A5557

An Act concerning public entity health claims utilization data and supplementing various parts of the statutory law.

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

1. This act shall be known and may be cited as the “Data Ownership Now Enforced Act” or the “DONE Act.”

2. The Legislature finds and declares that:

a. Public entities in New Jersey, including municipalities, school districts, counties, and their joint insurance funds and health insurance funds, face double-digit percentage increases in health benefits costs. The Legislature finds that an emergency exists in the public health benefits market requiring immediate legislative action.

b. The fundamental cause of uncontested, above-market renewals is data asymmetry: incumbent carriers, third-party administrators, fund administrators, and the State Division of Pensions and Benefits hold claims utilization data that is necessary for competing entities to develop credible alternative proposals, and they routinely fail to provide that data proactively, timely, or at no cost. Public entities have a compelling interest in accessing this data, generated by public expenditures on their behalf, and this act establishes and enforces that right of access.

c. The State Health Benefits Program and School Employees' Health Benefits Program, administered by the Division of Pensions and Benefits within the Department of the Treasury, collectively cover hundreds of thousands of New Jersey public employees and represent the single largest segment of the public health benefits market. The division currently provides claims data to participating public entities occasionally, only upon specific request, and charges a fee of up to $2,000 for detailed claims data reports. This practice insulates the State programs from competitive market forces and imposes a cost barrier on the public entities the programs are intended to serve. The Legislature finds this practice to be contrary to the public interest.

d. The proactive, automatic, cost-free dissemination of claims data to every public entity plan sponsor, without requiring a formal request, is the only mechanism that can realistically allow the January 1, 2027 renewal cycle to be competitive. Requiring a request-based system imposes administrative friction that advantages incumbents and disadvantages public entities, particularly smaller ones without dedicated benefits staff.

e. In September 2025, the New Jersey Office of the State Comptroller issued a report entitled “Local Government and School Board Health Insurance Funds: A Report on Conflicts of Interest and Procurement Violations,” documenting systemic conflicts of interest, procurement violations, and governance failures within the health insurance fund structure serving hundreds of New Jersey local governments and school boards. The comptroller found that the absence of independent oversight and transparent data had created conditions in which public contracts were awarded without genuine competitive process, and called upon the Legislature to strengthen oversight of joint insurance funds. The Legislature finds that mandatory proactive claims data disclosure is a necessary and foundational component of the reforms the comptroller has recommended.

f. New Jersey's public health benefits market operates through multiple distinct structures, including commercial carriers, third party administrators, municipal health insurance funds, school district health insurance funds, the State Health Benefits Program, and the School Employees Health Benefits Program, all of which must be subject to uniform proactive disclosure obligations for this act to be effective.

g. This act is intended to operate immediately upon enactment, with a 30-day universal dissemination deadline applying to all data custodians for existing claims data already in their possession, so that public entities have the data they need as soon as possible.

3. As used in this act:

"Authorized representative" means a licensed insurance producer, licensed third-party administrator, enrolled actuary, or other agent holding a professional license in New Jersey or executing a data use agreement with enforceable professional liability exposure, designated in writing by a plan sponsor to receive claims data on its behalf for the purpose of evaluating, soliciting, or obtaining competing health benefits proposals.

"Benchmark comparison report" means a de-identified actuarial report produced by a data custodian comparing a plan sponsor's utilization patterns, cost per member per month, and claim distribution against an anonymized cohort of similarly-sized and similarly-situated groups in the same geographic rating area, furnished in lieu of individual claim-line data when group size falls below the threshold in section 6 of this act.

"Carrier" means any insurance company, hospital service corporation, medical service corporation, health service corporation, or health maintenance organization authorized to issue health benefits plans in New Jersey.

"Claims data package" means the structured data set required to be disclosed under sections 4 and 5 of this act.

"CPT code" means a Current Procedural Terminology code published by the American Medical Association, or any successor coding system, used to identify medical, surgical, diagnostic, and other health care services.

"Data custodian" means any carrier, third-party administrator, health insurance fund administrator, joint insurance fund administrator, stop-loss carrier, or the Division of Pensions and Benefits, that holds, processes, or maintains claims data on behalf of a plan sponsor or fund member. For purposes of the State Health Benefits Program and School Employees’ Health Benefits Program, the Division of Pensions and Benefits shall be the data custodian.

