CAPITAL HEALTH SYSTEM, INC., ET AL. VS. NEW JERSEY DEPARTMENT OF BANKING AND INSURANCE
In this case, ten New Jersey hospitals challenged the Department of Banking and Insurance's decision to approve Horizon Blue Cross Blue Shield of New Jersey's (Horizon's) application to establish the OMNIA Health Alliance (OMNIA) network. OMNIA is a health benefits plan that contains a two-tiered network of hospitals and physicians under which a member's costs are lower if the member elects to use a Tier 1 provider. Horizon designated appellants as Tier 2 hospitals under the OMNIA tiered plan.
We conclude that the OMNIA plan met the Department's network adequacy requirements by ensuring that there was at least one hospital in each county or service area that was within twenty miles or thirty minutes, whichever is less, from 90% of the covered subscribers in the plan. Although OMNIA did not initially provide sufficient coverage in Burlington County for obstetrical services, it made arrangements with a Tier 2 hospital in that county to provide these services at Tier 1 rates. We held that this arrangement satisfied the Department's network adequacy requirements.
We also rejected appellants' contention that the Department's approval of the OMNIA plan was contrary to the public interest. After reviewing the governing statutes, we concluded that the Legislature did not specifically require the Department to make a specific finding that the approval of any tiered network plan "was in the public interest." In any event, we ruled that the Department's approval of an application that met all of existing regulatory requirements plainly served the public interest. We also noted that there is no statutory or regulatory procedure for the Department to determine the financial impact of the tier designation on a hospital.
Finally, we determined there is no provision in the existing statutes or regulations requiring that an insurance carrier publicly disclose the criteria it used to evaluate the hospitals for inclusion in, or exclusion from, a particular tier. We also found that appellants did not have a right to a hearing contesting Horizon's application for approval of the OMNIA network.