New Jersey has become the second state to legislate an individual Obamacare-like health care mandate following the lead of Massachusetts, which instituted its mandate in 2006 when it passed Romneycare. The New Jersey mandate replaces the financial penalty for not having health insurance that Republicans in Congress repealed in December.
In 2015 some 189,000 New Jersey residents paid $93 million in Affordable Care Act (ACA) fines for declining to obtain health insurance, according to the state’s Office of Legislative Services.
The funds collected under the new mandate, which takes effect Jan. 1, will go toward a state reinsurance fund to help lower premiums for residents.
“Protecting the viability of the individual mandate is needed to maintain a foundation for the insurance market and to allow the success of the ACA to continue,” Sen. Joe Vitale (D.-Middlesex), a sponsor of the bill, said in a statement. “New Jersey has benefited from the health care law, and we want to see that those benefits continue. It has made health care more affordable and more accessible, especially for those in need.”
The bill was signed by New Jersey Gov. Phil Murphy (D.) on Wednesday.
Massachusetts became the first state to adopt an individual mandate. That law served as a model for the mandate included in the ACA, which was signed into law by former President Barack Obama in 2010.