New Jersey is launching a new fee on companies whose workers have Medicaid health coverage instead of being covered by their employers. This move is seen as a way to help pay for the joint federal and state insurance program that covers low-income residents, especially as federal policy changes are expected to make the program more expensive for states.

Background

Democratic lawmakers and governors view this approach as a matter of fairness, as employers benefit from having some lower-income workers with taxpayer-funded health coverage. However, business groups and some liberal policy organizations object to the plan, citing concerns that it could lead companies to employ fewer people from low-income households or make employees less likely to enroll in Medicaid.

The fee will be applied to companies with at least 50 workers covered by Medicaid, with the state budget expecting to raise $145 million this year from the program. The fees per person will start at $325 a year for companies with 50 to 249 Medicaid beneficiaries and top out at $725 annually for employers with at least 500 recipients.

Other States Consider Similar Measures

Other states, including California, Colorado, and Oregon, are considering or have considered similar measures. California passed a bill that directs the state administration to present lawmakers with options for implementing an employer charge next year. Connecticut Governor Ned Lamont has also called for a similar move in his state.

Opponents argue that the approach is unfair and could have unintended consequences, such as discouraging companies from hiring workers who might be eligible for Medicaid. Proponents, on the other hand, see it as a necessary step to ensure the sustainability of the Medicaid program.

Original reporting: 40/29 / KHBS (NW Arkansas) — read the source article.