Assemblyman Verrelli introduced A5903, which makes various changes to the State Health Benefits Program (SHBP) plan offerings and governance. This bill appears to be a response to the recent recommendations for significant rate increases.
The legislation would abolish the State Health Benefits Plan Design Committee and change the State Health Benefits Commission to an 11-member board with 5 management representatives, 5 labor representatives, and 1 chairperson nominated by the Commission.
Under the legislation, the State Health Benefits Commission would be required to:
- Establish the State Health Benefits Program.
- Create, modify, or terminate a plan or plan components.
- Manage costs and ensure the continued viability of the program, and the anticipated costs when the actuary provides that the costs will likely exceed the rate of medical or prescription drug inflation.
- Issue an actuarial report.
- On a quarterly basis, review any new FDA-approved medications.
- Require a third-party medical claims review on an annual basis.
- Matters before the Commission must be resolved within 30 days or go to arbitration for resolution.
Additionally, the number of plans would be reduced from 7 to 5. They would include the SHBP Unity 2019, SHBP Tiered Network, SHBP PPO 2030, SHBP PPO 2035, and NJ Gold Plan. The SHBP Unity 2019 either sets a flat fee or a percentage based on salary. The SHBP Tiered Network is based upon an employee contribution rate equal to 75% of the rates paid in the Unity plan. The NJ Gold Plan benefits are actuarially equal to 80% of the full actuarial value of the benefits provided under the plan. The new contribution rates become the baseline in contracts for future negotiations
Local Governments must decide within 1 year if they wish to join SHBP. If they choose to participate, they must stay on plan for 2 consecutive plan years. If not, they cannot join SHBP for 2 consecutive plan years.
The legislation was referred to the Assembly Budget Committee for review, and if enacted, it would take effect immediately. There is currently no Senate companion.
The League is reviewing the legislation, meeting with stakeholders, and will continue to provide updates as necessary.
Contacts: Lori Buckelew, Deputy Executive Director, lbuckelew@njlm.org, 609-695-3481, x112, and Erin Knoedler, Legislative Analyst, eknoedler@njlm.org, x116.