Highlight on New Jersey: Challenges in ACA Implementation

In New Jersey, the implementation of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) presented the state with the problem of whether to create a Basic Health Program that would open up coverage for low-income individuals for whom Medicaid is not available, according to a study funded by the Robert Wood Johnson Foundation (RWJF). Though the program would be largely funded by the federal government, the state could accrue additional costs. The ACA also created the issue of how to coordinate New Jersey’s existing health insurance policies and regulations to comport with the law’s new essential health benefits requirements, as well as the issue of whether there are enough physicians to meet the growing demand of patients resulting from increased health insurance coverage.

Basic Health Plan

The study found that, though a Basic Health Program could provide low-income individuals with better coverage for lower cost, the benefits of such a program are not clear due to the uncertainty of whether federal funds will cover all of the state’s administrative costs. Rates of provider reimbursement would be higher than those provided by Medicaid, but they would also have to be lower than commercial insurance rates in order to meet the purpose of the Basic Health Program. Thus, some providers might refuse to accept patients enrolled in the program. The program could also have adverse effects on Health Insurance Exchanges (Exchanges), by reducing enrollment and effectively increasing the administrative cost of each Exchange enrollee.

Essential Health Benefits

In implementing the ACA’s essential health benefit requirements, New Jersey may identify a “benchmark” insurance plan (that includes the 10 essential health benefits) on which most other individual and small group plans can be modeled. Variations should be monitored—by entities such as the state’s Department of Banking and Insurance and the state’s federally facilitated Exchange—to ensure that plans continue to be “substantially equal” to the benchmark plan “and that any changes do not frustrate the goals” of the requirement, according to the study. Finally, the study states that monitoring is needed to ensure that the essential health benefits “covered on paper are paid for in practice.”

Access to Physician Services

According to the study, New Jersey residents reported little trouble finding a physician in the previous year, and those who did have trouble eventually found one. Groups that reported more difficulty in obtaining a physician included the uninsured and those on state programs, lower-income individuals (difficulty finding a specialist), and those in poorer physical or mental health. The self-employed, unemployed, homemakers, and those unable to work experienced the most difficulty in finding physician care.