Creates Health Care Cost Containment and Price Transparency Commission, Office of Healthcare Affordability and Transparency, and hospital price transparency regulations.

A1729

ASSEMBLY, No. 1729

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblywoman VERLINA REYNOLDS-JACKSON

District 15 (Hunterdon and Mercer)

Assemblywoman LINDA S. CARTER

District 22 (Somerset and Union)

Assemblywoman CAROL A. MURPHY

District 7 (Burlington)

Co-Sponsored by:

Assemblymen Sampson, Miller, Assemblywomen Donlon,
Peterpaul, Haider, Park, Drulis, Assemblyman Venezia, Assemblywomen Kane,
Brennan, Assemblymen Singh, Angelozzi, Calabrese, Walker and Onyema

SYNOPSIS

���� Creates Health Care Cost Containment and Price
Transparency Commission, Office of Healthcare Affordability and Transparency,
and hospital price transparency regulations.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning transparency and affordability in health
care
and

supplementing Title 26 of the Revised Statutes.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1. As used in this act:

���� �Commission� means the Health
Care Cost Containment and Price

Transparency Commission.

���� �Department� means the
Department of Health.

���� �Health care entity� means a
payer or provider.

���� "Hospital" means an
acute care general hospital licensed pursuant to P.L.1971, c.136 (C.26:2H-1 et
seq.).

���� �Office� means the Office of
Health Care Affordability and Transparency.

���� "Payer" means a
�health benefits plan,� �benefits payer,� or a �third-party administrator� as
these terms are defined in section 1 of P.L.2001, c.267 (C.17B:27B-1); a
publicly funded health care program, including Medicaid, Medicare, the State Health
Benefits Program, and the School Employee Health Benefits Program; or any other
public or private entity, other than an individual, that pays or reimburses the
cost for the provision of health care.

���� �Provider� means any person,
facility, or entity that is licensed, certified, registered, or otherwise
authorized by law to provide health care in the ordinary course of business or
practice of a profession.

���� 2. a. There is established the
Office of Health Care Affordability and Transparency in the Department of
Health.� The purpose of the office shall be to: provide support, staffing,
infrastructure, and expertise to the Health Care Cost Containment and Price
Transparency Commission, established pursuant to section 3 of this act, and
comprehensively address health care cost growth while establishing data
analytics and public reporting mechanisms to ensure healthcare affordability,
informed policymaking, and access for future generations.

���� b. The office shall have an
executive director appointed by the Governor.

���� c. The office shall establish
guidelines for health care entities to submit necessary data for the yearly
evaluation of total health care expenditures, their incremental growth, pricing
information, pricing incremental growth, the formulation of the healthcare cost
growth benchmark and hospital price benchmark, and for publishing relevant data
publicly.� Health care entities shall adhere to the submission schedules
established by the office.

���� d. The office shall collect
hospital pricing data for the State Health Benefits Plan, in particular the
in-network and out-of-network allowed amounts per service, for each hospital
facility located in New Jersey identified by name and hospital system affiliation,
based on the following service categories:

���� (1) inpatient hospital;

���� (2) outpatient hospital;

���� (3) emergency room services;
and

���� (4) physician services
provided:

���� (a) during an inpatient
hospital admission; and

���� (b) as part of an outpatient
visit or in connection with the provision of emergency room services, except to
the extent the office determines the physician services analysis is not
technically feasible and explains the basis for such a determination.� Service-level
allowed amounts shall be reported using codes used by the hospital for purposes
of accounting or billing for the item or service, including, but not limited
to, the Current Procedural Terminology code, the Healthcare Common Procedure
Coding System code, the Diagnosis Related Group, or the National Drug Code.

���� e. The office shall prioritize
existing data sources, such as data collected by the Drug Affordability
Council, the State Health Benefits Program and School Employee Health Benefits
Program, the Departments of Health and Human Services, and any other source may
come into existence, including a Statewide All Payer Claims Database, to avoid
redundant data acquisition processes.