"De-identified data" means health information from which all direct and indirect identifiers have been removed consistent with 45 C.F.R. s.164.514(b).

"Diagnosis code" means an ICD-10-CM code, or successor standard, used to classify diagnoses and conditions for claims processing purposes.

"Division" means the Division of Pensions and Benefits within the New Jersey Department of the Treasury.

"Fund administrator" means the executive director, administrator, or third-party management firm engaged to administer operations of a health insurance fund or joint insurance fund on behalf of its fund commissioners.

"Health Benefits Data Compliance Designee" or "designee" means the individual designated by a public entity pursuant to Section 8 of this Act.

"Health insurance fund" means a joint insurance fund established to provide group health and related employee benefits, formed pursuant to P.L.1983, c.372 (C.40A:10-36 et seq.) for municipal members, or P.L.1983, c.108 (C.18A:18B-1 et seq.) for school district members, and regulated by DOBI under N.J.A.C.11:15-3 or 11:15-5 respectively, including any regional employee benefits fund or municipal employee benefit fund operating under those statutes.

"Joint insurance fund" means a joint insurance fund established under P.L.1983, c.372 (C.40A:10-36 et seq.) providing property, liability, workers' compensation, or health benefits, or any combination thereof, to local government units. Where a joint insurance fund provides health benefits, it is subject to this act with respect to those health benefits.

"Municipal Reinsurance Health Insurance Fund" means a second-tier joint insurance fund whose members are other health insurance funds, formed under P.L.1983, c.372 (C.40A:10-36 et seq.) for the purpose of providing aggregate stop-loss reinsurance to member health insurance funds.

"NDC code" means a National Drug Code assigned by the U.S. Food and Drug Administration to identify pharmaceutical products.

"Plan sponsor" means a public entity that sponsors, participates in, or maintains a group health benefits plan through any mechanism, including a commercial carrier, third-party administrator, health insurance fund, joint insurance fund, the State Health Benefits Program, or the School Employees’ Health Benefits Program.

"Public entity" means any municipality, county, school district, regional school district, vocational school district, special district, authority, board, commission, or other unit of local government in this State.

"Standard annual claims data package" means the claims data package required under section 5 of this act, including all medical claims data, pharmacy claims data, summary utilization statistics, and plan design and financial summary elements. A standard annual claims data package does not include custom actuarial modeling, predictive analytics, population health projections, or other analytical products beyond the data elements specified in section 5 of this act. The Division of Pensions and Benefits may not reclassify any element required under section 5 as a special analytical report for purposes of imposing a fee.

"Stop-loss carrier" means an insurance company providing specific or aggregate excess loss coverage to a self-funded plan, health insurance fund, or joint insurance fund, which in doing so receives and holds individual or aggregate claims data.

"Third-party administrator" means any entity licensed under N.J.S.A. 17B:27B-1 et seq. or otherwise engaged to process health benefits claims on behalf of a self-funded plan, health insurance fund, or joint insurance fund.

4. a. Within 30 days of the effective date of this act, every data custodian shall proactively transmit, without any request, application, or fee, a complete claims data package to every plan sponsor for which it holds claims data, covering the most recently completed plan or fund year and, if available, the two preceding years. This obligation shall apply to data already in the data custodian's possession. A data custodian may not claim that additional time is needed to compile, prepare, or format data that it already maintains in its ordinary course of business.

b. Notwithstanding any other provision of law, including any fee schedule or administrative rule of the Division of Pensions and Benefits, the division shall, within 30 days of the effective date of this act:

(1) transmit a claims data package as specified in section 5 of this act, covering the most recently completed plan year and, if available, the two preceding years, to a public entity currently participating in the State Health Benefits Program or the School Employees’ Health Benefits Program at no charge to the public entity;

(2) establish a dedicated data disclosure function within the division that is staffed to respond to public entity data requests within 15 business days;

(3) post on the division's public website a plain-language notice to all participating public entities describing their rights under this act, including their right to receive data at no cost and to designate an authorized representative to receive data on their behalf; and

