LEGISLATIVE FISCAL ESTIMATE

[First Reprint]

SENATE, No. 1407

STATE OF NEW JERSEY

221st LEGISLATURE

 

DATED: JANUARY 13, 2025

 

 

SUMMARY

 

Synopsis:

Requires Medicaid coverage for community violence prevention services; establishes training and certification program for violence prevention professionals.

Type of Impact:

Annual impact on State costs and revenue.

Agencies Affected:

Department of Human Services; Department of Law and Public Safety; Department of Health.

 

 

Office of Legislative Services Estimate

Fiscal Impact

Annual

 

State Cost Impact

Indeterminate

 

State Revenue Impact

Indeterminate

 

 

 

 

·       The Office of Legislative Services (OLS) estimates that this bill will cause the State to incur annual Medicaid costs to provide community violence prevention services to certain individuals who receive health care services under the State’s Medicaid program.  The cost to provide these services cannot be quantified as: (1) the reimbursement rate for these services is not established under the bill; and (2) the number of individuals who will receive these services is unpredictable. These State costs will be partially offset by an increase in federal Medicaid reimbursements.

·       By way of context, based upon cost projections for an identical Medicaid benefit in Connecticut, the bill could cost the State $600,000 in net annual State expenses, provided that the State establishes a reimbursement rate of $12.65 per 15-minute block of service.  The OLS notes that research has also shown with the implementation of similar benefits, it is possible that these expenditures may result in an indeterminate decrease in medical costs covered under the Medicaid program associated with repeated injury, trauma, or poor health following victimization due to violence.  

·       The OLS concludes that the: 1) Department of Law and Public Safety will incur an indeterminate amount of annual costs under the bill to develop and administer a training and certification program for certified violence prevention professionals; and 2) Department of Health’s contribution to this effort, as required under the bill, will be implemented under the department’s existing budget as such tasks are largely supportive in nature and within the agency’s current scope of responsibilities.  The number of trainees and certification applicants under the bill, which is unknown and unpredictable, will be a significant factor in the amount of annual expenditures experienced by the division.

 

BILL DESCRIPTION

 

      The bill requires Medicaid coverage for community violence prevention services to an individual who has:  1) received medical treatment for an injury sustained as a result of an act of community violence, and 2) been referred by a certified or licensed health care provider or social services provider to receive community violence prevention services from a certified violence prevention professional.

      This bill also requires the Division of Consumer Affairs in the Department of Law and Public Safety, within six months of the effective date of the bill, to develop, in consultation with the Department of Health and the working group established by the bill, and administer a training and certification program for certified violence prevention professionals.  The division will issue a certification as a violence prevention professional to any individual who applies for certification and demonstrates eligibility for certification under the provisions of the bill.  The division may, at the director’s discretion, issue a temporary certification as a violence prevention professional under certain circumstances.  Such temporary certification will expire 24 months following the effective date of the bill.

 

 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received.

 

OFFICE OF LEGISLATIVE SERVICES

 

Fiscal Impact of Medicaid Coverage

      The OLS estimates that this bill will cause the State to incur annual Medicaid costs to provide community violence prevention services to certain individuals who receive health care services under the State’s Medicaid program.  The cost to provide these services cannot be quantified as: (1) the reimbursement rate for these services is not established under the bill; and (2) the number of individuals who will receive these services is unpredictable.  These State costs will be partially offset by an increase in federal Medicaid reimbursements. 

      For context, the bill mirrors legislation adopted in Connecticut in June of 2021.  According to the Medicaid State Plan Amendment submitted by the Connecticut Department of Social Services to the Centers for Medicare and Medicaid Services, the anticipated cost of the bill due to increased state and federal Medicaid expenditures in State Fiscal Year 2024 is $680,388, which is based on a reimbursement rate of $12.65 for each 15-minute block of services. 

      By way of comparison, Connecticut’s Medicaid enrollment as of June 2024 was 923,843, while New Jersey’s enrollment for the same time was 1,643,510, roughly 78 percent more than Connecticut’s enrollment.  Moreover, as community violence prevention services are frequently provided to individuals to prevent the spread of gun violence, the Centers for Disease Control and Prevention indicate that the two states have similar rates of gun deaths.  Assuming an identical reimbursement rate as Connecticut, and adjusting for the differences in Medicaid enrollment, it is estimated that this bill would result in an increase of $1.2 million Medicaid expenditures for New Jersey, of which the State would be responsible for $600,000.  To the extent that New Jersey’s reimbursement rate is higher, this estimate will increase; to the extent that New Jersey’s reimbursement rate is lower, this estimate will decrease. 

      It is possible that any increase in Medicaid expenditures under the bill may, over time, be offset by certain cost savings.  For example, a 2014 study examined the financial burden of violent injury on the Medicaid program, specifically with the implementation of hospital-based violence intervention programs services.  Similar to community violence prevention programs, hospital-based violence intervention programs are multidisciplinary programs that identify patients at risk of repeat violent injury and link them with hospital- and community-based resources aimed at addressing underlying risk factors for violence.  At the time of the study, it was suggested that if these services, costing $3,889 per patient, were provided to all violently injured hospitalized Medicaid patients in a single year, estimated at 7,383 individuals nationally, the total cost would be $29 million.  However, due to the prevention of violent re-injury, violent retaliation, and other adverse consequences associated with violent injury, the national saving to the Medicaid program would be $69 million, for a net savings of $40 million.  The OLS emphasizes that this example is regarding the national Medicaid program under the context of hospital-based violence intervention programs and not illustrative of the cost or cost savings of the bill in New Jersey.  

 

Fiscal Impact of Training and Certification Program  

      The OLS concludes that the Division of Consumer Affairs in the Department of Law and Public Safety will incur an indeterminate increase in annual costs under the bill in order to develop and administer a training and certification program for certified violence prevention professionals.  The number of trainees and certification applicants under the bill, which is unknown and unpredictable, will be a significant factor in the amount of annual expenditures experienced by the division. 

      The OLS notes that the requirements under this bill directed at the division mirror the division’s existing responsibilities.  Among other things, the division currently oversees the various professional and occupational boards in the State, and certifies the training programs of certain schools and agencies.  These activities are supported completely by fees and other receipts collected by the division.  To the extent that the division imposes fees for the trainees and certification applicants under the bill, the costs incurred by the division will decrease.  The bill neither imposes nor prohibits the use of such fees.

      The OLS further notes that the FY 2025 Appropriations Act provided $25.5 million from the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Fund for Violence Intervention Programs.  According to the State accounting system, all of these funds are unobligated; however, a press release from the Department of Law and Public Safety in September 2024 announced a $14.5 million competitive grant process to support Community-Based Violence Intervention Programs, beginning in 2025, with resources partially provided from the fund. 

      The OLS assumes that the Department of Health’s contributions to the division’s efforts regarding training and certification, as required under the bill, can be accomplished under the department’s existing budget as such tasks are largely supportive in nature and within the agency’s current scope of responsibilities.

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.).