N.J. governor to propose new fees for companies whose workers rely on Medicaid

Gov. Phil Murphy wants businesses to cover a bigger portion of New Jersey’s health-care bill when their employees receive Medicaid benefits from the state.

As part of the governor’s 2021 budget, to be unveiled Tuesday, Murphy will call for a “corporate responsibility fee” on private employers that have at least 50 workers on the Medicaid rolls, according to a source in the administration.

Murphy’s $40.85 billion budget proposal is expected to include nearly $4.7 billion to fund Medicaid coverage for more than 1.6 million people.

The “corporate responsibility fee” would generate an estimated $180 million — about six times the amount of a similar proposal Murphy put forward last year, but that wasn’t enacted in the final budget.

Last year’s version envisioned a fee of $150 per employee on Medicaid. The fees in the 2021 proposal are heftier — and the more workers on Medicaid, the higher the per-worker fee a company would have to pay.

Companies with 50 to 500 workers on Medicaid, would be charged $325 per employee using state Medicaid benefits. Businesses would also have to pay the fee for their employees’ dependents on Medicaid.

The fee would go up to $525 at companies that employ 500 to 1,000 people on Medicaid. And it would riser to $725 for businesses with more than 1,000 workers receiving Medicaid.

The idea, the administration official said, is to give an incentive to businesses to offer better health-care benefits to their workers.

As it stands, the companies covered by the proposal employ about 200,000 Medicaid recipients, and those workers add another 250,000 people to Medicaid through their spouses and dependents, according to state estimates. That’s about a quarter of the population using Medicaid in New Jersey.

The governor’s budget proposal plans for $12.6 billion in total Medicaid spending, with 63%, or $7.9 billion, covered by federal funding and the rest picked up by the state.

Murphy, a Democrat, disclosed over the weekend that he has a tumor on his left kidney, and will undergo surgery in March to remove it.

“Health care is a right, not a privilege for a select few, and skyrocketing medical costs are a national emergency,” Murphy tweeted on Saturday. “If there’s anything my diagnosis reminds me of, it’s that preventative services are lifesaving and we need to continue fighting for affordable health care for all.”

In his State of the State address last month, the governor announced that he was establishing an Office of Health Care Affordability and Transparency to cut health-care costs, and to work with the state’s Department of Banking and Insurance to track what residents pay for medical services.

On Tuesday, Murphy is also looking to revive two other budget proposals, which the New Jersey Legislature didn’t take up last year.

The governor will again propose a fee on opioid manufacturers and distributors to help fund the state’s efforts to combat the opioid crisis, the administration official said. The measure would generate an estimated $20 million in revenue.

Another proposal would raise gun permit and license fees for the first time since 1966, generating about $8.5 million for the state.

For instance, the permit fee to purchase a gun would increase from $2 to $50, and a permit to carry would cost $400 instead of $20. The fee for a retail firearms dealer license would climb from $50 to $500.