On Friday, June 1, Governor Murphy signed the “Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act” – A-2039 (Coughlin; Schaer; Lampitt) / S-485 (Vitale). The legislation makes hospital costs and billing more transparent, protects consumers who receive surprise medical bills and provides an arbitration process to work out disputed charges between healthcare providers and health insurance companies.
The new law ensures consumers receive advance notice if a healthcare provider is out-of-network. It also requires disclosures from providers and facilities regarding their network status and potential financial responsibility, as well as a description of the services and an estimate of the cost. Patients cannot be billed more than their deductible, co-payment or coinsurance amount, regardless of whether the provider is part of the patient’s insurer’s network. Instead, out-of-network providers would have to negotiate a settlement with the patient’s insurance company or, if necessary, submit to binding arbitration over the bills. The legislation will help contain rising healthcare costs.
On Wednesday, May 30, two bills designed to stabilize New Jersey’s health insurance marketplace were also signed by Governor Murphy. S-1877 (Vitale; Singleton) / A-3380 (McKeon; Murphy; Lampitt; Conaway; Vitale; Singleton) establishes a state “individual mandate” and requires New Jersey residents to have health insurance coverage or pay a penalty. This new law essentially mirrors the rules of the federal Affordable Care Act (ACA). The law takes effect January 1, 2019.
A companion bill, S-1878 (Vitale; Singleton; McKeon; Lampitt; Murphy) / A-3379 (McKeon; Lampitt; Murphy) establishes a reinsurance program to reimburse health insurance carriers for claims payments that exceed a certain threshold, which will be established by New Jersey’s Department of Banking and Insurance. NJBIA supported this bill after it was amended to remove a tax on all individual and group health plans in New Jersey. Funding for the reinsurance program will now come from penalties collected from those who do not purchase health coverage, federal funds available to states that establish a reinsurance program, and a general fund appropriation starting with FY 2021.