Employers' Pensions and Benefits Administration Manual (EPBAM)
   

 

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The State Health Benefits Program (SHBP) and the
School Employees' Health Benefits Program (SEHBP)


The information covered in this section of the Manual is very extensive.  Each of the items listed below is a link to a specific topic discussed concerning the State Health Benefits Program and the School Employees' Health Benefits Program. It may be helpful to begin reading the "Introduction" of this section and continue through the description of each of the plans offered by SHBP and SEHBP in order to get an overview of the programs.  

Specific topics can be accessed through the links below, and any necessary forms will be accessible from there.

TABLE OF CONTENTS

General Information

Introduction - SHBP

Introduction - SEHBP

SHBP/SEHBP Component Plans

Medical Plans, General

Medical Plan for:

Part-time State Employees and Part-time Faculty Members

Intermittent State Employees

National Guard Members

SHBP/SEHBP Benefits under the Civil Unions Law

Medical Plans and the Domestic Partnership Act

Prescription Drug Plans

Employee Dental Plans

Retiree Dental Expense Plan

Employer Participation

Employer Enrollment

Employer Enrollment in the NJ SHBP Dental Plans

Termination of Employer Participation

Termination of Employer Participation in the NJ SHBP Dental Plans

Employer Support Tasks

Employee Enrollment, Changes, Termination, Waivers

Available Handbooks

Summary Program Description

Prescription Drug Plans

Employee Dental Plans Member Handbook

NJ State Employee Group Dental Plan Book

NJ DIRECT Member Handbook

Aetna Member Handbook

CIGNA HealthCare Member Handbook

Retiree Dental Expense Plan Member Handbook

Other Links

SHBP/SEHBP Main Page for Employees

SHBP/SEHBP Financial

COBRA-HIPAA Information

The Centers for Medicare and Medicaid Services (CMS) and COBRA Continuation of Coverage

COBRA Rates

 

 


Introduction

The State Health Benefits Program (SHBP) was established in 1961. It offers medical and prescription drug coverage to qualified State and local government public employees, retirees, and eligible dependents; and dental coverage to qualified State and local government/education public employees, retirees, and their eligible dependents. Local employers must adopt a resolution to participate in the SHBP.

The State Health Benefits Commission (SHBC) is the executive organization responsible for overseeing the SHBP.

The State Health Benefits Program Act is found in the New Jersey Statutes Annotated, Title 52, Article 14-17.25 et seq. Rules governing the operation and administration of the program are found in Title 17, Chapter 9 of the New Jersey Administrative Code.

The School Employees' Health Benefits Program (SEHBP) was established in 2007. It offers medical and prescription drug coverage to qualified local education public employees, retirees, and eligible dependents. Local education employers must adopt a resolution to participate in the SEHBP.

The School Employees' Health Benefits Commission (SEHBC) is the executive organization responsible for overseeing the SEHBP.

The School Employees' Health Benefits Program Act is found in the New Jersey Statutes Annotated, Title 52, Article 14-17.46 et seq. Rules governing the operation and administration of the program are found in Title 17, Chapter 9 of the New Jersey Administrative Code.

The Division of Pensions and Benefits, specifically the Health Benefits Bureau and the Bureau of Policy and Planning, are responsible for the daily administrative activities of the SHBP and the SEHBP.

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State Health Benefits Program and School Employees' Health Benefits Program Component Plans

Click Here for Available Medical Plans

  • Local Employers may limit the number of plans available to their employees.
  • State employees cannot participate in NJ DIRECT10. New Jersey National Guard enrollees are restricted to enroll in NJ DIRECT15 or Aetna Freedom15 and/or the Employee Prescription Drug Plan.

All SHBP/SEHBP plans are self-funded, which means that the money paid out for benefits comes directly from a SHBP/SEHBP fund supplied by the State, participating local employers, and member premiums.

Resolution to Limit the Selection of Medical Plans

Local government and local education employers may adopt a resolution to limit the medical plans offered through the SHBP or SEHBP.

Plan Choice

The availability of plans offered to eligible employees may be limited by local employers through the binding collective bargaining process. However, local employers must offer at least one plan from each Category of Plans for a minimum of four plans.

