Lawyers squared off before the New Jersey Supreme Court on Tuesday over whether Horizon Blue Cross Blue Shield, the state's largest health insurer, can proceed with its planned rollout of its two-tiered Omnia Health Alliance Insurance Plan.

The court had agreed to hear an appeal from a group of hospitals that had been relegated to Tier 2 under the plan. Horizon's plan offers lower premiums and deductibles to patients who use Tier 1-designated hospitals.

The Tier 2 hospitals are seeking discovery of Horizon's consultant's evaluation of which hospitals should be designated as Tier 1 or Tier 2, and how the designations would affect the transfer of business to Tier 1 hospitals.