Bill > S157

Introduced Session

This bill, designated the "Health Insurance Affordability and Accessibility Reform Act," represents a major restructuring of the health insurance marketplace in this State in order to stabilize costs of, and enrollment in, individual and small employer health benefits plan. The bill requires carriers to offer individuals a choice of plans as developed by the New Jersey Individual Health Coverage Program Board. One plan shall be an indemnity plan and one plan shall be a basic health benefits plan that covers benefits and services as provided in the current law. In addition to the riders developed by the board, carriers may develop riders for standard plans as long as the rider increases the actuarial value of the plan. The bill amends the definition of community rating so that individual health benefits plans shall be rated to provide that the premium rate charged by a carrier for a standard plan for the highest rated individual shall not be greater than 200% of the premium rate charged for the lowest rated individual. The only factor that the rating differential may be based on is the age of the person covered under the individual plan. The factor must be applied in a manner consistent with regulations promulgated and adopted by the Commissioner of Banking and Insurance, which include age classifications in a minimum of five-year increments. The bill allows carriers to add riders to the basic and essential plan developed by the board as long as the rider does not increase the actuarial value of the basic and essential plan to the value of the standard plans. The bill provides that the rates for individual plans shall be formulated so that the anticipated minimum loss ratio is not less than 80% of the premium. The commissioner shall specify the instructions and format for annually calculating and reporting the carriers minimum loss ratio and issuing dividends or credits to policy holders. In addition, the bill requires that the carriers annual report include the carriers calculation of the dividends and credit applicable to all policy forms, as well as an explanation of the carriers plan to issue dividends or credits. The bill provides that after the effective date, no further loss assessments shall be calculated or collected; although carriers are not relieved of their obligations for loss assessments authorized prior to the effective date of the bill. The bill transfers regulatory oversight of the approval of policy contracts and forms and review of premium rate filings from the Individual Health Coverage Program Board to the commissioner. It also requires that one appointed board member be a person who is or was a policy holder of an individual health benefits plan. The board or commissioner is directed to provide appropriate staff to respond to the publics inquiries concerning the program and the individual health benefits plan. Finally, as a condition of issuing small employer health benefits plans in this State, carriers must issue individual health benefits plans. A carrier shall offer to every small employer the health benefits plans established by the New Jersey Small Employer Health Benefits Program Board. Rates for the small employer plans shall be formulated so that the anticipated minimum loss ratio is not less than 77% of the premium. The bill transfers regulatory oversight of the approval of policy contracts and forms and review of premium rate filings from the Small Employer Health Benefits Program Board to the commissioner. It also requires that at least one appointed board member be a person who is or was a policy holder of a small employer health benefits plan. Finally, the board or commissioner is directed to provide appropriate staff to respond to the publics inquiries concerning the program and the small health benefits plan.

AI Summary

Committee Categories

Nia Gill (D)*,  Raymond Lesniak (D),  Loretta Weinberg (D), 

Introduced in the Senate, Referred to Senate Commerce Committee (on 01/12/2010)