Sponsored by:
Assemblyman JOHN J. BURZICHELLI
District 3 (Cumberland, Gloucester and Salem)
Assemblyman DANIEL R. BENSON
District 14 (Mercer and Middlesex)
Assemblywoman CAROL A. MURPHY
District 7 (Burlington)
SYNOPSIS
Requires carriers that offer health benefits plans to provide new or existing subscribers with notification of certain hospital and health system contract expirations.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning health benefits plans and hospital and health system contract expirations and supplementing P.L.1997, c.192 (C.26:2S-1 et al.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. Notwithstanding the provisions of any law to the contrary, any carrier that offers a health benefits plan shall provide written notification to each subscriber at least 90 business days prior to the termination, withdrawal, or severance of any hospital or health system from the carrier’s network.
The termination date shall be the written end date of a contract between a carrier and a hospital or health system, and the notice shall be provided pursuant to this section in cases in which the parties are required to continue operating under a previous agreement pursuant to section 2 of P.L.1989, c.321 (C.26:2J-11.1) or any other law or regulation.
The written notice shall be provided to subscribers who reside within the county or in an adjacent county of any hospital, whether that hospital is a stand-alone facility or it is part of a health system that is scheduled to be terminated, withdrawn, or severed from the carrier’s network. The Department of Banking and Insurance shall create a standardized form to be used by carriers to comply with the provisions of this section.
Prior to enrolling, a prospective subscriber shall be informed by the carrier of:
(1) any hospital or health system contract in effect at the date of enrollment; and
(2) any hospital or health system contract which shall terminate or sever 90 days or less after the subscriber’s effective enrollment date in that health plan.
b. A carrier shall not automatically renew a contract with a hospital or health system unless the hospital or health system agrees to an automatic renewal clause at the time the contract is entered into.
2. This act shall take effect on the 90th day next following the date of enactment, and shall apply to any health benefits plan delivered, issued, executed or renewed in this State, or approved for issuance or renewal in this State by the Commissioner of Banking and Insurance, on or after that date.
STATEMENT
This bill provides that any carrier that offers a health benefits plan is required to provide written notification to each subscriber at least 90 business days prior to the termination, withdrawal, or severance of any hospital or health system contracts from the carrier’s network.
The bill provides that the termination date is the written end date of a contract between a carrier and a hospital or health system, and the notice is required to be provided in cases in which the parties are required to continue operating under a previous agreement pursuant to current law. The written notice is to be provided to subscribers who reside within the county or in an adjacent county of any hospital, whether that hospital is a stand-alone facility or it is part of a health system that is scheduled to be terminated, withdrawn, or severed from the carrier’s network. The Department of Banking and Insurance shall create a standardized form to be used by carriers to comply with the notice requirements.
Finally, the bill provides that, prior to enrolling, the carrier must inform a prospective subscriber of any hospital or health system contract in effect at the date of enrollment and any hospital or health system contract which will terminate or sever 90 days or less after the subscriber’s effective enrollment date in that health benefits plan.