Topic Category: Health

Promoting Equal Opportunities for Children Living in Poverty

Posted on by Raymond Castro

To read a PDF version of the full report, click here.

Temporary Assistance for Needy Families (TANF) is New Jersey’s only program designed to protect low-income families with children during their times of greatest need, acting as a critical bridge to stability and a shield against the harms of deep poverty. Programs like TANF that help stabilize the take home pay of low-income families have long-lasting effects on a child’s ability to succeed in school, get a high school or college degree, and find work as an adult. By increasing the state’s inadequate TANF grant levels, lawmakers could improve maternal and child health, which will have major short- and long-term benefits for families in every corner of the state. 

TANF does not provide the full supports that parents need to obtain the jobs that will permanently lift their families out of poverty. In fact, the ability to protect families in deep poverty has been undercut by many state and federal policies. This can be traced back to 1996 when Congress replaced the New Deal-era Aid to Families with Dependent Children (AFDC) program with TANF block grants. Intended to drastically limit basic assistance to struggling families, the federal TANF law set fixed federal funding, placed a five-year lifetime limit on TANF benefits, implemented punitive and ineffective work requirements, and included other harmful policies that further impoverish children and place enormous stress on families.

Making matters worse, New Jersey established its own enabling legislation in 1997 (P.L.1997, c.13) with harsher restrictions than required under federal law, resulting in an incredible 91 percent drop in enrollment from 102,000 families in 1996 to 13,000 in 2018. Prior to TANF, New Jersey assisted 93 out of 100 families below the federal poverty level compared to the national average of 72 families out of 100. In 2017-2018, the state was only assisting 15 out of 100 families living below the federal poverty level, which was below the national average of 22 families out of 100. In other words, New Jersey fell from one of the top performers in helping low-income families to one of the worst. The table in the appendix shows the incredible harm that TANF has caused in eliminating basic assistance to 180,000 children by county through 2019.

Despite recent increases in TANF benefits, they remain woefully inadequate for families living in poverty, especially since New Jersey has one of the highest costs of living in the nation. In fact, New Jersey ranks only 32nd in TANF benefits as compared with all states when housing costs are considered.[1] While this is a significant improvement as compared to the rank of 43rd in 2017 before the most recent increases in TANF benefits, New Jersey still has far to go.[2]

By reinvesting in TANF, state lawmakers choose healthier kids, safer families, and stronger communities where everyone has what they need to contribute and thrive. This report describes commonsense changes that would correct some of the flaws in the state TANF program and extend the reach of TANF to help many more families in New Jersey climb out of
poverty. 

The good news is that TANF allows states considerable flexibility to make changes in the program. The Legislature and governor have recently started to make improvements in TANF by increasing the assistance levels by 32 percent over the last year through 2020. This is the first increase in three decades and progress that can be built upon. The current administration, under Governor Murphy, is also emphasizing more education and training (E&T) in TANF instead of placing parents in dead-end work activities that lack opportunities to secure employment and long-term economic success. However, much more than that will be needed to turn around a program that was neglected for decades and made worse at the federal level.

The Importance of Reducing Child Poverty

Surprisingly, there is no state statutory goal in TANF to lift families out of poverty. Historically, the practice has been to get families off TANF as soon possible, which often forces enrollees to take any job, even if the pay is inadequate to support a family. Because of this narrow goal, the state has viewed a reduction in the TANF caseload as a success even when child poverty was increasing. This means that families often remain in poverty or even cycle back onto TANF. Research shows that kids who spend most of their childhood in poverty are 45 percent more likely to live in poverty at age 35 than children who live in poverty for only one year.[3] In other words, the less time in poverty, the more likely the cycle of poverty can be broken.

Although New Jersey has increased TANF benefits over the last two years, the state’s historic TANF policy of discouraging full economic opportunity is cruel, shortsighted, and discriminatory. It also does not make any economic sense because the best investment a state can make is in its children. The following are some of the benefits of reducing child poverty:

Reduces public costs in the long run

Chronic poverty causes devastating and long-term harm to children that costs the nation an estimated $1 trillion in economic activity, health, and crime.[4] The National Academies of Science, Engineering, and Medicine’s 2019 report, “A Roadmap to Reducing Child Poverty,” provides the first consensus declaration by the scientific community on the causal connection between growing up with adequate family income and positive outcomes for children that lay the foundation for better health and higher earnings in adulthood.[5] We either invest in our children now or pay much more later on.

Improves maternal and child health

Extensive research has conclusively shown the strong link between family income and infant mortality and children’s health.[6] Children born to low-income mothers have the highest rate of low birth weight. Children in poor families are four times more likely to be in poor or fair health compared to higher income kids. By directly giving pregnant mothers cash assistance, they have the flexibility to spend more of their limited income on things that lead to better health such as transportation to doctor appointments, safer housing, over the counter medications, diapers, and better nutrition. Improving health for families is especially important in New Jersey given that the state has consistently scored poorly in maternal and child health, especially for Black families. As long as pregnant mothers and parents of newborns suffer the stress of extreme poverty, New Jersey’s efforts to reduce infant mortality will be limited.

Reduces racial and ethnic income disparities.

New Jersey is a wealthy state, but wealth is not shared equally or fairly. This is especially true for kids in poverty. Due to historic discrimination, such as in housing, employment, and education, Black and Hispanic kids do not have the same opportunities white kids do. In fact, about two-thirds of all New Jersey children in poverty are Black or Hispanic, as Black and Hispanic children are more than three times more likely to live in poverty than white kids.[7] As a result, 8 out of 10 children on TANF, the poorest of the poor, are either Black or Hispanic. Failure to improve TANF means continuing to discriminate against these kids of color and robbing them of their birthright to equal opportunity. Addressing this problem would also help to reduce major income inequality, where New Jersey is ranked the seventh worst in the nation.[8]

Improves the economy 

Child poverty is a drag on New Jersey’s economy and makes the state less competitive because parents are not working or do not have opportunities for good paying jobs. There are also employers who do not want to train their employees because they do not want to invest in them to only have them leave for other jobs, which is also problematic. This could be reduced by improving TANF so it better provides the E&T that parents need. In addition, increasing TANF benefits would stimulate local economies where it is needed the most. Research shows that providing direct assistance to low-income people is one of the most effective ways to stimulate the economy because the money is spent quickly and directly in local communities.[9] State expenditures have decreased by over $5 billion since TANF was established, which has not only harmed thousands of poor families but the economies of low-income communities as well.[10]

Common Sense Measures to Improve TANF

1. Ensure that no families on TANF remain in deep poverty

The current level of NJ TANF benefits ($559 a month for a family of three) is only one-third of the federal poverty level, guaranteeing that families continue to live in deep poverty, defined as below half of the federal poverty level. This remains true despite the state increasing TANF benefits by 32 percent over the last two years. The low benefit level also costs the state more for many families because they cannot afford any housing and end up receiving much more expensive emergency assistance in a shelter or other arrangements to avert homelessness.

Solution: Require a set annual increase in TANF benefits so it reaches 50 percent of the federal poverty level within three years for each household size. For every year after, automatically adjust the TANF benefit for inflation.

2. Get families off the caseload and out of poverty

Historically, the goal of TANF has been to get a family off TANF as soon as possible, regardless of the outcome. As a result, parents are pressured to take jobs that are so low paying or temporary that the family remains in poverty and may be forced to return to TANF. Previous governors, therefore, have measured the success of TANF not by how many families in poverty have been helped but rather how quickly the caseload can be reduced regardless of the number of families that need assistance. This goal has resulted in punitive policies and practices in TANF that can make it a bureaucratic nightmare. The state also does not follow employment or earnings outcomes for families who left TANF to determine if TANF was successful in promoting economic independence.

Solution: In addition to federal TANF goals, the state should add the goal of lifting families out of poverty. To measure that goal, the state should be required to monitor the employment rates and earnings of families that leave TANF, including identifying where TANF leavers fall with respect to various percentages of the federal poverty level.

3. Provide better supports for children 

Historically, TANF has focused on parents rather than the whole family. In fact, TANF often punishes children to get their parents to comply with the many TANF rules. For example, if a parent does not meet the rigid work requirements, the parent loses his or her assistance in the second month and the child loses assistance by the third month if the parent is still non-compliant or cannot find suitable employment. Further, if a parent is denied assistance because they have reached the five-year limit, the child is also denied assistance as long as the child lives with the parent. In 2017, benefits were taken away from 328 families who reached the arbitrary time limit.[11] This increases stress and homelessness, which threatens family stability. Continuing to provide benefits to children will increase costs, which could be from state or federal TANF funds, but it is one of the best investments the state can make.

Solutions:

  • Only end TANF benefits for the parent when the parent is not in compliance with work activity but continue to provide them to the child.
  • Restore parents’ reduced TANF benefits due to a sanction if the parent becomes in compliance within 60 days.
  • Allow children to continue to be eligible for TANF even when their parents have reached the five-year TANF limit, encouraging home and family stability. The state can use federal funds so long as no more than 20 percent of caseloads are over the five-year limit. The state can also use existing state funds for these kids.
  • Exclude parents from the five-year TANF limit if they have followed all the TANF rules and continue to do so.
  • Expand quality childcare and provide adequate information to parents to ensure they can identify such care.

4. Increase child support payments

Currently New Jersey and the federal government keep all the child support that is paid to a family on TANF except for the first $100 a month regardless of how many kids are in the family. In 2020, the state and federal government estimates that they will collect $24 million in child support whereas kids will only receive $2 million in New Jersey.[12] This not only shortchanges the kids who live in deep poverty, it also means that the non-custodial parent is less likely to pay the full support because they know most of it would not go to their child. Recent research shows that when children on TANF are allowed to receive their full child support payments, those payments increase.[13] Therefore, New Jersey should accept the federal government’s offer to waive its share of the child support collected for up to $200 a month (when there are two or more children) when the support is passed through to the family and disregarded as income. This waiver of the federal share of collected support makes increasing the amount of child support passed through to the family at essentially half-price to the state.

Solution: Increase this child support pass through to $200 for families with two or more children, which will benefit the children and encourage non-custodial parents to pay more in child support.

