Assemblyman Herb Conaway introduced legislation (A 3368) today that would establish an electronic Health Information Technology ("e-HIT") Fund to be used to implement the objectives of the Statewide health information technology plan.  The Bill proposes that beginning April 1, 2009, and on a quarterly basis thereafter, each health care payer will pay a "technology reinvestment fee" into the e-HIT fund in an amount equal to 0.199% of one percent of all health care benefits claims paid by the payer for its New Jersey covered persons.  Payers that fail to pay the technology reinvestment fee would be subject to penalties

Not all health benefit plans will be subject to the fee, however.  The Bill excludes the following types of plans from having to pay the technology reinvestment fee:

  • Accident only
  • Credit
  • Disability
  • Long-term care
  • Workers’ compensation
  • Automobile medical payment insurance
  • PIP
  • Hospital confinement indemnity coverage
  • Medicaid
  • the New Jersey FamilyCare Program, and
  • any other State health care assistance program financed in whole or in part through a federal program, unless authorized by federal law and approved by the State.

Some have expressed concern that although private payers would bear the cost of the fee, significant savings that result from the implementation of a State-wide health information exchange would inure to excluded plans. 

Sustaining a RHIO once federal government HIT funding sources are no longer available is an issue that has led to the demise of dozens of RHIOs in previous years.  Congressman Conaway’s Bill attempts to address this issue.