New Jersey

SUMMARY

New Jersey has already introduced a few healthcare bills in the current legislative session, with more likely to come. The most prominent measures pertain to increasing insurance and prescription cost transparency.

 

LEGISLATION/REGULATION

New Jersey’s current regular legislative session runs from 1/9/2018 – 1/14/2020.

 

Recent Legislative Developments

Healthcare Transparency

2018 A 443  INSURANCE NETWORK TRANSPARENCY: Requires health care provider participating in carrier network to give notice to covered person of provider’s referral to out-of-network provider.   Active – Referred to Financial Institutions and Insurance Committee on 1/9/18.  
A 1920  DISCLOSING HEALTHCARE COSTS TO CONSUMERS: Health care facilities shall disclose to a covered person in writing or through an internet website the health benefits plans in which the health care facility is a participating provider prior to the provision of non-emergency services, and verbally or in writing, at the time of an appointment. ActiveReferred to Assembly Financial Institutions and Insurance Committee 1/9/2018.  
A 583  PRESCRIPTION DRUG REVIEW COMMISSION: The commission shall develop a list of critical prescription drugs made available in New Jersey for which there is a substantial public interest in understanding the development of pricing for the drugs. For each prescription drug that the commission places on the critical prescription drug list, the commission shall require the manufacturer to report the total cost of production, approximate cost of production per dose, and research and development costs of the drug.   Active – Referred to Assembly Health and Senior Services Committee 1/9/2018.  

 

Healthcare Cost

2018 AB 4676 PRESCRIPTION DRUG PATIENT PROTECTION ACT: PBMs are prohibited from requiring prior authorization for any prescription, unless there is an alternative drug that has a lower cost and is of equal quality and efficacy to the prescribed drug; if there is such an alternative drug, then that alternative drug would also not be subject to prior authorization.  Every PBM looking to provide pharmacy benefit management services in New Jersey must meet certain application requirements. In addition to providing basic ownership and contact information, the Division of Banking and Insurance (DOBI) will require PBMs to submit the following information in order to get a Certificate of Authority (C of A) before they are able to provide PBM services.   Active –Passed both Senate and House. Awaiting Governor’s Signature 1/19/18.
2017 AR 184 URGES FDA TO EXPEDITE APPROVAL PROCESS FOR GEENTo expedite access to generic drugs, for the next 47 reauthorization of the Generic Drug User Fee Act (GDUFA), the FDA should consider additional steps to improve ANDA review efficiency, so that the current backlog of pending applications and 2 the average time required to review generic drug applications can 3 be reduced. Active -Introduced on 10/26/17.

 

Healthcare Markets

2018 AB 605  PROHIBITS SALE OR LEASE OF ACCESS TO CERTAIN HEALTHCARE PROVIDER NETWORKS: This bill prohibits granting access to physician discounts under a provider network contract, in order to prevent the improper selling or leasing of these contractual discounts, under what is commonly known as a “silent PPO (preferred provider organization)” arrangement.  Active – Referred to Financial Institutions and Insurance Committee on 1/9/18. 

 

Key Statutes

We compile state statutes relate to healthcare price and competition, including healthcare transparency, markets, and costs. For a complete listing of all health related statutes visit the State Health Practice Database for Research.

 

Transparency in Healthcare

  • J. Admin. Code § 8:31B-4.1 requires that every hospital submit a uniform report on costs, revenue and statistical information. Annual acute care hospital cost reports, containing revenue data for all payers for each acute care hospital, are available to the public.

 

  • J. Stat. Ann. § 26:2H-5 authorizes the commissioner of health to conduct inspections of healthcare facilities. The commissioner is directed to establish a uniform statewide reporting system for health care facility utilization and costs.

 

  • J. Stat. Ann. § 26:2H-18.55 in setting out the duties of the commissioner of health, the commissioner is directed to “[s]tudy and, if feasible, establish hospital cost and outcome reports to provide assistance to consumers of health care in this State in making prudent health care choices.”

 

Healthcare Contracting

  • J. Admin. Code. § 11:24C-4.3 prohibits most favored nation clauses, or clauses having a similar effect, in an agreement between an insurance carrier and a participating provider. A most favored nations clause is an agreement between a payer (such as an insurance company) and a provider that typically requires a provider to give the payer the lowest rate that it gave to any other comparable payer, which can be anticompetitive by encouraging oligopolistic pricing by large payers and increasing barriers for new entrants. Agreements between a participating provider and a carrier are not subject to the prior approval of the Commissioner.

 

Healthcare Markets

 

  • J. Stat. Ann. § 30:4D-8.1 establishes a Medicaid ACO Demonstration Project with the goal of increasing access to care and increasing efficiency and cost reductions through improved coordination and information sharing. Such activities will be exempt from state antitrust laws to the extent necessary to facilitate the project.

 

  • J. Admin. Code. § 8:33:4-9 prohibits health care providers from acquiring, replacing, or adding to their facilities and equipment, except in specified circumstances, without the prior approval of the Department of Health through the state’s Certificate of Need process. A Certificate of Need regime aims to reduce healthcare overheard by reducing unnecessary or duplicative services, but can be anticompetitive by increasing regulatory barriers for new entrants.

 

 

LITIAGATION/ENFORCEMENT

  • None identified.

 

KEY RESOURCES 

New Jersey Legislature

New Jersey Office of the Attorney General

New Jersey Department of Banking & Insurance

NJ Hospital Price Compare