5. Provide the education and training parents need for better jobs

Historically, in order to meet TANF’s work requirements, more parents have been placed by the state, sometimes without pay, in job search activities or the Community Work Experience Program (CWEP) than in education and training programs. This policy too often results in “make work” placements that perpetuate poverty and creates enormous stress for the parents who in some cases have little or nothing to do in their CWEP placement. Unfortunately, because of the declining caseloads due to harsher requirements and greater reliance on CWEP, fewer parents are receiving E&T in TANF.

Solutions:

  • Prioritize education and training with the goal of getting parents to qualify for livable wage jobs that lift families out of poverty.
  • Expand existing options for E&T to provide parents with the skills that are needed for growing New Jersey industries, such as through apprenticeships, internships, work study programs and other opportunities as well as greater utilization of community colleges. A large body of research has shown that sectoral-based skills training programs can result in major gains in employment and wages for low-income adults who have the most difficulty finding jobs.[14]
  • Restrict the time period in CWEP placements to 6 months within any 12-month period.
  • Allow placements with for-profit entities to satisfy “alternative work experience,” provided that they are limited to 6 months and will likely lead to full-time employment with the employer.
  • Require businesses that receive state tax incentives to collaborate with local community organizations that provide support to TANF participants in the form of work-study, apprenticeships, internships, sector-based contextualized literacy training, skills-based training in growing New Jersey industries, and/or job-retention and advancement services.

6. Eliminating work requirement provisions that are much harsher than required by federal law

Federal rules require a parent to participate in a work activity for 30 hours a week, or 20 hours if their child is under six, but the state goes beyond that by requiring between 35 and 40 hours in unpaid work placements.[15] This higher hourly requirement is not always realistic for parents; for example, a parent who must also take their children on a bus to childcare then take another bus to participate in a work activity. Also, while federal policy allows a state to exempt parents of infants from work activities for up to 12 months, New Jersey only allows three months. The current state requirements often set up parents for failure and make it impossible for them to support and bond with their children, which is critical for their development. TANF sanctions historically have been the leading cause of case closures.[16]

Solution: Consistent with federal rules, allow parents with infants to be exempt from work requirements for up to 12 months, and reduce the current 35-hour week work requirement to 30 hours, and 20 hours if their child is below age 6.

7. Improving case management

Because of the five-year lifetime limit on TANF, it is critical that families receive supportive case management to ensure that the parents have all the resources they need to find good jobs before that limit is reached. Currently, participants who reach their 48th month of assistance must participate in the Supportive Assistance to Individuals and Families (SAIF) program. This program provides intensive case management for families who have been unable to become independent due to multiple barriers to employment.[17] While this has helped some families, it has been reported that it starts too late, and can sometimes mean parents have to meet even more requirements, which can cause them to just give up in frustration.

Solution: Offer additional case management and supportive services, based on an assessment of their barriers to securing employment, once a parent reaches a total of 36 months of enrollment.

8. Broadening TANF eligibility for lawfully present immigrant families

The New Jersey law sharply limits which immigrant children or parents that are lawfully present in this country are eligible for TANF. For example, immigrant children and parents who have been in the U.S. for five years or less are ineligible for TANF. People who were born outside the U.S. have the same needs as native-born people from New Jersey who live in poverty and should not be discriminated against. Excluding immigrants is also antithetical to the state’s public message that it welcomes them. Moreover, studies have shown that immigrants strongly contribute to the state’s economy.

Solution: Make all immigrant children and their parents who are lawfully present in this country eligible for TANF and who otherwise meet TANF eligibility standards.States can use state   funds but not federal TANF funds for those immigrants who were made ineligible or excluded for five years under the 1996 law.  

9. Improving the exit ramp off of public assistance to support work

It is important that a family’s TANF benefits be reduced gradually once the parent obtains a job to avoid a “cliff,” which is when a small increase in income from a job causes a disproportionate drop in TANF benefits, causing the family to be worse off financially. This cliff also becomes a disincentive to increasing hours or accepting potential raises. The current policy allows the parent to keep their full TANF benefits in the first month of employment, which is then phased down in subsequent months. The phase down rules differ for part-time and full-time workers, which is confusing for the parents and even the case workers. Simpler policies that also do not start grant reduction until after two months of earnings will allow TANF families time to stabilize their family budget after getting a new job.

Solutions:

  • Increase the current incentive for employment by allowing the employed family to receive their full TANF benefits for two months.
  • Remove some of the limits on how many times the earnings disregards can be applied.
  • No longer count the time receiving TANF due to earnings disregards towards the five-year time limit on TANF. While the federal TANF rules do not have a “stop the clock” provision, a state can choose when to run time or stop time clocks so long as not more than 20 percent of the caseload receive federal TANF funds beyond 60 months. Most working families do not stay on TANF for five years, but if the state chose, it also could simply use state funds to serve families whose clocks are stopped.

Conclusion

Collectively, these policies would provide a boost in basic assistance that gives families needed flexibility to use the income in the ways that best help their household live in a high cost of living state like New Jersey. This means diapers, medicine, clothing, bus fare, school supplies, rent and utility payments, car repairs, and more. Income matters: when Black, Brown, and white families struggling to meet their basic needs get more income, their children have a better chance of growing up healthy and with an opportunity to thrive.

TANF is the main income assistance program for families experiencing extreme financial hardship, and it can play a key role in ensuring that they are able to climb up and out of poverty. When we support the well-being of our neighbors, we make sure that everyone can reach their full potential and contribute to our communities.

Appendix

A screenshot of a cell phone Description automatically generated

End Notes

[1] Ashley Burnside, Ife Floyd, More States Raising TANF Benefits To Boost Families’ Economic Security, December 9, 2019, https://www.cbpp.org/research/family-income-support/more-states-raising-tanf-benefits-to-boost-families-economic-security

[2] Center on Budget and Policy Priorities, TANF Cash Benefits Have Fallen By More Than 20% In Most States And Continue To Erode, October 13,2017 https://www.publicnow.com/view/71F8C9CD6D0CC646ABAF4FF08EB28C609F63ABC9

[3] Department of workforce services, Inter-Generational Poverty In Utah 2012, Department of workforce services, Inter-Generational Poverty In Utah 2012, https://jobs.utah.gov/edo/intergenerational/igp12.pdf

[4] Michael McLaughlin, Marc Rank, Estimating The Economic Cost Of Childhood Poverty In the United States, March 30, 2018, https://academic.oup.com/swr/article-abstract/42/2/73/4956930?redirectedFrom=fulltext

[5] The National Association of Sciences, Engineering, Medicine; Consensus Study Report, A Roadmap To Reducing Child Poverty, 2019, https://www.nap.edu/catalog/25246/a-roadmap-to-reducing-child-poverty

[6] Stephen Woolf, et al, How Are Income and Wealth Linked To Health And Longevity, April, 2015, wealth https://www.urban.org/sites/default/files/publication/49116/2000178-How-are-Income-and-Wealth-Linked-to-Health-and-Longevity.pdf

[7] The Annie E. Casey Foundation, Children In Poverty By Race And Ethnicity In New Jersey, 2018, Richard Barrington, Moneyrates, States with the Lowest And Highest Income Inequality, April 3, 2019,  https://datacenter.kidscount.org/data/tables/44-children-in-poverty-by-race-and-ethnicity?loc=32&loct=2#detailed/2/32/false/37,871,870,573,869,36,868,867,133,38/10,11,9,12,1,185,13/324,323

[8] Elizabeth McNichol, How State Tax Policies Can Stop Increasing Inequality and Start Reducing It, December 15, 2016, https://www.cbpp.org/research/state-budget-and-tax/how-state-tax-policies-can-stop-increasing-inequality-and-start

[9] Sarah Rinehart, SNAP Is A Boon To Urban And Rural Economies. Proposed Farm Bill Changes Could Cripple Them, July 5, 2018, https://civileats.com/2018/07/05/snap-is-a-boon-to-urban-and-rural-economies-proposed-farm-bill-changes-could-cripple-them/

[10]Raymond Castro, Lost Opportunities For New Jersey Children, February 11, 2016, https://www.njpp.org/reports/lost-opportunities-for-new-jerseys-children

[11] New Jersey Division of Family Development, WorkFirst NJ, Quarterly Progress Update, December 2017, https://www.state.nj.us/humanservices/dfd/news/wfnj_%20dec17.pdf,

Development, WorkFirst NJ, Quarterly Progress Update, September 2017, https://www.state.nj.us/humanservices/dfd/news/wfnj_sept17.pdf, https://www.state.nj.us/humanservices/dfd/news/wfnj_june17.pdf , New Jersey Division of Family Development, WorkFirst NJ, Quarterly Progress, June, 2017, https://www.state.nj.us/humanservices/dfd/news/wfnj_mar17.pdf

[12] Governor’s FY 2020 Budget.

[13] Colorado Office of Performance and Strategic Outcomes, Evaluating the Effect Of Colorado’s For Support Pass-Through Policy, 2019-2019, https://drive.google.com/file/d/1lh2NsnwZP27eoZEjOPpHtUKMs2qOUW65/view

[14] Tazra Mitchell, Research Note: Sectoral Skills Training Programs For Low Income Workers Can Yield Sustained Earnings and Employment Gains, New Evaluation Finds, June 20, 2017, https://www.cbpp.org/research/family-income-support/research-note-sectoral-skills-training-programs-for-low-income

[15] New Jersey Division of Family Development, New Jersey State Plan For Temporary Assistance For Needy Families, FFY 2015 To FFY 2017,  https://www.nj.gov/humanservices/dfd/programs/workfirstnj/tanf_state_plan_15-17.pdf, p. 14

[16] In the last quarter alone in 2017 1057 parents were sanctioned, New Jersey Division Of Family Development, WorkFirst NJ, Quarterly Progress Update, December 2017, sanctioned. https://www.state.nj.us/humanservices/dfd/news/wfnj_%20dec17.pdf

[17] New Jersey Division of Family Development, New Jersey State Plan For Temporary Assistance For Needy Families, FFY 2015 To FFY 2017, https://www.nj.gov/humanservices/dfd/programs/workfirstnj/tanf_state_plan_15-17.pdf, .p.21

NJPP: Trump Budget Proposes Devastating Cuts to Health and Social Programs

Posted on by Raymond Castro

Earlier today President Trump unveiled a $4.8 trillion budget for 2021, including major cuts to the social safety net. In response to the budget proposal, New Jersey Policy Perspective (NJPP) releases the following statement.

