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Bill

S 3996

Amends the definition of "developmental disability"

2025 Regular Session Introduced by Kevin Parker

Requires NJ health plans to reimburse via EFT, notify enrollees of EFT fees and how to opt in; DOBI enforces with penalties and requires reimbursement of any fees.

REPORTED AND COMMITTED TO DISABILITIES
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WeVote Research Nonpartisan
Bill Summary · S 3996

Summary of Bill S 3996 (New Jersey)

Overview

  • Bill Number: S 3996
  • Title: Amends the definition of "developmental disability" (note: the introduced text provided focuses on health insurance reimbursement practices rather than amending the definition of developmental disability).
  • Status: Reported and committed to Disabilities (as of May 21, 2025)
  • Introduced: January 14, 2025
  • Sponsor: Kevin S. Parker (primary)

What the bill seeks to do

The introduced version of S 3996 requires health insurance carriers (and their contracted vendors) to support reimbursement payments to covered persons via electronic funds transfer (EFT) and to inform enrollees about any EFT-related fees and how to opt for EFT. The bill also sets enforcement mechanisms and penalties for noncompliance.

Key Provisions

  • Electronic Funds Transfer (EFT) for Reimbursements
    • Carriers or their contracted vendors must allow reimbursement payments to be made to a covered person through EFT.
  • Notifications to Covered Persons
    • Carriers must include in the health benefits plan materials:
    • If EFT reimbursements incur a fee; and
    • Instructions (on the carrier’s or vendor’s website) on how to select EFT as the reimbursement method.
  • Enforcement and Penalties
    • The Department of Banking and Insurance (DOBI) has enforcement authority for violations.
    • DOBI must (a) provide notice and an opportunity to be heard, and (b) impose civil penalties under the Penalty Enforcement Law of 1999 if a violation is found.
    • The department must order the carrier to reimburse the covered person for any documented fees or charges incurred due to the violation.
  • Definitions (for purposes of this act)
    • Carrier: An insurance company, health service corporation, hospital service corporation, medical service corporation, HMO, dental service corporation, or dental plan organization authorized to issue health/dental plans in NJ.
    • Covered person: A person on whose behalf benefits or services are payable under the health benefits plan.
    • Health benefits plan: A plan delivering hospital/medical benefits in NJ, with certain exclusions (e.g., accident-only, disability, Medicaid, Medicare-related plans, workers’ comp-related coverage, auto medical payments, PIP, etc.).
  • Effective Date and Applicability
    • Takes effect on the 90th day after enactment.
    • Applies to reimbursement claims submitted under a health benefits plan initiated or renewed on or after the effective date.

Who Is Affected

  • Covered Persons: Individuals enrolled in health benefit plans offered by carriers in New Jersey.
  • Carriers and Vendors: Insurance companies, health service organizations, HMO, and related entities that issue or administer health benefit plans in NJ, and their contracted vendors.
  • Regulators: Department of Banking and Insurance (DOBI) with enforcement authority.

Procedural/Timeline Notes

  • Introduction & Committees:
    • Introduced January 14, 2025; referred to the Senate Commerce Committee.
    • As of May 21, 2025, reported and committed to the Disabilities committee (indicating progression toward potential floor consideration).
  • Related Legislation: Several companion and related bills exist (e.g., A 5188; various companion/S-related bills) for similar reforms or parallel purposes.

Practical Implications & Context

  • If enacted, most beneficiaries could choose EFT for reimbursements and would be informed about any EFT-related fees and how to enroll.
  • The bill imposes a regulatory compliance burden on carriers and provides DOBI with a formal enforcement mechanism, including civil penalties and required reimbursement of resulting fees to enrollees.
  • The substantive linkage to “developmental disability” in the bill’s title is not reflected in the introduced text provided; readers should monitor the final enacted language to confirm any definitional changes to “developmental disability.”

Bottom Line

S 3996 would standardize and simplify reimbursement payments by mandating EFT options and clear notifications about EFT fees, with regulatory oversight and penalties for noncompliance. Its progression suggests continued consideration by New Jersey committees with potential final passage in the Legislature.

Compiled from official sources — confirm details with the bill’s official record.

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