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

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ORIGINAL DATE

LAST UPDATED

2-1-06

2-21-06 HB

481/aHCPAC/aHAFC/

aSPAC

SHORT TITLE Health Coverage for New Mexicans Committee

SB

ANALYST Collard

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

$50.0

Recurring

Legislative

Cash Balances

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates SB 280

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Health (DOH)

Human Services Department (HSD)

Public Regulation Commission (PRC)

Aging and Long-Term Services (ALTSD)

Health Policy Commission (HPC)

General Services Department (GSD)

SUMMARY

Synopsis of SPAC Amendment

The Senate Public Affairs Committee amendment to House Bill 481 reduces the number of ap-

pointees for the Health Coverage for all New Mexicans Committee from 39 to 35 and changes

the make-up of the committee as follows: reduces the number of members appointed by the

Speaker of the House of Representatives from six to five, and provides that two members must

be from the minority party; reduces the number of members appointed by the President Pro

Tempore from six to five, and provides that two members must be from the minority party;

changes make-up of the 20 members appointed by the Governor; by eliminating the Secretary of

the General Services Department and the Executive Director of the Health Policy Commission,

reduces the number of ex-officio members from seven to five; and adds two uninsured general

public members. Within the appointments, the governor, the President Pro Tempore and the

Speaker of the House of Representatives must ensure two appointees are from rural areas of the

House Bill 481/aHCPAC/aHAFC/aSPAC – Page

2

state and two of the appointees are Native American.

Synopsis of HAFC Amendment

The House Appropriations and Finance Committee amendment to House Bill 481, as amended

by the House Consumer and Public Affairs Committee, deletes the existing appropriation section

and inserts in lieu thereof an additional temporary provision section with regard to required ana-

lysis and an appropriation of $50 thousand from legislative cash balances to the Legislative

Council Service to pay for per diem and mileage expenses for the public members of the com-

mittee. The new temporary provision sections indicates the committee will work with the Health

and Human Services Committee, the Legislative Council Service, HSD and HPC to determine

the content, technical and legal assistance required to carry out this act.

Synopsis of HCPAC Amendment

The House Consumer and Public Affairs Committee amendment to House Bill 481 reduces the

number of appointees for the Health Coverage for all New Mexicans Committee from 39 to 31

and changes the make-up of the committee as follows: reduces the number of members ap-

pointed by the Speaker of the House of Representatives from six to four, reduces the number of

members appointed by the President Pro Tempore from six to four, reduces the number of mem-

bers appointed by the Governor from 20 to 17 and, by eliminating the Secretary of the General

Services Department, reduces the number of ex-officio members from seven to six. Within the

gubernatorial appointments, the committee amends the bill to require two appointees must be

uninsured members of the general public. Finally, the committee specifies two Native Ameri-

cans must be among the appointments made by the Governor, Speaker of the House of Represen-

tatives and President Pro Tempore.

Synopsis of Original Bill

House Bill 481 appropriates $500 thousand from the general fund to the Legislative Council Ser-

vices for the purpose of implementing the Health Coverage for All New Mexicans Act that pro-

poses the following:

•

Creates the “Health Coverage for All New Mexicans” Committee.

•

Specifies the appointment process for the committee of 39 members with appointments

made by the State Senate, House of Representatives and the Governor.

•

Specifies representation by the insurance industry in the state, employers including small

employers, nonprofit organizations including small nonprofit organizations, health care

advocacy community, general public with a demonstrated interest in health coverage for

all New Mexicans, insurance brokers, health care practitioners licensed to practice in

New Mexico, and labor.

•

Includes committee membership by the secretaries or their designees from the Human

Services Department, General Services Department, Department of Health, Executive Di-

rector or designee of the New Mexico Health Policy Commission, Superintendent of In-

surance or designee, Executive Director or Board Chair or designee for the Health Insur-

ance Alliance and the New Mexico Medical Insurance Pool.

•

Indicates that the committee shall operate from April 2006 through December 2007.

•

Provides that public members shall be paid per diem and mileage pursuant to the State

Per Diem and Mileage Act.

House Bill 481/aHCPAC/aHAFC/aSPAC – Page

3

•

Provides certain operating protocols for the committee.

•

Specifies that the committee shall actively and consistently solicit public input and that

all meetings of the committee or its subcommittees are open to the public.