Raymond Castro, Health Policy Director, NJPP:

“President Trump’s budget represents yet another massive redistribution of wealth from low-income and working class families to the top 1 percent. His budget proposes devastating cuts to health and social programs — possibly the largest cuts proposed by a president in the nation’s history — and threatens to push far too many families into poverty. Meanwhile, wealthy individuals would receive a windfall as the budget makes the 2017 tax cuts permanent. If signed into law, this will widen growing inequities and pull the safety net out from under families struggling to make ends meet. 

“The budget calls for $1 trillion in cuts over ten years in Medicaid and the marketplace which would result in billions of dollars lost for New Jersey and reverse the major progress that has been made in expanding health coverage across the state. The proposed cuts to Medicaid expansion endanger the health care of 500,0000 New Jerseyans currently in Medicaid. The health care of an additional 300,000 New Jerseyans is also at risk from a sharp reduction in marketplace premium assistance.

“Further, the budget would cut food assistance in New Jersey by $1.5 billion over five years. The budget would also fully eliminate the social services block grant, Community Services Block Grant, and Low-Income Home Energy Assistance Program, resulting in a total loss of federal funds of $1.3 billion over five years and the complete loss of these supportive services at the community level. In addition, Temporary Assistance for Needy Families, which has not received an increase at the federal level in 20 years, would be cut by over $200 million in New Jersey over five years, further impoverishing these families that live well below the poverty level. Simply put, these cuts would be catastrophic for New Jersey and would directly harm our families, friends, and neighbors in every corner of the state.”

# # #

Protecting Roe v. Wade is Not Enough

Posted on by Sheila Reynertson

Today, Americans commemorate the 47th anniversary of Roe v. Wade, the 1973 U.S. Supreme Court decision that struck down statewide bans on abortion, thereby allowing people to make decisions about whether and when to have a family. Thankfully, New Jersey has consistently upheld the right to abortion care since the procedure was legalized. 

New Jersey is one of just twelve states that uses state funds to support Medicaid access to abortion services to mitigate the impact of the Hyde Amendment, which blocks all federal funds from paying for abortion information, referrals, or care. Equally important, the state has largely remained outside the national trend of state-level abortion restrictions like waiting periods and mandatory ultrasound exams.

Though the right to abortion exists in theory, for many people in New Jersey and around the nation, it is inaccessible in practice. The leader of Yellowhammer Fund, an abortion fund and reproductive justice organization in Alabama, describes this reality in a thoughtful refection of this day. In a post-Roe world, Amanda Reyes asserts, access to abortion care requires a person have the financial ability to travel to and obtain the service; it requires a doctor or clinic savvy enough to remain in business despite chronically low Medicaid reimbursement rates; it requires a new generation of abortion providers to replace those who retire. When one or more of these are absent, the harm falls hardest on lower income communities and the under- and uninsured, people who are transgender and non-binary, and people who may face significant barriers to health care more generally. 

New Jersey can do better. 

In his State of the State address, Governor Murphy detailed an agenda for the year ahead that includes passing legislation to enshrine the right to abortion access and reproductive health care in state law. That makes sense, as it recognizes that reproductive health care is inextricably linked to racial and economic justice. With Roe v. Wade under threat by the U.S. Supreme Court, it’s more important than ever that New Jersey build on its strong track record of supporting reproductive health. 

But the legislation must go further to show that New Jersey won’t back down in the face of ongoing attacks. Lawmakers must ensure that everyone has equitable access to care regardless of a person’s income, zip code, age, race, or immigration status. When everyone can make decisions that are best for their own lives, families thrive and communities grow stronger. 

At NJPP, we know that ensuring access to comprehensive reproductive health care is critical to reducing poverty, ensuring racial equity, and advancing economic justice. But access to these services should not depend on how wealthy you are or which zip code you happen to live in. The governor and legislature have a unique opportunity this legislative session to not only affirm these rights, but ensure that the state is taking an active role in breaking down harmful barriers so all New Jerseyans can decide what’s best for them and their families.

NJPP: New Jersey Takes Major Step to Codify ACA Protections

Posted on by Raymond Castro

Earlier today, the New Jersey Senate passed a package of bills to codify core provisions of the Affordable Care Act (ACA) in state law. Should a federal court strike down the ACA, these protections would remain in place if signed into law by Governor Murphy. In response to the passage of these bills, New Jersey Policy Perspective (NJPP) releases the following statement.

Raymond Castro, Health Policy Director, NJPP:

“With the passage of these bills, New Jersey is solidifying its place as a national leader in protecting the health coverage of its residents. If signed by Governor Murphy, key provisions of the ACA will stay in place should a federal court strike down the landmark health care law. Most of these protections — such as prohibiting insurers from denying coverage for preexisting conditions, requiring essential benefits, providing free preventive services, and allowing parents to keep their dependents on their plan until age 26 — have been in effect for six years; it is hard to imagine a health care system without them.

“These bills, however, do not remedy the biggest problem New Jersey would face if the federal courts overturn the ACA: the loss of billions of federal dollars that are essential to provide Medicaid expansion coverage to a half-million New Jerseyans and keep premiums in the individual market affordable for another 300,000 adults and children. To avoid such a catastrophe, the state’s congressional delegation must continue to fight back against the Trump administration’s sabotage of the ACA.”

# # #

More Hispanic and Asian Children Uninsured Likely Due to Chilling Effect

Posted on by Raymond Castro

To read a PDF version of the full report, click here.

The well-being of New Jersey families relies on their access to high-quality, affordable health coverage, which should be easy to obtain without fear. This is a challenge, however, for legal immigrants and citizens who live in mixed-status households (where at least one family member is undocumented) due to federal policies that penalize immigrants who enroll in NJ FamilyCare (NJFC). Last year, the Trump administration proposed an expansion to the “public charge” rule that would deny green cards and various visas to certain immigrants if they are enrolled or were deemed likely to enroll in a safety net program, including Medicaid. Despite the overwhelming public comments opposing the change, it was scheduled to take effect on October 15, 2019 until it was enjoined by multiple federal courts.

While the rule change has yet to be implemented, it has already had a chilling effect on legal immigrants and citizens in mixed-status households who are now dropping out of or not applying for public health coverage for fear of retribution. Last year, one in seven adults in immigrant families nationally reported that they or a family member did not enroll in a public benefit program because of the proposed public charge rule.[i] The new 2018 census data shows a steep increase in the number of uninsured Hispanic and Asian children in New Jersey, further demonstrating the enormous harm of anti-immigrant policies here in the Garden State.  

More Uninsured Asian and Hispanic Children

Immigrant and citizen children in mixed-status households may have been harmed the most by the Trump administration’s anti-immigrant policies, especially as it concerns health coverage. Over the last year, there is a stark difference in the change in coverage for kids who are White or Black and kids who are Asian or Hispanic (Asian and Hispanic residents in New Jersey represent 85 percent of all immigrants).

While the total number of uninsured children remained about the same in New Jersey, it decreased by 3,591 for White and Black kids and increased by 2,621 for Asian and Hispanic kids. This is consistent with national trends as well. For example, the national uninsurance rate for Hispanic children increased significantly to 8.7 percent in 2018 from 7.7 percent in 2017.[ii]

Many children are harmed by the public charge rule even if it does not apply to them, as their parents do not always know this. The rule is complicated and strikes fear,[iii] which understandably has a chilling effect on many immigrant and mixed-status families. The chilling effect extends to children who are citizens as they can be living in households where another family member is an immigrant. The loss in health coverage for Hispanic and Asian kids is alarming because they already represent 54 percent of all uninsured children.

Historic Drop in Enrollment for Children in NJ FamilyCare

The increase in the number of uninsured Hispanic and Asian kids mirrors national trends and helps explain the major decrease in child enrollment in NJFC in 2018.[iv] Enrollment for children decreased by a startling 30,000 in 2018 from the peak of May to December. While the low unemployment rate during that time is a factor, researchers have concluded that the drop is too large to be explained by falling unemployment alone.[v] The new census data show that another cause is likely that parents are not enrolling their kids in or are dropping out of NJFC because of federal anti-immigrant policies that incite fear and mistrust among Hispanic and Asian families.[vi]

Drops in Enrollment Result in Lost Federal Funds and Higher Charity Care Costs

As result of this decrease in enrollment for kids, New Jersey is losing about $5 million in federal matching funds every month compared to the peak in May 2018.[vii] This will also have an economic impact because lost federal funds will result in lost jobs. Furthermore, hospitals are incurring $8.5 million in charity care costs to treat uninsured kids.[viii] This causes higher costs for taxpayers because part of charity care costs are reimbursed with federal and state funds. It also harms hospitals because the reimbursement they receive only defrays about half their full costs.[ix] 

If Trends Continue, the Uninsurance Rate for Children Will Increase in 2019

Even more alarming, the decrease in enrollment for children is likely to be even greater in 2019 based on current NJFC enrollment trends. As of August 2019, enrollment decreased to 780,000, the lowest level in approximately five years. Thus, this problem will likely only get worse and could result in the total uninsurance rate for kids rising significantly in 2019 for the first time since the Affordable Care Act was implemented, just as it already did at the national level in 2018.

Public Health Coverage for Immigrants Decreased Sharply in 2018

The census also provides data on enrollment in all public health coverage programs based on citizenship for all New Jerseyans regardless of age.

Most likely this decrease is in NJFC because the only other large public health program is Medicare which has very stable enrollment. The percent of New Jerseyans with public health coverage remained about the same for native born and naturalized citizens but decreased by a startling 14 percent for immigrants. That meant there were 23,000 fewer immigrants enrolled in public health coverage in 2018 compared to 2017. 

This decrease is particularly disturbing because immigrants already have the highest uninsurance rate compared to citizens in 2018 (31 percent vs 4 percent).

New Jersey has the third highest share of immigrants in the nation, and immigrants represent 41 percent of the state’s uninsured. This is the main reason why New Jersey scores near the national average in the uninsurance rate, in sharp contrast to other positive measures that New Jersey ranks very high in like median income and a low poverty rate. New Jersey can’t hope to become a top state in health coverage, much less achieve universal health coverage, without covering more immigrants.

