The Affordable Care Act (ACA), sometimes known as "Obamacare," passed the U.S. Congress two years ago. Many of its provisions have only just begun to take effect, and some will not take effect for several more years. One of its requirements is for each state to establish a health insurance exchange, which would allow, but not require, consumers to purchase health insurance in an open market system. The federal government will establish exchanges in any states that do not set up one of their own. Several people have recently published op-eds in New Jersey newspapers encouraging the state to set up an exchange. It could benefit small businesses by removing some of the burden of providing health insurance to employees.
According to New Jersey Newsroom, 1.3 million New Jersey residents, about 1 in 7 of the state's population, lack health insurance coverage. The total number of uninsured residents in 2010 was fifty percent higher than the number in 2000. This rate is much higher than the rate of increase nationwide. Increasing premiums are generally blamed for people's growing inability to afford insurance. Most people depend on employer-provided health insurance, as premiums tend to be much higher for insurance purchased directly by a consumer. Such a widespread lack of health care coverage can have a broader impact on a state's economy, as people cannot work due to health problems but cannot afford health care. This can lead to foreclosures and even business failures.
The ACA introduced a number of provisions to improve people's access to health insurance coverage. Many of these provisions, like the insurance mandate requiring people to purchase health insurance, have proven controversial and are the subject of court challenges. The law has had positive impacts on many people, though. The Philadelphia Inquirer reports, for example, that over 130,000 young adults in New Jersey and Pennsylvania, age 26 or less, may now obtain health insurance through plans held by their parents. This can lead, unfortunately, to increased costs for employers, as family-plan premiums are generally higher than plans covering one person or a married couple.
The proposed New Jersey Health Benefit Exchange Act would give consumers and small businesses the ability to shop for coverage plans that are better customized to their particular needs. According to bill sponsor Ruben J. Ramos, Jr., an Assemblyman from New Jersey's 33rd District, this system can save money for everyone involved, including the government, consumers, and employers.
To ensure that the exchange runs smoothly without conflicts of interest, the Health Benefit Exchange Act establishes strict guidelines for its governance. The governor and the state Legislature participate directly in selecting exchange commission members, ensuring the government's accountability for the exchange commission's performance. Individuals working directly in health care in insurance or hospital administration, or as a practicing physician, cannot serve on the commission. The commission will have an advisory board made up of "interested stakeholders," which includes small business owners.
The New Jersey business attorneys at Samuel C. Berger, PC offer fixed-fee packages of legal services to businesses and entrepreneurs who want to do business in New York and northern New Jersey. To speak to a member of our skilled legal team, contact us today online or at (212) 380-8117.
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