State of New Jersey
DEPARTMENT OF BANKING AND INSURANCE
PO BOX 325
T
RENTON, NJ 08625-0325
JON S. CORZINE
NEIL N. JASEY
Governor
TEL (609) 292-7272
Commissioner
Visit us on the Web at www.n
j
dobi.or
g
New Jersey is an Equal Opportunity Employer • Printed on Recycled Paper and Recyclable
BULLETIN NO: 10-02
TO: ALL HOSPITAL, MEDICAL AND HEALTH SERVICE
CORPORATIONS, HEALTH INSURANCE COMPANIES AND
HEALTH MAINTENANCE ORGANIZATIONS DELIVERING OR
ISSUING FOR DELIVERY A HEALTH BENEFITS PLAN IN NEW
JERSEY
FROM: NEIL N. JASEY, COMMISSIONER
RE: IMPLEMENTATION OF P.L. 2009, C. 115 WITH RESPECT TO
CERTAIN BENEFITS FOR TREATMENT OF AUTISM AND OTHER
DEVELOPMENTAL DISABILITIES
On August 13, 2009, P.L. 2009, c. 115 (“Chapter 115”) was enacted. The new
law is variously codified.
1
The law requires that carriers provide:
1. Coverage for expenses incurred in screening and diagnosing autism or another
developmental disability;
2. Coverage for expenses incurred for medically necessary physical therapy,
occupational therapy and speech therapy services for the treatment of autism or
another developmental disability;
3. Coverage for expenses incurred for medically necessary behavioral interventions
based on the principles of applied behavioral analysis (ABA) and related
structured behavioral programs for treatment of autism in individuals under 21
years old; and
4. A benefit for the coverage of the “Family Cost Share” expense incurred for
certain health care services obtained through the New Jersey Early Intervention
System (NJEIS).
In addition, carriers must provide the required coverage without consideration of whether
the services are restorative or have a restorative effect.
1
Statutory codification of Chapter 115 is as follows: N.J.S.A. 17:48-6ii (applying to hospital service
corporations); N.J.S.A.
17:48A-7ff (applying to medical service corporations); N.J.S.A. 17:48E-35.33
(applying to health service corporations); N.J.S.A. 17B:26-2.1cc (applying to insurers), N.J.S.A. 17B:27-
46.1ii (applying to insurers), N.J.S.A.
17B:27A-7.16 (applying to all carriers offering individual health
benefits plans); N.J.S.A.
17B:27A-19.20 (applying to all carriers offering small employer health benefits
plans); N.J.S.A. 26:2J-4.34 (applying to HMOs and all HMO coverage); N.J.S.A. 52:14-17.29p (regarding
the State Health Benefits Plan); and, N.J.S.A.
52:17.46.6b (regarding the School Employees’ Health
Benefits Plan).
2
Chapter 115 becomes effective on February 9, 2010. The Department of Banking and
Insurance (DOBI) will not be able to adopt rules implementing and interpreting the
provisions of Chapter 115 prior to February 9, 2010. Accordingly, the DOBI is issuing
this bulletin to provide guidance for health service corporations, hospital service
corporations, medical service corporations, health insurance companies, and health
maintenance organizations (collectively, “carriers”) in their efforts to comply with
Chapter 115 in a timely manner.
2
Scope of Chapter 115’s Applicability
Chapter 115 applies to all health insurance policies issued or renewed on or after
February 9, 2010 that provide hospital and medical expense benefits, including all health
maintenance organization and all health service corporation contracts.
Definition of Developmental Disability
Chapter 115 does not define the term “developmental disability.” However, the
New Jersey Developmentally Disabled Rights Act at N.J.S.A. 30:6D-1 et seq. defines the
term at N.J.S.A. 30:6D-3 to mean:
…a severe, chronic disability of a person which:
(1) is attributable to a mental or physical impairment or
combination of mental or physical impairments;
(2) is manifest before age 22;
(3) is likely to continue indefinitely;
(4) results in substantial functional limitations in three or more of
the following areas of major life activity, that is, self-care, receptive and
expressive language, learning, mobility, self-direction and capacity for
independent living or economic self-sufficiency; and
(5) reflects the need for a combination and sequence of special
inter-disciplinary or generic care, treatment or other services which are of
lifelong or extended duration and are individually planned and
coordinated. Developmental disability includes but is not limited to
severe disabilities attributable to mental retardation, autism, cerebral
palsy, epilepsy, spina-bifida and other neurological impairments where the
above criteria are met[.]