Urgent Action Needed

Immigration policy may be set at the national level, but there are proactive steps the state can take to mitigate the harm caused by the Trump administration. Some of these actions have already been taken, such as the state opposing and suing the federal government on the proposed public charge rule. In addition, the state is expanding outreach for the marketplace starting November 1, 2019, which should help in enrolling more immigrants. Starting in 2021, the state will also take over all the operations of the marketplace, which has been run by the federal government.

It will be critical that the state develop targeted strategies to reach Asian and Hispanic immigrants. The state needs to improve outreach to make sure immigrants are fully aware of the proposed public charge rule, which is currently stuck in the courts. The rule will only directly affect a relatively small number of immigrants, but each immigrant will need to weigh the risks and benefits to themselves and their family in deciding whether they want to apply for NJFC and other safety-net programs. 

To address this problem, the state should enact legislation that makes all children eligible for NJFC regardless of immigrant status and allocates outreach funding to organizations that have the trust of immigrants to reach and enroll more children in NJFC. Administrative barriers to enrollment in the Child Health Insurance Program (CHIP) portion of NJFC should be eliminated, like premiums which are the second highest in the country.  In addition, the state requires that children must be uninsured for 90 days before they can be eligible for CHIP, a needless restriction that should also be dropped.

Taking proactive steps to insure all kids—regardless of where they were born—will make New Jersey’s children healthier and save the state money on charity care costs. New Jersey cannot afford not to enact these reforms.

End Notes

[i] Hamutal Berstein, et al, Avoiding Routine Activities Because Of Immigration Concerns, Urban Institute, July 24, 2019, https://www.urban.org/research/publication/adults-immigrant-families-report-avoiding-routine-activities-because-immigration-concerns

[ii] Joan Alker, Why Are There More Uninsured Children and What Can We Do About It? Georgetown University, September 12, 2019, https://ccf.georgetown.edu/2019/09/12/why-are-there-more-uninsured-kids-and-what-can-we-do-about-it/

[iii] Ibid 1, Berstein, et al

[iv] Georgetown University , Child Enrollment in Medicaid and CHIP, May 2019, https://ccf.georgetown.edu/wp-content/uploads/2019/09/Child-Medicaid-CHIP-Enrollment-Dec-2017-May-2019.pdf

[v] Matt Broaddus, Research Note: Medicaid Enrollment Decline Among Adults And Children Too Large To Be Explained By Falling Unemployment, Center On Budget and Policy Priorities, July 17, 2019, https://www.cbpp.org/research/health/research-note-medicaid-enrollment-decline-among-adults-and-children-too-large-to-be

[vi] Samantha Artiga, Estimated Impact Of Final Public Charge Inadmissibility Rule on Immigrants and Medicaid Coverage, September 18, 2019, https://www.kff.org/disparities-policy/issue-brief/estimated-impacts-of-final-public-charge-inadmissibility-rule-on-immigrants-and-medicaid-coverage/

[vii] Calculated based on estimates in Governor Murphy’s FY 2019 State Budget.

[viii] New Jersey Department of Health estimates per OPRA request, 2019.

[ix] New Jersey Hospital Association, 2018 Economic Activity Report,  http://www.njha.com/media/541893/2018-Economic-Impact-Report.pdf

New Proposed Rule Threatens the Future of Medicaid

Posted on by Raymond Castro

The Trump administration’s most recent attack on Medicaid could hit New Jersey harder than any other state in the nation. Quietly released in July, the proposed rule change would reduce access to medical care for up to 1.7 million seniors, children, people with disabilities and low income workers who must rely on this program as their only source for health coverage. The proposal would repeal the current requirement for states to monitor whether the Medicaid reimbursement is sufficient to ensure enough doctors are participating in Medicaid to provide adequate access to medical services. This will create a major incentive for states to cut reimbursement levels and divert those savings to other state projects unrelated to health care. 

The proposal is a greater threat in New Jersey because the state already has the lowest percentage of doctors in the nation who are willing to participate in Medicaid (39 percent), and it’s reimbursement for all services, as a percentage of the Medicare rate (65 percent), is ranked second lowest in the nation. The proposal will harm most health care providers, but it could have an even greater impact on hospitals because the research shows that when consumers have less access to primary care, they end up in the emergency room and drive up charity costs which impacts everyone.

Unfortunately, this is another example of the Trump administration taking administrative action to enact unpopular policies rejected by Congress. The Trump administration has already approved waivers for states to cap Medicaid funding and enacted draconian work requirements, the latter of which has already reduced enrollment substantially even for people who work. The administration has also asked states to submit proposals to block grant Medicaid, even though that was specifically opposed by Congress as part of legislation to repeal the Affordable Care Act. Unless Congress or the courts overturn this rule and previous administrative actions, the future of the entire Medicaid program is under threat.

Consumers and providers who are concerned about this proposed rule must have their comments in to the Centers on Medicare and Medicaid Services by September 13, after which the administration can make it final.  

Proposed regulation text:
https://www.federalregister.gov/documents/2019/07/15/2019-14943/medicaid-program-methods-for-assuring-access-to-covered-medicaid-services-rescission

State-Based Exchange Will Ensure Health Care is Affordable

Posted on by Raymond Castro
Governor Murphy unveiling a package of bills to create and fund a State-Based Exchange at a roundtable event in Paterson on May 31, 2019. Photo by Edwin Torres / Office of the Governor.

Earlier today Governor Phil Murphy and lawmakers announced a package of bills to establish a fund a State-Based Exchange for health insurance. The proposals would uphold protections of the Affordable Care Act and give the state more flexibility in determining what plans are offered and how the enrollment process works. In response to today’s announcement, NJPP releases the following statement.

NEW JERSEY POLICY PERSPECTIVE HEALTH POLICY DIRECTOR RAY CASTRO 

“The creation of a State-Based Exchange is welcome news to hundreds of thousands of New Jerseyans whose health care has been threatened by the Trump administration and his enablers his Congress. While the federal government seeks to eliminate essential health benefits and critical protections for patients with preexisting conditions, New Jersey is responding in big ways to ensure health care remains comprehensive and affordable.

“With a state run marketplace, New Jersey can go beyond the minimum requirements in the Affordable Care Act to create a better experience for over 600,000 health care consumers. States that have their own marketplace have been more effective in making plans more affordable, promoting more transparency and accountability, enrolling more consumers, and offering more choices. Since 2016, health care enrollment dropped by 3.7 percent in states that use the federal marketplace while state marketplaces experienced an increase in enrollment of 0.9 percent.

“Positive benefits from a state marketplace should be noticeable to consumers in the first year of implementation as the open enrollment period will double from six weeks to twelve weeks. The state marketplace will also provide more robust outreach to ensure residents are aware of their coverage options. However, to achieve the full promise of a state marketplace, the state should establish the more ambitious goal of further reducing the number of uninsured New Jerseyans, which stands at the unacceptable level of 700,000. New Jersey should follow best practices adopted by other states and supplement federal premium subsidies with state subsidies, provide health coverage through buy-in programs for those not eligible for subsidies, and make creative and efficient use of existing federal funding. While the challenges are many, the opportunity is almost limitless.”

# # #

It’s Time for All Kids Health Coverage

Posted on by Raymond Castro

To read a PDF version of this report, click here.

The best investment a state can make is in its children, yet New Jersey is falling short in one of its most effective childhood health programs, the Child Health Insurance Program (CHIP). With the help of the Affordable Care Act, New Jersey has reduced the uninsurance rate by about a third since 2013.[1] Currently, about 800,000 children receive comprehensive quality health coverage in NJFC (which consists of  both Medicaid and CHIP), which represents one in three children in the state.[2] The uninsurance rate is now so low that New Jersey is in a position where it can realistically achieve a goal that would have been unheard of only a few years ago: universal health coverage for kids. 

That means more healthy children and a lower cost for taxpayers by preventing costly health problems later in life. The research is clear that coverage causes a reduction in adverse health outcomes for children, such as poorer health; avoidable hospitalizations; delayed prescriptions; less access to care from a specialist; newborn complications; no regular physician; unmet prescription needs; fewer visits to the emergency room; and death.[3] The research also shows major social benefits, such as fewer school absences[4] and higher graduation rates;[5] better jobs when these kids become adults;[6] as well as less medical debt and bankruptcies for the family.[7]

Assuring affordable health coverage for all kids is a historic opportunity that must not be wasted, but to meet this laudable goal, the state needs to overcome the following challenges:

New Jersey Is Still Behind Many Other States in Insuring Children

The state’s uninsurance rate dropped quickly from 2013 to 2015 (5.6 percent to 3.7 percent), but has remained flat for three years. In total, 78,000 children remain uninsured in New Jerseyand as many as 40 percent are not eligible for current programs.[8] Nineteen other states are doing better at insuring children than in New Jersey, many of which are much less wealthy, like Louisiana, Alabama, and West Virginia.[9] New Jersey’s uninsurance rate is higher than all Northeast states except Pennsylvania and Maine. Clearly NJFC has not lived up to its potential. Massachusetts and Washington, DC have essentially achieved universal health coverage for their children, so it can be done. 

Federal Anti-Immigrant Policies Discourage Enrollment in NJFC

One of the main reasons that the uninsurance rate for children in New Jersey is higher than in many other states is that it has the sixth highest number of children in immigrant families in the nation and many immigrant parents are reluctant to enroll their children in any public program because of federal anti-immigrant policies. Like in many other states, for example, from May 2018 to January 2019, the enrollment of kids in NJFC declined by 33,000, resulting in the lowest enrollment in approximately four years.[10] While much of this decline may be due to the improved economy, it also probably means that fewer children are applying for assistance because of existing and proposed punitive immigration policies from the Trump administration.

