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A1833
ASSEMBLY, No. 1833
STATE OF NEW JERSEY
222nd LEGISLATURE
�
PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION
Sponsored by:
Assemblyman ANTHONY S. VERRELLI
District 15 (Hunterdon and Mercer)
SYNOPSIS
���� Amends Fiscal Year 2026 annual appropriations act to
remove language requiring achievement of cost savings for SHBP.
CURRENT VERSION OF TEXT
���� Introduced Pending Technical Review by Legislative
Counsel.
��
An Act
amending P.L.2025, c.74, the Fiscal Year 2026 annual appropriations act, to remove
language requiring the achievement of cost savings for the State Health
Benefits Program.
����
Be It
Enacted
by the Senate and the General Assembly
of the State of New Jersey:
���� 1.� The following language
provisions in section 1 of P.L.2025, c.74, the annual appropriations act for
State Fiscal Year 2026, are amended to read as follows:
94 INTERDEPARTMENTAL ACCOUNTS
70 Government Direction, Management,
and Control
74 General Government Services
9410 Employee Benefits
DIRECT STATE SERVICES
[
Notwithstanding
the provisions of any law or regulation to the contrary, the appropriations for
the Employee Benefits program classification shall be subject to the following
conditions: (1) in a good faith effort to agree on proposals to save a total of
$100 million in State funds during the first six months of Plan Year (PY) 2026,
the State and public employees� representatives on the State Health Benefits
Plan Design Committee (SHBPDC) shall separately submit cost savings proposals
to the plan actuary by July 31, 2025 and the plan actuary shall review the
proposals to determine whether the plan design proposals will result in
recurring and actuarially verifiable cost savings, noting whether they will be
achieved in the first six months of PY 2026 in the amount of $100 million.� Any
proposal that the plan actuary determines will not result in recurring and
actuarially verifiable cost savings, or less cost savings than proposed, in the
first six months of PY 2026 shall be adjusted to reflect actuarially verified
cost savings or eliminated from further consideration if no savings are
actuarially verified.� The SHBPDC shall then meet and vote on each of the
verified proposals before September 30, 2025; (2) if the plan actuary
determines that the cost savings proposals submitted by the labor and
administration representatives will not result in recurring and verifiable
total savings of at least $100 million during the first six months of PY 2026,
the labor and administration representatives on the SHBPDC shall submit
additional proposals to the plan actuary in an effort to achieve the $100
million savings target before September 30, 2025; (3) if the SHBPDC is unable
to reach agreement on the actuarially verified proposals totaling $100 million
in cost savings before September 30, 2025, the SHBPDC shall immediately
commence the existing statutorily prescribed mediation and conciliation
procedure set forth in P.L.2011, c.78, and that process shall be concluded by
October 31, 2025; (4) if the SHBPDC is unable to reach agreement on cost
savings proposals totaling $100 million in actuarially verified savings
following the existing statutorily prescribed mediation and conciliation
procedure set forth in P.L.2011, c.78, the Legislature shall revise the
statutory framework set forth in P.L.2011, c.78 to determine a process by which
$100 million in actuarially verifiable cost savings shall be achieved for PY
2026 before December 1, 2025; (5) if the Legislature does not pass a bill
revising the statutory framework before December 1, 2025, then a representative
of the State selected by the Governor and a public employees� representative
selected by the State employees� and local employees� representatives on the
SHBPDC shall jointly select cost-saving changes to achieve $100 million in
actuarially verifiable cost savings.� In the event that the State
representative and the public employees� representative are unable to reach
agreement, then the Executive Director of the Office of Legislative Services
shall designate an additional representative and the three representatives
shall meet and vote to select cost-saving changes to achieve $100 million in
actuarially verifiable cost savings for the first six months of PY 2026 before
December 15, 2025.