The DOBI believes this definition should be used in implementing Chapter 115.
Definition of Autism
The DOBI interprets “autism” as used in Chapter 115 to mean autism and related
conditions often included under the phrase “Autism Spectrum Disorder.” In current
clinical terms, this would include several conditions classified under “Pervasive
2
This bulletin should not be construed to provide any guidance with respect to the State Health Benefits
Plan or the School Employee’s Health Benefits Plan, to which Chapter 115 also applies, but which are
outside the DOBI’s regulatory authority.
3
Developmental Disorder.” The DOBI considers diagnostic codes using 299, as set forth
in the Diagnostic and Statistical Manual of Mental Health Disorders, Fourth Edition, Text
Revised (DSM IV-TR) or International Classification of Disease (ICD), to be “autism”
for purposes of complying with Chapter 115. However, because not all clinicians
consider Childhood Disintegrative Disorder (CDD) and Rett’s Disorder to be included
under Autism Spectrum Disorder, it is acceptable for carriers to choose to exclude 299.1
and 299.8 when it is clear the diagnosis is for CDD or Rett’s Disorder, respectively.
3,4
Coverage of Applied Behavioral Analysis
Chapter 115 requires that carriers provide coverage for expenses incurred by an
individual who is under 21 years of age and diagnosed with autism for medically
necessary treatments of the autistic condition based on the principles of applied
behavioral analysis (ABA) and related structured behavioral programs.
Behavioral Interventions based on ABA
and Related Structured Behavioral Programs
“Behavioral interventions based on ABA” are interventions or strategies based
upon learning theory that are intended to improve socially important behavior of an
individual using instructional and environmental modifications that have been evaluated
through scientific research using reliable and objective measurements, including the
empirical identification of functional relations between behavior and environmental
factors. Behavioral intervention strategies based on ABA include, but are not limited to:
1. chaining;
2. functional analysis;
3. functional assessment;
4. functional communication training;
5. modeling, including video modeling (also known as imitation training);
6. procedures designed to reduce challenging and dangerous behaviors (e.g.,
differential reinforcement, extinction, time out, and response cost);
7. prompting; and
8. reinforcement systems, including differential reinforcement, shaping and
strategies to promote generalization
“Related structured behavioral programs
” are services delivered by a qualified
practitioner that are comprised of multiple intervention strategies (that is, behavioral
intervention packages) based upon the principles of ABA. These packages may include
but are not limited to:
1. activity schedules;
2. discrete trial instruction;
3. incidental teaching;
3
The DSM IV-TR and ICD-9’s 299 code (Pervasive Developmental Disorder) includes: autistic disorder,
Asperger’s disorder, Rett’s disorder, childhood disintegrative disorder and pervasive developmental
disorder-not otherwise specified.
4
Although a carrier may not consider a diagnosis of CDD or Rett’s disorder to be “autism,” carriers should
still consider whether such diagnoses meet the criteria for developmental disability at N.J.S.A.
30:6D-3.
4
4. natural environment training;
5. picture exchange communication system;
6. pivotal response treatment;
7. script and script-fading procedures; and
8. self-management
Qualified Practitioners of ABA
The DOBI is aware that carriers define an eligible provider of health care services
as a practitioner acting within the scope of his or her license in the state in which the
license is issued. The DOBI is also aware that most states, including New Jersey, have
no professional license for ABA practitioners. There are, however, voluntary credentials
that practitioners of ABA may obtain through the national Behavior Analyst Certification
Board upon satisfaction of one or more very robust sets of standards. The DOBI does not
construe Chapter 115 as requiring carriers to pay for services for the treatment of autism
without regard to practitioner qualifications. Consequently, the DOBI believes carriers
should consider behavioral interventions based on ABA and related structured behavior
program services eligible for benefits if administered directly by or under the direct
supervision of an individual who is credentialed by the national Behavior Analyst
Certification Board as either:
a Board Certified Behavior Analyst - Doctoral (BCBA-D); or
a Board Certified Behavior Analyst (BCBA)
Carriers will need to modify their forms and protocols to accommodate this
exception for the delivery of behavioral interventions based on ABA and related
structured behavior programs in those jurisdictions lacking a requisite license for
practitioners. Carriers may amend the definition of practitioner as part of form filings,
including rider filings, to add the coverage required by Chapter 115.