Unfortunately, if enrollment trends in NJFC continue to be less than expected, the number of uninsured children will likely continue to remain flat — or actually go up. Of particular concern is the proposed “public charge” rule that could result in the denial of citizenship to legal immigrant parents if their child received Medicaid.[11] There are an estimated 150,000 citizen children in NJFC who have non-citizen parents who could be affected by the proposed public charge rule, which could result in between 22,500 to 52,500 children losing coverage.[12]

NJFC’s systemic outreach to schools is broad-based and not based on immigration status. New Jersey relies mainly on working with public schools to reach all uninsured kids, but other states have made extensive use of contracts with community-based organizations that have the trust of the Latino community to reach these families or have used evidence-based strategies, such as parent mentoring programs that employ the parent enrolled in Medicaid or CHIP to do the outreach.[13]

New Jersey Is Losing Up To $60 Million In Federal Funds for Uninsured Children Already Eligible for NJFC and the Marketplace

Over half (58 percent) of all uninsured children in New Jersey are eligible for, but not enrolled in NJFC — which has an income limit of 355 percent of the federal poverty level — and in the Marketplace, which has an income limit of 400 percent of the federal poverty level. That means most of them are eligible for coverage that is matched by the federal government at 50 percent in Medicaid and at least 65 percent in Child Health Insurance Program (CHIP). If New Jersey enrolled all these children, it would receive $60 million in federal matching funds.[14] Any new federal funds would increase economic activity in New Jersey because they have a multiplier effect since they come from outside the state and create new jobs.

Major Racial and Ethnic Health Disparities in Covering Children

Health equity means that every child should have an equal opportunity for good health regardless of the color of their skin. Unfortunately, that is not the case in New Jersey, as indicated by the uninsurance rates of children. The uninsurance rate for White kids is 2.2 percent. The rate for Hispanic children is three times higher, at 6.3 percent, while the rate for Black children is two and a half times higher, at 5.1 percent.

This data illustrates a disturbing reality in New Jersey — one of the most affluent states in the nation — as nearly three quarters (71 percent) of all children who are uninsured are children of color. In raw numbers, that means that 35,000 Hispanic children are uninsured, as are 15,000 Black children, and 5,000 Asian children, while only 21,000 white children are uninsured. We know that these inequities not only harm people of color when they are children, but when they grow up as well. For example, Black New Jerseyans die nearly five years earlier than white New Jerseyans. 

Children from Lower-Income Families Are Much More Likely to Be Uninsured Than Wealthier Kids

Wealthier children in New Jersey are more than five times more likely to be insured than poor kids. Whereas the uninsurance rate for kids above four times the poverty level is only 1.5 percent, the uninsurance rate for kids below the federal poverty level is a staggering 8.7 percent. These children meet the income level for Medicaid (138 percent of the federal poverty level) which provides comprehensive benefits and no cost sharing, although some of them may not be eligible. 

Health Coverage for Kids Often Depends on Where They Live 

A child’s health should not depend on where they live, but that is often the case in New Jersey. Cumberland County has the highest uninsurance rate at 6.3 percent, which is four times greater than wealthy Morris County, which has the lowest rate at only 1.5 percent. Unlike some other states, counties in New Jersey do not provide health coverage for uninsured kids, so the only way they can obtain public coverage is through the state’s program, NJFC. The uninsurance rate for kids in Morris County is already near universal health coverage, but that is not nearly the case in other parts of the state, especially in other much less affluent counties with higher unemployment rates.

CHIP Premiums are Among the Highest in the Nation

New Jersey’s maximum premium ($152 a month) in CHIP is the second highest premium in the nation for families above 300 percent of the federal poverty level, the second highest (tied with New York at $90) above 250 percent of the poverty level, and the fourth highest ($45 a month) above 200 percent of the poverty level.[19] These high costs are especially problematic in New Jersey because the state has one of the highest costs of living in the nation, especially for housing, so these families have little left in disposable income for premiums. This policy is completely inconsistent with Medicaid in New Jersey, which does not charge any premiums. Twenty-one states do not charge any premiums.

Further, these exceptionally high costs are even worse than they appear, as New Jersey does not vary premiums by family size. For example, the maximum premium in New York for families above 300 percent of the federal poverty level is $135 a month, but for one child it is only $45. Missouri, Vermont and Washington all vary their premiums by family size.

Waiting Periods in CHIP Cause 90-Day Gaps in Coverage 

Unlike 36 other states, New Jersey also requires that children must be uninsured for 90 days before they can enroll in CHIP if they leave employer-based coverage, which is the maximum allowed under federal law. The state does allow exceptions to the 90 days if they leave employer coverage through no fault of their own. Other than New Jersey, Maine is the only state in the Northeast that requires a waiting period. There is a growing recognition among states that this requirement simply creates another gap in health coverage. Within the last five years alone, at least 24 states have eliminated their waiting periods and two states moved all their children in CHIP into Medicaid, which does not require a waiting period.[20] States surrounding New Jersey that ended their waiting periods entirely are New York, Pennsylvania, Delaware, Connecticut, and Maryland. 

Many Middle-Income Children Are Denied Coverage in CHIP

Citizen children who exceed the income eligibility level for NJFC at 355 percent of the federal poverty level and for the Marketplace at 400 percent of the federal poverty level are also denied any subsidized health coverage. There are 14,600 such children in New Jersey, which represents 19 percent of all the uninsured children. Technically they should still be eligible for CHIP because state law requires the establishment of a buy-in program that allows consumers to purchase the full cost of insurance at reduced rates. Such a program was in operation until 2010, when the Christie administration decided that they would not make the changes that were needed to make the plans compliant with the essential benefits that were required in the Affordable Care Act. 

However, Congress has granted states new flexibility that will make it easier to administer a new program at lower rates. The savings to the consumer could be major with no cost to the state. The cost to insure a child in the private market is about twice the cost for coverage in CHIP.[21]

Unauthorized Immigrant Children are Ineligible for NJFC

There are about 17,000 undocumented, uninsured immigrant children in New Jersey who are also ineligible for NJFC under state law. These children represent 23 percent of all uninsured kids in the state. All six states and DC that have covered undocumented kids have lower uninsurance rates than in New Jersey. These states recognize that these children did not choose to live in this country — and they get sick just like any other kid. Ironically the state requires that they attend school and will pay for that education along with the local governments, but the state will not fund their health coverage. This investment in their education would be much more effective if these kids had health coverage as they would spend less time home sick or in school getting their classmates sick, too. 

Recommendations

While these challenges are significant, there are common sense solutions that will cost little to implement yet could be a game changer in making affordable health coverage available to every child in New Jersey. Given that so many children in New Jersey are currently still without any health coverage, the steps below should be taken as soon as possible. All costs are annualized; State FY 2020 costs would be about half these estimates assuming an implementation date of January 2020 (half the fiscal year).

Develop Better Strategies to Reach More Uninsured Children

  • Earmark funding for outreach on a permanent basis. This will allow the state to conduct the targeted and intensive outreach necessary to enroll the remaining uninsured. This funding would also be used to research where underserved children live. 
  • Focus outreach efforts on creating a permanent infrastructure of local organizations (including faith-based) that the community trusts which can effectively reach children with barriers to enrollment.
  • Authorize a parent mentoring program which has been shown to be more effective than traditional methods to insure Latino kids, improve health outcomes and increase employment for parents.
  • Authorize funding for community-based demonstration projects, in cooperation with public health agencies, schools and other local entities, to test various ways to provide health care for children of color and immigrant children who are unlikely to enroll in NJFC.

State Cost: $1 million for outreach, which could obtain up to another $1 million in federal matching funds and $1 million for demonstration projects, which may be eligible for federal funding depending on how they are structured.  

Remove Major Administrative Barriers to Health Coverage

  • Consistent with Medicaid and all other families below 200 percent of the federal poverty level in CHIP, eliminate all premiums to other families in CHIP. 
  • Like 36 other states, do not require that a child wholeaves employer-based healthcoveragemust be uninsured for 90 days before enrolling in CHIP.  

State Cost: Eliminating premiums would result in lost collections of up to $28 million annually in CHIP which would be offset set by $22 million in federal matching funds resulting in a state cost of $6 million  (this would rise to $10 million in the future as the federal CHIP matching rate gradually decreases to 65 percent). This does not take into account substantial administrative savings that would be achieved and that some of those collections would continue for co-payments which would not be eliminated. Ending the 90-day waiting period would increase enrollment by about 1,500 and cost about $900,000 in state funds which would be matched with $2.9 million in federal funds based on the experience of many states that have abandoned the waiting period.[22] This change would likely create administrative savings. 

Cover Those Children Who Are Currently Ineligible For NJFC

  • Reinstate and improve the buy-in program for families above 400% of the federal poverty level as long as they do not have coverage availabletothem for less than 9.5 percent of the family income similar to ACA policy,with the goal of making it as seamless and cost-effective as possible and open to more than one insurer. 
  • Authorize the state to require any or all the carriers to participate in the buy-in program as a condition for continuing to participate in NJFC.
  • Repeal any eligibility restrictions in NJFC based on immigration status.
  • Strengthen the rules for confidentiality to apply to all information relating to the administration of CHIP and Medicaid and allowing the state to withhold information from the federal government on children who receive health coverage at all state cost and where such sharing of information may not be in the best interest of the child. 

State Cost: There is no cost for the buy-in because the parents would pay the full cost in their premiums and any administrative costs or costs associated with any possible adverse selection. It would cost about $10 million to make uninsured unauthorized children eligible assuming a 25 percent participation rate which does not consider reduced costs from a decrease in the spread of infectious diseases in schools in addition to other health and social savings outline earlier. Further, the federal government would still be responsible for paying the full cost for hospitalization which could reduce the above estimate significantly.   

Improve Transparency and Accountability

  • Require that the work group, authorized under state law that advises the Department of Human Services on ways to improve outreach, meet at least annually.
  • Require the Department to submit an annual report to the legislature on actions it has taken and their results to provide affordable quality health coverage for all children in New Jersey and the extent to which coverage disparities have improved based on income, race/ethnicity, and geography.

State Cost: Insignificant administrative costs.

Possible Revenues

The $19 million total annual cost for all these recommendations ($9.5 million in SFY 2020 assuming a January 2020 start date) is statistically insignificant compared to a $15 billion budget for NJFC (the state cannot even project total NJFC cost from one year to the next within this level of accuracy). Thus, they should be funded with general revenues.

However, if additional revenues need to be identified for this expansion, it is likely that the savings which will occur as a result of the sharp drop in the child enrollment in NJFC due to existing and proposed federal anti-immigrant policies and a better economy could be more than sufficient to fund this proposal as would part of the revenues that would be generated by the  Corporate Responsibility Fee proposed by Governor Murphy, which is based on the number of employees (and their dependents) who are enrolled in Medicaid at all public cost, or other similar fee.[23]

End Notes

[1]American Community Survey, 2017

[2] Center on Budget and Policy Priorities, Medicaid Works: A State by State Look, no date, https://www.cbpp.org/medicaid-works-a-state-by-state-look#New_Jersey.

