New Jersey to Charge Employers for Workers on Medicaid

New Jersey will begin charging employers for each worker and dependent covered by Medicaid. The fees range from $325 to $725 per person annually depending on the number of beneficiaries at the company. Gov. Mikie Sherrill signed the measure Tuesday night. The state budget approved earlier in the week includes the projected revenue.

California passed a bill this week directing state officials to study an employer charge for next year. Democratic candidate Xavier Becerra has included the idea in his platform for governor. State Sen. John Laird, sponsor of the California measure, said the federal tax and policy law signed by President Donald Trump last year increased the need for state action.

Legislation with similar goals passed one chamber in Colorado and Oregon this year. Connecticut Gov. Ned Lamont has proposed including an employer charge in the state budget that would take effect in two years.

The New Jersey Business and Industry Association said the fees penalize employers for circumstances they cannot control. Christopher Emigholz, the group's chief government affairs officer, issued a statement opposing the approach. Gideon Lukens of the Center on Budget and Policy Priorities said the policy could discourage companies from hiring workers from low-income households.

He added that employees might avoid enrolling in Medicaid to remain more attractive to employers. New Jersey's law exempts temporary, seasonal, and part-time workers. It also prohibits employment decisions based on Medicaid status. Earlier state efforts in Massachusetts and Maryland produced mixed results.

Massachusetts ended its program after one year. Maryland's 2006 measure was struck down in court after an industry challenge.