New Jersey Develops Health Care Cost Growth
With the Health Care Cost Growth Benchmark Program, New Jersey is taking another important step to make health care more affordable and transparent. We know that health care costs have grown faster than the economy for decades and continue to be on the rise. Increasing costs are burdening New Jersey families, businesses and the State, resulting in decreased funding for other important priorities including, for example, education and housing. Many states do not have a complete understanding of health care spending and what is driving unsustainable increases. As a result, initiatives to address health care spending can be ineffective or have unintended side effects, such as simply shifting, rather than decreasing, costs across heath providers, payers, employers, and patients.
This Program supports state-led activities that engage cross-sector stakeholders in designing, adopting, and implementing policies to measure health care costs, analyze its drivers and set a statewide health care cost growth rate target.
About the New Jersey Cost Growth Benchmark Program
On January 28, 2021 New Jersey Governor Phil Murphy signed Executive Order 217 which directs the Office of Health Care Affordability and Transparency to lead efforts to identify opportunities across all sectors to advance the shared goals of improved health care affordability, accessibility, and transparency. “Despite the progress we’ve made, health care costs continue to be a challenge for New Jersey residents, employers, and the State. Throughout this past year, our health care workforce has come together selflessly in service to our residents. The time is now to build on this collective spirit to more fully transform our health care system to make it more equitable, accessible, and affordable,” said Governor Murphy in a press release announcing the Order.
Key features of this Order include:
- Convening an Interagency Working Group (IWG), Chaired by the Director of the Office of Healthcare Affordability and Transparency, to determine the Cost Growth Benchmark value and inform the implementation strategy.
- Creating a Health Care Affordability Advisory Group comprised of health care industry leaders, consumer advocates, and policy leaders to guide the IWG’s development and implementation of the cost growth benchmark program.
- Directing the New Jersey Department of Banking and Insurance to spearhead plans for the development and implementation of both the health care Cost Growth Benchmark and health insurance affordability standards to ensure consumer protection and increased oversight and accountability.
Support for the Cost Growth Benchmark Program
To advance this work, New Jersey is taking part in the Peterson-Milbank Program for Sustainable Health Care Costs, launched by the Peterson Center on Healthcare and the Milbank Memorial Fund. The program supports state-led activities that engage cross-sector stakeholders in designing, adopting, and implementing policies to measure health care costs and set state-wide health care cost growth rate benchmarks. With the Peterson Center on Healthcare’s support, the Milbank Memorial Fund and Bailit Health will provide technical assistance to set and implement health care cost growth benchmarks as a first step toward making health care more affordable and transparent. Rutgers Center for State Health Policy is providing analytic and strategic guidance in support of the State’s efforts.
Frequently Asked Questions (FAQ’s)
Cost Growth Benchmark Program Informational Webinar Slide Decks
Advisory Group Documents
Interagency Working Group and Advisory Group Member Rosters
Summaries of Advisory Group Meetings
State Cost Growth Benchmark Models
Join the New Jersey Benchmark Program mailing list to receive information and updates about the Program.