Americans For a Modern Economy Statement on Passage of “Fair Share” Healthcare Legislation in New Jersey

By Americans for a Modern Economy

July 6, 2026

Last week, lawmakers in New Jersey passed legislation enabling the state to charge “fees” to companies that have at least 50 employees covered by Medicaid. The bill calls for big employers to pay annual fees of $325, $525, or $725 for each worker on Medicaid and for each of their family members covered by the publicly-funded health insurance program. The cost of the fee depends on how many of the company’s staff are insured through Medicaid.  

While the state faces significant Medicaid budget shortfalls due to changes in federal policy, Americans for a Modern Economy believes that the concept of taxing employment is counterproductive. AME Senior Advisor Joe Kefauver said, “if your goal is to employ fewer people who rely on Medicaid, then this would be a great policy to achieve that. If your goal is to make it harder for lower income workers to either enter or stay in the workforce, this would be a great policy to achieve that as well. But if your goal is to actually create job opportunities for people that need them most and give them access to either employer-sponsored plans or public plans, this is a bad direction to go in.”

Because policy does not happen in a vacuum, there will be real world reactions by both employers and job seekers. Employers may be less likely to hire workers on Medicaid and it may arise as a factor in other personnel decisions. Conversely, some potential workers might be less likely to enroll in Medicaid for fear that it might make them less-desirable applicants. These are terrible outcomes that policy proposals like these will encourage.

AME believes that meaningful reform in this space entails insurance reform, tort reform, transparency, access, prescription drug reform and numerous other policy changes. But ignoring the actual drivers of soaring healthcare costs and merely taxing employment doesn’t address the real issues at hand and creates significantly more problems that it sets out to solve. 

Perhaps if the bill had been the subject of a proper hearing and committee process instead of being forced through in the waning hours of the budget process, proper attention could have been given to the complexities and unintended consequences of taxing employment and punishing job creation.