S1210

An Act concerning the standards for offering of health benefits plans in the State and supplementing P.L.1997, c.192 (C.26:2S-1 et seq.).

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. The Commissioner of Banking and Insurance shall not approve, and shall not allow to be offered or issued for delivery to a resident of this State or to an employer located in this State, an insured health benefits plan including a plan obtained through an association, trust, or multiple employer arrangement, unless the plan complies with the requirements of one or more of the following sets of New Jersey statutes, as applicable to a carrier and health benefits plans offered in the relevant individual, small employer, or large employer markets:

(1) P.L.1938, c.366 (C.17:48-1 et seq.);

(2) P.L.1940, c.74 (C.17:48A-1 et seq.);

(3) P.L.1985, c.236 (C.17:48E-1 et seq.);

(4) N.J.S.17B:26-1 et seq.;

(5) N.J.S.17B:27-26 et seq.;

(6) P.L.1973, c.337 (C.26:2J-1 et seq.);

(7) P.L.1992, c.161 (C.17B:27A-2 et seq.);

(8) P.L.1997, c.1972 (C.26:2S-1 et seq.); or

(9) P.L.1992, c.162 (C.17B:27A-17 et seq.).

b. Subsection a. of this section shall apply to any individual or group hospital or medical expense benefits coverage obtained through an out-of-State trust or association covering an eligible person as defined in section 2 of P.L.1992, c.161 (C.17B:27A-2), a small employer as defined in section 1 of P.L.1992, c.162 (C.17B:27A-17), or any other insured group health benefits plan in the State.

c. The commissioner shall take all appropriate enforcement action that is within the commissioner’s authority and that is necessary to prevent any entity from offering or issuing for delivery a health benefits plan to a resident of this State or an employer in this State if the health benefits plan is not in compliance with this section.

d. This section shall not apply to any entity offering a self-funded health benefits plan.

2. This act shall take effect immediately.

STATEMENT

This bill supplements the “Health Care Quality Act” to prohibit the Commissioner of Banking and Insurance from approving or allowing to be offered to residents or employers in this State, a health benefits plan unless the plan complies with all of the requirements contained in one or more of the sets of New Jersey statutes that govern the standards for fully insured health benefit plans offered in New Jersey.

The commissioner has the sole authority to license insurers to offer health benefits plans in the State after determining that they meet the standards required by New Jersey law. These standards are set forth in detail in statutes, as listed in the bill, that apply to hospital, medical, and health service corporations, commercial individual and group insurers, and health maintenance organizations. These laws establish significant protections for New Jersey residents, employers, and health care providers concerning their relationships with health insurance carriers.

The bill is in response to the Executive Order 13813 issued by the President of the United States on October 12, 2017. That order includes provisions requiring the Secretary of Labor to consider proposing regulations to expand health coverage by allowing more employers to form association health plans, and requiring the Secretaries of the Treasury, Labor, and Health and Human Services, to consider proposing regulations to expand the availability of short term limited-duration insurance. The order also states that the policy of the federal executive branch is to facilitate the purchase of insurance across state lines.

Short term limited-duration health insurance plans, plans offered through associations, trusts, or multiple employer arrangements, and other plans that meet the requirements in other states in which they are issued, may not meet the same standards required for health benefits plans offered or sold in New Jersey. This bill prohibits the offering or sale of any plans in this State that do not meet the standards required by New Jersey law. Further, the bill requires the commissioner to take all appropriate enforcement action that is within the commissioner’s authority and that is necessary to prevent any entity from offering or issuing for delivery a health benefits plan to a resident of this State or an employer in this State if the health benefits plan is not in compliance with the provisions of the bill.

The bill does not apply to any entity offering a self-funded health benefits plan.