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Hospitals within the Hackensack Meridian Health system will soon no longer be considered as in-network providers by Horizon Blue Cross Blue Shield of New Jersey, according to the health insurance company.

In a Jan. 30 announcement, the insurer said it has worked for the past year to try to reach a new agreement with the system, but that HMH “has decided to terminate its hospitals from the Horizon Hospital Network effective June 1, 2025, unless we agree to significant price increases for services and care at their facilities.”

Headquartered in Edison, HMH is the state’s largest integrated health network and serves nearly 2 million patients annually. Its footprint consists of 18 hospitals and more than 500 patient care locations, including ambulatory care centers, surgery centers, home health services, urgent care facilities and rehabilitation centers.

Ahead of the change, both sides said they will continue negotiating. However, they remain at odds over what regards fair pricing and reimbursement.

“In 2024, Horizon successfully negotiated new agreements with many health systems, hospitals and physician groups that share our goal to make health care more affordable. We have contracts with more than 70,000 health care professionals and all other hospitals in New Jersey are currently in network,” said the insurance company, which noted, “High prices at hospitals directly increase members’ out-of-pocket costs and insurance premiums and make health care less affordable.”

Horizon went on to say, “We continue to work with HMH to reach an agreement for a fair and reasonable increase in the prices that Horizon members pay for care and to keep HMH hospitals in our network.”

Still trying

In a statement shared with NJBIZ, an HMH spokesperson said, “Hackensack Meridian Health has been unable to reach an agreement on our hospital contract with Horizon Blue Cross Blue Shield of New Jersey despite lengthy negotiations. We have been and remain committed to reaching an agreement but must receive fair care reimbursements from Horizon to continue to invest in the care, medical technology, and locations that the local communities we serve rely on and expect.”

According to HMH, the proposal from Horizon included “inadequate reimbursement rates and demands significant changes to previously agreed-upon contract terms.”

However, the system said it “remains committed to working with Horizon to reach a mutually beneficial agreement prioritizing high-quality patient care and access.”

The network noted, “Over the last two years, Hackensack Meridian Health has successfully renewed its contracts with all of its major payors. The rate increases agreed to with those payors are consistent with the rate increases Hackensack Meridian Health has requested of Horizon. Horizon is proposing changes to our existing contractual terms that are also in place with other payers.”

HMH also said a recent PwC Health Research Institute report on medical cost trends “clearly supports” the reasonableness of its requested rates.

The health care provider pointed to these particular findings:

• Hospitals are experiencing a higher acuity inpatient and outpatient utilization driven by demand for care deferred by the pandemic
• Inflationary pressures due to rising operating expenses, which the health care industry has felt since 2022, expect to persist into 2025
• The hospital and related services index continues to increase year over year. In the last quarter of 2023, it hit 6.3% growth

What’s the impact?

According to Horizon, the following facilities will be considered in-network hospitals through May 31:

• Bayshore Medical Center
• Hackensack University Medical Center
• Hackensack Meridian Health Carrier Clinic
• Hackensack UMC Mountainside
• Hackensack UMC Palisades
• Hackensack UMC at Pascack Valley
• Jersey Shore University Medical Center
• JFK University Medical Center
• Ocean University Medical Center
• Old Bridge Medical Center
• Raritan Bay Medical Center
• Riverview Medical Center
• Southern Ocean Medical Center

Unless approved for continuity of care, any nonemergency care received from HMH hospitals after that date will be considered out of network, Horizon said.

However, members may be eligible for continuity of care and can continue using these hospitals for certain treatment, care or services for up to 90 days. That applies if they are undergoing treatment for:

• A serious or complex condition, such as heart attack, stroke or cancer
• Inpatient medical or behavioral health care services
• A scheduled non-elective surgery or post-operative care
• Pregnancy
• A terminal illness

According to Horizon, HMH’s primary care and specialty physician practices will remain in-network. The change also does not impact members covered by a Braven Health, Medicare or Medicaid policy, the insurer said.

An ‘alarming’ development

State Sen. Jon Bramnick, R-21st District, described the removal of HMH’s hospitals from Horizon’s network as “unacceptable.”

“Hundreds of thousands of New Jersey patients rely on the care provided by Hackensack Meridian’s 18 hospital facilities across New Jersey and the prospect of patients being unable to access necessary and lifesaving services under their Horizon policy is alarming,” the gubernatorial candidate said in a statement.

“New Jersey’s health care providers are squeezed by big health insurers every day. While doctors, nurses and hospital staff work 24/7 to save lives, health insurers work around the clock to find ways to deny necessary care and bolster their revenue,” said Bramnick.

“It is imperative that Hackensack Meridian and Horizon Blue Cross Blue Shield come to an agreement that keeps Hackensack Meridian hospitals in-network and fairly compensates New Jersey’s world class healthcare workers fairly,” he added.