]
GRANTS-IN-AID
[
Notwithstanding
the provisions of any law or regulation to the contrary, the appropriations for
the Employee Benefits program classification shall be subject to the following
conditions: (1) in a good faith effort to agree on proposals to save a total of
$100 million in State funds during the first six months of Plan Year (PY) 2026,
the State and public employees� representatives on the State Health Benefits
Plan Design Committee (SHBPDC) shall separately submit cost savings proposals
to the plan actuary by July 31, 2025 and the plan actuary shall review the
proposals to determine whether the plan design proposals will result in
recurring and actuarially verifiable cost savings, noting whether they will be
achieved in the first six months of PY 2026 in the amount of $100 million.� Any
proposal that the plan actuary determines will not result in recurring and
actuarially verifiable cost savings, or less cost savings than proposed, in the
first six months of PY 2026 shall be adjusted to reflect actuarially verified
cost savings or eliminated from further consideration if no savings are
actuarially verified.� The SHBPDC shall then meet and vote on each of the
verified proposals before September 30, 2025; (2) if the plan actuary
determines that the cost savings proposals submitted by the labor and
administration representatives will not result in recurring and verifiable
total savings of at least $100 million during the first six months of PY 2026,
the labor and administration representatives on the SHBPDC shall submit
additional proposals to the plan actuary in an effort to achieve the $100
million savings target before September 30, 2025; (3) if the SHBPDC is unable
to reach agreement on the actuarially verified proposals totaling $100 million
in cost savings before September 30, 2025, the SHBPDC shall immediately
commence the existing statutorily prescribed mediation and conciliation
procedure set forth in P.L.2011, c.78, and that process shall be concluded by
October 31, 2025; (4) if the SHBPDC is unable to reach agreement on cost
savings proposals totaling $100 million in actuarially verified savings
following the existing statutorily prescribed mediation and conciliation
procedure set forth in P.L.2011, c.78, the Legislature shall revise the
statutory framework set forth in P.L.2011, c.78 to determine a process by which
$100 million in actuarially verifiable cost savings shall be achieved for PY
2026 before December 1, 2025; (5) if the Legislature does not pass a bill
revising the statutory framework before December 1, 2025, then a representative
of the State selected by the Governor and a public employees� representative
selected by the State employees� and local employees� representatives on the
SHBPDC shall jointly select cost-saving changes to achieve $100 million in
actuarially verifiable cost savings.� In the event that the State
representative and the public employees� representative are unable to reach
agreement, then the Executive Director of the Office of Legislative Services
shall designate an additional representative and the three representatives
shall meet and vote to select cost-saving changes to achieve $100 million in
actuarially verifiable cost savings for the first six months of PY 2026 before
December 15, 2025.
]
���� 2.� This act shall take effect
immediately.
STATEMENT
���� This bill amends the language
provisions in the annual appropriations act for Fiscal Year 2026 to remove
language requiring the achievement of cost savings in State funds appropriated
for the Employee Benefits program classification.�
���� In its current form, the
annual appropriations act for Fiscal Year 2026 provides that $100 million in
actuarially verifiable cost savings must be achieved in the first six months of
Plan Year 2026 through a series of submissions of cost savings proposals by
representatives on the State Health Benefits Plan Design Committee (SHBPDC),
which are to be verified by the State actuary.� If the SHBPDC fails to pass the
proposals necessary to achieve the required cost savings, then the Legislature
is required to revise the statutory framework set forth in P.L.2011, c.78 to
achieve such savings.� Should the Legislature fail to pass a bill revising the
statutory framework, then a representative of the State selected by the
Governor and a public employees� representative selected by the State
employees� and local employees� representatives on the SHBPDC are required to
select cost-saving changes to achieve the $100 million in actuarially
verifiable cost savings.� If the two representatives cannot reach an agreement
to achieve such savings, the Executive Director of the Office of Legislative
Services is required to designate an additional representative.� The three
representatives are then required to meet and vote to select cost-saving
changes to achieve the $100 million in actuarially verifiable cost savings for
the first six months of FY2026.
���� This bill removes the language
provisions requiring the achievement of cost savings for the SHBP and outlining
the process for the achievement of such cost savings.