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F I S C A L I M P A C T R E P O R T
SPONSOR McSorely
ORIGINAL DATE
LAST UPDATED
2/01/07
3/06/07 HB
SHORT TITLE Domestic Partner Health Care Coverage
SB 182/aSJC/aSF1
ANALYST Earnest
APPROPRIATION (dollars in thousands)
Appropriation
Recurring
or Non-Rec
Fund
Affected
FY07
FY08
NFI
NFI
(Parenthesis ( ) Indicate Expenditure Decreases)
Relates to House Bill 15
SOURCES OF INFORMATION
LFC Files
Responses Received From
Human Resources Department (HSD)
Public Regulation Commission (PRC)
SUMMARY
Synopsis of SFl Amendment
Senate Floor amendment number 1 would remove from the definition of contract household “(3)
are jointly responsible for the common welfare of each other;"
Synopsis of SJC Amendment
The SJC amendment replaces all references to “domestic partners" with “contract household"
and removes from the definition of the now-named “contract household" the terms “(1) are in a
mutually exclusive, committed relationship."
Synopsis of Original Bill
Senate Bill 182 requires insurers to offer health insurance coverage for those small employers
who elect to offer this coverage for the domestic partners of their full- and part-time employees.
Domestic partners are defined as “unmarried partners over eighteen years of age who: (1) are in
pg_0002
Senate Bill 182/aSJC/aSFl – Page
2
a mutually exclusive, committed relationship; (2) have shared a primary residence for twelve or
more consecutive months; (3) are jointly responsible for the common welfare of each other; and
(4) share financial obligations."
FISCAL IMPLICATIONS
None identified.
SIGNIFICANT ISSUES
PRC notes that many insurers offer health insurance coverage for domestic partners as part of a
group health insurance plan when the employer wants to offer such coverage to their employees,
but some insurers don’t. This creates an un-level playing field in the market place and creates
confusion for employers. While many large employers have the clout to negotiate for this
coverage, small employers may have more difficulty in finding domestic partner coverage for
their employees.
According to HSD:
•
The bill was recommended by the Insure New Mexico! Council as a method to insure
more people in New Mexico.
o
The Council consisted of large and small employers, insurance companies,
brokers, labor representatives and advocates.
•
The opportunity to offer employer-sponsored health insurance for full- and part-time
employees’ domestic partners in the small group market will help address New
Mexico’s high rate of uninsured.
•
Offering coverage to employees’ domestic partners helps companies recruit
candidates by providing them the option of choosing their own or their partner’s
health insurance plan.
•
Employers would be able to shop around to provide the most affordable coverage
through competition among insurance carriers.
•
The bill does not require all small employers to offer coverage for the domestic
partners of their full- and part-time employees.
ADMINISTRATIVE IMPLICATIONS
SB 182 may require insurers to re-file certain group contracts with the PRC’s Insurance
Division. While this could result in increased workloads, the Insurance Division believes that
this additional review can be accomplished with existing staff without fiscal or performance
implications.
CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP
Senate Bill 182 is a duplicate of House Bill 15.
OTHER SUBSTANTIVE ISSUES
Data Shows Many Do Not Have Health Care Coverage in New Mexico
pg_0003
Senate Bill 182/aSJC/aSFl – Page
3
•
Approximately 401,000 New Mexicans (21.1% of the state’s population) do not have
health insurance (Census Current Population Survey, 2005).
•
New Mexico has one of the highest rates of uninsured in the country.
•
Among uninsured adults in New Mexico, 25% work one part-time job and 41% report
working multiple part-time jobs (HRSA Household Survey, 2004).
•
The largest percent of the uninsured (approximately 60%) are between the ages of 18-34,
when they are most likely to be establishing a career (HRSA Household Survey, 2004).
State Employees Have Coverage for Domestic Partners
•
Of the 20,318 state employees enrolled in group medical coverage, 1,077 (5.3%) are
enrolled in domestic partner coverage.
Health and Insurance Companies Provide Domestic Partner Coverage to Their Employees
•
Large insurance companies such as Blue Cross and Blue Shield of New Mexico,
Lovelace Health System and Presbyterian Health Services provide domestic partner
health insurance coverage for their own employees.
o
Insurance companies understand there is no actuarial risk to their own organizations.
o
As large employers, they want to be competitive and not bound by antiquated
underwriting guidelines.
o
They support getting more New Mexicans insured.
BE/nt