Calendar Year Benefit Maximum
Group health plans: Although DOBI recognizes that the Legislature intended to
limit coverage of ABA services for persons under age 21 diagnosed with autism spectrum
disorder to $36,000 per calendar year, carriers may not be able to limit the benefit as
described. The federal Mental Health Parity and Addiction Equity Act of 2008, Pub.
Law 110-343, sec. 512 (MHPAEA), generally prohibits group health plans, other than
small employer group health plans, from having more restrictive benefits or services for
treatment of mental illness than are applicable to treatment of physical conditions.
MHPAEA states that the term mental illness is defined under the terms of the plan and in
accordance with applicable Federal and State law. New Jersey law requires health
coverage issued for delivery in this State to provide benefits or services for biologically-
based mental illnesses, and specifically includes pervasive developmental disorders
(autism) in this classification. Carriers providing biologically-based mental illness
benefits in group health plans as required by New Jersey law must comply with both
MHPAEA and Chapter 115
5
. The federal law preempts New Jersey state law when there
5
MHPAEA (see 29 U.S.C. 1185a) does not require coverage for treatment of mental health conditions, but
requires equitable benefits if coverage of mental health conditions is provided. However, MHPAEA also
has exemption provisions that permit a plan’s mental health coverage not to comply with parity
5
is a conflict between the two. Chapter 115’s limit of $36,000 per calendar year for ABA-
related treatment of a condition classified in New Jersey law as a mental illness conflicts
with federal provisions prohibiting such limits on treatment of mental health conditions in
group health plans. Thus, as the law is currently written, the ABA-related benefit
limitation established in Chapter 115 in group health plans subject to MHPAEA may not
be applied unless the employer obtains an exemption under MHPAEA for its group
health plan based on the “1% cost increase.” To resolve this conflict and preserve the
original legislative intent of limiting these benefits to $36,000 per calendar year, the
Legislature could enact necessary legislation to address this issue. Were such legislation
to be enacted, the DOBI would provide additional guidance to carriers.
Federal mental health parity laws do not apply to group plans that are not “group
health plans” as that term is defined in HIPAA.
Nongroup health plans
: Federal mental health parity laws do not apply to
coverage offered and renewed in the individual market. Accordingly, carriers may apply
Chapter 115’s per calendar year per person benefit limit for ABA-related treatment of
autism when the coverage involved is under a nongroup policy.
Early Intervention Family Cost Share Expense Benefit
Carriers must provide benefits for the coverage of the “Family Cost Share”
expense incurred by covered persons for the provision of certain health care services
obtained in accordance with a treatment plan developed as a result of, or in conjunction
with, an Individualized Family Service Plan (IFSP) for a child determined eligible for
early intervention services through the New Jersey Early Intervention System (NJEIS).
6
Chapter 115 establishes limits for the Family Cost Share expense benefit, as follows:
Carriers are only required to provide a benefit for the Family Cost Share expense
associated with the provision of physical therapy, occupational therapy, speech
therapy and behavioral interventions based on ABA or related structured behavior
services.
7
Carriers are only required to provide a benefit for the Family Cost Share expense
when the service in question is provided to a child diagnosed with autism or other
developmental disability.
Carriers cannot deny benefits for the Family Cost Share expense on the basis that
treatment with any of the Chapter 115-identified therapies is not restorative.
Family Cost Share Participation Statement
Families that are responsible for the NJEIS Family Cost Share receive monthly
invoices from NJEIS and submit payments to NJEIS. Families may then seek
reimbursement for the expense from the carrier. Initially, Family Cost Share
Participation (FCSP) statements detail health care services using Current Procedural
requirements if it can be shown actuarially that compliance would result in an increase in actual total costs
for the plan of 1% (2% initially).
6
See http://www.state.nj.us/health/fhs/eis/index.shtml for more information regarding NJEIS. NJEIS’ rules
are at N.J.A.C.
8:17.
7
There is no Family Cost Share expense for ABA at this time; however, DOBI has been advised that
NJEIS will be making systemic improvements to ensure that families have access to related structured
behavioral interventions.
