News Release

New Jersey Department of
Banking and Insurance

Commissioner Marlene Caride

For Immediate Release:
July 27, 2018

For Further Information:
Trish Graber (trish.graber@dobi.nj.gov)
or Marshall McKnight (marshall.mcknight@dobi.nj.gov)
(609) 292-5064

TRENTON – The New Jersey Department of Banking and Insurance today released figures on the requested health insurance rates submitted to the department by insurance carriers for 2019.

The average requested rate increase in the individual market is 5.8 percent. Carriers indicated that without the recent enactment of the law to continue an individual mandate in New Jersey, the average requested rate increase would have been 12.6 percent. For 2019, carriers requested a 5.2 percent average increase in rates in the small employer market.

“New Jersey is working aggressively to ensure that residents have access to affordable quality coverage, and actions taken by the state to improve the market are reflected in the rates submitted. Under the leadership of Governor Murphy, New Jersey is leading the nation in its efforts to create stability in the market and to combat the uncertainty created by Washington. Carriers were clear that without state action, the average increase requested in the individual market would have more than doubled,” said Department of Banking and Insurance Commissioner Marlene Caride. “We are pleased that the initial rate filings demonstrate concrete results from state efforts. The department is now undertaking its review process to determine if all rates submitted for the individual and small employer markets are justified and comply with the law.”

Policies in Washington aimed at dismantling the Affordable Care Act have created enormous uncertainty in insurance markets nationwide. The repeal of the individual mandate as part of the federal Tax Cuts and Jobs Act has led to requested rate increases in states across the country. The federal government has also advanced rules to permit the sale of short-term limited duration plans and association health plans that do not comply with the ACA, stalled Risk Adjustment Payments to carriers and slashed funding for health care navigators that assist consumers with enrolling in coverage.

Despite the federal actions, New Jersey’s work to stabilize its insurance market has significantly moderated requested rate increases. On average, carriers have approximated that rate requests would have been 6.8 percent higher if the individual mandate had not been continued in New Jersey. In addition, New Jersey has submitted an application for a section 1332 state innovation waiver to the federal government to allow for the creation of a reinsurance program, as provided for by state law, to help reduce premium increases in the individual market. The Department is seeking federal funding to help achieve a 15 percent reduction in the rates for plan year 2019, compared to what they would be without a reinsurance program. If the application is approved, the rates for individual health coverage plans would reflect further changes to account for the 15 percent reduction.

The tables below specify the average rate changes reflected in the proposed rates for both the individual and small employer markets. The rates were filed with the department by carriers on July 18. The department is currently reviewing the proposed rates to ensure they are justified and in compliance with the law. Final rates are expected to be released in the fall.

Proposed Rate Changes for Individual Health Coverage Plans

Proposed Rate Changes for Small Employer Health Benefits Plans