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

SPONSOR SPAC

ORIGINAL DATE

LAST UPDATED

2/16/07

HB

SHORT TITLE

Health & Dental Insurance as Child Support

SB 296/SPACS

ANALYST Weber

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates HB 694

SOURCES OF INFORMATION

LFC Files

Responses Received From

Human Services Department (HSD)

SUMMARY

Synopsis of Bill

Senate Public Affairs Committee Substitute for Senate Bill 296 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

Senate Bill 296/SPACS – Page

2

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

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 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 CSSB296 imply that dental insurance is

required; these phrases should be deleted.

MW/csd