Future of Affordable Care Act may be uncertain, but legislators are putting legal backstop in place that would guarantee coverage regardless of what Trump & Co. do

New Jersey lawmakers are advancing legislation to provide a state-level safety net for certain federal health insurance protections spelled out in the embattled Affordable Care Act — measures many hope the Garden State will never have to rely on.

Members of the Senate Budget and Appropriations committee voted unanimously Monday in favor of a handful of bills to shore up popular ACA provisions — including protections for those with preexisting conditions, free coverage for preventive care and insurance for children up to age 26 on their parents’ policies. They also fully backed a proposal to require insurance companies invest at least 85% of what they collect from customers into health-care benefits, not profits or administrative costs.

But the panel split along party lines on several of the Democratic-led bills, like legislation to force Garden State insurers to cover 10 “essential benefits” now mandated by the federal act and keep them from imposing financial limits on a patient’s coverage. Republicans also voted against legislation to permit the state to review insurance rate hikes over a certain threshold and to ban so-called bare-bones policies, but all the measures advanced in the committee dominated by Democrats.

“Many of these bills are reasonable and (involve) common sense,” said Sen. Declan O’Scanlon (R-Monmouth) who occasionally supports Democratic-led policies. These included a bill to impose a state tax on those without health insurance, which experts said helped stabilize New Jersey’s market when the federal government suspended the national “individual mandate” last year.

“But you have to be cognizant of the cost and the impact,” O’Scanlon added. “As we increase these mandates, we have to think about what it does to the overall market.”

Facing final vote in Senate

Six of the seven bills advanced have passed the Assembly and face only a final vote in the Senate — which could be held Thursday — before Gov. Phil Murphy, a strong supporter of the ACA, could sign them into law. One is also still pending before the full Assembly. Most of the bills are part of a larger package that Senate Democrats developed in response to a December 2018 federal court ruling that declared the 2010 law, also known as Obamacare, unconstitutional.

“We cannot leave the health and safety of our citizens up to the whims of the White House,” said Sen. Joe Vitale (D-Middlesex), a lead sponsor of the measures.  “This legislation is a commitment to our residents and an assurance that our state will do everything we can to make sure New Jerseyans are healthy, safe and able to afford health care.”

That package also included legislation empowering New Jersey to create its own exchange, or insurance marketplace, for commercial plans sold to individuals and small businesses. Murphy enacted that law in June, and the state plans to launch its own online sales platform later this year. But the other ACA-related protections have taken more time to advance in the Legislature.

Trump’s ongoing challenge to ACA

Even if these remaining measures are enacted, the requirements would largely remain dormant — and not trigger new state spending — as long as the ACA remains in place. That law has survived repeated attacks from President Donald Trump and Republicans in Congress. A December ruling by a federal appeals court remanded it back to the same federal trial court in Texas for additional review, which supporters fear could eventually lead to its undoing. But if the federal court rules against the national insurance program, the New Jersey proposals would provide something of a backstop for state residents.

“This puts New Jersey at the forefront of protecting the Affordable Care Act,” said Maura Collinsgru, the health-care program director for New Jersey Citizen Action, which has long advocated for Obamacare protections. More than a dozen states have implemented some state-level protections for individuals with preexisting conditions, or essential health benefit assurances, and New Jersey’s legislation targets many of these same goals.

Regardless of what happens in the court or in Washington, D.C., Collinsgru said the bills “ensure that the progress we’ve made under the ACA … will remain the floor of coverage and we will not jeopardize the lives and health of those benefitting from these protections.”

The legislation is also supported by the New Jersey Association of Health Plans, which represents insurance providers. “These bills bring New Jersey laws up to the standard of the Affordable Care Act,” said association president and CEO Ward Sanders, and they will protect state residents “in the event the law is repealed.”

Tapping into federal dollars

Under the ACA, which took full effect in 2014, New Jersey chose to tap into newly available federal dollars to expand its Medicaid program to reach an additional 500,000 low-income individuals. The law also created new benefits and protections — like coverage for children up to age 26 on their parents’ plan, and for essential needs like mental health and maternity care, among others — for those covered by most commercial plans, which benefitted millions of Garden State residents at all economic levels.

“Health insurance is not an option in America,” said Sen. Nellie Pou (D-Passaic), another lead sponsor. “Everyone deserves the right to affordable healthcare, and codifying this federal law into state law will help give New Jerseyans more options and greater coverage for years to come, regardless of who is in charge of the Oval Office.”

However, if the ACA is somehow repealed or invalidated and the state-level protections envisioned in New Jersey were to become relevant, far fewer Garden State residents would be guaranteed the level of coverage they currently enjoy. The federal law covers individuals enrolled in all kinds of insurance plans, including self-insured plans favored by big companies and regulated through national law.

But these plans — which insure close to 4 million New Jersey residents — are beyond the reach of state law and would not be governed by the measures now moving in the Senate. Instead, the ACA legislation would likely apply to approximately 2 million people here, including public workers, small business employees and individuals who purchase commercial plans directly.

Specifically, the bills advanced Monday, with some amendments, address the following issues:

S.562 by Sens. Nia Gill (D-Essex) and Troy Singleton (D-Camden) would require health insurance plans to cover 10 essential health benefits: outpatient care (like visiting a doctor), emergency services, hospitalization, maternity and newborn care, mental health and substance-use disorders, prescription drugs, rehabilitation services and devices, lab work, preventive care and chronic disease management, and pediatric services of all kinds. It also prohibits insurance companies from imposing annual or lifetime spending limits on these. The bill passed on party lines, with eight Democrats voting “yes” and four Republicans voting “no.”

S.626 by Sens. Vitale and Patrick Diegnan (D-Middlesex), prohibits insurance companies from banning policy holders with preexisting conditions or charging them more for coverage. The bill passed with unanimous support.

S.3802 by Sens. Pou and Loretta Weinberg (D-Bergen) requires children to be covered on their parents’ plan until age 26. The bill passed with unanimous support.

S.3803 by Sens. Pou and M. Teresa Ruiz (D-Essex) requires health-insurance coverage for certain preventive services, like mammograms, at no out-of-pocket cost to the patient. The bill passed with unanimous support.

S.3808 by Sens Singleton and Diegnan would ban low-cost, low coverage “basic and essential” health-care plans in all state markets. The bill passed along party lines.

S.3809 by Sens Pou and Joseph Lagana, (D-Bergen) would expand rate-review processes in the Department of Banking and Insurance for certain individual and small-employer health-benefits plan, including when a company seeks to raise rates more than 10%. The bill passed along party lines.

S.3812 by Sens. Diegnan and Joe Cryan (D-Union) would apply an 85% loss-ratio requirement to large-group health insurance plans, requiring them to reinvest at 85% of their revenue in benefits. The bill passed unanimously.

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