New Jersey Administrative Code
Title 11 - INSURANCE
Chapter 21 - SMALL EMPLOYER HEALTH BENEFITS PROGRAM
Subchapter 1 - GENERAL PROVISIONS
Section 11:21-1.2 - Definitions
Words and terms contained in the Act, when used in this chapter, shall have the meanings as defined in the Act, unless the context clearly indicates otherwise, or as such words and terms are further defined by this chapter.
"Act" means P.L. 1992, c.162, as adopted and subsequently amended (17B:27A-17 et seq.), also referred to herein as the Small Employer Health Benefits Act.
"Affiliated carrier" means a carrier that directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, another carrier.
"Affiliated company" means a person that directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, another person. All persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 of the Internal Revenue Code of 1986 ( 26 U.S.C. § 414 ) shall be treated as one employer.
"Allowed charge" means an amount that is not more than the lesser of the allowance for the service or supply as determined by the standard approved by the Board as set forth at 11:21-7.1 3 or the negotiated fee schedule.
"Board" means the Board of Directors of the New Jersey Small Employer Health Benefits Program established by the Act.
"Carrier" means any entity subject to the insurance laws and regulations of this State, or subject to the jurisdiction of the Commissioner, that contracts or offers to contract to provide, deliver, arrange for, pay for, or reimburse any of the costs of health care services, including an insurance company authorized to issue health insurance, a health maintenance organization, a hospital service corporation, medical service corporation and health service corporation, or any other entity providing a plan of health insurance, health benefits or health services. The term "carrier" shall not include a joint insurance fund established pursuant to State law. For purposes of this chapter, carriers that are affiliated companies shall be treated as one carrier, except that any insurance company, health service corporation, hospital service corporation, or medical service corporation that is an affiliate of a health maintenance organization located in New Jersey or any health maintenance organization located in New Jersey that is affiliated with an insurance company, health service corporation, hospital service corporation, or medical service corporation shall treat the health maintenance organization as a separate carrier.
"Carrier coinsurance" means the percentage of a covered charge paid by a carrier.
"Cash deductible" or "deductible" means the amount of covered charges that a covered person must pay before the health benefits plan pays any benefits for such charges.
"Coinsurance" means the percentage of a covered charge that must be paid by a covered person. Coinsurance does not include cash deductibles, copayment, or non-covered charges.
"Commissioner" means the Commissioner of the New Jersey Department of Banking and Insurance.
"Copayment" or "copay" means a specified dollar amount a covered person must pay for specified covered charges.
"Department" means the New Jersey Department of Banking and Insurance.
"Dependent" means the spouse or child of a full-time employee subject to applicable terms of the employee's health benefits plan. For purposes of dependent eligibility only, the reference to "spouse" includes a civil union partner pursuant to P.L. 2006, c. 103, and same sex relationships recognized in other jurisdictions if such relationships provide substantially all of the rights and benefits of marriage, except that spouse shall be limited to spouses of a marriage as marriage is defined in Federal law with respect to the provisions of the Policy regarding continuation rights required by the Federal Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA), Pub. L. 99-272, as subsequently amended, and the provisions of the policy or contract regarding Medicare Eligibility by Reason of Age and Medicare Eligibility by Reason of Disability. At the option of the small employer, "spouse" includes a domestic partner pursuant to P.L. 2003, c. 246.
"Eligible employee" means a full-time, bona fide employee who works a normal work week of 25 or more hours. The term excludes a sole proprietor, a partner of a partnership, or an independent contractor and does not include employees who work less than 25 hours a week, work on a temporary or substitute basis, or are participating in an employee welfare arrangement pursuant to a collective bargaining agreement.
"Employee" means an individual who is an employee under the common law standard as described in 26 CFR 31.3401(c) -1. For purposes of determining whether an employer is a small employer, employee excludes an individual and his or her spouse when the business is owned by the individual or by the individual and his or her spouse, a sole proprietor, a partner in a partnership, and a two percent shareholder in a Subchapter S corporation as well as immediate family members of such individuals. Employee also excludes a leased employee.
"Employee open enrollment period" means the 30-day period each year designated by the small employer during which:
1. Employees and dependents who are eligible under the small employer's plan but who are late enrollees may enroll for coverage under the small employer's plan; and
2. Employees and dependents who are covered under the small employer's plan may elect coverage under a different policy, if any, offered by the small employer.
