Horizon Blue Cross Blue Shield of New Jersey “A” Credit Rating Affirmed
Newark, NJ (PRWEB) April 28, 2017 -- Horizon Blue Cross Blue Shield of New Jersey (BCBSNJ) announced today that Standard & Poor’s has affirmed the company’s credit rating of “A” and its outlook as “stable.” At the same time, the ratings agency cautioned that the company’s rating could be downgraded if capital reserves, which have fallen in recent years, dip below “capital adequacy” thresholds required for its strong rating.
“Horizon is committed to being a prudent and responsible steward of the premium dollars entrusted to us so that our 3.8 million members can always have the financial peace of mind they deserve,” said Robert A. Marino, Chairman and CEO, Horizon BCBSNJ. “The health insurance industry, in New Jersey and nationally, remains highly volatile, and our company’s financial stability continues to be tested. We’re pleased that S&P has acknowledged how well Horizon has managed through the many risks to our business operations, and understands how hard we are fighting to make transformative changes to the health care system that improve care quality while lowering costs and enhancing the patient experience.”
In its ratings report, Standard & Poor’s noted that Horizon’s management team “exercises prudent control of operations by maintaining financial strength, efficient administrative expense controls, expanding and optimizing network provider relationships, and improving systems technology platforms to support its entire product line.” The agency also noted: “The team has also been at the forefront of various innovative payment models to make the New Jersey health-care system more effective, efficient, and affordable. These models include patient-centered medical homes and pediatric programs, episodes of care models, and accountable care organizations. These arrangements have been successful so far in improving health and lowering costs.” S&P added that Horizon BCBSNJ’s OMNIA Health Plans have “exceeded expectations” and “we believe that OMNIA has potential to support management's goals of lowering healthcare costs while increasing quality of care.”
While maintaining Horizon BCBSNJ’s “A” rating and outlook as “stable,” S&P took note of how a raid on the company’s capital reserves could impact its financial stability, viewing “any such event as a source of potential capital volatility.” S&P added that diminished “capital adequacy” could trigger a downgrade in the future. The ratings agency took note that Horizon’s BCBSNJ’s capital reserve as measured by a Risk-Based Capital (RBC) ratio, has been in decline, and “we expect continued modest deterioration in capital. We assume its RBC will remain about 575%-600% in 2017-2019, translating to continued 'AAA' capital redundancies per our risk-adjusted model, though with a much tighter reserve (less than 5%) relative to historical levels.”
“In its report and its ratings, S&P has recognized Horizon’s efforts to operate with the kind of sound financial judgment and fiscal prudence that have been the guiding principles of our company for 85 years,” said David R. Huber,” Horizon BCBSNJ Senior Vice President, Chief Financial Officer and Treasurer. “While risks and uncertainties continue to presents real threats to our stability, we are more determined than ever to protect the interests of the members we serve.”
Standard & Poor's Ratings Services is the world's leading provider of independent credit risk research and benchmarks. The agency publishes more than a million credit ratings on debt issued by sovereign, municipal, corporate and financial sector entities.
Journalists seeking further details and information about the ratings report can do so by contacting Thomas_Vincz(at)HorizonBlue(dot)com.
About Horizon Blue Cross Blue Shield of New Jersey:
Horizon Blue Cross Blue Shield of New Jersey, the state’s oldest and largest health insurer is a tax-paying, not-for-profit health service corporation, providing a wide array of medical, dental, and prescription insurance products and services. Horizon BCBSNJ is leading the transformation of health care in New Jersey by working with doctors and hospitals to deliver innovative, patient-centered programs that reward the quality, not quantity, of care patients receive. Learn more at http://www.HorizonBlue.com. Horizon BCBSNJ is an independent licensee of the Blue Cross Blue Shield Association serving more than 3.8 million members.
###
Thomas Vincz, HORIZON HEALTHCARE SERVICES, INC., http://Horizonblue.com, +1 9734666625, [email protected]
Share this article