SENATE BUDGET AND APPROPRIATIONS COMMITTEE

STATEMENT TO

[First Reprint]

SENATE, No. 48

with Senate committee amendments

STATE OF NEW JERSEY

DATED: MARCH 7, 1996

      The Senate Budget and Appropriations Committee reports favorably Senate Bill No. 48 (1R) of 1996 with amendments.

      Senate Bill No. 48 (1R), as amended, requires hospital, medical or health service corporations, commercial health insurers, health maintenance organizations (HMO's), dental plan organizations and dental service corporations, or their subsidiaries that process health benefits claims as third party administrators, to demonstrate that they will adopt and implement standards established by the Commissioner of Insurance to receive, transmit and store health care claim information electronically.

      The Commissioner of Insurance, in consultation with the Healthcare Information Electronic Data Interchange Policy Council (established pursuant to Senate, No. 50 or Assembly, No. 1476 of 1996, now pending before the Legislature) will establish these demonstration standards, along with a timetable for adoption and implementation. The bill authorizes the commissioner to grant extensions or waivers of the implementation requirement if it is demonstrated that compliance with the timetable for implementation will result in an undue hardship to a carrier, subsidiary or its covered individuals or enrollees.

      The bill directs the commissioner, in establishing the standards, to:

      (1) Encourage the use of the electronic data interchange (EDI) network developed by the council;

      (2) Encourage carriers to issue patient identification cards or systems to covered individuals; and

      (3) Encourage and facilitate the development of privately owned and operated secure networks which are interconnected and available to all participants in the health care services delivery process.

      This bill is part of a legislative package designed to effectuate the recommendations of the Healthcare Information Networks and Technologies (HINT) report to the Legislature under the joint auspices of Thomas Edison State College and the New Jersey Institute of Technology.

COMMITTEE AMENDMENTS

      The committee amended the bill to include any subsidiary of a hospital, medical or health service corporation, health insurer, health maintenance organization, dental service corporation and dental plan organization that processes health care benefits claims as a third party administrator within the provisions of the bill.

      The amendment deletes the requirement that the demonstration standards include the receipt, transmission and storage of medical information. This is unnecessary for the purposes of the HINT package of bills.

FISCAL IMPACT

      This bill has not been certified as requiring a fiscal note because it will not have an impact on State or local government revenues or expenditures.