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Senate Commerce Committee Statement to Assembly, No. 4538 (February 11, 2021)

Summary

Senate Commerce Committee Statement to the First Reprint of Assembly Bill No. 4538 with committee amendments, State of New Jersey, dated February 11, 2021. The bill requires certain insurance companies and dental plan organizations to provide credits for reduced usage during the coronavirus disease 2019 pandemic. Under the bill, every carrier writing dental insurance plans issues a credit equivalent to the value of any reduced claims experience for the period beginning on March 27, 2020 and ending on May 26, 2020. The committee amendments include changing a reporting date for the Department of Banking and Insurance to May 31, 2021 from December 31, 2020. The statement says the amended bill is identical to Senate Bill No. 3131.

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“Senate Commerce Committee Statement to Assembly, No. 4538 (February 11, 2021).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2021-02-11-scm-a4538-s2-b184bd3388/, SHA-256 9f5304b178a9044635ea798e900757027743201bff3e30b58aa321ab647ff49f.

Full text

     SENATE COMMERCE COMMITTEE

                    STATEMENT TO

                       [First Reprint]
               ASSEMBLY, No. 4538
                   with committee amendments



 STATE OF NEW JERSEY
                  DATED: FEBRUARY 11, 2021

    The Senate Commerce Committee reports favorably and with
committee amendments Assembly Bill No. 4538.
   This bill requires certain insurance companies, health, hospital,
medical, and dental service organizations, and dental plan
organizations to provide credits for reduced usage during the
coronavirus disease 2019 pandemic. The provisions of the bill do
not apply to any entity that:
   (1) issued a credit or refund to policyholders in an amount
equivalent to 50% or more of one month’s premium for each
policyholder for the period of March through June 2020;
   (2) waived frequency limits for the 2020 plan year;
   (3) waived deductibles or maximum annual rollover limitations;
or
   (4) has taken any actions to assist policyholders that the
Commissioner of Banking and Insurance deems sufficient to excuse
the entity from the provisions of the bill.
   Under the bill, every carrier writing dental insurance plans in this
State is to issue to each policyholder in good standing with a plan
that was in effect on March 27, 2020, regardless of whether the plan
has since been terminated, a credit in an amount equivalent to the
value of any reduced claims experience due to the limitations of
dental services for the period beginning on March 27, 2020 and
ending on May 26, 2020. The credit may be returned to the
policyholder in the form of a direct refund, or credit toward future
premiums, and shall apply to both fully paid and monthly billed
policies. Policyholders shall not be required to take any action to
receive the refund or credit. The bill prohibits a carrier from
conditioning the issuance of the credit on the renewal of the plan by
the policyholder.
   Under the bill, every insurer is to provide to the Department of
Banking and Insurance a report containing all actions taken, and
contemplated future actions, to reduce premiums in compliance
with the bill. The information provided in each report shall reflect
activity through the preceding month’s end.
                                  2

  As amended and reported, this bill is identical to Senate Bill No.
3131, as also amended and reported by the committee.

COMMITTEE AMENDMENTS:
    The committee amended the bills to:
    (1) require a carrier subject to the provisions of the bill to issue a
credit to each policyholder pursuant to the bill without regard to
whether the policyholder’s plan has since been terminated;
    (2) prohibit a carrier from conditioning the issuance of the credit
on the renewal of the plan by the policyholder;
    (3) change the date by which a carrier is to provide certain
information to the Department of Banking and Insurance to May 31,
2021 from December 31, 2020;
    (4) make certain changes to the requirements for exemption from
the provisions of the bill;
    (5) define the term “dental benefits plan”; and
    (6) clarify that the bill does not apply to certain provider network
contracts for dental services.

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