6
Terminology – CPT – codes. After several months, the FCSP statement only provides a
summary of the total cost share due. Because a family’s Family Cost Share may be
related to services other than those for which carriers are required to provide a benefit
under Chapter 115, carriers may request that families submit the more detailed FCSP
statement on a continuing basis, and documentation of payment of the Family Cost Share
to NJEIS.
Diagnosis Codes
The FCSP statement may not identify the child as having a diagnosis of a
developmental disability, and NJEIS does not limit eligibility for early intervention
services to children diagnosed with a developmental disability. Given that Chapter 115 is
specific to developmental disabilities, the DOBI recognizes that there may be instances in
which a family may incur a covered Family Cost Share expense, but will receive no
benefit because the child has not been diagnosed with a developmental disability.
Nevertheless, carriers should request more information from the family regarding
diagnosed developmental disabilities when the benefits for the Family Cost Share
expense are in question to avoid inappropriate denials of benefits with respect to physical
therapy, occupational therapy, speech therapy and ABA-related behavioral interventions.
NJEIS Providers and Practitioners
NJEIS clients generally do not choose the practitioners that will deliver services.
The practitioners that deliver early intervention services to NJEIS clients through NJEIS-
contracted provider agencies may or may not also contract with carriers through other
means. The practitioners will, however, be in the NJEIS “network.” Through a vendor,
NJEIS verifies the credentials of practitioners before practitioners are eligible to deliver
services to NJEIS clients. DOBI’s position is that Chapter 115 requires that carriers
cover the Family Cost Share expense benefit without regard to whether the delivery of
the service is rendered by a practitioner in the carrier’s network, so long as the service is
provided through NJEIS.
Additional Family Cost Share Benefit Information
1. As explained in the Family Cost Participation Handbook issued by NJEIS, a
Family Cost Statement (bill) is sent to families on a monthly basis and payment is
required within 30 days of receipt of the Family Cost Statement. After families
have made payment, families may seek reimbursement for the eligible portions of
the Family Cost Share from their insurance carriers. In all instances, carriers
should be reimbursing families for the Family Cost Share expense the families
paid to the NJEIS. Families do not pay practitioners, and practitioners do not bill
families for any portion of the cost associated with the health care services
provided through the NJEIS. There is no assignment of benefits involved.
2. The FCSP statement will identify a family’s cost share per service hour as well as
the maximum monthly cost share the family could incur. Expenses are incurred
on a 15 minute basis. Chapter 115 does not impose an obligation on carriers to
provide a benefit that exceeds a family’s maximum monthly Family Cost Share
expense.
7
3. Family cost shares may change annually. The NJEIS posts the Family Cost Share
formula and table on its web pages. However, it is reasonable for carriers to rely
upon the Family Cost Share expense set forth in the FCSP statement.
4. Carriers may make the Family Cost Share expense benefit subject to a plan’s
deductible and coinsurance or copayment requirements. Eligible Family Cost
Share expenses should be applied toward any out-of-pocket maximum limit
established under the plan. The DOBI does not believe a carrier may establish a
separate deductible, coinsurance, copayment or out-of-pocket maximum for the
Family Cost Share expense benefit.
Limitations on Therapy Services
Chapter 115 states that coverage for physical therapy, occupational therapy,
speech therapy and behavioral interventions based on ABA provided to treat a
developmental disability should not limit benefits otherwise available to a covered
person. Accordingly, carriers may not reduce the physical therapy, occupational therapy,
speech therapy or behavioral therapy benefit(s) available under the contract for treatment
of other illnesses, injuries and conditions based upon the provision of such services to
treat autism or another developmental disability. Carriers may establish a separate set of
benefits for these services for purposes of treating autism and other developmental
disabilities, but the separate benefit must be subject to terms and conditions that are the
same as or more favorable than the terms and conditions applicable to the benefits for
treatment of other illnesses, injuries or conditions. The DOBI will not approve limits for
physical therapy, occupational therapy or speech therapy for treatment of autism or other
developmental disabilities that establish a maximum number of days of therapy measured
from the date of diagnosis or inception of treatment, or benefit limits established on a per
illness or injury basis.
Questions regarding this bulletin and implementation of Chapter 115 should be
submitted by electronic mail to [email protected]
. If warranted, the DOBI will
issue additional guidance, and may post responses to frequently asked questions to the
DOBI’s website at http://www.state.nj.us/dobi/index.html
.
January 14, 2010
Date Neil N. Jasey, Commissioner
INOORD\autismbull1.doc
