It is the second time this month the panel ruled in Horizon's favor in the multi-front court fight.
TRENTON -- Horizon Blue Cross Blue Shield of New Jersey does not have to share a confidential report that explains how the insurance giant selected hospitals for the cheapest tier in its controversial OMNIA plans, an appeals court has ruled.
Seven hospitals suing Horizon for excluding them from OMNIA's "tier 1" category fought to obtain an unredacted copy of a consultant's report that guided the company's choices. Horizon relegated these and 24 other hospitals to "tier 2" status which require OMNIA policy holders to pay more in order to use them.
Tier 2 hospitals were not given the option to join tier 1. They have claimed the designation will do irreparable harm to their bottom line and reputations.
A three-member appellate panel sided with Horizon, and on Thursday overturned rulings by trial court judges. The hospitals were entitled to portions of but not the the full "McKinsey" report, so named for the company that produced it, the ruling said.
"We conclude that the information sought by St. Peter's and Capital is not relevant to the issues of contract interpretation that dominate this litigation, and that, even if relevant, the hospitals' asserted need for this discovery is outweighed by Horizon's greater need to preserve the confidentiality of its proprietary business information," according to Appellate Judge Michael Haas, writing for the appellate panel.
The hospitals suing Horizon are Capital Health System in Trenton and Hopewell; Centrastate in Freehold; Holy Name in Teaneck; JFK Medical Center in Edison; Trinitas Regional Medical Center in Elizabeth and Valley Hospital in Ridgewood. Saint Peter's University Hospital in New Brunswick filed a separate but similar claim; the appeals court merged the cases for the purposes of deciding which documents must be produced in the discovery process.
11 things about Horizon's nasty OMNIA battle
The court also said Thursday Horizon could keep confidential its financial agreements with tier 1 hospitals, including 22 deemed "OMNIA Alliance partners" which will recoup a windfall from cost savings. The court ruled the information was not relevant to the lawsuits.
It is the second time this month the panel ruled in Horizon's favor in the multi-front court fight. On June 7, the court upheld the Christie administration's decision to approve the OMNIA health plans, concluding the state's review was not rushed, but rather "exhaustive and deliberate."
"The Appellate Court's ruling is another in a long line of wins for the consumers of New Jersey," said Robert A. Marino, Horizon's chairman and CEO of Horizon. "Horizon's goal is, and will always be, to provide high quality, affordable health coverage to New Jerseyans who are demanding, and who deserve, nothing less."
The two lawsuits filed will proceed. The hospitals are suing Horizon for violating their contracts which require the insurance company to give them 60 days notice before the launch of a new line of plans.
Steven M. Goldman, attorney for the Tier 2 hospital coalition, said he would appeal.
"Instead of being transparent with this information, Horizon has used legal tactics to obstruct two separate court orders to disclose important information about OMNIA - information detailing how New Jersey's largest nonprofit insurance company worked in secret with the state's largest hospital systems to craft the flawed OMNIA network," Goldman said.
Susan K. Livio may be reached at slivio@njadvancemedia.com. Follow her on Twitter @SusanKLivio. Find NJ.com Politics on Facebook.