(4) provide the claims data in the standardized machine-readable format specified by the Commissioner of Banking and Insurance under subsection d. of section 5 of this act or, if that format specification has not yet been promulgated, in a comma separated value (CSV), Excel, or structured spreadsheet format with field definitions sufficient for actuarial use.

c. The Division of Pensions and Benefits shall not charge any fee to a participating public entity for the standard annual claims data package required under this act. The division may charge a reasonable cost-recovery fee, not to exceed $500, for special analytical reports or custom data extracts requested beyond the standard annual claims data package as defined in section 3 of this act. Any existing fee schedule, rule, or practice charging any amount for standard claims data disclosure to a participating public entity shall be superseded and void.

d. Following the initial 30-day proactive dissemination, every data custodian shall furnish a complete claims data package to every plan sponsor within 30 days of the close of each plan or fund year, without request and without charge.

e. A plan sponsor or its authorized representative may at any time request a claims data package from any data custodian. The data custodian shall furnish the requested data within 15 business days of receipt of a written request. No fee shall be charged for standard claims data packages.

f. When a plan sponsor or its authorized representative provides written notice that a competitive procurement is actively underway, the data custodian shall furnish any requested supplemental data within 10 business days.

g. A plan sponsor may direct any data custodian to transmit its claims data package directly to a designated authorized representative. The data custodian shall transmit the package within five business days and shall continue to transmit to the authorized representative on all future disseminations until revoked in writing.

h. When a public entity participates in a health insurance fund or joint insurance fund as a member, the fund administrator is the data custodian and shall proactively transmit to each member entity a claims data package specific to that member's covered lives on the same 30-day schedule. A member entity's right to its own population's data is independent of any aggregate fund-level reporting.

i. A municipal reinsurance health insurance fund shall furnish to each member health insurance fund, within 30 days of this act's effective date and annually thereafter, aggregate claims data for that member health insurance fund's covered population held in connection with the municipal reinsurance health insurance fund's stop-loss reinsurance function.

j. A stop-loss carrier shall furnish to the plan sponsor or fund administrator, within 30 days of this act's effective date and within 15 business days of any subsequent request, all individual large-claim data and aggregated claims data it holds in connection with stop-loss claims administration.

k. No data custodian shall refuse, delay, charge a fee for, or otherwise restrict the disclosure of claims data required under this act. Any contract provision, fund by-law, administrative rule, or fee schedule having the effect of delaying or charging for required disclosure is void and unenforceable against public policy. This prohibition applies with equal force to the Division of Pensions and Benefits.

5. a. Subject to the size thresholds in section 6 of this act, the claims data package shall include:

(1) medical claims data. For each medical claim processed during the covered period:

(a) CPT code identifying the procedure or service rendered;

(b) ICD-10-CM diagnosis code, up to the number of diagnosis fields submitted;

(d) place of service code (inpatient, out-patient facility, professional office, urgent care, emergency department, telehealth, or other);

(e) provider specialty code as classified by the data custodian's network management system;

(f) billed charges;

(g) allowed amount (contractual or reasonable and customary allowance);

(h) plan-paid amount;

(i) member cost-sharing amount, as deductible, copay, and coinsurance combined;

(j) claim status and denial reason code where applicable;

(k) network status of rendering provider (in-network or out-of-network);

(l) de-identified member identifier, which shall be a consistent anonymized code permitting longitudinal claim linkage without revealing identity;

(m) member relationship code (subscriber or dependent); and

(n) member age band, classified using five-year age bands and biological sex;

(2) pharmacy claims data. For each pharmacy claim processed during the covered period:

(a) NDC code identifying the pharmaceutical product dispensed;

(b) generic or brand indicator;

(d) quantity dispensed and days' supply;

(e) ingredient cost, dispensing fee, and plan-paid amount;

(f) member cost-sharing amount;

(g) point-of-sale rebate applied, if any, as a dollar amount;

(h) de-identified member identifier consistent with subparagraph (l) of paragraph (1). of this subsection; and

(i) member age band and biological sex; and

(3) mental health and substance use disorder claims included within medical claims data using applicable CPT and ICD-10-CM codes and de-identified to a stricter standard consistent with 42 C.F.R. Part 2 where applicable. Any data cell that would have a reasonable probability of permitting re-identification shall be suppressed.

