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Tight Budget May Make It Tough to Master Health Benefit Exchange

Andrew Kitchenman | April 11, 2013

State officials see opportunity to succeed in enrolling residents with little funding.

While hundreds of thousands of New Jersey residents will be required to purchase health insurance by January 1 under the federal healthcare law, there will be limited funds available to help them compare policies and sort through options.

The federal government is providing $1.5 million to New Jersey to hire “navigators,” organizations that will assist residents in learning about and enrolling in the state health benefit exchange. That amount is less than 10 percent of the total recommended by New Jersey Policy Perspective, a nonprofit think tank that focuses on the needs of low- to middle-income residents.

The $1.5 million announced in the federal cooperative agreement to support navigators “will not be nearly enough,” said Raymond J. Castro, a senior policy analyst for the organization. He noted that Maryland plans to spend nearly $25 million on its outreach effort despite having many fewer uninsured.

However, state officials anticipate that residents will successfully enroll despite the limited funding. They cite the current success the state has in enrolling residents in Medicaid despite not having a separate budget for outreach.

Under the 2010 Affordable Care Act, every resident is required to purchase health insurance. Individuals and small employers will be able to buy insurance on the exchange, an online marketplace that will enable them to choose between different plans and learn whether they are eligible for federal subsidies.

New Jerseyans with income between 138 percent and 400 percent of the federal poverty line, currently $32,499 to $94,200 for a family of four, would be eligible for subsidies. Those below that income level will be eligible for Medicaid, the state and federally funded insurance program for low-income individuals and families.

Based on plans of other states, Castro estimated in a report issued Tuesday, link:http://www.njpp.org/assets/reports/NJPPstatesupportexchangeapril2013.pdf|State Support Essential for Success of Insurance Exchange], that New Jersey would require $18 million in funding to successfully enroll its residents, including $12 million in state funds and a $6 million federal match. Castro said that without an adequate outreach, the state risks having 186,000 fewer insured residents and losing $690 million in Medicaid funds.

Castro said Gov. Chris Christie’s decision to pursue a federally operated exchange has added several burdens to implementing it, since the insurance sold through the exchange must be integrated into a system that’s primarily regulated at the state level. The decision may also leave the state with fewer residents covered, Castro wrote in the report.

State Department of Human Services spokeswoman Nicole Brossoie said the state has a track record of enrolling residents in insurance through its Medicaid program, without spending money on advertising. She noted that the federal Department of Health and Human Services has given New Jersey a performance bonus for four consecutive years due to enrollment increase.

“As January 2014 approaches, we’ll be doing targeted outreach” for the state’s Medicaid program, Brossoie said in an email, adding that the state would be reaching out to “other populations through our partner government and community-based organizations.”

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