���� f. The office shall be
authorized to conduct and publish studies and implement programs� with the goal
of reducing the rate of growth in per capita total health care spending,
promoting an affordable pricing environment that maintains access to high quality
care, and lowering consumer spending on premiums and out-of-pocket costs.

���� 3. a. There is established the
Health Care Cost Containment and Price Transparency Commission in, but not of,
the Department of Health.� The purpose of the commission shall be to: monitor,
analyze, and contain health care prices by identifying drivers of health care
cost growth including hospital price growth; establishing and adopting a health
care cost growth benchmark and a hospital price growth benchmark; identifying
health care entities that exceed the benchmark or benchmarks; and addressing
increases in excess of the benchmark or benchmarks through public transparency,
opportunities for remediation, and other progressive enforcement actions that
include civil penalties.

���� b. The commission shall
consist of 18 members as follows: two individuals appointed by the Governor;
the Commissioner of Health or the commissioner�s designee; one individual
appointed by the Speaker of the General Assembly; one individual appointed by the
Senate President; one individual representing the interests of local government
health care purchasers, nominated by the New Jersey League of Municipalities;
one individual representing the interests of local government, nominated by New
Jersey Association of Counties; two individuals representing the interests of
the public sector, nominated by the Coalition of Affordable Hospitals; two
individuals representing the interests of the private sector, nominated by the
Coalition of Affordable Hospitals; three consumer advocates, nominated by the
New Jersey for Health Care Coalition; one individual representing the interests
of small businesses, nominated by the New Jersey Business and Industry
Association; the State Comptroller, or the State Comptroller�s designee, as a
non-voting member; and two representatives from the Office of Health Care
Affordability and Transparency, as non-voting members.

���� c. Members of the commission
shall serve five-year terms, with initial appointments varying to allow for
staggered terms.

���� d. A vacancy in the term of a
member of the commission shall be filled for the remainder of the term in the
same manner as the original appointment.

���� e. Members of the commission
shall be diverse and possess expertise in a subject area of health care.

���� f. No member shall take any
official action on any matter in which the person has a direct or indirect
personal financial interest.

���� g. The commission shall select
a chair, convene at least quarterly, and hold at least one annual public
meeting.

���� (1) The commission may compel
testimony at the public meeting from healthcare entities whose costs or prices
exceed either benchmark.

���� (2) The commission shall
provide an opportunity for public input at the annual public meeting.

���� h. The commission shall
establish goals of reducing the rate of growth in per capita total health care
spending, promoting an affordable pricing environment that maintains access to
high quality care, and lowering consumer spending on premiums and out-of-pocket
costs.

���� i. Each member of the
commission shall receive paid time off from monies appropriated pursuant to
section 5 of this act to participate in commission activities, and shall be
reimbursed for traveling and other expenses necessarily incurred in the
performance of official duties.

���� j. (1) The commission shall
set a cost growth benchmark for health care entities, based on the Healthcare
Affordability, Responsibility, and Transparency program, as well as a hospital
price growth benchmark for each hospital, using their total facility plus
physician price as a percent of Medicare as a baseline.

���� (2) The commission shall
request that the office procure from health care entities the requisite data to
evaluate total health care expenditures and health care prices, as well as
their incremental growth.

���� (3) The commission shall
review various cost drivers with a specific focus on the role of price growth
in healthcare affordability.

���� (4) (a) The commission shall
require health care entities that substantially or consistently charge or
receive more for health care services than the benchmarks established by the
commission, to submit to the commission a performance improvement plan.� The
commission shall work in consultation with the office to set guidelines for a
performance improvement plan�s creation, content, and enforcement.

���� (b) The commission shall
impose progressive enforcement actions including civil penalties on health care
entities that either fail to respond to the commission�s request to submit a
corrective action plan or comply with the requirements of a corrective action
plan.� The commission shall work in consultation with the office to establish
criteria for the imposition of civil penalties.� Civil penalties shall be
collected in a summary proceeding brought in the name of the State in a court
of competent jurisdiction pursuant to the "Penalty Enforcement Law of
1999," P.L.1999, c.274 (C.2A:58-10 et seq.).