b. The claims data package pursuant to subsection a. of this section shall include:

(1) total covered member months and enrollment by tier at beginning and end of the period;

(2) total plan-paid claims by claim type (inpatient, out-patient, professional, emergency, pharmacy);

(3) high-cost claimant concentration report: number of claimants with aggregate plan-paid claims exceeding $50,000, $100,000, and $250,000, without identifying those claimants;

(4) top 25 CPT codes by total plan-paid amount;

(5) top 25 ICD-10-CM diagnosis codes by frequency;

(6) top 25 pharmaceutical products by total plan-paid amount, identified by NDC code and generic name; and

(7) network utilization rate.

c. The claims data package pursuant to subsection a. of this section shall also include:

(1) summary of plan designs in effect, including deductible, out-of-pocket maximum, copay, and coinsurance structure;

(2) total premium, assessment, or contribution paid (employer and employee combined);

(3) medical loss ratio or loss ratio, as applicable;

(4) claims incurred but not reported reserve estimate as of the close of the period;

(5) for health insurance funds and joint insurance funds: total fund surplus or deficit; stop-loss attachment points (specific and aggregate); and name and license number of any stop-loss carrier; and

(6) for the State Health Benefits Program and the School Employees’ Health Benefits Program, the division shall provide per-entity cost-per-member-per-month data, employer contribution rate, and aggregate loss ratio for the participating entity's covered population, in addition to all other required data elements;

d. The Commissioner of Banking and Insurance shall promulgate emergency data format regulations within 30 days of the effective date of this act pursuant to subsection (f) of section 4 of P.L.1968, c.410 (C.52:14B-4), establishing a structured machine-readable format in Java Script Object Notation or CSV, a standardized field schema and data dictionary, and secure transmission standards. Pending promulgation, data custodians shall furnish data in CSV or Excel format with field labels sufficient for actuarial use. The Division of Pensions and Benefits shall coordinate with the commissioner to implement compatible format standards within the same timeframe.

6. a. The following size-based disclosure tiers shall apply:

(1) Tier 1: 100 or more covered lives. Full claims data package as specified in Section 5, including claim-level de-identified data.

(2) Tier 2: 50 to 99 covered lives. Full claims data package with enhanced cell-suppression: any cell representing fewer than 11 individuals shall be suppressed. The data custodian shall include a written attestation that cell-suppression was applied.

(3) Tier 3: fewer than 50 covered lives. Individual claim-line data shall not be required. In lieu thereof, the data custodian shall furnish:

(a) full summary utilization statistics and financial summary under subsections b. and c. of section 5 of this act;

(b) a benchmark comparison report comparing the group's cost per member per month, utilization rates by major service category, and top condition categories against an anonymized cohort of similarly-sized groups in the same geographic rating area, consisting of no fewer than 500 covered lives;

(c) aggregate pharmacy utilization data including total claims count, total plan-paid pharmacy costs, and generic dispensing rate;

(d) a narrative summary prepared by the data custodian's actuary or medical director describing major cost drivers and utilization trends observable at the aggregate level without identifying individuals; and

(e) an attestation from a credentialed actuary (FCAS, MAAA, or FSA) that the benchmark report was produced consistent with Commissioner standards and that no individual claimant can be identified from the disclosed data.

b. If a data custodian cannot produce a compliant benchmark comparison report from its own book of business because it does not maintain a cohort of 500 or more similarly-sized covered lives in the same geographic rating area, it shall: notify the plan sponsor and the Commissioner in writing within 10 days of the dissemination deadline; contract with a qualified third-party data aggregator to produce a compliant benchmark report; and furnish the completed benchmark report within 60 days of the dissemination deadline. This 60-day extension applies only to the benchmark comparison report and does not extend the deadline for any other element of the claims data package.

c. A plan sponsor covering fewer than 50 lives in any single year but whose three-year aggregate covered life count equals or exceeds 150 life-years may request claim-level de-identified data pooled across those three years under Tier 2 cell-suppression methodology. The data custodian shall furnish pooled data within 15 business days.

d. For public entities participating in the State Health Benefits Program or the School Employees’ Health Benefits Program with fewer than 50 covered lives, the division shall furnish the full Tier 3 package pursuant to paragraph (3) of subsection a. of this section, including a benchmark comparison against similarly-sized State Health Benefits Program or School Employees’ Health Benefits Program participating entities, at no cost. The division shall not use small group size as a basis for withholding or reducing data disclosure.

e. Nothing in this section shall limit any right of access a plan sponsor independently possesses as a group health plan administrator under 45 C.F.R. s.164.504(f).

