Governor Murphy Releases Plan to Improve Healthcare Affordability
On March 30, 2022, the Murphy Administration released a detailed description of the Healthcare Affordability, Responsibility and Transparency (HART) Program—a plan aimed at addressing rising healthcare costs.1 The Program sets targets for healthcare leaders to meet regarding healthcare costs in an effort to slow the unsustainable rate of growth.
“A survey of 900 New Jersey adults conducted in 2020 found that more than three-quarters (77 percent) are worried about being able to afford healthcare.”
A survey of 900 New Jersey adults conducted in 2020 found that more than three-quarters (77 percent) are worried about being able to afford healthcare.2 Over the past two decades, family premiums and employee contributions to premiums have increased at a far greater rate than household incomes.
Governor Phil Murphy explained, “Through continued collaboration with healthcare leaders across the state, this critical program aims to make healthcare more affordable for New Jersey families while promoting a more sustainable healthcare future for our state.”1
In recognition of the hardship this disparity imposes on consumers, the Governor signed Executive Order No. 217 in January 2021 to direct the development of a healthcare cost growth benchmark program, newly named the HART Program, to address the rising cost of healthcare in New Jersey.3 The program was then formally established when the Governor signed Executive Order No. 277 in December 2021.4
The HART Program was developed by the Interagency Healthcare Affordability Working Group—led by Director Shabnam Salih and consisting of representatives from the Department of Banking and Insurance (DOBI), Department of Human Services (DHS), Department of Health (DOH), Division of Consumer Affairs and the Department of the Treasury—with guidance from an advisory group comprised of healthcare leaders and relevant stakeholders.
The HART Program establishes a target rate of growth for healthcare spending within New Jersey, collects data to track and report on progress in meeting that target, helps to understand factors driving costs and points toward strategies that can help curb cost growth and align spending with target goals. The HART program takes a comprehensive approach to addressing the rate of healthcare cost growth that encompasses insurance, hospital and provider, and pharmaceutical spending. It sets a strong foundation for affordability, not only through working to meet cost growth targets over the next six years, but through establishing a data analytics and public reporting infrastructure to support smart, focused policymaking in the future. This program is another critical step by the Administration to address challenges of healthcare affordability and access without sacrificing quality.5
The blueprint released by the HART Program lays out the target rate of growth for healthcare spending and explains the program’s comprehensive approach to understanding the factors that drive costs. The program’s approach encompasses collection and analysis of insurance, hospital, provider and pharmaceutical costs to track our state’s progress in meeting these targets, understand cost drivers and identify strategies to help curb costs. The goal of the HART Program is to create more sustainable spending for New Jersey.5
“The HART program will accomplish a long-time legislative initiative of mine to address healthcare affordability,” said Senator Troy Singleton (D-7). “Rising healthcare costs affect most New Jerseyans on a day-to-day basis, and financial burdens should not prevent individuals from receiving the proper care that they need and deserve. Price transparency, whether in healthcare or prescription drugs, is a critical factor toward lowering the overall costs of care. As someone who worked on this issue over the last decade, I fully appreciate the intent and purpose of the Governor’s plan and am hopeful it will achieve tangible results.”6
Various advocates, hospitals, healthcare providers, insurers, unions, employers and other stakeholders across New Jersey have signed onto a compact, committing to working towards meeting the program’s targets and goals.7
Plan to Limit Cost of Life-Saving Drugs
State lawmakers have introduced legislation backed by Governor Murphy that would limit the cost of life-saving drugs, including asthma inhalers and insulin, for some residents in New Jersey and rein in the rising price of healthcare.
‘”To put it in the simplest terms,” said Senator Singleton, “drugs don’t work if people can’t afford them.”’
“To put it in the simplest terms,” said Senator Singleton, “drugs don’t work if people can’t afford them. That is why addressing the astronomical cost of prescription drugs is a priority as we work to make New Jersey more affordable. The bills we have introduced are a key component of our collective efforts to provide consumer relief and bring transparency to the pharmaceutical supply chain. These efforts, when combined with our work to create a Prescription Drug Affordability Board and to require carriers to pass savings onto customers, will truly be transformative and make a positive difference in the lives of people who rely on these life-saving medicines.”8
Three bills that address these issues are the following:
Senate Bill 1614/Assembly Bill 28399 (sponsored by Senators Joseph Vitale, Nellie Pou and Troy Singleton, and Assemblypersons John McKeon, Robert Karabinchak, Annette Quijano and Paul Moriarty) seek to ensure insurance coverage and to cap co-pays for 30-day supplies of several life-saving drugs, including epinephrine injectors (capped at $25), asthma inhalers (at $50) and insulin (at $35). These co-pays would not count against a patient’s insurance deductible.
Senate Bill 1615/Assembly Bill 284010 (sponsored by Senators Troy Singleton, Jospeh Vitale and Nellie Pou, and Assemblypersons John McKeon, Angela McKnight, William Moen, Jr. and Paul Moriarty) require drugmakers, wholesalers, insurance companies and others to report to the state details on sales volume, revenue and other metrics. They would also require manufacturers to notify the state if they planned to hike prices above a certain threshold.
Senate Bill 1616/Assembly Bill 284111 (sponsored by Senators Joseph Vitale, Troy Singleton and Nellie Pou, and Assemblypersons John McKeon, Roy Freiman and Gabriela Mosquera) would force pharmacy benefit managers (PBMs—companies that serve as middlemen in the prescription-drug supply chain) to be more transparent and be licensed by the state’s Department of Banking and Insurance.
Assemblyman John McKeon (D-27), one of the sponsors of the bill package, said “Transparency shines a light on drug pricing and holds manufacturers accountable for increases or high prices for new prescriptions. Pharmacy benefits managers were created as middlemen to reduce costs, but a lack of transparency has allowed them to operate virtually unchecked. In order to reduce patient costs, we must enhance transparency in various capacities, which would allow our state agencies and the public to become more aware of unfair fee surges.”12
Governor Murphy said during his State of the State address that he supports a plan with the Legislature to make prescription drugs more affordable in New Jersey, including “life-saving” medication and pills that millions of residents take daily, with the goal of making prices in the supply chain “more transparent, so we can see what drives drug prices higher, and so we can lower them.”13
The bill package is currently moving through the Legislature and should be on the Governor’s desk for his consideration before the end of June.
New York No Longer Enforcing Booster Requirement for Healthcare Workers
New York State is no longer moving forward with plans to enforce a COVID-19 booster shot requirement for healthcare workers. The New York State Department of Health said the mandate, slated to go into effect on February 21, 2022, isn’t moving forward over potential short-staffing problems. Also, removing the February deadline provides healthcare workers more time to get boosted. The original vaccine mandate for healthcare employees remains in effect.
New York State Health Commissioner, Dr. Mary T. Bassett, stated, “The vaccine and booster are critical tools to keep both healthcare workers and their patients safe, and we continue to urge everyone to get vaccinated and receive a booster dose when eligible.”
The State plans to review the decision in three months to determine if more needs to be done to get healthcare workers boosted.”14