[3] Flores G. Lesley B, Children and US Federal Policy on Health and Health Care: Seen But Not Heard. JAMA 2005;168(12):1155-63. Pediatric.

[4] Howell Trenholm, et al, The Impact of New Health Insurance Coverage on Undocumented And Other Low-Income Children: Lesson From Three California Counties. Journal of Health Care for The Poor and Underserved, 2010.

[5] Cohodes, S, et al, The Effect of Child Health Insurance Access on Schooling: Evidence from Public Insurance Expansion. The National Bureau of Economic Research, 2014.

[6] D. Brown, et al, Medicaid As an Investment In Children: What Is The Long-Term Impact On Health Receipts? National Bureau of Economic Research, January 2015.

[7] M. H. Boudreaux, et al, The Long-Term Impact of Medicaid Exposure in Early Childhood: Evidence From The Program Origin, Journal of Health Economics, January 2016.

[8] American Community Survey, 2017.

[9]Joan Alker, Olivia Pham, Nation’s Progress on Children’s Health Coverage Reverses Course, November 21, 2018, https://ccf.georgetown.edu/2018/11/21/nations-progress-on-childrens-health-coverage-reverses-course/

[10] DHAHS, NJFC Enrollment Statistics, http://www.njfamilycare.org/default.aspx

[11]Georgetown University Health Policy Institute, How Proposed Changes to Public Charge What Impact Children In Immigrant Communities, no date,  https://ccf.georgetown.edu/wp-content/uploads/2018/11/Public-Charge-Fact-Sheet_Final_11918.pdf

[12] Samantha Artiga, Effects of Public Charge Changes on Health Coverage for Citizen Children, KFF, May 2018, http://files.kff.org/attachment/Issue-Brief-Potential-Effects-of-Public-Charge-Changes-on-Health-Coverage-for-Citizen-Children

[13] Glen Flores, et al, Parent Mentoring Program Increases Coverage Rates for Uninsured Latino Children, Health Equity, March 2018.

[14] The average total cost in CHIP and Medicaid for a child is $2,400 which was multiplied times the number of kids who are eligible for NJFC (minus unauthorized immigrant kids). Federal matching is based on 50 percent federal funds in Medicaid and 65 percent in CHIP which was prorated base on eligible kids for each of these programs.

[15] DHAHS, NJFC Enrollment Statistics, http://www.njfamilycare.org/default.aspx

[16] Georgetown University Health Policy Institute, How Proposed Changes to Public Charge What Impact Children In Immigrant Communities, no date, https://ccf.georgetown.edu/wp-content/uploads/2018/11/Public-Charge-Fact-Sheet_Final_11918.pdf

[17] Samantha Artiga, Effects of Public Charge Changes on Health Coverage for Citizen Children, KFF, May 2018, http://files.kff.org/attachment/Issue-Brief-Potential-Effects-of-Public-Charge-Changes-on-Health-Coverage-for-Citizen-Children

[18] Glen Flores, et al, Parent Mentoring Program Increases Coverage Rates for Uninsured Latino Children, Health Equity, March 2018.

[19] Trisha Brooks, Kaiser Family Foundation, Medicaid And CHIP Eligibility, Enrollment, Renewal, And Cost Sharing Policies As of January 2019: Findings from a 50-state Survey, March 2018 http://files.kff.org/attachment/Report-Medicaid-and-CHIP-Eligibility-Enrollment-Renewal-and-Cost-Sharing-Policies-as-of-January-2019

[20] Ibid.

[21] Healthcare.gov

[22] The enrollment changes for all states that ended their waiting period in 2014 was calculated for 2013 and 2015 and compared to all other states. The enrollment changes for states that dropped their waiting period was a .2 percent increase vs. a .5 percent decrease in all other states. That .7 percent difference was applied to the CHIP enrollment and costs in the governor’s 2020 budget. The sources for enrollment rates for all states are https://ccf.georgetown.edu/wp-content/uploads/2013/01/Getting-Into-Gear-for-2014.pdfand https://ccf.georgetown.edu/wp-content/uploads/2015/01/Modern-Era-Medicaid-January-2015.pdf

[23] FY2020 Budget in Brief, p. 6,https://www.nj.gov/treasury/omb/publications/20bib/BIB.pdf

NJPP: State Health Exchange a Win for Working Families

Posted on by Raymond Castro

In response to Governor Murphy’s announcement that the State of New Jersey will establish a state-based health care exchange for the year 2021, NJPP Health Policy Director Raymond Castro praised the decision, calling it a win for working families. See below for a complete statement:

RAYMOND CASTRO, HEALTH POLICY DIRECTOR, NEW JERSEY POLICY PERSPECTIVE:

“This is great news for residents who have been struggling to afford their health insurance. It will allow the state the flexibility to provide even better assistance to working New Jerseyans. States with their own exchanges are exploring and implementing innovative ways to reduce premiums and cost sharing for all income levels, with some states even allowing individuals who are not eligible for federal subsidies to purchase plans at much lower rates. These actions, combined with better outreach, will reduce  premiums in the individual marketplace by encouraging healthier New Jerseyans to participate in the Exchange. It should also reverse this year’s decrease in enrollment in the Exchange (from 265,000 to 240,000).

“Remarkably, the state Exchange can be established without additional state funds since insurer fees that otherwise would go to the federal government will stay in New Jersey, where they can be better used to meet the state’s unique needs.

“We also welcome Governor Murphy’s proposal to codify all of the ACA’s major consumer protections in state law. This will ensure that no matter what the Trump administration or Congress does, New Jerseyans will be protected with quality, affordable insurance.”

# # #

Targeted Public Investments Can Improve Health Across New Jersey

Posted on by Brandon McKoy

To read a PDF version of this report, click here.

By Brandon McKoy, Sheila Reynertson, and Raymond Castro

All New Jerseyans should have the opportunity to lead a healthy life, no matter where they live or how much money they make. State policymakers can foster this opportunity for all Garden State residents by unleashing targeted public investments and making smart budget and tax policy decisions. Lawmakers — as well as health care leaders — need to look beyond traditional investments in health care services and access (think insurance, hospitals, and the like), and consider how the state’s investments in education, housing, and other socioeconomic and environmental factors can eliminate the barriers to a healthy life for New Jerseyans.

While access to health care does play an important role in influencing health outcomes, the conditions and circumstances in which people live, work, learn, and play are very influential in shaping how healthy they feel and how long they live. One widely recognized and validated model, from the University of Wisconsin Population Health Institute, suggests that 80 percent of health outcomes are determined by social and economic, environmental, and behavioral factors; just 20 percent are attributable to health care.[1] Social, economic, and environmental factors are largely shaped by state and federal policy and budget decisions.

Low-Income New Jerseyans Face Unique Barriers to Healthy Living

Healthy people and communities are the building blocks of a strong and thriving New Jersey. Since state policymakers expanded Medicaid in 2013, New Jersey’s uninsured rate rapidly dropped to 8 percent in 2017 from 13.2 percent in 2013. However, a number of barriers prevent many Garden State communities from experiencing good health, including economic instability and hardship; limited access to healthy, affordable food; lack of affordable housing; and exercise options in safe, walkable neighborhoods.

In short, opportunities for Americans to be healthy are not distributed equally. As documented by many studies, there is a direct relationship between income and health with low-income Americans having poorer self-reported health status across all racial and ethnic groups.[2]Meanwhile, a history of structural racism and inequality have helped create especially poor health outcomes for Americans of color, who are more likely to report their health as fair or poor than their White peers. And low-income people of color have the poorest self-reported health status of all, with more than 1 in 5 low-income Black and Latinx people reporting fair or poor health (among racial groups where data are available: Black, Latinx, and White).[3]

In New Jersey, these health inequities can be viewed geographically and demographically, though it’s worth noting that due to historically racist policies in housing and other areas, residential segregation has created a situation with many demographically homogenous geographies across the Garden State. This is not so evident at the county level, but much more so at the ZIP code level.

For example, the share of residents in poor or fair health is just 11 percent in New Jersey’s healthiest county (Morris) and 23 percent in the state’s least healthy county (Cumberland). The disparities across racial and ethnic lines are even more severe: just 11 percent of White and Asian New Jerseyans are in poor or fair health, compared to 20 percent and 32 percent of Black and Latinx New Jerseyans, respectively.[4]

Where one is born and resides in New Jersey can have a big impact on how long one lives. Take life expectancy in the Trenton area, for example. In the 08611 ZIP code, which includes the Chambersburg and Mill Hill neighborhoods, the average life expectancy is 73 years. As one moves north and east of Trenton, people live longer lives: In the 08619 ZIP code, that includes neighborhoods in both Trenton and Hamilton, the average life expectancy jumps 10 percent, to 80 years; and moving farther out to the 08550 ZIP code (the Princeton Junction section of West Windsor), the average life expectancy increases another 9 percent, to 87 years.[5]

This neighborhood-by-neighborhood disparity is not limited to Mercer County, of course. One finds similar results when comparing life expectancy in Camden and Cherry Hill, or in Newark and Montclair, for example.

Overall, New Jerseyans of color are less likely to achieve greater health than their White neighbors — no matter where they live. While close to 60 percent of White New Jerseyans have “good or excellent health,” according to the health equity metrics developed as part of the Health Opportunity and Equity (HOPE) Initiative, less than 45 percent of Black, and less than 35 percent of Latinx, New Jerseyans do.[6]Black New Jerseyans also have significantly lower average life expectancies, and higher rates of infant mortality, than their White or Latinx neighbors.[7]

Building Healthy Communities and Advancing Equity Through Public Policy

 New Jersey policymakers should focus on improving the health and well-being of all the state’s residents by implementing sound policies that lift people out of poverty and boost opportunity, and by leveraging the state budget to support programs beyond investments in health care. Many programs and policies that may not seem health-related on the surface can help build healthy communities and advance equity.

The good news is that New Jersey has already taken major steps in this direction; lawmakers ought to build on that foundation of progress in 2019 and beyond. Here’s how.

