08:37 AM

New Law Means Better Health Care Experience for You



Change improves Horizon’s ability to adapt to changing customer needs.

William D. Georges, Senior Vice President & Chief Strategy Officer

By William D. Georges, Senior Vice President and Chief Strategy Officer at Horizon Blue Cross Blue Shield of New Jersey

Five years ago, Amazon introduced Alexa, the virtual assistant that gives customers a more intuitive way to interact with the technology they use every day. Today, more than one in four households in the U.S. has a smart speaker like Alexa, and an increasing number of people are using the units to manage their health. It’s just another sign that health care is evolving faster than ever.

That increasing pace of change is why Horizon Blue Cross Blue Shield of New Jersey (Horizon BCBSNJ) is seeking legislation that allows us to make a technical change to our corporate structure and modernize to a not-for-profit mutual holding company. That change, if approved by New Jersey’s legislature and the Commissioner of Banking and Insurance, will give us the flexibility to adapt and respond as our members’ needs change and as the health care system evolves in our rapidly changing and highly competitive marketplace.

There When You Needed Us Most

Horizon BCBSNJ is uniquely focused on New Jersey and, as we demonstrated when COVID-19 struck New Jersey, deeply committed to being there for our members and New Jersey’s communities when you need us most. To make access to care safer, more affordable and more convenient when the pandemic hit, we expanded telemedicine benefits and eliminated out-of-pocket costs for COVID-related testing and care. For people feeling stressed, anxious or depressed we expanded options for no-cost mental and emotional health support. We helped employers preserve health coverage for their employees by working with them while businesses and workers sheltered in place. We also played a leadership role to protect New Jersey’s health by contributing nearly $800,000 to local non-profits and community groups, by donating 500,000 N95 masks and 81,000 face shields, and by providing $2 million to the Governor’s Pandemic Relief Fund.

Staying True to Our Mission of Working for Members, Not Shareholders

The bill before the State legislature protects what makes our company unique. It preserves our historic mission as New Jersey’s only not-for-profit health insurer with strong ties to its communities. At the end of the day, we would still be accountable to and operate for the benefit of our members, who are Horizon policyholders – not shareholders or anyone else.

While just about everyone agrees that we should have the tools and flexibility to best serve our members, some industry observers have asked important questions about our becoming a not-for-profit mutual holding company. They seek assurances – understandably – that the change we are requesting is truly in the best interest of New Jerseyans and that it will not alter the fundamental purpose we have been dedicated to for the past 88 years: to always be there for our members, helping them achieve their best health and improving the health of New Jersey’s communities.

So let me, here and now, offer those assurances as clearly and succinctly as I can.


Establishing an Open and Transparent Review Process

First, the proposed bill does not imminently change the structure of our company. It simply creates a process for us to apply to the state Department of Banking and Insurance to seek the change, and it lays out the conditions that Horizon BCBSNJ would need to meet in order to become a not-for-profit mutual holding company. That process would be open and transparent, with public hearings and opportunity for comments. Horizon will only be allowed to become a not-for-profit mutual if we can clearly demonstrate to the Commissioner that it will be in the best interest of our members.

Separate legislation is required because current state laws were passed in a time that did not contemplate a more modern way of organizing ourselves to better serve our members while retaining our historic not-for-profit mission.

Preserving Our Not-for-Profit Status

Secondly, and most importantly, what we are today is what we would be tomorrow, only better. Like the Horizon BCBSNJ of today, the mutual holding company we are proposing would be a not-for-profit. We would be governed by all the laws that control New Jersey’s not-for-profits and would be legally required to operate exclusively for the benefit of our members, unlike out-of-state, for-profit insurers who must serve their shareholders.

Importantly, this new law will strengthen the guarantee that Horizon remains forever a not-for-profit that exists for the benefit of its members. This change means that Horizon cannot be sold or change to become a for-profit company that is owned by shareholders or investors. Horizon’s commitment to remain a not-for-profit, mission-oriented company that serves only the interests of our members is unwavering.

Investing in Innovation to Drive Affordability, Simplicity, Quality

By taking on the commonly-used mutual holding company form – which has been adopted by Blue Cross Blue Shield plans in 18 other states – we would have the flexibility to continue working hard for our members and invest more in innovative partnerships and technologies that drive health care affordability, simplicity and quality. Investments could include:

New, consumer-friendly technologies that make care more convenient and accessible including for pressing mental health and substance abuse needs magnified by the impact of COVID-19;

New models of care that address social and economic barriers to positive health outcomes;

A range of new services, such as student health insurance and expanded Medicare and senior services;

New capabilities for providers and hospitals in such areas as population health, electronic patient records, advanced analytics, prescription management programs and other tools to promote clinical advancements and provide doctors with a more holistic look at their patient’s health, while lowering the total cost of care.

As a not-for-profit today, Horizon already owns and operates several for-profit entities – units that sell dental and vision plans, for example. The bill does not change this, and we plan to make other important investments in the future. The important thing is that, just as today, the benefit of Horizon’s business activities across all of its companies go to support its core mission – serving our members. And, like today, we would use those successes only in ways that benefit our members or support our mission to improve the health of New Jersey’s communities.

Ensuring the Public Interest Is Always Protected

That leads to my third point: the legislation recognizes that, as a not-for-profit and consistent with current state law, Horizon BCBSNJ’s assets – all of them – must and will continue to be used to advance our non-profit mission. And, as noted, the law will now permanently preserve Horizon’s not-for-profit mission and ensure that a stronger Horizon will forever be focused on one thing only: improving the health of our members and the well-being of the communities we serve. In the event that we ever sought to become a for-profit entity – a change we have no plans to make – all of Horizon’s assets would be transferred to a not-for-profit foundation aligned with the state. This provision is an important protection for the public that stakeholders have rightfully sought.

What we are today, we would be tomorrow, only better.

I invite you to learn more about our plans and read answers to other frequently asked questions by visiting www.HorizonForYou.com. I look forward to continuing to work with state leaders and other interested parties to ensure that Horizon has the operational flexibility to continue being there for our members and their health. Becoming a not-for-profit mutual is an essential step toward that goal.