Office of Legislative Services
State House Annex
P.O. Box 068
Trenton, New Jersey 08625
Legislative Budget and Finance Office
Phone (609) 847-3105
Fax (609) 777-2442
www.njleg.state.nj.us
LEGISLATIVE FISCAL ESTIMATE
ASSEMBLY, No. 4275
STATE OF NEW JERSEY
221st LEGISLATURE
DATED: FEBRUARY 14, 2025
SUMMARY
Synopsis: Prohibits SHBP, SEHBP, and Medicaid from denying coverage for
maintenance medications for chronic conditions for covered persons
solely because of change in health benefits plan or pharmacy benefits
manager.
Type of Impact: Annual expenditure increase to the State and participating local
entities.
Agencies Affected: Division of Pensions and Benefits in the Department of the Treasury.
Office of Legislative Services Estimate
Fiscal Impact Annual
State Expenditure Increase Indeterminate
Local Expenditure Increase Indeterminate
The Office of Legislative Services (OLS) estimates that preventing persons covered under
contracts issued or purchased by the State Health Benefits Commission or the School
Employees’ Health Benefits Commission from losing coverage for maintenance medications
for chronic conditions because of a change in health benefits plan or pharmacy benefits
manager will result in an indeterminate annual expenditure increase to the State and
participating local entities.
The OLS finds that the bill’s provisions will not impact State Medicaid expenditures.
BILL DESCRIPTION
This bill prevents persons covered under contracts issued or purchased by the State Health
Benefits Commission, the School Employees’ Health Benefits Commission, or the State Medicaid
Program from losing coverage for maintenance medications for chronic conditions when the loss
of coverage in pharmaceutical benefits results solely from a change in the covered person’s health
benefits plan or the pharmacy benefits manager for that plan. Under the bill, the covered person FE to A4275
2
needs to have been taking the medication before the change in the plan or pharmacy benefit
manager, and that class of drug must be covered under the new plan or pharmacy benefit manager.
FISCAL ANALYSIS
EXECUTIVE BRANCH
None received.
OFFICE OF LEGISLATIVE SERVICES
The OLS estimates that prohibiting contracts issued or purchased by the State Health Benefits
Commission or the School Employees’ Health Benefits Commission from denying coverage for
maintenance medications for chronic conditions for covered persons when the denial results solely
from a change in health benefits plan or that plan’s pharmacy benefits manager will result in an
indeterminate annual expenditure increase to the State, to local governments that participate in the
State Health Benefits Program, and to school districts that participate in the School Employees’
Health Benefits Program.
The annual expenditure increase will depend on the number of covered persons who would
otherwise have lost coverage for a maintenance medication for a chronic condition due solely to a
change in health benefits plan or pharmacy benefits manager and the extent to which the new plan
or pharmacy benefits manager provides coverage for that same medication. The OLS is unable to
determine the number of persons who will be impacted under the bill or the coverage requirements
of the prospective new health benefits plan or pharmacy benefits manager.
The OLS finds that the bill’s provisions will not impact State Medicaid expenditures. The
current contract between the Medicaid managed care organizations and the Division of Medical
Assistance and Health Services in the Department of Human Services stipulates that an enrollee
who is receiving a prescription medication that was on the managed care organization’s formulary
and subsequently removed or changed will be allowed to continue to receive this medication, if
requested by the prescriber and the enrollee, for as long as the enrollee is a member of the managed
care plan.
Section: State Government
Analyst: Anna Harris
Associate Fiscal 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.).