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Senator Bob Singer Senator Bob Singer (R-30)
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Contact: Senate Republicans / (609) 847-3600
March 15, 2012
Singer Slams Health Exchange Act That Would Create Duplicative Services, Benefit Stakeholders with Political Influence

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Senator Robert Singer, R-Monmouth/Ocean, slammed “The New Jersey Health Benefit Exchange Act,” approved by the Senate today.

“Unlike other states, New Jersey has a 20-year-old system that assures affordable health coverage to individual and small group markets,” Singer said. “Two boards in the state Department of Banking and Insurance already cover the intent of the Exchange Act, for example by certifying products in those markets, controlling rates, publicizing the availability of coverage, mandating guaranteed issue and renewal, as well as providing lesser waiting periods for coverage and longer dependent coverage.”

The Exchange Act — being rushed through in an attempt to secure federal Department of Health and Human Services grants that were recently graced with greater flexibility in terms of deadlines — is estimated to cost tens of millions of dollars per year to administer.

Massachusetts has had an exchange law for several years. The cost, which would be comparable to New Jersey, is estimated at $40 million per year, not counting subsidies for policies, which will ostensibly come from the federal government under health care reform law. That also wouldn’t include a total cost of $400,000 to pay eight board members — an amendment to New Jersey’s Exchange Act S-1319, inserted by the Senate Commerce Committee, making the bill different than its counterpart A-2171, also voted on today.

S-1319 proposes an exchange governed by board members, including four appointed upon the recommendation of the Senate President and Assembly Speaker, who would serve part time and each collect $50,000 as well as expense reimbursements. The board would be authorized to contract with professional health or insurance service firms to effectuate the Act. Committee amendments also created a 15-member advisory committee, appointed by the board, including representatives from health insurers, health service corporations, insurance producers, licensed general hospitals, public employee unions, private-sector unions and other stakeholders.

“We could have our two boards in state Banking and Insurance absorb any enhanced duties called for by federal law and deemed constitutional by the Supreme Court,” Singer concluded. “We should not rush to enact a state Exchange Act that in many ways is duplicative, would increase civil service and benefit stakeholders with political influences.”

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