7. a. Claims data furnished pursuant to this act shall be used solely for:

(1) evaluating incumbent coverage terms and pricing;

(2) soliciting and evaluating competing proposals from alternative carriers, third-party administrators, or stop-loss reinsurers;

(3) disease management and population health management;

(4) plan design analysis;

(5) actuarial analysis and consulting; and

(6) required government reporting.

b. Claims data shall not be sold, licensed, or used for commercial data aggregation or marketing purposes unrelated to the plan sponsor's coverage.

c. An authorized representative receiving claims data shall execute a written data use agreement with the plan sponsor prior to receiving data.

8. a. Each public entity that participates in any group health benefits plan, whether through a commercial carrier, third-party administrator, health insurance fund, joint insurance fund, the State Health Benefits Program or the School Employees’ Health Benefits Program, shall designate one existing employee as its health benefits data compliance designee within 30 days of the effective date of this act.

b. The designee shall be an existing officer or employee. No new position shall be created and no additional compensation is required solely by virtue of this designation. Appropriate designees include:

(1) The municipal clerk, business administrator, or chief financial officer for municipalities;

(2) The school business administrator or superintendent for school districts;

(3) The human resources director or director of employee benefits where such position exists; or

(4) The fund administrator for a health insurance fund or joint insurance fund, with respect to that fund's compliance obligations independently of individual member entities.

c. The designee shall: serve as named point of contact for all data custodians; respond to covered member privacy inquiries; coordinate with authorized representatives for competitive procurement; ensure data use agreements are executed and maintained; and file the annual attestation required under subsection e. of this section.

d. Each public entity shall file the name, title, and contact information of its designee with the Department of Banking and Insurance within 30 days of the effective date of this act, and within 15 days of any subsequent change. The department shall maintain a publicly accessible online registry of designees.

e. The designee shall execute and file with the department an annual attestation confirming: review of the applicable provisions of this act; receipt of the annual claims data package or filing of a complaint if not received; use of claims data only for permitted purposes; and absence of any known unauthorized disclosure or reporting of any such event as required by law. The attestation form shall be available at no cost on the department’s website.

f. The designee is a named accountability contact, not a credentialed compliance professional. No fee, license, or course of study is required.

g. Designation under this section shall not require the public entity to hire additional personnel, obtain any licensure, or pay any fee to the State.

9. a. With respect to the 30-day proactive dissemination obligation under subsections a. and b. of section 4 of this act, penalties shall accrue without prior notice or compliance order as follows: $1,000 per data custodian per day for each day of non-compliance beginning on the 31st day after enactment, up to a maximum of $100,000 per data custodian per month.

b. For violations of the ongoing annual obligation and all other requirements following the initial 30-day period, the commissioner may issue compliance orders and impose penalties not to exceed $5,000 per day per plan sponsor following a 15-day cure period, or $25,000 per day for willful non-compliance, and may require reimbursement of documented costs.

c. Non-compliance by the division shall be reported by the commissioner to the Governor, the President of the Senate, and the Speaker of the General Assembly within 45 days of the 30-day deadline, together with a remediation plan. In addition, any public entity aggrieved by the division's failure to comply may seek a writ of mandamus in the Superior Court of New Jersey compelling the division to perform its ministerial duty of data disclosure under this act. A court shall give those applications priority and may issue orders on an expedited basis.

d. A plan sponsor may bring a civil action in Superior Court for declaratory or injunctive relief, compensatory damages, and attorneys' fees. The court may issue a temporary restraining order compelling disclosure on an expedited basis without bond upon a showing of imminent renewal deadline.

e. A plan sponsor may apply for an order of immediate disclosure on an order to show cause returnable within five business days, which shall receive priority calendar treatment.

f. Complaints shall be acknowledged within three business days and receive a preliminary determination or investigation within 20 calendar days.

