TRENTON - Four Republican members of the Senate Budget and Appropriations Committee moved an amendment Dec. 15 to legislation restructuring Horizon Blue Cross Blue Shield of New Jersey to require a proposed $600 million payment from the insurer to be deposited into a new nonprofit entity that is dedicated to rate stabilization and improving the quality and efficiency of health care, in New Jersey.
According to a release, the members, Senate Republican Budget Officer Steven Oroho (R-24th) and Sens. Sam Thompson (R-12th), Sens, Declan O’Scanlon (R-13th), and Sen. Michael Testa (R-1th), said they are concerned that premiums paid by Horizon’s policyholders and ratepayers will be consumed by the state’s general fund to pay for spending unrelated to health care.
“In an ideal world, the excess premiums paid to Horizon by policyholders, small businesses, local governments, and taxpayers would be returned to customers in the form of lower future premiums,” the Republican senators said, in a joint statement. “It’s clear, however, that’s not what this rushed legislation envisions. If the sponsors are going to require a massive payment to the state, we believe the proceeds should be dedicated by law to improving health care, in New Jersey, in a way that benefits and supports the needs of the communities that paid the premiums in the first place.”
Under the current legislation, S-3218, Horizon is required to make a one-time, $600 million payment to the state, along with smaller payments for a number of years.
The amendment would direct the $600 million payment to a new nonprofit that would be created, called the “Health Care Rate Stabilization and Improvements Organization,” for the purposes of rate stabilization and improving health care, in New Jersey, with a focus on addressing infant mortality, maternal mortality, diabetes, heart disease and veterans’ health.
The amendment would restrict the funds as an endowed account, with no more than 25% of the principal being expended annually and pursuant to a plan adopted by the organization’s board.
The board would be comprised of 12 unpaid members, as follows: four members appointed by the governo, without advice and consent and with no more than two from any one political party; one member each appointed Senate and Assembly majority and minority Leaders; and four members from the board of Horizon Blue Cross Blue Shield of New Jersey.
“We believe we have an obligation to ensure that any proceeds resulting from Horizon’s restructuring are dedicated appropriately,” the members added. “Those funds were paid by millions of Horizon’s subscribers, thousands of small businesses, and hundreds of local governments across the Garden State. They should support the unmet health care needs of New Jerseyans, not consumed by the black hole of the State Treasury.”
Additionally, Bucco and Sen. Gerry Cardinale (R-39th) expressed their support for the amendment, saying it addresses some of the concerns they raised during the Senate Commerce Committee’s consideration of the legislation.