LEGISLATIVE FISCAL ESTIMATE

ASSEMBLY, No. 4863

STATE OF NEW JERSEY

221st LEGISLATURE

 

DATED: JULY 21, 2025

 

 

SUMMARY

 

Synopsis:

Requires NJ FamilyCare payment for multiple medical encounters per day for enrollee at federally qualified health center.

Type of Impact:

Annual State expenditure and revenue increases.

Agencies Affected:

Department of Human Services.

 

Office of Legislative Services Estimate

Fiscal Impact

Annual

 

State Expenditure Increase

Indeterminate

 

State Revenue Increase

Indeterminate

 

 

 

 

·         The Office of Legislative Services (OLS) concludes that this bill will increase State expenditures under the NJ FamilyCare program by an indeterminate amount due to an increase in the number of encounters at federally qualified health centers that are reimbursable under NJ FamilyCare.  These increased costs concomitantly will grow annual State revenue in the form of federal Medicaid and Children’s Health Insurance Program cost reimbursements.

·         The OLS cannot predict the number of new reimbursable encounters that would result under the bill, and therefore cannot quantify the fiscal impact of the bill.  For reference, however, it is estimated that nearly 320,000 NJ FamilyCare enrollees receive services from a State federally qualified health center.  Each additional encounter under the bill would increase State costs by either $233.59 or $241.09, depending on the center providing the service.  On average, the federal government provides $0.64 in matching funds for every $1.00 in qualifying State NJ FamilyCare expenditures.

 

 

BILL DESCRIPTION

 

      This bill requires NJ FamilyCare to reimburse for multiple medical encounters with federally qualified health center specialists per day for an enrollee, provided: the referring provider documents the reason for each specialist referral; each encounter is with different specialist; and NJ FamilyCare reimbursement for multiple encounters per day at a center does not violate federal statute.

 

 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received.

 

OFFICE OF LEGISLATIVE SERVICES

 

      The OLS concludes that this bill will increase State expenditures under the NJ FamilyCare program by an indeterminate amount due to an increase in the number of encounters at federally qualified health centers that are reimbursable under NJ FamilyCare.  These increased costs concomitantly will grow annual State revenue in the form of federal Medicaid and Children’s Health Insurance Program cost reimbursements. 

      Currently, only one medical encounter at a federally qualified health center is covered per beneficiary, per day.  Pursuant to the New Jersey Administrative Code, the only exceptions are: 1) when the beneficiary is seen by more than one licensed practitioner for the prevention, treatment, or diagnosis of different injuries or illnesses, and practitioners of appropriate different specialties are involved; and 2) when the beneficiary leaves the center after having been seen by a practitioner, then returns to the center and is seen by another practitioner on the same day.  This bill would expand the exceptions to include when the beneficiary has multiple encounters in one day with different specialists in which the referring provider documents the reason for each specialist referral.

      The OLS cannot predict the number of new reimbursable encounters that would result under the bill, and therefore cannot quantify the fiscal impact of the bill.  For reference, New Jersey has 24 federally qualified health centers.  As of January 2025, 11 of these entities have an NJ FamilyCare encounter rate of $233.59 and 13 have an encounter rate of $241.09.  According to KFF, a non-profit organization, in 2023 federally qualified health centers received $242.1 million in revenue from NJ FamilyCare.  The New Jersey Primary Care Association estimates that the centers served 319,260 NJ FamilyCare enrollees in 2023.  

      For illustration purposes, if 25 percent of NJ FamilyCare enrollees receiving services through a federally qualified health center, or 79,815 individuals, each received one additional service per year that was eligible for reimbursement under the bill, the annual State cost increase would be between $18.6 million and $19.2 million.  Of this amount, the State would be reimbursed approximately between $11.9 million and $12.3 million in federal Medicaid reimbursements, for a net State cost of between $6.7 million and $6.9 million.  For reference, on average, the federal government provides $0.64 in matching funds for every $1.00 in qualifying State NJ FamilyCare expenditures.

 

Section:

Human Services

Analyst:

Sarah Schmidt

Principal Research Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

 

This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

 

This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).