The local employer may, through its sole discretion, impose the provisions of a binding collective bargaining agreement on those employees who have no majority representation for collective bargaining purposes. The local employer may, through the collective bargaining process, offer employees all, a combination of plans, or one plan from each of the four categories of plans. The plans offered may be different for each baragining group.

Employee Contribution Required (As of July 2011)

Under Chapter 78, P.L. 2001, employee contributions for health benefits are required at a specified percentage of the health benefits/prescription drug premiums for a salary range, but not less than 1.5% of salary (as previously required under Chapter 2, P.L. 2010).

For employees employed as of the contribution's effective date (June 28, 2011) the percentage of premium requirement is implemented in a four-year phase-in at contribution levels of 1/4, 1/2, 3/4, and the full amount of the contribution rate during the phase-in years.

For State employees the phase-in period began as of July 1, 2011

For Local government and local education employees the first year phase in begins upon the expiration of the collective negotiations agreement in effect as of June 28, 2011.

For new employees hired on or after June 28, 2011, or after the expiration of a collective negotiations agreement that was in force on June 28, 2011, the employees contribute (without any phase-in) at the full amount of the required contribution rate.

Calculation charts and worksheets reflecting the phase-in of contribution levels for employees employed on the contribution's effective date who will pay 1/4, 1/2, 3/4, and the full amount of the contribution rate during the phase-in years are available on the Division of Pensions and Benefits' Web site.

Waiver of Medical and Prescription Coverage

State employees may waive SHBP medical and prescription drug coverage and will not have to pay the required health benefits contribution, provided that they are covered under a spouse's or partner's employer provided health benefits coverage. SHBP coverage may be resumed if the spouse's or partner's dependent coverage is no longer in effect. An SHBP Waiver form and the appropriate health benefits application are required to be submitted through the employer to the SHBP.

An employer other than the State participating in the SHBp or SEHBP may allow an employee who is covered as a dependent under a spouse's or partner's employer provided health benefits coverage, to waive SHBp or SEHBP health benefits coverage and be reimbursed up to 25 percent of the amount saved by the employer or $5,000, whichever is less. SHBP/SEHBP coverage may be resumed if the spouse's or partner's dependent coverage is no longer in effect. The decision of an employer to allow its employees to waive coverage and the amount of consideration to be paid are not subject to collective bargaining. An SHBP/SEHBP Waiver form and the appropriate application are required to be submitted through the employer to the SHBP. 

Available Medical Plan for Part-time Employees of the State and Part-time Faculty Members at Public Institutions of Higher Education

Part-time employees of the State of New Jersey and part-time faculty members employed at New Jersey public institutions of higher education (New Jersey State colleges, State universities, or county community colleges) who are eligible for SHBP coverage under Chapter 172, P.L. 2003, may enroll in a SHBP/SEHBP medical plan and the Employee Prescription Drug Plan, and must pay the full cost of coverage for the level of coverage selected.

Medical Plan Coverage for Intermittent State Employees

Certain intermittent State employees who have worked a minimum of 750 regular pay status hours within the previous fiscal year (i.e., July 1 to June 30) are eligible for enrollment in all plans but Aetna Freedom10 and NJ DIRECT10 and the Employee Prescription Drug Plan. Intermittent employees who maintain 750 hours of work per fiscal year will receive coverage for the next fiscal year.

Intermittent State employees who meet the minimum pay status hours outlined above must also be covered under the labor contract between the CWA and the State of New Jersey that committed the State to provide SHBP coverage to intermittent employees.

Employers must certify that their intermittent employees have at least 750 regular pay status hours in the prior fiscal year to qualify for coverage in subsequent years. The Human Resource Offices of the Department of Labor and the Department of the Treasury will re-certify eligibility of every intermittent employee with SHBP coverage each year.

Medical Plan Coverage for National Guard Members Called to State Active Duty

National Guard members who are called to State active duty for 30 days or more are eligible for enrollment in NJ DIRECT15, Aetna Freedom15, and the Employee Prescription Drug Plan at the State's expense. Members can also enroll eligible dependents at the State's expense. The Department of Military and Veteran's Affairs is responsible for notifying eligible members and for notifying the Division of Pensions and Benefits of members who are eligible.

