Bill > S1976

This bill mandates that the State Health Benefits Commission and the School Employees' Health Benefits Commission, which manage health insurance for state employees and school employees respectively, must study and then implement a system called "reference-based pricing" for their health plans. Reference-based pricing is a method of controlling healthcare costs by setting a maximum amount the plan will pay for a specific service, often using Medicare's reimbursement rates as a benchmark. The commissions are required to consult with their actuaries and insurance carriers to review how this pricing model works, its potential financial impact, and identify which healthcare services are suitable for this approach. They must evaluate anticipated costs and savings, the effect on high-cost services like radiology and outpatient procedures, the optimal reimbursement percentages based on Medicare rates, and the outcomes of reference-based pricing in other states, considering consumer choice and provider prices. After completing this review and issuing a report with recommendations within 180 days, the commissions must implement reference-based pricing for all new contracts with insurance carriers within one year, using Medicare rates as the reference point for reimbursement limitations. Before implementation, they must publicly detail how these reference percentages were determined, the projected cost savings, and the existing negotiated prices from their carriers.

Health and Social Services

https://www.njleg.state.nj.us/bill-search/2024/S1976