While the updated New Jersey Temporary Disability Benefits (TDB) Law is lowering the barriers for private plans and is providing benefit enhancements for NJ employees in 2020, quite a few things still need to be fleshed out for the industry to implement properly. Even so, we have been receiving many questions from brokers who are eager to quote New Jersey Temporary Disability Insurance (TDI) for next year or who already want to submit applications electronically.
Our best interpretation and current assessment of the status of TDI is that New Jersey has made good progress in removing obstacles for employers to switch coverage to approved private plans, but questions remain centered around its implementation, process and level of funding. More concrete answers for most of these questions are expected from the State of New Jersey before early September. So for now, enjoy your summer and stay tuned for more updates as we work with the State to get the answers you need.
Here is the list of the top 10 questions that are still open and need to be determined by the State of New Jersey:
When will New Jersey be able to accept electronic submissions of Temporary Disability Insurance applications (form DP-1)?
The State is working on it.
Will there be changes to New Jersey’s current DP-1 form?
Yes, we expect the DP-1 to change, such as the removal of the Employee Election section since this is no longer required. Subscribe here to stay in the know on TDI updates such as a new DP-1 form.
How will insurance carriers build the Temporary Disability Benefit changes into their policies?
It hasn’t been decided yet whether carriers will need to file new, updated policy forms, a rider, or an amendment.
When will the State release the “Notice of NJ Employee Contribution Rate Change” and “Notice of NJ TDB Rates” memos?
Usually, the State of New Jersey issues these annual notices to insurance carriers around October/November, but this may change.
What’s different about the Temporary Disability Insurance rate calculation this time?
In previous years, the State would develop a rate based on historical experience. 2020 will be different because the actuaries will be doing a look forward to assess the costs of the mid-year benefit changes on 7/1/2020.
Will New Jersey be providing 2 memos for 2020 given the mid-year change in benefits?
This is still to be determined.
Should my clients expect two posting notices for 2020?
This still needs to be determined as well.
Does the increase in wage cap apply only to employee contributions or to both the employee and employer contributions?
We anticipate the employee and employer contribution rates to remain separate factors. But we await clarification whether the respective wage caps will be different or continue to use one reporting cap for both.
Based on the wage cap increasing on 1/1/20, will taxability on claims be set at the employer level or claimant level?
This is still to be determined.
Anything else that might be impacted as a result of the changes?
Yes, other things could potentially be impacted, such as bills if employee and employer were to have different taxable wage caps.
But again, details and their ripple effects will be determined as we get closer to the changes taking effect.
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The information included in this blog post contains forward-looking statements. Such statements are based on management’s beliefs and assumptions made based on information currently available to management. Any TDI information is as of the blog post’s date stamp; it is based on the applicable statutes and regulation, and may change as regulations evolve or New Jersey issues guidance regarding its Temporary Disability Insurance regulations. Have more questions? Email us at firstname.lastname@example.org
The information in this post is not intended as an offer of coverage (“Invitation to Contract”). It is for illustrative purposes only, providing a general overview of the services described. It is not a contract. Available in NJ only. The Temporary Disability Benefits (TDB) Law (New Jersey Revised Statutes Title 34, Workers’ Compensation Law) governs this private plan and its interpretation and administration. All coverage extends up to TDB Law limits reflected in this policy. Please refer to the policy and TDB law for coverage details, a complete listing of covered services, provisions, conditions, exclusions, and terms under which the policy may be continued or cancelled. In the event of conflicting information with the policy and applicable TDB Law, the policy and TDB Law will take precedence over what is shown in this material. Claim payment is not guaranteed; benefit amount depends on wages. Policies have a statutory 7-day waiting period.
ShelterPoint Life Insurance Company (principal office in Garden City, NY) in: NJ (form# TDB-P-NJ)