New Jersey Attorney General Matthew J. Platkin announced a historic $100 million settlement with Horizon Healthcare Services, doing business as Horizon Blue Cross Blue Shield of New Jersey, resolving allegations that the insurer overcharged the State for health claims and breached a key cost-saving contract term. The agreement represents the largest non-Medicaid False Claims Act settlement in New Jersey history and underscores the State’s commitment to safeguarding taxpayer dollars while protecting public employees’ healthcare benefits.
According to the State’s Complaint in Intervention filed in U.S. District Court, Horizon allegedly induced New Jersey to enter into a 2020 contract to administer the State Health Benefits Program (SHBP) and the School Employees’ Health Benefits Program (SEHBP) under false pretenses, then systematically submitted inflated claims over the life of the contract. While federal authorities opted not to pursue the matter, the State pressed forward with legal action, citing violations of the New Jersey False Claims Act (NJFCA), including fraudulent inducement, false claims, and submission of misleading records, as well as breach of contract and unjust enrichment. Both the complaint and the resulting settlement were unsealed on November 15, 2025.
Attorney General Platkin emphasized the broader impact of the case, stating that inflated healthcare costs ultimately affect hundreds of thousands of public employees. He praised the State’s legal and Treasury teams for their diligence, highlighting the importance of accountability for entities attempting to exploit government contracts. State Treasurer Elizabeth Maher Muoio also recognized the Division of Pensions and Benefits (DPB) for its thorough investigation, which began in 2021 and focused on protecting members’ health benefits.
The dispute centers on the 2020 contract’s innovative “lesser of” provision, which required Horizon, as the third-party administrator (TPA), to charge the State no more than the lower of a provider’s billed amount or the rate negotiated between the provider and the TPA. While Horizon represented that it could comply with this cost-saving measure, the complaint alleges that the company knowingly submitted bids with no intention of adhering to the rule. Internal communications reportedly reflected discussions on retroactively correcting overbilling if necessary, yet over a four-and-a-half-year period, Horizon received nearly $500 million in TPA fees while submitting thousands of inflated claims and issuing false Explanation of Benefits (EOBs) to plan members.
The investigation intensified after the contract’s implementation. In April 2021, DPB, with input from the Treasurer’s Office, began probing Horizon’s compliance with the “lesser of” provision and other contract requirements, including new patient navigation and advocacy services. Later that year, private parties, known as relators, filed a qui tam lawsuit under the NJFCA. While the federal government declined involvement, the State’s investigation over subsequent years confirmed Horizon’s violations, paving the way for the settlement.
Under the agreement, Horizon will pay $100 million to New Jersey within 25 calendar days and cease violations of the “lesser of” provision, as well as issuing misleading EOBs. The settlement also requires Horizon to maintain rigorous compliance verification, including daily, monthly, and quarterly reporting to the DPB, covering both the 2024 contract period and any subsequent agreements. The settlement further protects the State’s interests by ensuring Horizon cannot violate the NJFCA in future contracts, particularly regarding the cost-limiting provisions.
A portion of the settlement—$12 million—will be distributed to five of the six relators involved in the qui tam lawsuit, a figure negotiated to maximize recovery for the State. Horizon currently provides healthcare coverage to more than three million New Jersey residents, including over 750,000 active state employees, early retirees, and their families, overseeing billions in annual medical spending.
The successful resolution of this case demonstrates New Jersey’s commitment to holding insurers accountable while ensuring that taxpayer funds are protected and health plan participants receive accurate billing and services. For more resources on health and wellness in New Jersey, residents can explore guidance and updates on state health programs and benefits.