SHBP/SEHBP Benefits under the Civil Union Law

Chapter 103, P.L. 2006 establishes New Jersey Civil Unions, which are designed to provide the same legal rights and financial benefits currently available to married heterosexual couples to same-sex couples who enter into a civil union. For more information about this legislation, see Fact Sheet #75, Civil Unions.

SHBP/SEHBP Benefits under the Domestic Partnership Act

Under the New Jersey Domestic Partnership Act, SHBP benefits are extended to eligible same-sex domestic partners of State employees and retirees. Local public employers participating in the SHBP/SEHBP are permitted to extend benefits to their employees and retirees through resolution or ordinance. There are certain conditions that must be met in order for the domestic partner of an enrolled member to be eligible for SHBP/SEHBP coverage.

SHBP/SEHBP members must be made aware of the possible federal tax implications of covering a domestic partner under the SHBP (see Fact Sheet #71, Benefits under the Domestic Partnership Act.)

For additional information about the Domestic Partnership Act and its impact on State-administered retirement system pension and benefit issues, including coverage under the State Health Benefits Program, please refer to Fact Sheet #71, Benefits under the Domestic Partnership Act.

Preferred Provider Organization (PPO) — A Brief Introduction

The Preferred Provider Organization (PPO) plans are administered for the SHBP/SEHBP by Aetna and Horizon Blue Cross Blue Shield of New Jersey (Horizon BCBSNJ). Plans are available nationwide. Members are not required to choose a primary care physician and do not need a referral for IN-NETWORK services under the plans.

Click here for a list of PPO Plans

In-Network Benefits

When a member sees a physician who participates in-network, the member will only pay the appropriate copayment for eligible services.

Members living outside of New Jersey can utilize physicians participating in-network; the member will only pay the appropriate copayment for eligible services.

If the physician does not paricipate in the network, the services will be considered out-of-network.

Members should contact their doctor to see if he or she participates in the network. For specific details on in-network services, members should contact their plan.

Out-of-Network Benefits

Out-of-network benefits allow members to utilize any licensed physician, but they are required to file a claim form. Most eligible out-of-network care is reimbursed at the applicable percentage of “reasonable and customary” allowances after a member’s annual deductible is met. Out-of-network hospital admissions are also subject to a deductible. For specific details on out-of--network benefits, members should contact their plan .

Click here for PPO Copayments and Deductibles

Under out-of-network benefits, your out-of-pocket expenses may substantially increase because you will be charged for any portion of the fee that is above the "resonable and customary" amount allowed by the plan for payment to a provider for a particular service.

For example, if a physician's charge for a surgical procedure is $500 and the "reasonable and customary" allowance is $400, you are responsible for the $100 difference in addition to any coinsurance and deductible amounts.

Health Maintenance Organization Plans (HMO) — A Brief Introduction

The Health Maintenence Organization (HMO) plans have networks that provide services nationwide.

Click here for a list of HMO Plans

Members who enroll in an HMO must select a Primary Care Physician (PCP) from a group of participating providers contracted by the HMO. All services,
except emergencies, are coordinated through the chosen PCP.

The member's PCP will refer the member to a specialist who participates in the HMO network when a specialist's care is required. Both HMOs offer electronic referrals which facilitate the use of specialists.

HMOs have no deductibles or claim forms to file, but members are required to pay a copayment for visits to their PCP or a referred specialist.

For specific details HMO plan benefits, members should contact their plan.

Click here for HMO Copayments

HMO plans require copayments for routine services such as office visits, use of emergency rooms, etc.

High Deductible Health Plans — A Brief Introduction

The SHBP/SEHBP High Deductible Health Plans (HDHP) combine medical benefits, that include prescription drugs, with a tax-advantaged Health Savings Account (HSA).

Click here for a list of HDHP plans

Under a HDHP, members must pay an annual deductible before the medical plan pays for any covered health care costs. Only services that are covered by the plan count toward the annual deductible. Eligible preventive services normally covered at 100 percent and are not subject to the deductible.

Once the entire annual deductible is met, members pay a percentage of the covered health care costs (coinsurance) and your health plan pays the rest — up to any out-of-pocket maximum.