"Employer open enrollment period" means the period from November 15 through December 15 each year during which minimum participation and contribution requirements do not apply in accordance with 45 CFR 147.104 .
"Enrollment date" means, with respect to a person covered under a health benefits plan, the date of enrollment of the person in the health benefits plan or, if earlier, the first day of the waiting period for such enrollment. If an employee changes plans or if the employer transfers coverage to another carrier, the covered person's enrollment date does not change.
"Full-time employee" as used to determine eligibility for coverage under a small employer health benefits plan and satisfaction of participation requirements means an employee who works a normal work week of 25 or more hours per week. Note that the determination of small employer status in 11:21-7.2 uses a different definition of full-time employee.
"Group health plan" means an employee welfare benefit plan, as defined in Title I of section 3 of Pub.L. 93-406, the "Employee Retirement Income Security Act of 1974" ( 29 U.S.C. § 1002(1) ), to the extent that the plan provides medical care and including items and services paid for as medical care to employees or their dependents directly or through insurance, reimbursement or otherwise.
"Health benefits plan" means any hospital and medical expense insurance policy or certificate; health, hospital or medical services corporation contract or certificate; or health maintenance organization subscriber contract or certificate delivered or issued for delivery in this State by any carrier to a small employer group pursuant to section 3 of the Act (17B:27A-19 ), or any other similar contract, policy or plan issued to a small employer not explicitly excluded from the definition of health benefits plan. For purposes of this Act, "Health benefits plan" shall not include one or more, or any combination of, the following: coverage only for accident or disability income insurance, or any combination thereof; coverage issued as a supplement to liability insurance; liability insurance, including general liability insurance and automobile liability insurance; workers' compensation or similar insurance; automobile medical payment insurance; credit-only insurance; coverage for on-site medical clinics; and other similar insurance coverage, as specified in Federal regulations, under which benefits for medical care are secondary or incidental to other insurance benefits. Health benefits plans shall not include the following benefits if they are provided under a separate policy, certificate or contract of insurance or are otherwise not an integral part of the plan: limited scope dental or vision benefits; benefits for long-term care, nursing home care, home health care, community-based care, or any combination thereof; and such other similar, limited benefits as are specified in Federal regulations. Health benefits plan shall not include hospital confinement indemnity coverage if the benefits are provided under a separate policy, certificate or contract of insurance, there is no coordination between the provision of the benefits and any exclusion of benefits under any group health benefits plan maintained by the same plan sponsor, and those benefits are paid with respect to an event without regard to whether benefits are provided with respect to such an event under any group health plan maintained by the same plan sponsor. Health benefits plan shall not include the following if it is offered as a separate policy, certificate or contract of insurance: Medicare supplemental health insurance as defined under section 1882(g)(1) of the Federal Social Security Act ( 42 U.S.C. § 1395(g)(1) ); and coverage supplemental to the coverage provided under chapter 55 of Title 10, United States Code ( 10 U.S.C. § 1071 et seq.); and similar supplemental coverage provided to coverage under a group health plan.
"Health status-related factor" means any of the following factors: health status; medical condition, including both physical and mental illness; claims experience; receipt of health care; medical history; genetic information; evidence of insurability, including conditions arising out of acts of domestic violence; and disability.
"Late enrollee" means a full-time employee or dependent who requests enrollment in a health benefits plan of a small employer following the initial minimum 30-day enrollment period provided under the terms of the health benefits plan.
"Maximum out of pocket" means the annual maximum dollar amount that a covered person must pay as copayment, deductible, and coinsurance for all covered services and supplies in a calendar year. All amounts paid as copayment, deductible, and coinsurance shall count toward the maximum out of pocket. Once the maximum out of pocket has been reached, the covered person has no further obligation to pay any amounts as copayment, deductible, and coinsurance for covered services and supplies for the remainder of the calendar year.
"Medicaid" means the program administered by the New Jersey Division of Medical Assistance and Health Services Program in the New Jersey Department of Human Services, providing medical assistance to qualified applicants, in accordance with P.L. 1968, c.413 (30:4D-1 et seq.) and amendments thereto.
"Medical care" means amounts paid:
1. For the diagnosis, care, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body; and
2. Transportation primarily for and essential to medical care referred to in paragraph 1 above.
"Medicare" means coverage provided pursuant to Title XVIII of the Federal Social Security Act, Pub. L. 89-97 ( 42 U.S.C. § 1395 et seq.) and amendments thereto.
