Christie announces fine against Horizon, pushes reform. Is it ‘retaliation’?
Penalties against health insurers over Medicaid billing issues aren’t typically disclosed by the state Department of Human Services, let alone announced publicly by Gov. Chris Christie.
But Wednesday provided an exception, allowing Christie a chance to punch at a months-long target returning to his sights at the climax of budget talks – Horizon Blue Cross Blue Shield, which he’d like to reform in part to enable the state to move from its reserve to a new state health-care fund.
At a news conference, Christie said DHS had sanctioned Horizon Blue Cross Blue Shield $15.5 million Monday for late or inaccurate processing of Medicaid claims over the past year, mishandling complaints and inaccurate financial reports. He also noted the Department of Banking and Insurance had fined the company $550,000 since September.
“Horizon just brazenly failed their members and the citizens of New Jersey who pay them,” Christie said.
Christie said Horizon had already gotten the funds from the Medicaid program and had a contractual obligation to pay those claims faster. He suggested the company held the funds as long as possible to profit from investing the money.
“That’s like I give you $10 bucks to go down the street and you’re going to buy me a sandwich, and you keep the $10 and I never get the sandwich. And then you come back two days later and say, ‘Here’s the sandwich.’ And I’m like, ‘What happened the last two days?’” Christie said.
Horizon public affairs manager Kevin McArdle said the company has fixed problems stemming from a change in claims vendors last spring and will challenge what he calls an unfair and unjustified penalty.
“Given the substantial progress and success we achieved in working with the state, we were blindsided by both the timing and severity of this action,” McArdle said. “It makes us question the motivation behind levying a large and unreasonable penalty without permitting the opportunity for the customary appeal and review.”
McArdle said Christie’s comments “strongly suggest that this is further retaliation” for the company’s unwillingness to pay the state $300 million from its reserves, as Christie proposed in his Feb. 28 budget speech, into a new state fund to pay for health programs.
Christie wouldn’t acknowledge the Horizon bill’s role in budget negotiations, but Assemblyman Gary Schaer said the issue was debated in an hours-long private meeting Wednesday of Assembly Democrats, hastily called after Christie met a day earlier with legislative leaders about the budget.
“Certainly that was an issue that the caucus discussed at length,” Schaer said. “What the governor’s thinking is I’m not sure. Certainly he’s expressed his interest that this is an important item. I know that there is certainly a wide variance of opinion on the issue.”
Before Christie announced the fine, but after it became clear Christie had raised Horizon in budget negotiations, New Jersey publishing magnate Steve Forbes had already taken to Twitter to accuse Christie of bullying the company.
Christie insists that’s not what’s going on.
“When you’ve been hit with $16 million in fines in nine months for incompetence, or worse, depending on what the motivation was for this, it has nothing to do with bullying,” said Christie, who added that the investigations by state departments began many months before he made his proposal.
Christie’s idea has gotten a cool reception in the Legislature, where it doesn’t yet have any public sponsors. He said the expansion of Horizon’s board to add four new members appointed by legislative leaders and increased transparency about company finances are more important than the financial transfer the bill would allow starting in the first half of 2018.
“We need the greater transparency and additional independent management that our proposed legislation provides to the public,” Christie said.
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