N.J. hospitals see red with Horizon Blue

//September 18, 2009

NULLJury trials have begun at Bergen County Superior Court in a contest between Horizon Healthcare Services, of Newark, and a group of 15 hospitals in New Jersey over the latterÂs claim over unpaid bills. The hospitals want $83 million in damages from Horizon Blue Cross Blue Shield of New Jersey, accusing the insurer of improperly selling discounted hospital rates to self-insured groups and failing to administer claims.

Jeffrey Brown, partner at the Hackensack law firm of Garfunkel, Wild & Travis, who is representing the hospitals, said his clients hired Horizon to market their services to the self-insured because those payments tended to be delayed and poorly coordinated. But Horizon failed them, he said, describing the current fight as one over a Âbreach of contractÂ and one that was Âat a much higher level than clerical errors.Â

Brown said total damages would exceed $100 million if interest charges were included; they have not sought any punitive damages.

A Horizon Blue spokesman maintained his company met its contractual obligations and does not owe the hospitals any money. The self-insured labor unions were entitled to the same discounted rates as Horizon BlueÂs other customers, he said.

Horizon Blue also contested the $83 million sought in damages. That figure Ârepresents the additional amount these hospitals would like to have charged the labor union funds for the services they provided,Â its spokesman said.