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Assemblyman Kevin Rooney Concerned Over Health Insurance Surcharges Impact on Small Businesses

Assemblyman Kevin Rooney is raising concern over a COVID-19-related monthly surcharge increase set to impact small businesses that purchase insurance through Members Health Plan NJ.

Members Health Plan NJ, one of two Multiple Employer Welfare Arrangements (MEWA) in the state, allows small businesses to join together to offer health benefits to workers. Recently, the insurer notified employers a 5.5% surcharge would be included on bills beginning in February due to an estimated $10 million increase in unexpected claim expenses prompted by COVID-19.  

The surcharge is projected to last through December 2021.

In its letter, Member Health Plan NJ wrote that its board “will continually assess the situation and hopes to remove the surcharge as soon as costs and claims volume normalize.”

Rooney: Surcharge Is ‘Suspect’

Since MEWAs are regulated by the New Jersey Department of Banking and Insurance, Rooney is calling for the state to “step up their financial support or step in and investigate if such a hike is necessary.”

Rooney called it “suspect” that the carrier said it had “higher than normal claim volume” during a period when many other health insurance companies “are reporting record profits” because people put elective surgeries on hold or postponed appointments due to stay-at-home orders.

“Forcing our surviving small businesses to pay a surcharge on health insurance during the middle of a pandemic could hurt their ability to keep their doors open,” he said. “The consequences of such an increase needs to be thoroughly considered.”

Rooney went on, “If we ever want our economy to recover, we have to support our small businesses.”

NJ Extends Enrollment Deadline

Rooney’s concerns come at the same time as Gov. Phil Murphy extended the deadline for uninsured New Jersey residents to sign up for health insurance through the Affordable Care Act to May 15 from the previous Jan. 31 deadline.

Starting Feb. 1, those who lost insurance during the COVID-19 pandemic can log onto the state’s insurance marketplace, GetCoveredNJ.gov, to purchase coverage.

Murphy lengthened the deadline, which was expected to end on Jan. 31, after President Joe Biden reopened enrollment on the federal Affordable Care Act exchange amid the ongoing coronavirus crisis.

 “This action will expand opportunities for residents to get the coverage they need to maintain their health and wellbeing,” the governor said.

Key Plan Information

Residents can enroll in a health insurance plan through the marketplace or directly from carriers through this extended COVID-19 special enrollment period by visiting Get Covered New Jersey.

Those shopping for health insurance also have access to a new state subsidy—called New Jersey Health Plan Savings—on top of premium tax credits and cost-sharing reductions available to lower the cost of their health insurance, according to the state.

All plans offer free preventative care, free telehealth during the pandemic and 90 days after the public health emergency ends and coverage for emergencies, mental health care, substance abuse services. Plans also cover testing and vaccinations for COVID-19 at no cost.

The coverage effective dates under the enrollment extension are as follows:

  • Enroll by February 28, coverage effective March 1.
  • Enroll by March 31, coverage effective April 1.
  • Enroll by April 30, coverage effective May 1.
  • Enroll by May 15, coverage effective June 1.

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