UPDATE: New Jersey pushes back even harder against ACA sabotage

2019 OPEN ENROLLMENT ENDS (most states)

Time: D H M S

Last month I noted that New Jersey is taking a leading role regarding protecting and improving the Affordable Care Act; the state legislature has passed bills which would:

  • Reinstate the ACA's individual mandate penalty,
  • Establish a robust reinsurance program to significantly lower insurance premiums for individual market enrollees,
  • Protect people from out-of-network "balance billing", and
  • Cancel out Trump's expansion of "Association Health Plans"

(New Jersey actually already had several other "ACA protection" laws on the books in the first place, including protections against short-term plans and "surprise billing".)

In addition, new Governor Phil Murphy had alread proven that he understands and supports the ACA; within days of taking office he had already issued an executive order telling all state agencies to do everything they reasonably can to inform the public about how to enroll during Open Enrollment and so forth.

Well, we're still waiting for Gov. Murphy to sign the mandate/reinsurance bills (they're actually connected...the reinsurance program would be partly funded by revenue from the mandate penalty bill), but in the meantime, it turns out there's some other ACA protections/enhancements on the way:

Gov. Phil Murphy announced last week that state regulators would take a more active role in reviewing some ACA plans and has committed more state funding to expand coverage and continue outreach for the program, ordering state departments to actively promote enrollment soon after he took office in January.

He is also expected to sign legislation to strengthen the individual and small-business insurance market, including a bill that would make New Jersey the second state in the nation to implement its own individual mandate for health insurance — with a resultant tax penalty for not doing so.

And on Thursday the state Assembly advanced a Democratic-sponsored measure to require hospital staff to play a more active role in connecting patients with insurance. While many facilities already work to enroll uninsured patients with Medicaid, if they qualify, the legislation would also require employees to help people sign up through the ACA’s marketplace, which sells discounted commercial policies to working poor residents who don’t have coverage through their jobs.

“A primary goal of the Murphy Administration is to ensure that every New Jerseyan has access to affordable health insurance and that all our residents are able to see a doctor when they are sick. New Jersey is committed to increasing enrollment to ensure as many individuals are covered by health insurance as possible. My administration also believes it is critical that the health insurance offered in the state contains all the protections required under New Jersey law and the Affordable Care Act,” Murphy told the federal Centers for Medicare and Medicaid Services in a May 11 letter announcing the state’s intention to take control of some aspects of marketplace management.

Most of this refers to items I wrote about above, but two appear to be new: The "hospital staff have to help people enroll" bill moving through the state Assembly...and Gov. Murphy's order regarding "taking a more active role in reviewing ACA plans".

If I understand this correctly, New Jersey is apparently switching from a "Clearinghouse" model to an "Active Purchaser" model when it comes to deciding which ACA policies to offer on the exchange.

Here's Louise Norris' explanation of what the difference is: "Active-purchaser exchanges negotiate directly with the insurance carriers in order to get the best premiums, networks, and benefits for plans sold in the exchange. Clearinghouse exchanges set the criteria that plans must meet in order to be sold on the exchange, and all plans that meet that criteria are welcome to participate."

To put this in smartphone terms, the clearinghouse model is more like the Google Play Store: They'll accept pretty much any mobile app submitted as long as it meets the bare minimum criteria. The active purchaser model is more like Apples' App Store: Every app submitted has to go through a thorough quality review process before they decide whether to allow it onto the store for download.

I'm not certain that this is what's happening...in fact, without their own ACA exchange, I'm not entirely sure that New Jersey can do so (as far as I know, all "active purchaser" states are ones which run their own full exchange platform), but if so, I welcome it.

On the other hand, this may simply refer to giving more resources/authority to the state insurance commissioner to review/authorize premium changes?

UPDATE: OK, I've received clarification from both Dave Anderson and Louise Norris: Without their own exchange (legally, that is, not necessarily their own separate website platform), it doesn't sound like New Jersey could actually establish themselves as an "active purchaser" state. They could intensify their review of premiums, networks and so forth (which is what this sounds like), but it doesn't sound like they could actually negotiate the contracts, which is the main thing an "active purchaser" would do.

Even so, the fact remains that New Jersey is definitely going all in on protecting/strengthening the ACA at the state level. I wouldn't be surprised if they even go so far as to establish their own full state exchange at some point...

UPDATE: OK, here's more details about exactly what "taking a more active role" means:

TRENTON – Governor Phil Murphy today announced that the state will take over the plan management functions of the Affordable Care Act marketplace for the upcoming 2019 enrollment period, assuming greater control over the health exchange in New Jersey.

The Governor recently sent a letter notifying the Centers for Medicare & Medicaid Services that the Department of Banking and Insurance will perform the plan management functions of the marketplace and, therefore, review for compliance with the ACA and New Jersey law all plans to be sold on the health exchange in New Jersey for plan year 2019. The move continues the Murphy Administration’s commitment to the success of the Affordable Care Act. Governor Murphy in January signed an Executive Order directing all state agencies that interact with the public to provide information regarding enrollment in the ACA marketplace.

“At a time when President Trump is attempting to dismantle the Affordable Care Act, it is up to states to step up and protect access to affordable quality health coverage,”said Governor Murphy. “New Jersey is committed to increasing enrollment to ensure as many individuals are covered by health insurance as possible. My administration also believes it is critical that the insurance offered in the state contain all the protections required under New Jersey law and the Affordable Care Act. Assuming responsibility for managing the plans sold on the exchange is a vital step in this process.”

The Department of Banking and Insurance has the responsibility of reviewing health plans sold in the state to ensure compliance with state laws. It currently performs review functions for the individual and small group market. The Department also reviews and makes recommendations to CMS regarding certification of plans for sale on the exchange in New Jersey. Plan management by the state will officially transfer the review function to the department as the regulatory authority in the state.

“We are dedicated to making sure that residents have access to affordable, quality health coverage and that plans sold in our state comply with New Jersey law and the provisions of the Affordable Care Act,” said Department of Banking and Insurance Acting Commissioner Marlene Caride. “The Department has the knowledge and expertise to take over the oversight and management of plans offered for sale on the exchange, but I believe it also has a responsibility to do so on behalf of our residents.”

Carriers will submit plans this month to be offered for sale through the federal marketplace in New Jersey. All qualified health plans (QHP) application data will be submitted to the State using the SERFF system, which is currently used for various filings.

The enrollment period begins November 1, 2018.

The governor’s letter to CMS is attached.