NJSIPP LEGISLATIVE UPDATE

July 1, 2025

Laurie Clark – Legislative Counsel

GOVERNOR MURPHY SIGNS FISCAL YEAR 2026 BUDGET INTO LAW

Ambulatory Surgery Center Tax Increase– Effective July 1

               Despite our best efforts to stop it, the elimination of both the current $300,000 floor and the $350,000 CAP on the amount of the tax was passed in a standalone bill and signed into law on June 30. The new law is targeted to save $70 million over this fiscal year. Once the Legislature returns to session, coalition efforts will begin to attempt to change the assessment to net rather than gross receipts.

Known as the “Healthcare Finance Enhancement Act” (Assembly Bill 5809), the new law brings significant changes to the assessment of ambulatory care facilities, including ambulatory surgery centers, surgical practices, and licensed imaging centers (ACFs). Prior to the passage of the new law, ACFs were required to pay a 2.95% assessment on gross receipts over $300,000, with a cap on the assessment of $350,000. Under the new law, beginning July 1, 2025, the assessment is set at 2.5% of gross receipts, and both the floor of $300,000 and the cap of $350,000 have been removed. Further, while certain facilities, such as one (1) room surgical practices, were previously exempt from the assessment, these facilities will now be subject to the same assessment.

These changes will impact almost every ACF in New Jersey. While many facilities will have a reduced financial burden due to the decrease in the assessment percentage, many other facilities, such as surgical practices, will no longer be exempt from an assessment. Additionally, facilities that generate larger gross receipts will be assessed higher amounts, as the $350,000 cap has been lifted, and facilities that generate gross receipts under $300,000 will no longer be exempt.

                The $58.78 billion Fiscal Year 2026 (FY2026) budget, which was passed by the Legislature and signed by the Governor, redirects over 75 percent of the total budget back into local communities in the form of grants-in-aid for property tax relief, social services, higher education, as well as State aid to schools, municipalities, and counties.

 

FY26 Budget Highlights

• Final FY26 Budget by the Numbers
• State appropriations: $58.78 billion
• State revenue: $57.31 billion
• Surplus: $6.7 billion
• Spending increase from FY25 to FY26: 4%
• Spending increase from budget proposed by Legislature in February to final budget in June: $767 million or 1.3%
• 5^th straight year of 100% pension payment

The Legislature is expected to return to session in November.

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New Jersey State Legislative Update

Laurie Clark – Legislative Counsel to NJSIPP

February 13, 2025

We started the New Year with positive news on the legislative and regulatory fronts!

Telemedicine Parity Extension Signed into Law

Bill Was Signed on December 31

 

 On December 19, both Houses of the Legislature voted to pass S2988/A3853 sponsored by Senator Vin Gopal and Assemblyman Herb Conaway.

 This bill amends section 11 of P.L.2021, c.310 to extend the end date from December 31, 2024 to July 1, 2026 during which time a health benefits plan in this State is to provide coverage and payment for health care services delivered to a covered person through telemedicine or tele-health at a provider reimbursement rate that equals the provider reimbursement rate that is applicable, when the services are delivered through in-person contact and consultation in New Jersey, provided the services are otherwise covered by the health benefits plan when delivered through in-person contact and consultation in New Jersey.

The bills were signed into law on December 31. The law became effective immediately and extends the pay parity regulations for New Jersey Insurance Coverage until July 1, 2026.

Please note that Medicare Regulations on Telehealth Pay Parity have been extended until March of 2025. We await further Congressional action in the new session which begins tomorrow.

New Jersey Department of Banking and Insurance Issues Bulletin on Prior Authorization Law

On December 31, 2024, the New Jersey Department of Banking and Insurance issued several key bulletins effectuating the provisions of laws signed in the previous legislative session (2023). These Bulletins have the full force of law and are mandatory for compliance by insurance carriers operating in New Jersey beginning on January 1, 2025.

Please review the bulletin concerning prior authorization at the link below.

We are especially happy about the provisions that require a physician of the same specialty be directly involved with the internal appeal. Our society worked very hard on those provisions.

 

https://www.nj.gov/dobi/bulletins/blt24_17.pdf

          

Personal Injury Protection Auto Insurance Reforms Underway

On Monday, the Senate Commerce Committee chaired by Senator Joseph Lagana reported favorably and with committee amendments Senate Bill No. 1473 (Lagana/Bramnick).

As amended, this bill revises the personal injury protection coverage for basic automobile insurance policies from $15,000 to $20,000 and requires a minimum personal injury protection coverage of $50,000 for standard automobile liability insurance policies.  Under the bill, every basic automobile insurance policy will be required to provide personal injury protection coverage in an amount not to exceed $20,000 per person per accident, and every standard automobile liability insurance policy will be required to provide personal injury protection coverage that shall be no less than $50,000 per person per accident.  Current law requires basic automobile insurance policies to provide personal injury protection coverage in an amount not to exceed $15,000 per person per accident, with no minimums required for standard automobile liability insurance policies.  Additionally, the bill requires insurers to inform a named insured that policy limits for the insured’s standard automobile liability insurance policy or basic automobile insurance policy have increased during the renewal period of the policy but exempts insurers from needing a signed coverage selection form before increasing these limits.

This bill was pre-filed for introduction in the 2024-2025 session pending technical review.  As reported, the bill includes the changes required by technical review, which has been performed.

 

COMMITTEE AMENDMENTS:

The committee has amended the bill to:

(1)  revise personal injury protection coverages for basic automobile insurance policies from $50,000 to $20,000; 

(2)  require insurers to inform a named insured that policy limits have increased when the named insured has renewed a policy of insurance and exempt insurers from receiving a signed coverage selection form before increasing a policy’s limits;

(3)  update current law reviewing personal injury protection options for standard automobile liability insurance policies;

(4)  revise the effective date to require that the revised personal injury protection coverages for basic automobile insurance policies be implemented on the first day of the 18th month after the date of enactment of this bill; and

(5)  make certain technical changes.

The bill is now on second reading and ready for a Senate floor vote.

In addition, work on a new PIP Fee Schedule is in progress. The goal is to have it in place by the end of 2025.