Another debate over the future structure of Horizon Blue Cross Blue Shield of New Jersey appears to be looming in the Legislature.

A bill providing for the reorganization of the health service corporation was proposed Thursday in the Senate. The sponsors of S3218 are Sens. Nellie Pou, D-Passaic; Paul Sarlo, D-Bergen; and Steve Sweeney, D-Gloucester, the Senate president.

The idea has been the subject of repeated battles, with Horizon seeking to modernize its structure and opponents calling for the company to have to compensate the state to account for the $7 billion in assets it has accumulated due to its tax treatment stemming from its charitable mission.

The text of the new bill isn’t yet online, but a draft that has circulated calls for Horizon to convert to a mutual holding company and provide the state an initial payment of $600 million by June 2022, followed by up to $650 million combined over the 17 years that follow.

Maura Collinsgru, the health care program director for New Jersey Citizen Action, called it a “complicated shell game” that has the NJ For Health Care coalition very concerned.

“What Horizon is proposing is not significantly different than a 2019 proposal that was withdrawn when consumer advocates raised concerns,” Collinsgru said. “Once again it appears that Horizon is seeking to circumvent their obligations under a law put in place in 2001 that governs the kinds of changes Horizon is proposing.”

Tom Vincz, a spokesman for Horizon, said the company has “been working with various stakeholders for the last year to address every specific concern that was raised with the original bill. We believe those changes are being incorporated into the legislation.”

Renee Steinhagen, executive director of the NJ Appleseed Public Interest Law Center, said “this deal, this transaction, is nothing other than a conversion to a for-profit stock company, and the state should treat it as such.”

“This new legislation is nothing other (than) to try to allow them to walk away with all the $7 billion of assets without making a charitable trust payment,” said Steinhagen, who said that otherwise Horizon would change its corporate structure and make the payment under existing law.

The draft legislation says that if a mutual holding company converts to a stock holding company, its entire fair market value would have to be transferred to a foundation, as required by the 2001 law.

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Chuck Bell, programs director for Consumers Union, the nonprofit publisher of Consumer Reports magazine, said his group has seen “creeping conversions” in which a Blue Cross Blue Shield entity first becomes a mutual is what is a prelude to a sale.

“Our bottom line policy concern would be a mutual holding company structure is, in our opinion, designed to weaken public accountability both to the states and to the policy holders,” Bell said.

Michael Symons is State House bureau chief for New Jersey 101.5. Contact him at

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