New Jersey poised to mandate health insurance

May 1, 2018

Following the repeal of the Affordable Care Act’s individual mandate and a host of federal insurance regulations, many health policy analysts questioned whether ACA-friendly states would adopt their own insurance reforms to stabilize their insurance marketplaces or codify existing reforms. While several states are debating different insurance strategies, enacting a state version of the individual mandate is seen as politically difficult if not impossible.

New Jersey, however, is on the verge of being the second state to require constituents to have health insurance coverage. (Massachusetts was the first after it passed its coverage plan, which became the basis for the Affordable Care Act.). The state legislature passed its mandate, the New Jersey Health Insurance Market Preservation Act, by a vote of 23-13 in the New Jersey Senate and 50-23 in the New Jersey Assembly.

But a recent poll by the Rutgers Center for State Health Policy found that while New Jersey residents support the ACA (65 percent to 29 percent favored having the state maintain the ACA even if Congress repealed it), most did not agree that individuals should be required to have health insurance (55 percent said no, 40 percent said yes, 5 percent were undecided). The legislature also passed a bill to authorize the state to seek a federal waiver to create a reinsurance pool by a vote of 22-14 in the Senate and 46-22 in the Assembly. Both policies could help the New Jersey stabilize its marketplace and stem at least some potential rate hikes.

Other states may also pass similar state mandates or find renewed interest from New Jersey’s example. For instance, the Vermont House passed a version of the individual mandate in March; that bill is pending before the state senate. Several key Vermont health officials from both political parties raised concerns about the repeal of the federal mandate.

Although a mandate may help a state insurance marketplace by keeping younger, healthier consumers in the insurance pool, it may not be the main reason that people ultimately do buy insurance. A recent poll found that for people who are buying insurance on their own through the individual or small group market, the threat of the ACA’s individual mandate was not necessarily what prompted them to buy insurance; rather, protection for high medical bills and peace of mind were the top cited reasons.

For additional resources, the Center for Health Journalism at the University of Southern California produced a February webinar on the individual mandate. This topic will be discussed at our summer 2018 CSG-ERC annual meeting in Rye Brook, New York, as well.

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