g. No data custodian, including the Division of Pensions and Benefits, shall take any adverse action against a plan sponsor for exercising rights under this act or filing a complaint.

h. The commissioner's existing examination authority over health insurance funds and joint insurance funds under N.J.A.C. 11:15 et seq. is expressly extended to enforce this act against fund administrators and third-party administrators as data custodians.

i. To the extent any health insurance fund or joint insurance fund's status as a governmental plan within the meaning of 29 U.S.C. s.1002(32) is contested in any proceeding, this act shall apply with full force to the data custodians serving that fund, including any carrier, third-party administrator, or stop-loss carrier, as entities subject to Title 17B of the New Jersey Statutes, independently of the fund's own classification. The Legislature's intent is that no gap in coverage shall result from any ERISA classification dispute.

10. The Division of Pensions and Benefits shall, without request and without charge, transmit to each public entity participating in the State Health Benefits Program a standard annual claims data package as defined in P.L. , c. (C. ) (pending before the Legislature as this bill) within 30 days of the close of each plan year and within 30 days of the effective date of that act for the most recently completed plan year. The division shall not charge any fee for the standard annual claims data package. No administrative rule, fee schedule, or internal policy of the division may be construed to limit, delay, or impose a cost on the disclosure of claims data required by this section. The Director of the Division of Pensions and Benefits shall designate a data disclosure coordinator within the division responsible for timely compliance with this section.

11. The Division of Pensions and Benefits shall, without request and without charge, transmit to each school district participating in the School Employees' Health Benefits Program a standard annual claims data package as defined in P.L. , c. (C. ) (pending before the Legislature as this bill) within 30 days of the close of each plan year and within 30 days of the effective date of that act for the most recently completed plan year. The division shall not charge any fee for the standard annual claims data package. The data disclosure coordinator designated pursuant to section 10 of P.L. , c. (C. ) (pending before the Legislature as this bill) shall also be responsible for compliance with this section.

12. Any existing regulation, fee schedule, administrative directive, or practice of the Division of Pensions and Benefits that charges any amount for standard claims data disclosure to a participating public entity is hereby superseded and of no further force or effect upon enactment of this act.

13. a. The commissioner shall exercise emergency rulemaking authority pursuant to subsection (f) of section 4 of P.L.1968, c.410 (C.52:14B-4) to promulgate temporary regulations implementing this act within 30 days of enactment, to remain in effect for 365 days and be replaced by permanent regulations within 12 months.

b. Emergency regulations shall address: standardized data format specifications; secure transmission protocols; de-identification certification requirements; benchmark comparison report standards including minimum cohort size, matching methodology, and the benchmark fallback procedure under subsection d. of section 6 of this act; designee registration and attestation forms; complaint procedures; and cell-suppression methodology.

c. The Legislature finds that double-digit health benefits cost increases and the imminent January 1, 2027 renewal cycle constitute an emergency of sufficient urgency to justify emergency rulemaking authority.

14. a. This act shall be construed consistent with HIPAA. Where any disclosure requires additional safeguards, the data custodian shall notify the plan sponsor within five business days and work cooperatively to establish a compliant arrangement, without using the HIPAA process as a basis for delay beyond the 30-day dissemination deadline.

b. To the extent any provision is preempted by ERISA with respect to self-funded private-sector plans, that provision shall have no force as applied to those plans. All provisions apply in full to public entity plans, which are governmental plans exempt from ERISA under 29 U.S.C. s.1003(b)(1).

c. Public entity health benefits plans, including those operated through health insurance funds, joint insurance funds, the State Health Benefits Program, and the School Employees’ Health Benefits Program, are governmental plans as defined under 29 U.S.C. s.1002(32) and are exempt from ERISA preemption. This act applies with full force to those plans. Where the governmental plan status of any health insurance fund or joint insurance fund is disputed, subsection i. of section 9 applies.

d. Nothing in this act diminishes existing rights under P.L.1992, c.160 (C. 17B:27A-1 et al.), P.L.2018, c.32 (C.26:2SS-1 et seq.), or P.L.2023, c.296 (C.17B:30-55.1 et seq.).

e. This act shall be liberally construed to promote market competition, reduce costs for public purchasers, and ensure plan sponsors possess the information necessary to make informed and timely coverage decisions.