Make Health Care Affordable for All New Jerseyans

Polls in New Jersey have shown that health care costs were the number one issue in the midterm elections last year. This is understandable because New Jersey is often ranked among the top states in medical costs. To help address this issue, policymakers enacted a reinsurance program and reinstated the individual mandate that was repealed at the federal level, both of which have and will continue to reduce insurance costs.[8]Nevertheless, much more needs to be done. New Jersey lawmakers should:

  • Make all uninsured children eligible for NJ FamilyCare (includes Medicaid and CHIP) regardless of immigration status and income
  • Establish a commission to oversee and set caps on the excessive costs of prescription drugs
  • Raise Medicaid reimbursement rates for pediatric services that are not sufficiently accessible to low-income children

Boost the Income of Workers and Their Families

In a high-cost state like New Jersey, far too many workers and their families are not paid enough to make ends meet. This creates a wide range of barriers to better health for hundreds of thousands of New Jerseyans who are unable to afford a decent, safe place to live; or who struggle to regularly put nutritious meals on the table; or who must cope with the toxic stress and uncertainty that comes with being unable to secure basic economic security.

To allow all New Jerseyans the chance to live healthy, thriving lives, policymakers must boost the income of these workers and their families on both payday and at tax time.

Raise the minimum wage

New Jersey’s minimum wage in 2019 is $8.85, a woefully inadequate rate that does not help workers meet their basic needs. But thanks to the hard work of NJPP and our allies, the Governor signed into law an increase in the wage to $15 by 2024 for most workers, after which future increases will be tied to inflation. The wage will go up to $10 on July 1, 2019, and then increase to $11 on January 1, 2020. The wage will then increase $1 on January 1st each year until reaching $15 in 2024. This increase will benefit about 1 million of the state’s workers, helping them meet their daily needs and improving our economy.[9]

Some workers are on a separate, slower phase-in schedule. Those who are employed as seasonal workers or at businesses with fewer than 6 workers will get to $15 by 2026, after which there is a provision to bring them to parity with the general wage by 2028. For farmworkers, they will get to $12.50 by 2024, after which the Commissioner of Labor and Secretary of Agriculture will determine whether they should continue to $15. If they decide in the affirmative, farm workers will reach $15 by 2027, after which they will reach parity with the general wage by 2030.

New Jersey’s tipped wage will also get a small increase to $5.13 from the federal tipped minimum wage of $2.13. While this is important, the tipped differential between the tipped wage and the minimum wage will go from $6.72 in 2019 to $9.87 in 2024, a development that we have advised against. NJPP has reported on the unique challenges faced by workers who rely on tips for a majority of their pay, from increased instances of wage theft to a heightened risk of assault and sexual harassment. NJPP and labor advocates will continue to push for the complete phase out of the tipped wage.

Nevertheless, this is a hugely important change that will reverberate throughout New Jersey’s economy. As one of the slowest states to emerge from the Great Recession, and with a population where four out of ten households essentially live paycheck to paycheck and have trouble making ends meet, raising the minimum wage to $15 will be transformative for the state’s workers, families, and businesses.[10]Lawmakers should develop new legislation to phase-out the tipped wage altogether, a move that would significantly improve the economic security and work experience of tipped workers.[11]

Expand tax credits for working families

 Increasing take-home pay for low-paid workers is a critical step toward increasing economic security and the prospects for better health. It is equally critical for policymakers to ensure low-income and working-class families aren’t unduly punished by an upside-down tax code that asks them to pay greater shares of their income to state and local taxes.

The federal Earned Income Tax Credit (EITC) provides low-paid workers with a boost to their incomes in the form of a tax refund. This credit lifts more than 5 million Americans — including 3 million children — out of poverty each year, and reduces the severity of poverty for many millions more.[12]The EITC has been shown to have tremendous widespread benefits, including improved health for infantsand mothers.

New Jersey — like 28 other states and D.C. — has a state EITC that builds on the federal credit and helps even out the tax code and increase opportunity for working families and their children.[13]Children who get additional income through programs like the EITC tend to do better and go farther in school and tend to work and earn more as adults — all of which can have a strong, positive effect on their ability to live healthier lives.

The state EITC in New Jersey is strong, thanks to a longstanding tradition of bipartisan support in the legislature and governor’s office. Last year, policymakers came together and agreed to increase the state EITC from 35 percent of the federal credit to 40 percent over three years. This will put tens of millions of more dollars each year in the pockets of over half a million New Jersey families.

Lawmakers should build on the success of this vital credit by expanding it to an important group of low-paid workers that the EITC largely ignores: adults who aren’t raising children. California, Maryland, Minnesota, and the District of Columbia have already expanded their EITCs to include these workers; hundreds of thousands of low-paid New Jersey workers could receive a much-needed boost to help make ends meet if Garden State lawmakers follow suit.[14][15]

New Jersey policymakers took another big step last year to help the state’s lower-income working families at tax time when they created a new child and dependent care tax credit (CDCTC) for 74,000 families with annual incomes of less than $60,000. It is based on the federal credit, which allows parents and caregivers to deduct up to 35 percent of employment related care expenses from their federal taxes. However, New Jersey caps the CDCTC at a low 50% of the federal credit and is nonrefundable, meaning it will offset the tax due but cannot reduce the tax below $0. Making the CDCTC fully refundable and at a more generous percentage of the federal credit would help the families that need it the most. Half of the states and D.C. currently offer these credits. In twelve states the credits are fully refundable.

Ensure All Workers Have the Ability to Balance Work and Family Needs

Expand paid family leave

 In 2008, New Jersey became the second state to adopt a paid family leave policy. Nearly a decade into the Family Leave Insurance (FLI) program, it’s a clear success, having replaced hundreds of millions of dollars in lost wages for tens of thousands of New Jerseyans who needed to take time off to be with a new child or sick family member.

The existence of this program is a boon for health in New Jersey, particularly for the health of young children. A period of paid leave after the birth of a child contributes to the healthy development of infants and toddlers. There is evidence linking paid leave to better maternal and child health outcomes, like reduced infant and post-neonatal mortality rates; increased breastfeeding, well-child medical visits, and immunizations; and improved health outcomes for children in early elementary school, including reduced issues with maintaining a healthy weight, ADHD and hearing-related problems, particularly for less-advantaged children.[16]

And yet this trailblazing program is falling short of its potential, with serious repercussions for New Jersey families and for the state’s economy. The program is not widely advertised, particularly among low-paid workers. And the wage replacement level and cap on earnings are so low that many workers across the income scale simply cannot afford to take advantage of what should be an important benefit.

In January 2019, legislation to improve and expand the NJ Family Leave Insurance Program passed both houses. The reforms and additional changes in the bill will go a long way to make the program more accessible for working families, especially those struggling to balance work and family caregiving. With the bill on the Governor’s desk, New Jersey is poised to both remove the barriers that have stopped many people from taking paid family leave and increase public awareness of the program so that no one will have to choose work over the time to heal or care for a loved one in need. These improvements will be fully funded by a small increase to current worker contributions, with measurable benefits for families, employers and the state’s economy. Specifically, the new law will:

  • Allow workers to take up to 12 weeks of paid leave
  • Increase the current two-thirds wage replacement
  • Raise the very low cap on earnings while on leave
  • Expand job protections for 200,000 workers employed at companies with 30 to 50 workers
  • Expand the definition of family to include grandparents and grandkids, siblings, adult children, parents-in-law, and chosen family
  • Provide benefits for survivors of domestic violence or sexual assault and to those caring for survivors
  • Increase public awareness with designated funding for outreach

Ensure sound implementation of earned sick leave

Until last year,over 1 million New Jerseyans, mostly in low-paid jobs, couldn’t get paid if they needed to take time off because they were sick. And for many, taking an unpaid day off meant forfeiting their job. Last year state policymakers fixed that problem.

The New Jersey Earned Sick Leave Law — which went into effect on October 29, 2018 — allows employees to accrue 1 hour of earned sick leave for every 30 hours worked, for up to 40 hours each year. This new law is important for workers, particularly low-paid workers, and also for public health.

Earned sick leave has been linked to reducing preventable hospitalizations and emergency-room visits; stopping the spread of illness (particularly foodborne illness, since the restaurant industry is one where workers are least likely to have employer-sponsored access to earned sick days); and more.[17][18]People who come to work sick also get injured more often, particularly in high-risk occupations like manufacturing, construction, healthcare and agriculture.[19]

Being able to take earned sick days is also very important for working parents. When they aren’t allowed to take earned sick days, parents face the difficult decision of caring for themselves and their loved ones or showing up for work, a choice which could extend the duration and increase the severity of an illness.

We have seen evidence right here in New Jersey of how earned sick leave policies can improve health. In Jersey City, which was the first New Jersey municipality to pass an earned sick leave policy in 2014, fewer sick Jersey City employees are coming to work, reducing the risk of illness spreading around the city — an important finding that promotes both public health and a stronger economy.[20]

The New Jersey Department of Labor is now in the process of finalizing regulations which appear to be strong interpretations consistent with Earned Sick Leave Act. They establish clear guidelines for New Jersey employers about their new obligations and employees about their rights to access earned time off to recover from an illness or help a sick loved one. To ensure New Jersey workers and employers learn about the law, regulations will also provide for general outreach and education efforts in multiple languages.

Invest in the Building Blocks of Healthy, Strong Communities

Continue expanding access to high-quality preschool

Universal high-quality preschool prepares children for school and has been found to boost their test scores, high school graduation rates and employment opportunities, as well as their long-term health.

Children who participate in high-quality early childhood programs experience immediate and long-term health-related benefits.[21]They also tend to go farther in school; setting up another wave of positive outcomes, since people with more education live longer, are less likely to die from cancer or heart disease and have better access to health care and insurance.[22]

In 2008, the legislature recognized the value of expanding access to high-quality early education, passing the School Finance and Reform Act to bring preschool to more towns across the state. Still, many New Jersey’s children lack access to early education. That’s because many successive governors and legislatures have yet to deliver on the promise of the 2008 law. That has begun to change, and in last two state budgets lawmakers dedicated over $100 million in additional funding to expand state-funded, full-day preschool for 3- and 4-year-olds to more school districts.[23]As a result, the number of districts providing at least partial access to high-quality public preschool has more than tripled, from 35 just two years ago to over 100 today.[24]

New Jersey policymakers should continue to take steps to fully fund the 2008 law and expand preschool to more districts, but they also ought to think bigger and bolder and work towards implementing truly universal preschool across the entire state, in every district.

