Chris Deacon: Inside New Jersey's $100M Horizon Settlement

Episode Summary:

If a state health plan with lawyers, auditors, and subpoena power can get systematically overcharged for years, what's happening to your company?

In this episode of Healthcare Rebuilt, host Boe Hartman welcomes Chris Deacon, former Director of New Jersey's Public Sector Health Plans and author of The Great American Healthcare Heist. Chris shares her journey from being a lawyer to running one of the largest public health plans in America, overseeing healthcare for 820,000 people and $7 billion in taxpayer money.

Chris reveals the alarming discrepancies she discovered when auditing claims processed by Horizon Blue Cross Blue Shield. The state had a "lessor of" provision in their contract; a straightforward protection requiring Horizon to charge whichever was less: what providers billed or Horizon's pre-negotiated rate. Instead, Chris found Horizon was doing the exact opposite. For example, a hospital billed $674,856, but Horizon charged the state over $2 million—a $1.35 million overcharge on a single claim.

When internal complaints were ignored due to political dynamics and industry influence, Chris made the difficult decision to become a whistleblower. Her actions led to a $100 million settlement, though Horizon denies wrongdoing, doesn't have to admit fault, and remains the state's vendor.

This episode serves as a wake-up call for self-insured employers, CFOs, and benefits leaders because if this could happen to a sophisticated government entity, leaders need start asking what's happening at their own company?
‍

Meet the Guest:

Chris Deacon
Former Director, New Jersey Public Sector Health Plans | Healthcare Consultant | Author

Chris Deacon is a lawyer who served in New Jersey's Attorney General's office, Governor's office, and Treasury before becoming Director of the Division of Pensions and Benefits. In this role, she oversaw the State Health Benefits Program (SHBP) and the School Employees' Health Benefits Program (SEHBP), one of the largest health plans in the country, covering 820,000 lives across 37 public sector unions. Today, she runs her own consulting firm working with union health plans and employers.  

Connect with Chris:

Book: The Great American Healthcare Heist The Great American Healthcare Heist: Why We're Paying More and Getting Less: Deacon, Chris E: 9798999531407: Amazon.com: Books

LinkedIn: (1) Chris Deacon | LinkedIn

Website: Insights | VerSan
‍

Key Takeaways:

"The math was not mathing."  When Chris's team analyzed just 50 out-of-state claims, they found $18 million in overcharges. Horizon refused to provide more claims data for review.

"You cannot just trust, you have to verify." Contract language protecting employers is meaningless without the ability to audit compliance at the claims level. Employers need complete data access and independent auditors.

‍"We need to remove the 27 intermediaries that come between that provider and that patient and purchaser." The complexity of healthcare transactions creates opportunities for abuse. Direct relationships and transparency are the solution.

"This is not unique to Horizon Blue Cross Blue Shield; there are very blurry lines in the industry." Chris sees similar patterns across the healthcare industry. The New Jersey case exposes practices that may be occurring nationwide.

The Whistleblower Penalty: Despite being the primary whistleblower whose actions recovered $100 million for taxpayers, Chris receives $0 from the settlement because she discovered the fraud in her official capacity as a state administrator.
‍

In This Episode:

• Chris's journey from lawyer to overseeing one of America's largest public health plans.
• The role of Horizon Blue Cross Blue Shield as third-party administrator.
• How the "lessor of" provision was supposed to protect taxpayers.
• Discovering $18 million in overcharges on just 50 claims.
• Why Horizon refused to provide additional claims data.
• The political dynamics that prevented internal resolution.
• Making the decision to become a whistleblower.
• Details of the $100 million settlement (and why it's just a slap on the wrist).
• Why self-insured employers are even more vulnerable than government plans.
• What employers should demand from carriers and TPAs.
• Chris's vision for a more transparent, accountable healthcare system.

Listen on:

Apple Podcasts
Spotify
Google Podcasts
Amazon Music
Everywhere you listen to podcasts

‍Have questions about your healthcare costs? Contact Nomi Health to learn more about direct networks, real-time payment systems, and analytics that show you where your money goes.