This bill establishes a requirement for annual cost of living adjustments for contracts between the Divisions of Mental Health and Addiction Services and Developmental Disabilities within the New Jersey Department of Human Services (DHS). Specifically, it mandates that these contracts include an annual increase in the cost of living adjustment based on the Consumer Price Index for the previous 12-month period, which runs from October 1 to September 30, as published by the United States Department of Labor. The DHS is tasked with announcing the rate of this increase each year on October 1.

Additionally, the bill clarifies that the term "program providing mental health services, substance use treatment services, or services to persons with developmental disabilities" encompasses State programs that are either partially or fully funded by Medicaid and are licensed or approved by the Commissioner of Human Services or other relevant State licensing entities. The Commissioner of Human Services is also required to adopt rules and regulations to implement the provisions of this act, which is set to take effect immediately upon passage.