Make public transit more accessible, affordable, and reliable

Transportation is a monumental issue for New Jersey, and here more than anywhere else the conversation about transportation must be about public transit. But, despite the fact that nearly a million New Jerseyans use public transportation on a daily basis, the political and policy culture of the state remains dominated by car-centric thinking. This is an enormous problem for the most densely populated state in the nation.

As a result, public transit in New Jersey is in crisis. The infrastructure is decaying. The funding streams are dried up, and the funding structure is broken. As a result, the costs to commuters are rising. And still, the service is getting worse. Low-income residents and New Jerseyans of color are disproportionately harmed by this public transit crisis that is also making our communities less healthy.

This must change. After all, increased use of public transit has a positive effect on health. It improves local economies, helping boost working families and their long-term health. It makes the air cleaner and safer for New Jerseyans to breathe by getting more automobiles off the roads. And it leads to more physical activity too — public transit users, on average, walk more than drivers. And the connections between bicycle infrastructure and transit infrastructure show tremendous promise, helping to extend the reach of public transit and get more riders on buses and in trains, without further clogging local roads — and doing so in a way that is more affordable for less well-off residents.

But public transit’s social, economic and health benefits don’t exist if there are no riders, or not enough riders. And if the transit system is unaffordable, unreliable and unsafe due to years of disinvestment, the riders will — if they can — stay away.

New Jersey has shirked its responsibility to invest the dollars necessary to create a reliable, affordable, modern public transit system. In 2016, policymakers took a big step toward fixing this problem by raising fuel taxes to help pay for capital investments in transit modernization and for expansion across the state. That will help, but it will not fix New Jersey’s long-standing underfunding of NJ Transitoperatingcosts.

Lawmakers must find adequate, stable and dedicated funding for NJ Transit’s operations. From 2005 to 2017, the state slashed direct support of NJ Transit by 59 percent. This meant NJ Transit increasingly turned to riders to make up the difference. Major fare hikes raised rider contributions by 45 percent over the same time.[25]

Riders pick up far more of the tab for NJ Transit (52 percent) than they do for most peer transit agencies around the country. In Chicago, for example, riders pay for 38 percent of operations and in Los Angeles, just 22 percent. This is a direct result of how little of NJ Transit’s operating budget is covered by dedicated taxes — just 1.3 percent, compared to 51 percent in Chicago and 58 percent in Los Angeles.

Dedicated, stable annual revenues are necessary to support NJ Transit’s operating budget. Lawmakers should consider a variety of options, including congestion pricing, a surcharge on gas-guzzling automobile purchases and taxing businesses that disproportionately benefit from transit (as New York’s Metropolitan Transit Agency does). Ensuring stable and adequate support for operating expenses will prevent NJ Transit from imposing even more fare hikes or capital funding raids.

Reverse disinvestment in higher education

People who attend and graduate from college have a greater shot at economic success — and at living healthier lives. Now more than ever, Americans with less education are dying earlier than their peers; more likely to have major diseases, such as heart disease and diabetes; more likely to have risk factors that predict disease, such as smoking and obesity; and more likely to have diminished physical abilities for health reasons or to be disabled.[26]

New Jersey policymakers concerned with improving health outcomes for all residents shouldn’t overlook the role of affordable public higher education — and should work to reverse the recent trend of sustained disinvestment in New Jersey’s public colleges and universities.

At a time when more students than ever are seeking to secure their families’ future with a college education, New Jersey has slashed funding for its institutions of higher learning and shifted the cost burden onto the shoulders of striving students and their families. Between 2008 and 2018, New Jersey’s funding for public four-year colleges and universities dropped 24 percent, representing a $2,387 cut per-student. Over that same period, average tuition costs at public four-year colleges and universities increased 18 percent, or $2,075, from $11,973 in 2008 to $13,868 in 2018.

This results in an increasingly heavy burden for New Jersey families. In 2017, average tuition and fees at a public four-year institution accounted for 17 percent of a New Jersey family’s median income. For families of color — who often face additional barriers to employment and increased difficulty accessing jobs that pay better — the situation was far more severe, with those costs accounting for 27 percent of a Black New Jersey family’s median income and 25 percent of a Latinx family’s median income.[27]

To slow the increase in unaffordable college prices and rising student debt, New Jersey should at the very least return to pre-recession levels of funding for higher education.

Raise adequate revenues in an equitable way

Creating opportunities for all New Jerseyans to lead healthier lives requires investments beyond traditional health care spending. It is essential to apply a health lens to the way the state raises and spends money, because health starts with where we live, learn, work, and play. Great schools, safe and vibrant communities, quality jobs, and programs that lift and keep people out of poverty strengthen our economy while creating opportunities for healthier New Jerseyans in every corner of the state. To support these foundations of thriving communities, our state needs dependable revenues that are equitable, sustainable, and adequate.

The good news is that New Jersey’s fiscal year 2019 budget, the first of Governor Murphy’s administration, signaled a much-needed reversal after nearly a decade of austere fiscal policy.[28]After years of neglect, assets critical to New Jersey’s economic success, like K-12 schools, public transit, and county colleges all received modest increases in state funding. However, the most recent budget falls short in one key area that has plagued the state and its finances for three decades: there are simply not enough stable, long-term sources of new revenue to sustain these increased investments.

Policymakers should build on the steps taken in the FY 2019 budget by implementing adequate revenue streams. Doing so will help unleash important public investments that can boost opportunity and the long-term health of New Jersey’s current and future generations.

Policymakers should:

  • Continue to make the state income tax more based on the ability to pay, by levying higher marginal rates on income over $1 million
  • Restore adequate taxation of inherited wealth
  • Reform and minimize corporate tax breaks for economic development
  • Modernize the sales tax and return the base rate to 7 percent
  • Strengthen the state’s newly implemented combined reporting law
  • Make the corporate tax surcharge permanent

Author’s Note: Support for this report was provided by the Robert Wood Johnson Foundation. The views expressed here do not necessarily reflect the views of the Foundation.

 

Endnotes

[1]Patrick L Remington, Bridget B Catlin and Keith P Gennuso, “The County Health Rankings: rationale and methods,” Population Health Metrics, April 17, 2015, https://pophealthmetrics.biomedcentral.com/articles/10.1186/s12963-015-0044-2. Note that the County Health Rankings model does not account for genetics and biology, which are not measurable or modifiable.

[2]https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2837459/

[3]Ibid.

[4]http://www.countyhealthrankings.org/app/new-jersey/2018/overview

[5]https://societyhealth.vcu.edu/work/the-projects/mapstrenton.html

[6]http://www.nationalcollaborative.org/wp-content/uploads/2018/07/hope_chartbook_final-1.pdf

[7]Although life expectancy for Latinx people is higher than for whites and higher than the U.S. average, the data include individuals born in the United States as well as individuals born outside the United States. Individuals born in the United States tend to have lower life expectancy than those born outside the United States. A growing body of research explores other potential reasons for longer life expectancy among Latinx populations relative to what would be expected based on their income and education levels. See: Neil K. Mehta et al., “Life Expectancy Among U.S.-born and Foreign-born Older Adults in the United States: Estimates From Linked Social Security and Medicare Data,” Demography: August 2016, 53(4): 1109-1134, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5026916/; Paola Scommenga, “Exploring the Paradox of U.S. Hispanics’ Longer Life Expectancy,” Population Reference Bureau, July 12, 2013, https://www.prb.org/us-hispanics-life-expectancy/

[8]https://www.njpp.org/healthcare/new-jerseys-individual-market-premiums-to-be-among-the-lowest-in-the-nation

[9]https://www.njpp.org/reports/increasing-the-minimum-wage-to-15-would-boost-the-economy-and-help-over-1-million-workers-but-not-if-the-legislature-stalls

[10]United Way of Northern New Jersey, ALICE Report 2019: https://www.dropbox.com/s/h3huycfbak512t2/18_UW_ALICE_Report_NJ_Update_10.19.18_Lowres.pdf?dl=0

[11]http://rocunited.org/wp-content/uploads/2018/02/OneFairWage_W.pdf

[12]https://www.cbpp.org/research/federal-tax/policy-basics-the-earned-income-tax-credit

[13]https://www.cbpp.org/research/state-budget-and-tax/policy-basics-state-earned-income-tax-credits

[14]https://www.cbpp.org/blog/state-eitc-expansions-will-help-millions-of-workers-and-their-families

[15]https://www.njpp.org/budget/eitc-expansion-would-provide-a-crucial-boost-to-hundreds-of-thousands-of-new-jerseyans

[16]http://www.nationalpartnership.org/our-work/resources/workplace/paid-leave/the-child-development-case-for-a-national-paid-family-and-medical-leave-insurance-program.pdf

[17]https://smlr.rutgers.edu/sites/default/files/images/NJ_HIA_-_Full_ReportApril2011_0.pdf

[18]http://www.nationalpartnership.org/our-work/resources/workplace/paid-sick-days/paid-sick-days-lead-to-cost-savings-savings-for-all.pdf

[19]https://blogs.cdc.gov/niosh-science-blog/2012/07/30/sick-leave/

[20]https://smlr.rutgers.edu/sites/default/files/documents/Jersey_City_ESD_Issue_Brief.pdf

[21]https://developingchild.harvard.edu/resources/the-foundations-of-lifelong-health-are-built-in-early-childhood/

[22]https://www.rwjf.org/content/dam/farm/reports/issue_briefs/2014/rwjf414926

[23]https://prekourway.org/assets/Pre-K-Our-Way_ExpandNJsPreK_OCTOBER_2018.pdf

[24]https://prekourway.org/assets/Pre-K-Our-Way_WINTER-2018_Newsletter.pdf

[25]http://blog.tstc.org/2016/12/13/nj-transit-lacks-dedicated-funding-thats-not-normal/

[26]https://www.rwjf.org/en/library/research/2014/01/education–it-matters-more-to-health-than-ever-before.html

[27]https://www.cbpp.org/research/state-budget-and-tax/unkept-promises-state-cuts-to-higher-education-threaten-access-and

[28]https://www.njpp.org/budget/opportunity-lost-consequences-and-shortcomings-of-the-fiscal-year-2019-budget

«« Previous Posts∞Older Posts »»