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Horizon's OMNIA Could Change Maternity Patterns in New Jersey

Mary K. Caffrey
Two separate lawsuits have challenged the health insurance plan, which seeks to give some hospitals lower reimbursements in exchange for directing large numbers of patients their way. After business hours, the attorney for a group of hospitals said regulators declined to stay their approval of the tiered network.
In an earlier interview with The American Journal of Managed Care, Jeffrey Greenbaum, attorney for St. Peter’s, said the hospital was surprised that none of the broad criteria that Horizon listed for evaluating its selection of Tier 1 hospitals included maternity care. “There’s nothing concerning the care of women or children,” he said.

In 2014, St. Peter’s handled 5578 deliveries, the third-highest total in New Jersey and the most in its market, according to NJ Department of Health statistics. Only Hackensack University Medical Center and St. Barnabas Medical handled more. So far this year, St. Peter’s has handled 4844 deliveries, fourth-highest in the state and the most in central New Jersey. Besides Hackensack and St. Barnabas, both in North Jersey, the other hospital ahead of St. Peter’s is Virtua Voorhees, which so far has handled 4931 deliveries. Virtua Voorhees and Virtua Mount Holly, a level 2 maternity service, have seen increases in deliveries since another maternity wing in the area closed.

The 4 busiest hospitals, as well as Monmouth Medical Center and Morristown Medical Center, also handled the most twin births over the past 2 years. The number of twin births at a given hospital is more variable from year to year, and the 2014-2015 totals for the hospitals are: Hackensack, 292; Monmouth, 239; Morristown, 264; St. Barnabas, 256; St. Peter’s, 245; and Virtua Voorhees, 279. No other hospital in New Jersey had more than 200 twin births in the 2-year period.

Separate from the 17 hospitals that seek to overturn the OMNIA approval, St. Peter’s has sued Horizon to be included in Tier 1, saying in court documents that OMNIA is already disrupting its relationships with physicians. A hearing on that action is set for December 17, 2015.  Virtua Voorhees is among the 17 hospitals involved in the first lawsuit.

While the suits seek different outcomes, the central complaint is the same: Horizon seeks to cut costs by asking Tier 1 hospitals to accept reduced reimbursements; in exchange, these hospitals will see more patients directed their way. Those hospitals left out of the preferred group, in Tier 2, fear a bleak financial picture over time as patients go elsewhere. Horizon insists that the first-year projection only calls for 250,000 patients migrating away from Tier 2 hospitals.

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