Jefferson Heath will leave Horizon Blue Cross Blue Shield of New Jersey’s network on March 1 without a new contract
In addition to Horizon, New Jersey's largest insurer, Jefferson is in high-stakes contract talks with at least two other major insurers, Highmark and Independence Blue Cross.
Jefferson Health and Horizon Blue Cross Blue Shield of New Jersey have reached in impasse in contract talks, leading both to warn patients that Jefferson’s three South Jersey hospitals will leave Horizon’s network on March 1 if they fail to reach a new agreement.
Horizon posted a notice online saying that Jefferson had terminated its contract with the insurer effective Sunday, but added that under New Jersey law patients will be able to continue receiving in-network care at Jefferson’s Cherry Hill, Stratford, and Washington Township hospitals through Feb. 28.
A Horizon spokesperson did not respond to a request for comment Monday evening.
Insurers and health systems typically reach agreements before contracts expire, but Jefferson has been taking a particularly tough approach with insurers during a period of significant operating losses for the Philadelphia region’s largest health system. Jefferson’s Lehigh Valley Health Network went out of network with UnitedHealthcare in two phases last year and this year.
A Horizon website for patients said that meeting Jefferson’s demands would cost Horizon members more than $185 million over the next three years and that New Jersey residents should not have to pay for Jefferson’s losses in Pennsylvania. Horizon, based in Newark, N.J., did not say how much of a percentage increase Jefferson is seeking.
Jefferson’s online communication to patients said that Horizon pays other New Jersey hospitals 146% more on average than Jefferson for inpatient care and up to 89% more for emergency care. Jefferson did not address the question of geographic diversity in rates, which are likely higher in the more expensive New York metro area.
Jefferson said it wants Horizon to narrow the gap, not make it the highest-paid system.
“Jefferson was in active negotiations with Horizon when they decided to abruptly cancel all discussions,” Jefferson said in a statement. “They’re putting patients well being at risk by refusing to continue conversations with us. We stand ready to meet with Horizon any time, any day, any location on behalf of our patients.”
Neither Jefferson nor Horizon said how many patients would be affected if they can’t agree to a new contract. In New Jersey, cancer and psychiatric patients would be able to continue receiving in-network care from Jefferson for a year even without a new contract, Horizon said.
In its dispute with Independence in Southeastern Pennsylvania, Jefferson is not focused on local competitors but rather on what it says is Independence’s underpayment relative to national averages for the entire market.
Jefferson also issued a notice that it could go out of network with Highmark, Pennsylvania’s largest Blue Cross Blue Shield company, on Jan. 1.