"Member" means a carrier that issues health benefits plans in New Jersey on or after November 30, 1992.
"Multiple employer arrangement" means an arrangement established or maintained to provide health benefits to employees and their dependents of two or more employers, under an insured plan purchased from a carrier in which the carrier assumes all or a substantial portion of the risk, as determined by the commissioner and shall include, but is not limited to, a multiple employer welfare arrangement, or MEWA, multiple employer trust or other form of benefit trust.
"Network maximum out of pocket" means the annual maximum dollar amount that a covered person must pay as copayment, deductible, and coinsurance for all services and supplies provided by network providers in a calendar year. All amounts paid as copayment, deductible, and coinsurance shall count toward the network maximum out of pocket. Once the network maximum out of pocket has been reached, the covered person has no further obligation to pay any amounts as copayment, deductible, and coinsurance for services and supplies provided by network providers for the remainder of the calendar year. If a carrier wishes to use a common maximum out of pocket provision in a plan that has both network and non-network benefits, the network maximum out of pocket shall mean the annual maximum dollar amount that a covered person must pay as copayment, deductible, and coinsurance for all services and supplies provided by network providers and non-network providers in a calendar year. All amounts paid as copayment, deductible, and coinsurance for both network and non-network services and supplies shall count toward the network maximum out of pocket. Once the network maximum out of pocket has been reached, the covered person has no further obligation to pay any amounts as copayment, deductible, and coinsurance for services and supplies provided by network or non-network providers for the remainder of the calendar year.
"Non-network maximum out of pocket" means the annual maximum dollar amount that a covered person must pay as deductible and coinsurance for all services and supplies provided by non-network providers in a calendar year. All amounts paid as deductible and coinsurance shall count toward the non-network maximum out of pocket. Once the non-network maximum out of pocket has been reached, the covered person has no further obligation to pay any amounts as copayment, deductible and coinsurance for services and supplies provided by non-network providers for the remainder of the calendar year.
"Plan sponsor" has the meaning given that term under Title I of section 3 of Pub.L. 93-406, the "Employee Retirement Income Security Act of 1974" ( 29 U.S.C. § 1002(16)(B) ).
"Program" means the New Jersey Small Employer Health Benefits Program established pursuant to the Act.
"Public health plan" means any plan established or maintained by a state, the U.S. government, a foreign country, or any political subdivision of a state, the U.S. government, or a foreign country that provides health coverage to individuals who are enrolled in the plan.
"Small employer" means in connection with a group health plan with respect to a calendar year and a plan year, an employer with a business location in the State of New Jersey who employed an average of at least one but not more than 50 employees on business days during the preceding calendar year; and who employs at least one employee on the first day of the plan year.
Any person treated as a single employer under subsection (b), (c), (m), or (o) of section 414 of the Internal Revenue Code of 1986 ( 26 U.S.C. § 414 ) shall be treated as one employer. Additionally, small employer includes an employer that employs more than 50 full-time employees if the employer's workforce exceeds 50 full-time employees for no more than 120 days during the calendar year and the employees in excess of 50 who were employed during such 120-day or fewer period were seasonal workers. As used in the definition of small employer, full-time means an employee works 30 or more hours per week.
"Small employer carrier" means any carrier that offers health benefits plans covering full-time employees of one or more small employers.
"Small employer health benefits plan" means a health benefits plan issued to small employers pursuant to 17B:27A-19.
"Standard health benefits plan" means a health benefits plan promulgated by the SEH Board, described at 11:21-3.1, and set forth in the Appendix to this chapter.
"State" means the State of New Jersey.
"Stop loss" or "excess risk insurance" means an insurance policy designed to reimburse a self-funded arrangement of one or more small employers for catastrophic, excess or unexpected expenses wherein neither the employees nor other individuals are third party beneficiaries under the insurance policy. In order to be considered stop loss or excess risk insurance for purposes of the Small Employer Health Benefits Act, the policy shall establish a per person attachment point or retention or aggregate attachment point or retention, or both, which meet the following requirements:
1. If the policy establishes a per person attachment point or retention, that specific attachment point or retention shall not be less than $ 20,000 per covered person per plan year; and
2. If the policy establishes an aggregate attachment point or retention, that aggregate attachment point or retention shall not be less than 125 percent of expected claims per plan year.
"Supplemental limited benefit insurance" means insurance that is provided in addition to a health benefits plan on an indemnity nonexpense incurred basis.
