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

SPONSOR Trujillo

ORIGINAL DATE

LAST UPDATED

2/15/07

HB 694

SHORT TITLE Health & Dental Insurance as Child Support

SB

ANALYST Weber

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates SB296CS

SOURCES OF INFORMATION

LFC Files

Responses Received From

Human Services Department (HSD)

SUMMARY

Synopsis of Bill

House Bill 694 relates to changing state statute to conform the federal law after enactment of the

Deficit Reduction Act of 2005. This bill requires the consideration that either or both parents of

minor children provide private health insurance coverage as deemed appropriate unlike current

state law that only requires consideration of coverage by the non-custodial parent.

FISCAL IMPLICATIONS

None

SIGNIFICANT ISSUES

Currently, medical support orders (orders to provide medical insurance coverage) are sought by

the Child Support Enforcement Division (CSED) of the Human Services Department (HSD) only

against the non-custodial parents in child support proceedings. Changes brought about by the

federal Deficit Reduction Act of 2005 allow the court to determine which parent, non-custodial

House Bill 694 – Page

2

or custodial, is in the best position to obtain medical insurance for the children. As an example,

it may be easier and less expensive for the custodial parent to get medical insurance for the

children through her or his employer. In that case, the non-custodial parent would be ordered to

pay regular child support, which would include his/her proportionate share of the cost for the

medical insurance coverage being provided by the custodial parent. Other considerations are that

there are times when it is more practical for the coverage to be maintained by the custodial

parent, the non-custodial parent’s medical provider may not provide services in the area where

the children live and the non-custodial parent may change employment frequently, jeopardizing

consistent medical coverage for the dependents.

A potential result is more New Mexicans may have health insurance. Currently, 35 percent are

covered by private health insurance when health insurance has been court ordered. Health

insurance coverage could be obtained for an estimated 16,284 New Mexico children who do not

currently have private insurance.

TECHNICAL ISSUES

HSD adds Section 3 of HB 694 amends Section 40-4C-3.D of the existing Mandatory Medical

Support Act to state in the definitions that “health insurance coverage may include dental

insurance," consistent with the federal statute, which does not require that dental insurance be

included in the coverage. However, other sections of HB 694 imply that dental insurance is

required; these phrases should be deleted.

MW/mt