15. This act shall take effect immediately upon enactment.

STATEMENT

This bill enacts the “Data Ownership Now Enforced Act,” or “DONE Act.” The bill requires health insurance carriers, third-party administrators, health insurance fund and joint insurance fund administrators, stop-loss carriers, and the Division of Pensions and Benefits to proactively transmit structured, HIPAA-compliant claims utilization data to every public entity plan sponsor within 30 days of enactment of the bill, without request and without charge.

Public entities (municipalities, school districts, counties, health insurance funds and joint insurance funds) are among the largest purchasers of health benefits in New Jersey and among the least equipped to evaluate the pricing they receive. The claims utilization data necessary for a competing carrier or administrator to develop a credible alternative proposal is held exclusively by the incumbent data custodian. Without that data, competitive procurement is not possible. The result is that renewal increases go unchallenged, not because they are justified, but because the public entity lacks the information to evaluate them. This bill corrects that condition by establishing an affirmative, immediate, and cost-free data disclosure obligation applicable to every data custodian in the public health benefits market.

The absence of data transparency also creates the governance conditions documented by the New Jersey Office of the State Comptroller in its September 2025 report, “Local Government and School Board Health Insurance Funds: A Report on Conflicts of Interest and Procurement Violations.” The comptroller found that the absence of independent oversight and transparent data had created conditions in which public contracts were awarded without genuine competitive process, and called upon the Legislature to strengthen oversight of joint insurance funds. This bill implements that recommendation at the foundational level, as no meaningful oversight is possible without the underlying data that allows for evaluation.

The current system denies elected officials and administrative teams responsible for public funds the information necessary for them to fulfill their fiduciary responsibilities to taxpayers. Smaller public entities (small school districts, boroughs, and townships without dedicated benefits staff) bear the heaviest burden of data asymmetry, as they lack the leverage to extract data informally. This bill creates a uniform disclosure floor so that every public entity, regardless of size, receives the same proactive data package automatically, enabling officials at every level to make informed decisions about one of their largest budget expenditures.

The State Health Benefits Program and School Employees' Health Benefits Program are the largest segment of the public health benefits market in New Jersey. The Division of Pensions and Benefits currently charges participating public entities up to $2,000 for claims data reports and provides data only upon specific request. This bill requires the division to transmit standard annual claims data packages to every participating entity within 30 days of enactment and annually thereafter, at no charge. Any fee schedule charging for standard data disclosure is superseded on the date of enactment. The State is subject to the same disclosure standard this bill imposes on private data custodians.

New Jersey's public health benefits market operates through multiple distinct legal structures. Health insurance funds and joint insurance funds are not insurance companies, but statutory entities, meaning standard carrier disclosure obligations do not automatically apply to their administrators. This bill defines fund administrators and third-party administrators as data custodians with the same disclosure obligations as commercial carriers. The Municipal Reinsurance Health Insurance Fund and stop-loss carriers, which hold individual large-claim data not otherwise accessible to plan sponsors, are separately addressed.

For public entities with fewer than 50 covered lives, individual claim-line disclosure raises HIPAA re-identification concerns. In lieu of claim-line data, this bill requires data custodians to furnish a benchmark comparison report: an actuarially certified comparison of the group's utilization and cost against an anonymized cohort of similarly-sized groups in the same geographic rating area. A multi-year pooling option allows small groups with three years of coverage history to request Tier 2 claim-level data. A benchmark fallback provision addresses data custodians that lack a sufficient same-geography cohort.

The bill requires each public entity to designate an existing employee as its health benefits data compliance designee. This provision requires no new hire, no certification, and no fee. The designee is a named accountability contact who serves as the point of contact for data custodians, coordinates authorized representative access, and files an annual attestation.

The bill provides for penalties for failure to meet the initial 30-day dissemination obligation accrue without a cure period at $1,000 per data custodian per day, capped at $100,000 per month. Ongoing violations carry penalties up to $5,000 per day, or $25,000 per day for willful non-compliance. Plan sponsors may seek expedited judicial relief on a five-business-day order to show cause with priority calendar treatment. Non-compliance by the Division of Pensions and Benefits is reported directly to the Governor and Legislature, and public entities may seek a writ of mandamus compelling division compliance.