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Frequently Asked Questions

About the State Health Benefits Program's Plan Changes
ve July 2007

The following are frequently asked questions:

1. Q. Are employees who are only enrolled for prescription drug coverage still required to contribute 1.5% of base salary?

A. Yes. The 1.5% contribution is required regardless of whether the employee is in the medical plan or a prescription drug plan or both.

2. Q. Is there a maximum base annual salary on which the health contribution is based?

A. No. The 1.5% health contribution is based on the participating employee’s base annual salary.

3. Q. What is the effective date of the changes?

A. The contribution change will occur the first full pay period in July. The copayment changes will occur July 1 (State monthly employees) or July 7 (State biweekly employees).

4. Q. How do we calculate imputed income for domestic partners or for couples in a civil union?

A. The imputed income is the full premium for Single coverage.  There is no reduction based on the 1.5% contribution.

5. Q. When will ID cards be distributed?

A. The distribution of ID cards will begin the week of June 17th.

6. Q. What proof is required for an employee to waive coverage for other health coverage?

A. The only requirement is that the employee completes the State Employee Waiver/Reinstatement form certifying that the employee has other health coverage and submit it to employer along with the SHBP Application indicating the waiving of coverage. The employer will complete “Part 2” of the waiver form and forward it to the SHBP. If an employee has previously waived coverage in the SHBP, there is no need for that employee to submit another waiver.

An employee may reinstate SHBP coverage under the provisions of HIPAA by submitting the State Employee Waiver/Reinstatement form and Application with proof of the loss of other health coverage within 60 days of that loss or during open enrollment.

7. Q. How will the contribution for retirees be determined for those in the ABP.

A. The calculation of the health contribution for retirees of the ABP has not been determined at this time.

8. Q. If a member has a medical intolerance of a generic equivalent of a brand name drug, will the member still be required to pay the $25 copayment?

A. In the event that a member is unable to take the generic equivalent of a brand medication due to a therapeutic failure or intolerance to the generic equivalent, the member will be able to receive the brand name drug.  This will require that the member’s physician obtain prior authorization for the brand medication based on the failure or intolerance to the generic equivalent.  If the physician’s request for the use of the brand name drug is approved, the member will receive the brand name drug and will only be required to pay the brand copayment. See also: Third Tier Copayment Exception.

9. Q. Are the health contributions still “pre-tax”?

A. If the employee is enrolled in the Premium Option Program (POP), then the health contributions will be considered pre-tax for federal income and Social Security tax purposes. If the employee has declined enrollment in POP, the contribution will be on an after-tax basis. If the employee does not decline participation in POP during the annual open enrollment, the employee will be eligible to participate in POP with the start of each calendar year.

10. Q. Are extra deductions required for 10-month employees to cover the period of July and August when they receive no income?

A. No. Beginning with the school year that begins in September 2007, a 10-month employee’s health contribution will be based on the 10-month annual base salary. Extra deductions will not be necessary next June for SHBP coverage for the months of July and August.

11. Q. If an employee is granted a leave of absence, on what salary should we base the health contribution?

A. The employee health contribution should be based on 1.5% of the current annual base salary.

12. Q. If an employee receives a retroactive increase in salary, do we need to take a health contribution for the retroactive portion of the increase?

A. The 1.5% health contribution would be required for any retroactive increase in salary for any period covered after July 1, 2007. For example, an employee receives an increase in base salary in September retroactive to June 1st. A health contribution would be due for the difference in salary for the months of July and August.

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Copyright State of New Jersey, 1996-2005
Division of Pensions and Benefits
PO Box 295
Trenton, NJ 08625-0295

All Technical issues regarding this Web site should be sent to the Division of Pensions and Benefits Webmaster.

Last Updated: June 18, 2007