McKeon look (bad) because every hospital in the state has for-profit activity,” the insider said.
Party-line politics also plays a role in the battle, another insider said.
“It’s no secret that George Norcross … has an individual working relationship with the governor. And there are many around the state who look at that as a hint of disloyalty to the Democratic Party. If there is an opportunity to take shots, especially those with longstanding issues with George (referring to Codey), I think they’ll take the opportunity.”
(This report was generated from more than a half-dozen interviews.)