The Health Savings Account (HSA) is a pre-tax personal savings account funded by the member (and employer for the HDHP 1500 plans). HSA funds may be used to pay for qualified medical expenses not covered through your health plan including deductibles, coinsurance, dental or vision care, and other costs as outlined by the IRS.

Click here for High Deductible Health Plans (HDHP) Costs

* HD4000 plans are not offered to SEHBP active employees.

Note: Medicare eligible Retirees cannot enroll in a High Deductible Health Plan.

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Available Prescription Drug Plans

Active Employee Prescription Drug Coverage

The SHBP/SEHBP Prescription Drug Plans are offered to eligible, active State of New Jersey employees and their dependents as a separate drug plan. Local employers may also elect to provide the SHBP/SEHBP Prescription Drug Plans to their employees as a separate prescription drug benefit. For specific details about the Prescription Drug Plans, see the SHBP/SEHBP Prescription Drug Plans Member Handbook.

The Prescription Drug Plans are administered for the SHBP and SEHBP by Medco Health Solutions, Inc., the pharmacy benefit manager for all eligible members.

Detailed information concerning the SHBP/SEHBP Prescription Drug Plans are available in the SHBP Summary Program Description, and in the SHBP/SEHBP Prescription Drug Plans Member Handbook.

Retiree Prescription Drug Coverage

Retirees have access to a separate prescription drug card plan that includes a mail order service. The plan features a three-tiered design. Copayments vary by plan. More information about the benefit is available from the plans.

The SHBP Employee Dental Plans

The SHBP Employee Dental Plans are available to eligible full-time State employees, full-time employees of a local employer (county, municipality, school board, etc.) that elects by resolution to provide the Employee Dental Plans to its employees, and the eligible dependents of these employees. The program provides a choice between two different types of plans, the Dental Expense Plan and Dental Provider Organizations (DPOs). A comparison of the types of plans is found in Fact Sheet #37, Employee Dental Plans. More detailed information is available in the Employee Dental Plans Member Handbook

Please note that there is one application, the Employee Dental Plans Application, for full-time State employees, full-time employees of a local employer (county, municipality, school board, etc.) that elects by resolution to provide the Employee Dental Plans to its employees, and the eligible dependents of these employees.

Local employers wishing to initiate participation in the Employee Dental Plans should click here for more information about how to elect to participate in the SHBP Employee Dental Plans, including the completion of the Resolution for SHBP Dental Plan Participation.

The Dental Plan Organizations (DPOs) are individual companies offering dental services through contracts with a network of dental providers. A DPO member selects a DPO dentist, and the cost of most diagnostic and preventive services is covered in full, although certain services require an additional copayment. The DPOs operate much like Health Maintenance Organizations in that they will not cover services provided by an out-of-network provider unless there was a proper referral. You must use a dentist who is a member of the DPO you selected or be referred by your DPO dentist. For more information, please see the Employee Dental Plans Member Handbook.

The Dental Expense Plan is a traditional indemnity plan that allows a member to obtain services from any dentist. After the member satisfies a deductible, the member is reimbursed for a percentage of the reasonable and customary charges for the services that are covered under the plan. The Dental Expense Plan has a network of participating providers who offer discounted services. Employees save money by using these providers. This plan is administered under a contract between the State Health Benefits Commission (SHBC) and Aetna Dental. For more information, please see the Employee Dental Plans Member Handbook.

The cost of participation in either plan is shared equally by the State and the employee. Premium payments are made through payroll deductions.

Retiree Dental Expense Plan

The SHBP offers a Retiree Dental Expense Plan to retirees enrolled in, or eligible to enroll in, the Retired Group of the SHBP/SEHBP. Employers should inform employees who are nearing retirement about this plan.The plan is self-insured by the State and is administered for the SHBP by Aetna Dental.

