Health systems planning at a state level: New Jersey.
In 1991, New Jersey undertook a planning effort to eliminate the proliferation of high cost, redundant services, downsize or eliminate underutilized services, develop primary and preventive services, and consolidate regional services. The recommendation to reduce the number of accredited hospitals created serious opposition from a variety of interests and the legislature subsequently enacted legislation prohibiting enactment of rules to implement the plan. More recently, New Jersey undertook new legislation to reform health insurance to require community rating, availability of individual and small group policies, eliminate restriction on pre-existing conditions, and promote competition. Legislation also provided for hospital care of indigents to be funded by a change in the unemployment insurance system. The latter was to replace a funding mechanism which was initially invalidated by a Federal Court. In future years, some of these funds will be shifted to a subsidized insurance program. There is already evidence that these reforms have resulted in increased competition among insurance companies, hospitals, and providers. Hopefully, this will contain costs without a decrement to quality. It should also increase the number of people with health coverage, although this does not provide for universal coverage.