ASSEMBLY BUDGET COMMITTEE

STATEMENT TO

ASSEMBLY, No. 5877

STATE OF NEW JERSEY

DATED:  JUNE 26, 2025

      The Assembly Budget Committee reports favorably Assembly Bill No. 5877.

      This bill revises the assessment imposed on nursing homes if permissible under federal law.

      Under N.J.S.A.26:2H-96, each nursing home is to pay an assessment to the Director of the Division of Taxation in the Department of the Treasury, which when combined with the aggregate amount of assessments paid by all other nursing homes, is not to exceed six percent of the aggregate amount of annual revenues received by all nursing homes in accordance with 42 C.F.R. s.433.68(f)(3)(i).

      This bill amends N.J.S.A.26:2H-96 to provide that the assessment is to be either six percent or the maximum percentage that is permissible under federal law.

FISCAL IMPACT:

      The Office of Legislative Services (OLS) concludes that this bill will increase State revenues collected under the existing nursing home assessment, and deposited into the Nursing Home Quality of Care Improvement Fund, by an indeterminate amount. This estimate assumes that, in order to comply with the bill’s provision that revenues generated under the assessment are to equal six percent of the aggregate amount of annual revenues received by all nursing homes, the Department of the Treasury will need to increase the existing rate imposed on nursing homes.

      The revenues collected from the nursing home assessment are dedicated to increasing State expenditures on Medicaid reimbursements for nursing home services, thereby generating federal Medicaid matching funds.  Therefore, the annual increase in State revenue from the nursing home assessment under the bill will result in increased State Medicaid expenditures that also increase State revenue in the form of federal Medicaid reimbursements.