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Legislative Updates

Assembly Appropriations Committee Passes Bills to Increase Health Insurance Tax & Workers’ Compensation Costs

219th Legislative Session Health Issues Updates Legislative Updates State Budget Updates

On July 27, the Assembly Appropriations Committee, by a vote of 7-4, released from committee A-4389 (McKeon), which would implement a new tax on fully insured health insurance premiums for health benefits plans.

The intended purpose of A-4389 (McKeon) is to provide more affordable access to health care in New Jersey, a concept that the CCSNJ undeniably supports. However, this proposal will inevitably lead to higher health insurance premiums for employers that already struggle to afford health insurance coverage for their employees. Should the tax increase proposed in this bill go into effect, the higher premiums will trickle down increasing the cost of insurance for employees at a time when families can ill-afford it.

A-4389 (McKeon) was amended in the Assembly Appropriations Committee to make the following positive changes to the bill:

The new tax rate was lowered from 2.75 percent to 2.5 percent

Multiple employer welfare arrangements, otherwise known as MEWAs, small group and nonprofit dental plans are now excluded from the tax

Although the CCSNJ appreciates the concessions made by the bill’s sponsors, given the impact this legislation will have on the large group market the CCSNJ remains opposed.

The bill now moves to the full Assembly for a vote on Thursday, July 30. The Senate version is awaiting consideration by the Senate Budget & Appropriations Committee.

To read the Coalition letter, which the CCSNJ co-signed, opposing this bill, click here.

To read the CCSNJ position on the bill, click here. 

The Assembly Appropriations Committee also released, by a vote of 7-4, A3999/S2380 (Giblin / Burzichelli / Murphy / Sweeney / Scutari / Singer) which would create a rebuttable presumption, for workers’ compensation insurance purposes, that certain essential employees contracted COVID-19 during the scope of their employment.

The CCSNJ wholeheartedly agrees that those employees who contracted COVID-19 during the course of their employment should have benefits made available to them. However, the Federal Pandemic Unemployment Assistance (PUA) already provides funding for employees who are unable to work due to COVID-19 related reasons. Additionally, the CCSNJ argues this legislation could potentially overwhelm New Jersey’s workers’ compensation system.

A3999/S2380 ( Giblin/Buzichelli/Murphy/Sweeney/Scutari/Singer) was amended in committee to clarify that a state employee who is offered the option of working at home but refused shall not be regarded as an essential employee.

The bill now moves to the full Assembly for a vote on Thursday, July 30.

To read the CCSNJ position on the bill, click here. 

Please reach out to Hilary Chebra, Manager, Government Affairs, at if you have any questions.

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