���� (5) The commission shall
prepare and submit to the Governor and, to the Legislature pursuant to section
2 of P.L.1991, c.164 (C.52:14-19.1), an annual report containing the latest
available data on total health care expenditures, the current status of
compliance by each health care entity with the benchmarks, hospital pricing
information for the State Health Benefits plan as described in section 2 of
this act, and policy recommendations to lower health care costs. This report
shall be made available publicly by the commission on an Internet website, hosted
by the office or the department.

���� 4. a. The department shall
require hospitals to be in compliance with federal hospital price transparency
requirements and provide a written warning notice to or request a corrective
action plan from any hospital that is not in compliance with these federal
requirements.

���� b. (1) A hospital shall be
prohibited from attempting to collect a medical debt from a patient if the
hospital is not, at the time of providing medical services to the patient, in
compliance with the provisions of this section.

���� (2) Debt collection attempts
prohibited by this section include referring the debt directly or indirectly to
a debt collector, collection agency, or to a third-party retained by the health
care facility; suing the patient or patient guarantor; enforcing an arbitration
or mediation clause in any hospital contract; or causing a report to be made to
a consumer reporting agency.

���� c. A hospital that fails to
act in accordance with the provisions of this section shall be liable to a
civil penalty of $10 per day per bed in the hospital for each offense.� For the
purposes of this act, each violation shall constitute a separate offense.� The
civil penalty shall be collected in a summary proceeding, brought in the name
of the State in a court of competent jurisdiction pursuant to the "Penalty
Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.).

���� d. The department shall
prepare and submit to the Governor and to the Legislature pursuant to section 2
of P.L.1991, c.164 (C.52:14-19.1), detailing hospitals� compliance with the
federal hospital price transparency requirements, and publish the report on its
Internet website.

���� 5.��� The Commissioner of
Health shall adopt rules and regulations, in accordance with the
�Administrative Procedure Act,� P.L.1968, c.410 (C.52:14B-1 et seq.), as are
necessary to effectuate the provisions of this act.

���� 6.��� This act shall take
effect 180 days following the date of enactment.

STATEMENT

���� This bill creates the Health
Care Cost Containment and Price Transparency Commission (commission), the
Office of Healthcare Affordability and Transparency (office), and hospital
price transparency regulations.

���� Under the bill, the purpose of
the office is to provide support, staffing, infrastructure, and expertise to
the commission, and to comprehensively address health care cost growth while
also establishing data analytics and public reporting mechanisms to ensure
healthcare affordability, informed policymaking, and access for future
generations.� The office is to establish guidelines for health care entities to
submit necessary data for the yearly evaluation of total health care
expenditures, their incremental growth, pricing information, pricing
incremental growth, the formulation of the healthcare cost growth benchmark and
the hospital price benchmark, and for publishing relevant data publicly.

���� Under the bill, the purpose of
the 18 member commission is to: monitor, analyze, and contain health care
prices by identifying drivers of health care cost growth including hospital
price growth; establishing and adopting a health care cost growth benchmark and
a hospital price growth benchmark; identifying health care entities that exceed
the benchmark or benchmarks; and addressing increases in excess of the
benchmark or benchmarks through public transparency, opportunities for
remediation, and other actions, including civil penalties.� The commission is
to set a cost growth benchmark for health care entities.� The commission is to
impose civil penalties, pursuant to the "Penalty Enforcement Law of
1999," P.L.1999, c.274 (C.2A:58-10 et seq.), on health care entities that
either fail to respond to the commission�s request to submit a corrective
action plan or comply with the requirements of a corrective action plan.�

���� The bill provides that the
Department of Health is to require hospitals to be in compliance with federal
hospital price transparency requirements and provide a written warning notice
to, or request a corrective action plan from, any hospital that is not in
compliance with these federal requirements.� A hospital is to be prohibited
from attempting to collect a medical debt from a patient if the hospital is
not, at the time of providing medical services to the patient, in compliance
with the provisions of this bill.� A hospital that fails to act in accordance
with the provisions of this bill is to be liable to a civil penalty of $10 per
day per hospital bed for each offense, pursuant to the "Penalty
Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.).