This bill amends the current law regarding the annual assessment on net written premiums of health maintenance organizations (HMOs) in New Jersey. Specifically, it increases the assessment from five percent to six percent, effective for fiscal year 2025 and thereafter. The bill outlines a schedule of assessments that includes a one percent special interim assessment for fiscal years 2005 and 2006, followed by a two percent assessment for fiscal years 2007 through 2019, a three percent assessment for fiscal year 2020, and a five percent assessment for fiscal year 2021 through 2024. The new six percent rate will be allocated to the Health Care Subsidy Fund, which is designated for charity care payments to hospitals.

The bill also stipulates that HMOs cannot impose additional premiums, fees, or surcharges on their enrollees to recover the costs of the assessment, with an exception for federally funded programs. The Department of the Treasury estimates that this increase will generate an additional $83 million in gross revenue for the Health Care Subsidy Fund. The bill is part of the Governor's Fiscal Year 2025 budget recommendations and is intended to enhance funding for charity care in hospitals across the state.

Statutes affected:
Introduced: 26:2J-47