New Jersey’s Individual Market Premiums to be Among the Lowest in the Nation

New Jersey’s response to the federal government’s sabotage of the Affordable Care Act (ACA) is starting to pay off, according to a new report released today by New Jersey Policy Perspective (NJPP).

The report, New Jersey’s Individual Market Premiums to be Among the Lowest in the Nation, calculates the savings to New Jersey consumers purchasing health insurance on the individual market as a result of state health policies enacted in 2018, notably the statewide individual mandate and establishment of a reinsurance fund. In 2019, the average consumer will save $1,600 on premiums, and all 140,000 middle-class New Jerseyans in the current market will save a total of $3.3 billion over the next ten years.

“New Jersey is proving that staggering health care costs are not inevitable; they were created by policy choices and can be lowered with policy choices,” said Raymond Castro, NJPP Director of Health Policy and author of the report. “As a result of innovative state health policies, premiums will be 22 percent less than they otherwise would be next year and in the foreseeable future. This helps to explains why New Jersey will have the fourth lowest premiums in the nation next year in the Marketplace and cements the state as the national leader in combating the Trump administration’s sabotage of the Affordable Care Act. These savings are a testament to how much can be accomplished in reducing health costs when the state takes an active role in the market to protect consumers.”

The New Jersey Department of Banking and Insurance (DOBI) estimates that the new reinsurance program will guarantee premiums are 15.1 percent lower than they would have been otherwise, and the statewide individual mandate will further reduce premiums by 6.1 percent. DOBI also encouraged insurance carriers to offer less expensive silver plans in 2019, resulting in the base rate for the least expensive Silver plan to drop 23 percent. As a result of these reforms, premiums in New Jersey will drop from ninth highest in 2014 to fourth lowest in the nation in 2019.  

“Despite the Trump administration’s efforts to undermine the Affordable Care Act, New Jersey has taken action to stabilize the state’s health insurance market to provide residents with access to quality affordable coverage. This report demonstrates the importance of the work the Murphy administration is doing,” said Department of Banking and Insurance Commissioner Marlene Caride. “Health plan rates are down by an overall average of 9.3 percent in the individual market. We encourage residents to review their options and to choose a plan that meets their needs. Open enrollment ends December 15 and we want to ensure that as many New Jerseyans as possible enroll in coverage. Information about coverage options and in-person help can be found at GetCovered.NJ.gov.”

The Trump administration’s sabotage of the ACA came at a significant cost to New Jersey consumers, who experienced a 19 percent increase in their premiums in 2018. Next year, New Jersey’s average premium will be 26 percent lower than the national average and far less than in neighboring states.

“Both the progress in coverage expansion and cost containment we realized under the Affordable Care Act was undermined by the Trump administration’s actions, said Maura Collinsgru, Director of Health Programs at New Jersey Citizen Action. “These premium decreases demonstrate New Jersey did the right thing in passing the ACA stabilization bills. By stabilizing our market we can once again turn our attention to expanding quality, affordable health care to those New Jerseyans we have yet to enroll.”

Read the full report here.