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F I S C A L I M P A C T R E P O R T

SPONSOR Wirth

DATE TYPED 1/27/05

HB 289

SHORT TITLE Part-time Employee Insurance Coverage

SB

ANALYST Rosen

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

NFI

Indeterminate Recurring

Varies with

agency funding

sources

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates SB335

SOURCES OF INFORMATION

Responses Received From

Economic Development Department (EDD)

Public Regulation Commission (PRC)

Human Services Department (HSD)

Corrections Department (CD)

No Responses Received From

Labor Department (LD)

SUMMARY

Synopsis of Bill

House Bill 289 requires insurers to offer health insurance companies with employees who work

or are expected to work an average of at least 20 hours per week over a six-month period. Insur-

ance carriers or employers are not mandated to provide health insurance coverage to part-time

employees. However, if an employer chooses to provide health insurance coverage to its part-

time workers then an insurance carrier must offer the product.

House Bill 289 -- Page 2

Significant Issues

This bill is based on the recommendations of the Insure New Mexico Council to require insurers

to offer health insurance to employees working 20 hours or more. Currently some insurers do

not offer insurance for employees working less than 30 hours. Under this bill, if employers elect

to offer health insurance to their part-time employees, insurance carriers shall be required to of-

fer the insurance product.

HSD indicates the opportunity to provide employer-sponsored health insurance for part-time

employees will help address New Mexico’s high rate of uninsured. The bill allows more flexible

work arrangements such as job-sharing, part-time salary status, etc., without sacrificing health

insurance benefits.

PERFORMANCE IMPLICATIONS

HSD indicates this bill targets several performance measures the governor has identified to re-

duce the uninsured population and increase the rate of employer-sponsored health insurance in

New Mexico, including decreasing the state uninsured rate by 10%. HSD estimates this bill

could help up to 4,000 individuals and target a particularly difficult group of uninsured. The bill

addresses the HSD goal of providing New Mexicans access to support and services so they may

move toward self-sufficiency.

FISCAL IMPLICATIONS

There is no fiscal impact associated with this bill. However, several executive agencies indicate

they will need additional funding if required to offer part-time workers health care insurance

coverage.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Duplicates SB335

OTHER SUBSTANTIVE ISSUES

HSD indicates, according to the Census’ 2003 Current Population Survey, New Mexico ranks

second in the nation for the rate of uninsured at 22.1% or an estimated 414,000 individuals.

HSD indicates, in the 2004 HRSA Household Survey of the uninsured, 25% of uninsured adults

worked one part-time job while 41% were working multiple part-time jobs. In addition, 62% of

the uninsured are young, ages 18 to 34, the age group most likely to be working multiple part-

time jobs as they try to establish a career or a work history.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL.

The status quo will be maintained with limited incentives available for employers electing to of-

fer health insurance coverage to part-time employees.

JR/lg:yr