Most retirees pay the full cost of the Retiree Dental Expense Plan (the plan is offered with the understanding that the State will bear no costs for it.) Under certain circumstances, local public employers participating in the SHBP/SEHBP may elect to share the cost of coverage for their retirees through the adoption of the provisions of Chapter 48, P.L. 1999. The following links are made available so that employers can provide additional information about the Retiree Dental Expense Plan to their eligible employees:

Fact Sheet #73, Retiree Dental Expense Plan

Retiree Dental Expense Plan Rates

Retiree Dental Expense Plan Member Handbook

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EMPLOYER PARTICIPATION

Employer Enrollment in the State Health Benefits Program

The State Health Benefits Program is open to all local government employers who elect to participate by completing the Resolution to Authorize Participation in the SHBP/SEHBP

The School Employees' Health Benefits Program is open to all local education employers who elect to participate by completing the Resolution to Authorize Participation in the SHBP/SEHBP

Employers can enroll in the medical plan only or medical plan and prescription drug program. However, an employer enrolling only in the medical plan must offer a uniform, stand-alone prescription drug plan to all eligible employees in order to be in compliance with the SHBP/SEHBP.

To enroll in the SHBP/SEHBP, the employer must submit a completed resolution a minimum of 75 days for employers with fewer than 250 employees, and 90 days for employers with 250 or more employees prior to the desired entry date. The effective date of coverage for employers with fewer than 250 employees, COBRA participants and retired members will be the first day of the month following a period beginning 75 days after the receipt by the State Health Benefits Commission of the completed resolution.  The effective date of coverage for employers with 250 or more employees, COBRA participants and retired members will be the first day of the month following a period beginning 90 days after the receipt by the State Health Benefits Commission of the completed resolution.

You can obtain the resolution and enrollment packet by calling the Health Benefits Bureau at (609) 777-4154. This packet will include:

These resolutions must be completed by the location's Certifying Officer and returned to the Health Benefits Bureau a minimum of 60 days prior to the effective date of coverage. Submission of the resolutions at least 75 - 90 days ahead of the effective date will ensure that sufficient time is available to process all applications from the employer's employees, retirees, and COBRA participants.

Employer Participation in the SHBP Employee Dental Plans

Local government or education employers wishing to initiate participation in the SHBP Employee Dental Plans should complete and mail a Resolution for SHBP Dental Plan Participation to the Division of Pensions and Benefits.

The resolution must be completed by the location's Certifying Officer and returned to the Health Benefits Bureau a minimum of 75 days for employers with fewer than 250 employees, and 90 days for employers with 250 or more employees prior to the desired entry date. The effective date of coverage for employers with fewer than 250 employees, COBRA participants and retired members will be the first day of the month following a period beginning 75 days after the receipt by the State Health Benefits Commission of the completed resolution.  The effective date of coverage for employers with 250 or more employees, COBRA participants and retired members will be the first day of the month following a period beginning 90 days after the receipt by the State Health Benefits Commission of the completed resolution. Submission of the resolutions at least 75 - 90 days ahead of the effective date will ensure that sufficient time is available to process all applications from the employer's employees, retirees, and COBRA participants.

Termination of Employer Participation

Voluntary Termination

When an employer chooses to terminate all participation in the SHBP/SEHBP, a completed Termination Resolution must be submitted by the employer to the State Health Benefits Commission or School Employees' Health Benefits Commission for approval. If an employer chooses to terminate participation in the prescription drug plan only, a completed Termination Prescription Drug Resolution must be submitted by the employer to the State Health Benefits Commission or School Employees' Health Benefits Commission for approval. A minimum of 60 days notice (preferably 75 or more days) is required in order to effect the termination process. When an employer terminates participation, the coverage of all its employees, retirees, and COBRA participants is also terminated unless the retirees are covered by specific legislation that permits them to continue SHBP/SEHBP participation upon the termination of their former employer.

An employer choosing to terminate participation in the Employee Dental Plans must submit a completed Resolution for SHBP Dental Plan Termination to the State Health Benefits Commission for approval.  A minimum of 60 days notice (preferably 75 or more days) is required in order to effect the termination process.

Termination for Nonpayment

A participating employer will be considered in default if premiums are not paid within 31 days of the date they are due. At that point, coverage will terminate for all employees and dependents. When an employer defaults on payment, the Division of Pensions and Benefits notifies the Office of the Attorney General and the Division of Local Government or the Department of Education, as appropriate, that the employer has failed to meet its obligations to the State of New Jersey. When the coverage is terminated, the employer must notify all employees and retirees of the termination of their coverage. Premiums will continue to accumulate with interest penalties.


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Last Updated: October 15, 2012