A6062

An Act concerning NJ FamilyCare and supplementing Title 30 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. As used in this act, “NJ FamilyCare” means the Medicaid program established pursuant to P.L.1968, c.413 (C.30:4D-1 et seq.) and the program established pursuant to P.L.2005, c.156 (C.30:4J-8 et al.) which includes the Children’s Health Benefits Program.

2. a. There is established in the Department of the Treasury a nonlapsing, revolving fund to be known as the NJ FamilyCare Stabilization Fund. This fund shall be the repository for monies appropriated pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill) and any other funds approved by the Department of Human Services. Moneys deposited in the fund, and any interest earned thereon, shall be used by the Division of Medical Assistance and Health Services in the Department of Human Services to maintain existing NJ FamilyCare services and benefits in any given fiscal year in which revenues from federal reimbursements of NJ FamilyCare expenditures are anticipated to decrease by 15 percent or greater when compared to the previous fiscal year.

b. The State Treasurer shall be the custodian of the fund and all disbursements from the fund shall be made by the State Treasurer upon requests made by the Commissioner of Human Services, provided that 60 percent of the fund balance as of July 1 of a fiscal year is the maximum amount that shall be disbursed in that fiscal year. The monies in the fund shall be invested and reinvested by the Director of the Division of Investment in the Department of the Treasury in the same manner as other trust funds in the custody of the State Treasurer in the manner provided by law. Interest received on the monies in the fund shall be credited to the fund.

c. Commencing on January 1 following the first appropriation into the fund pursuant to section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill), and annually thereafter:

(1) the State Treasurer shall provide a report to the Department of Human Services and the Legislature, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), on the status of the fund; and

(2) the Department of Human Services shall provide a report to the Legislature, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), documenting expenditures of monies from the fund in the previous calendar year, identifying the reasons why these expenditures were necessary to maintain existing NJ FamilyCare services and benefits, and providing projections for the use of monies from the fund in the current calendar year.

3. Commencing upon the effective date of the next annual appropriations act for the State fiscal year following the effective date of this act, and annually thereafter on each subsequent effective date of an annual appropriations act for a State fiscal year, there is appropriated five percent of State’s unreserved - undesignated General Fund balance, as indicated in the applicable annual appropriations act by subtracting the total appropriations for all State funds from the total resources for all State funds, to the NJ FamilyCare Stabilization Fund, established pursuant to section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill).

4. This act shall take effect immediately.

STATEMENT

This bill establishes the NJ FamilyCare Stabilization Fund, a nonlapsing, revolving fund in the Department of the Treasury. NJ FamilyCare is the State’s publicly funded health insurance program for low-income individuals, which includes Medicaid and the Children’s Health Insurance Program. The bill directs that five percent of the State’s unreserved - undesignated General Fund balance, as determined upon the enactment of the annual appropriations act at the start of each State fiscal year, is to be annually appropriated to the NJ FamilyCare Stabilization Fund. For reference, the FY 2026 Annual Appropriations provides an unreserved - undesignated fund balance $6.7 billion for the State. Under this bill, $335 million of those funds would be transferred to the newly established NJ FamilyCare Stabilization Fund in FY 2026.

The resources in the fund are to be used by the Division of Medical Assistance and Health Services in the Department of Human Services to maintain existing NJ FamilyCare services and benefits in any given fiscal year in which revenues from federal reimbursements of NJ FamilyCare expenditures are anticipated to decrease by 15 percent or greater when compared to the previous fiscal year. In any given fiscal year, the bill limits disbursement from the fund to 60 percent of the fund balance as of July 1 of the applicable fiscal year.

The bill requires that, commencing on January 1 next following the first appropriation into the fund, and annually thereafter: 1) the State Treasurer is to provide a report to the Department of Human Services and the Legislature on the status of the NJ FamilyCare Stabilization Fund; and 2) the Department of Human Services is to provide a report to the Legislature documenting expenditures of monies from the fund in the previous calendar year, identifying the reasons why these expenditures were necessary to maintain existing NJ FamilyCare services and benefits, and providing projections for the use of monies from the fund in the current calendar year.

On July 4, 2025 the federal law known as “The One Big Beautiful Bill Act” was adopted. This law makes sweeping changes to the Medicaid Program regarding eligibility and financing, which changes are projected to significantly reduce the amount of federal funding supporting the NJ FamilyCare Program in the coming years. This bill aims to help the State prepare for this and any future funding changes to the NJ FamilyCare Program as a means to ensure that the State’s most vulnerable residents can continue to have access to comprehensive health benefits.