•

Appropriates $50 thousand in general fund to the Legislative Council Service (LCS) to

pay for per diem and mileage and $450 thousand to LCS to pay for the cost analysis of

the various models and the technical and legal analysis associated with various coverage

models.

•

Requires the Committee work in conjunction with the chair of the Legislative Health and

Human Services Committee, LCS, Human Services Department, and the Health Policy

Commission in determining the content of the analysis and the technical and legal assis-

tance required for carrying out provisions of the Act.

•

The bill carries an emergency clause.

The bill proposes creation of the “Health Coverage for All New Mexicans Committee” with the

Committee taking into consideration current resources, projected needs, and public and private

health care expenditures in the state to contract for analyzing the cost of various models to

achieve health coverage for all New Mexicans. The various models to be analyzed will take into

consideration the costs of different approaches including the current system and the cost of tran-

sitioning to another system; and appropriate roles for health care consumers and providers;

Medicaid and other publicly funded, operated or created health care programs; and businesses,

nonprofit organizations, brokers and commercial insurers. National experts experienced in ana-

lyzing the cost of health care systems would conduct the analysis of the various models. The

Committee shall report its findings and recommendations to the Governor and the Legislative

Health and Human Services Committee.

FISCAL IMPLICATIONS

The appropriation of $500 thousand contained in this bill is a recurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of FY08 shall revert to the

general fund.

The bill specifies $50 thousand is appropriated for reimbursement of the per diem and mileage

expenses of the public members of the Health Coverage for All New Mexicans Committee, and

$450 thousand is appropriated to pay for the cost analysis and for the technical and legal analysis

to carry out the provisions of the act.

SIGNIFICANT ISSUES

DOH indicates this bill carries a message from the Governor, and was recommended by the Leg-

islative Health and Human Services Committee and by the Insure New Mexico! Council in its

2005 Report to the Governor. This can be found at :

(

http://insurenewmexico.state.nm.us/documents/2005_Insure_NM_Report_to_Governor.pdf

).

PRC indicates over 20 percent of New Mexicans are uninsured. Universal coverage is seen as a

way to insure that all New Mexicans have access to health care. There are more than one univer-

sal coverage model and we need to understand the cost and the effect of moving to universal

coverage.

House Bill 481/aHCPAC/aHAFC/aSPAC – Page

4

PRC also indicates models for universal coverage include the “single payer system”, which pro-

poses that the state operate a single managed health care plan, which provides coverage to all,

contracts with providers, determines certificates of needs, develops drug formularies. In the re-

cent year a proposal has emerged to provide universal coverage in a market based system where

insurance coverage is provided by the insurance industry, based on RFP with the state as the pur-

chaser. This system discusses payroll taxes and income taxes as a means of financing the univer-

sal coverage. A funded study would provide meaningful information about these approaches as

well as explore others.

ADMINISTRATIVE IMPLICATIONS

The bill specifies staffing for the “Health Coverage for All New Mexicans Committee” will be

provided by the Legislative Council Service, Human Services Department, and the Governor’s

Health Policy Advisor.

DUPLICATION

House Bill 481 duplicates Senate Bill 280.

OTHER SUBSTANTIVE ISSUES

DOH notes 399,000 New Mexicans, or 21 percent of the state’s population, do not have health

insurance. (Census Current Population Survey, 2004) and this figure has dropped slightly from

2003 when it was 22.1 percent uninsured. New Mexico has the second highest rate of uninsured

in the country (only behind Texas).

HPC notes many New Mexicans age 55–64 years are relatively well off; however certain sub-

groups including unmarried persons, women, and minorities are at a greater risk of living in

poverty, lacking health insurance, and being disabled.

Among both men and women 55–64 years of age, non-Hispanic black and Hispanic adults were

twice as likely to be living in poverty compared with non-Hispanic white adults in 2003. Levels

of disability reported as a reason for unemployment were also higher among non-Hispanic black

men and particularly among non-Hispanic black women age 55–64 years than among other racial

and ethnic groups.

Those without health insurance or adequate income are particularly vulnerable to the financial

and physical burdens of disease and disability. This includes uninsured children. To improve the

health of all New Mexicans and to enable policymakers to chart future trends, target resources

most effectively, and set program and policy priorities, it is critical that the State keep collecting

and disseminating reliable and accurate information about all components of health, including

current health status, the determinants of health, resources, and outcomes. The research and work

of this committee is crucial for the health and econometrics for New Mexico.

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