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Former Commissioner of Health Heather Howard. (Photo: Heather Howard).

Opinion: New Jersey should increase Medicaid reimbursement rates for reproductive health care

By Heather Howard, May 15 2023 11:29 am


The battle over abortion rights and care continues in all corners of the country. This fight does not just include the struggle over the fundamental legal right – although, of course, we are seeing that play out every day in state capitals. It also includes a fight over whether abortion care will be accessible for those who need it, even in states where the legal right is protected. In this particular fight, New Jersey would do well to look to our neighboring state, because New York is setting the example by allocating critical funds for abortion care. 

New York has amplified its commitment to reproductive health through direct support to reproductive healthcare providers. For Fiscal Year 2023, this support came in the appropriation of $35 million to providers. $25 million was allocated to an Abortion Provider Support Fund for providers in order to both expand capacity and ensure access for patients seeking care in New York. The remaining $10 million went towards security grants through the Division of Criminal Justice Services to help ensure the safety of care providers who are often faced with threats of violence by radicalized anti-abortion advocates.  

New York has not stopped there. The budget the state recently adopted will provide an additional $100.7 million to support abortion providers, including $65.8 million to increase Medicaid reimbursement rates for abortion and family planning services. Additionally, legislation Governor Hochul recently signed will ensure access to medication abortion for SUNY and CUNY students, and make hormonal contraception available over-the-counter. 

Fortunately New Jersey has a strong record of support for reproductive healthcare. Like New York, it is allowing the sale of hormonal contraceptives without a prescription. The Murphy Administration has provided additional funding for reproductive care providers to aid in the expansion of protections and access to reproductive health care. The funding included zero-percent interest loans for upgrades at healthcare facilities and grants for security enhancements. And NJ Attorney General Matt Platkin created a Reproductive Rights Strike Force, which has taken steps to protect healthcare providers and patients. 

Last December, the New Jersey Department of Banking and Insurance began the formal process to require coverage for abortion without exceptions under the health benefits plans it regulates following the conclusion of its 2022 study, as mandated by Gov. Murphy’s historic Freedom of Reproductive Choice Act. Coverage began on January first. The state also enacted legislation to prevent the disclosure of a patient’s medical records related to reproductive health care without consent and prohibit public entities or employees from cooperating with interstate investigations against those seeking, receiving, facilitating, or providing care that is legal in New Jersey. But New Jersey can and should do more. 

Indeed, New York may be setting the example but it isn’t the only state that recognizes the need for increased financial commitment toward abortion care. California, Illinois, New Mexico, and Oregon have all increased Medicaid reimbursement rates for abortion in recognition of the increased burden on providers in this challenging environment. These rate increases range from 20% to over 500%, demonstrating that abortion has historically been under-reimbursed by Medicaid, and emphasizing that NOW is the moment to rectify this situation and provide much-needed support to abortion care providers.     

New Jersey must take note. Increasing Medicaid reimbursement rates would expand access for the approximately 2 million New Jerseyans in the program, ensure the long-term sustainability of reproductive healthcare providers, and foster a great return on investment for the State. 

New Jersey’s family planning providers offer patients a full range of preventative reproductive health care services, including lifesaving cancer screenings, birth control, and testing and treatment for sexually transmitted infections and HIV/AIDS. Several providers, including the two Planned Parenthood affiliates in the state, also offer abortion services.  

Family planning reimbursement rates have not been increased in over a decade, and abortion rates have not been increased for even longer. Medicaid reimbursement rates for many of these essential services are clearly insufficient, which results in increased uncompensated care charges. Planned Parenthood health centers instead rely on the generosity of donors to underwrite the cost of care for Medicaid patients. Not all providers have that luxury, which is notably unsustainable.  

In a post-Roe world, patients from around the country are turning to states like New York and New Jersey for abortion and miscarriage care. Because these individuals are ineligible for NJ FamilyCare and many of them face even more dire financial needs due to travel expenses, their care typically increases uncompensated care charges. Increasing Medicaid reimbursement rates would maximize Medicaid dollars for NJ residents and ease the burden on stretched providers who are picking up the difference for the many folks inedible for state benefits. 

Moreover, if family planning providers are reimbursed more appropriately for their services, they are better able to support all who turn to them for care. Increased reimbursement rates may also allow more providers to make the decision to see Medicaid patients without taking a difficult loss to their bottom line, leading to increased access for over 2 million New Jerseyans who rely on Medicaid for their health care coverage. 

New Jersey’s investment in Medicaid family planning services receives a 9-to-1 federal match, so the funding increase for much of this investment will come from the federal government. Therefore, the state will be responsible for only ten percent of the increase in funding – an enormous impact with just a small investment. While abortion services are not eligible for this match, it is time to bring abortion reimbursement rates to parity with the level of care that providers offer every day – especially as the landscape of abortion access is imperiled in other states across the country. 

New Jersey has done a great deal in protecting abortion rights but with this budget, state leaders have the opportunity to expand access to these critical healthcare services and ensure sustainability for healthcare providers in the long term. If a roadmap is required, New Jersey need only look next door.  

Heather Howard is Professor of the Practice at Princeton University’s School of Public and International Affairs and former Commissioner for the New Jersey Department of Health and Senior Services.


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