Bill > A2765

Introduced Session

This bill revises certain requirements for individual and small employer health benefits plans and for small employer members of multiple employer welfare arrangements. This bill brings New Jersey statutes that govern the rating factors used by health insurance carriers to charge premiums for health benefits plans in the individual and small employer markets into compliance with certain provisions of the federal Affordable Care Act (ACA). Current New Jersey statutes allow premiums for health benefits plans offered in these markets to vary according to certain factors and within certain ranges in ways that are not in compliance with the requirements of the ACA. Specifically, with respect to plans offered through the New Jersey Individual Health Coverage Program, the bill: (1) provides that the premium rate charged by a carrier for the highest rated individual or class of individuals shall not exceed 300%, instead of 350% as provided in current law, of the premium rate charged for the lowest rated individual or class of individuals purchasing the same individual health benefits plan; and (2) requires rate differentials based on age to use classifications established in one-year increments, instead of five-year increments as provided in current law. With respect to plans offered through the New Jersey Small Employer Health Benefits Program, the bill: (1) removes gender as a permissible rating factor; (2) eliminates separate rating treatment for small employer purchasing alliances for determining permissible rate differentials between the highest rated and lowest rated plans, and for determining compliance with medical loss ratios; and (3) requires rate differentials based on age to use classifications established in one-year increments, instead of five-year increments as provided in current law. By amending these statutes that govern the offering of individual and small employer plans in the State, the bill brings New Jersey law into conformance with certain provisions of the ACA. With respect to plans offered through the Small Employer Health Benefits Program, the bill also provides that the premium rate charged by a carrier to the highest rated small group purchasing a small employer health benefits plan may not be greater than 300% of the premium rate charged for the lowest rated small group purchasing that same health benefits plan. A multiple employer welfare arrangement, or MEWA, is a self-funded or partially self-funded multiple employer welfare arrangement that provides for health benefits plans and that has one or more of the employer members either domiciled in New Jersey or its principal headquarters or principal administrative office located in the State. Under current law, the assessments payable by small employer members of MEWAs are required to be in accordance with the rating requirements of the New Jersey Small Employer Health Benefits Program. Pursuant to this requirement, assessments payable by small employer members may not be greater than 200% of the premium rate charged for the lowest rated small employer member. Under the bill, assessments payable by small employer members would be required to be no greater than 300% of the assessment charged to the lowest rated small employer member of the self-funded multiple employer welfare arrangement. The bill also clarifies the requirements for small employer members of MEWAs concerning mandated health benefits. Under current law, small employer members are required to provide health benefits that are equal to or greater than benefits required to be provided by the New Jersey Small Employer Health Benefits Program. Under the bill, small employer members would be required to provide hospital and medical benefits that are equal to or greater than the hospital and medical benefits required to be provided by the New Jersey Small Employer Health Benefits Program. The bill clarifies that the hospital and medical benefits provided shall include coverage of pediatric services, including oral and vision care, as required by the Affordable Care Act, and maternity benefits, including prenatal and postnatal care. The bill further clarifies the hospital and medical benefits coverage requirement and makes it clear that a self-funded multiple employer welfare arrangement is not required to provide small employer members with any plan provisions applicable under the New Jersey Small Employer Health Benefits Program other than coverage of mandated hospital and medical benefits. As used in the bill, plan provisions include, but are not limited to, any rules, requirements, and payment provisions, including any cost-sharing requirements, designed to implement those plans. Finally, the bill requires hospital and medical benefits provided by MEWAs include coverage of pediatric services, including oral and vision care, as required by the Affordable Care Act, and maternity benefits, including prenatal and postnatal care.

Committee Categories

Lou Greenwald (D)*, 

Introduced, Referred to Assembly Financial Institutions and Insurance Committee (on 01/09/2024)

Official Document