A court blocked a challenge from a nonprofit and a nurses union seeking to prevent Horizon Blue Cross Blue Shield from reorganizing as a nonprofit mutual holding company, nj.com reported June 1.
The groups, New Jersey Citizen Action and Health Professionals and Allied Employees, argued the state's insurance commissioner, Marlene Caride, hastily waved the proposed reorganization through.
An appeals court sided with the state, finding the reorganization would not raise premiums or hurt Horizon BCBS members, according to the report.
"It is important to note that under the law, the [Horizon BCBS] must maintain its mission as a charitable and benevolent institution, and the state attorney general has confirmed that any nonprofit mutual holding company formed under the law remains subject to its oversight," Ms. Caride said in a November 2022 statement.
Horizon BCBS will pay New Jersey $1.25 billion over 25 years to make up for lost tax revenue as part of the reorganization. Becoming a nonprofit mutual holding company will allow Horizon to acquire for-profit subsidiaries.
In October 2022 hearings, Horizon BCBS representatives argued the reorganization is necessary to allow the nonprofit to compete with for-profit payers.
North Carolina legislators approved a similar reorganization proposal by BCBS North Carolina May 30. The legislation is awaiting the governor's approval.