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Schaer & Weinberg Disappointed in Christie’s Veto of Legislation to Protect Access to Quality Healthcare Services for NJ’s Most Vulnerable

Hope to Work with Stakeholders to Ward Off Arbitrary Insurance Reimbursement Decreases that Would Effect Quality of Home Health Services

Senate Majority Leader Loretta Weinberg and Assembly Budget Committee Chair Gary Schaer expressed their disappointment and frustration over Gov. Christie’s decision to veto legislation they sponsored that would have helped protect access to quality healthcare services for some of New Jersey’s most vulnerable residents by carefully monitoring insurance reimbursement rates.

“Our aim with this legislation was to prevent indiscriminate reimbursement rate cuts by insurers prior to their taking all of the appropriate action to reduce costs,” said Weinberg (D-Bergen). “The governor’s rejection of this patient-protection bill is incredibly disappointing. We will continue to work with providers and other interested parties on this effort in the new session to increase state oversight of HMO rate changes and ensure that quality care is maintained for our most defenseless residents.”

“The Governor’s veto is plain wrong. A decent living wage to those who serve on the front lines of healthcare shouldn’t be up for debate,” said Schaer (D-Bergen/Passaic). “I am deeply troubled by this veto because this legislation would have protected our most vulnerable patients from HMOs increasing health care costs without the proper oversight and examination. This legislation would have ensured managed care organizations are not arbitrarily cutting rates to the providers that care for the patients they serve.”

The bill (A-3409) would have prohibited health maintenance organizations (HMO) that contract with the state Department of Human Services (DHS) to provide benefits for Medicaid and the NJ FamilyCare program from reducing reimbursement rates to participating health care providers in those plans without obtaining prior written approval from the Commissioner of Human Services.

In FY 2012, the state moved almost 155,000 people from fee-for-service Medicaid programs into HMOs, with almost half of those people going to Horizon Blue Cross. In September 2012, Horizon notified health-care agencies that it was cutting the reimbursement rate for personal care aides by 10 percent, from $15.50 per hour to $13.95 per hour. Horizon later delayed the cut and reduced the decrease to 4.5 percent.

The lawmakers noted that with reimbursement rates already so low many agencies are challenged to recruit and keep home health aides. Home health aides treat the most vulnerable clients and anecdotal information indicates the average salary for the 30,000 home health aides working in New Jersey is approximately $20,000 per year.

“This bill was intended to be a safeguard to help ensure that potential rate reductions will not adversely impact the quality of personal care aides and the healthcare services they provide to eligible beneficiaries,” added Schaer. “I welcome the opportunity to work with Governor Christie, HMOs and various stakeholders to ensure that insurance companies have taken all appropriate action to properly manage the care of these populations before jeopardizing the access to care for our most vulnerable citizens.”