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

SPONSOR Beffort

ORIGINAL DATE

LAST UPDATED

1/25/08

HB

SHORT TITLE Non-Resident College Student Health Insurance

SB 38

ANALYST Haug

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

Conflict with SB3

Relationship to SB37

SOURCES OF INFORMATION

LFC Files

Responses Received From

Higher Education Department (HED)

New Mexico Health Policy Commission (HPC)

SUMMARY

Synopsis of Bill

Senate Bill 38 requires nonresident students to provide proof of health insurance as a condition

of admission to a postsecondary educational institution. In Senate Bill 38, the term "nonresident

student" is as defined by the New Mexico Higher Education Department (NMHED) pursuant to

Subsection G of Section 21-1-4 NMSA 1978. If passed, the effective date of this act would be

7/1/2008.

FISCAL IMPLICATIONS

Senate Bill 38 has no fiscal impact.

SIGNIFICANT ISSUES

The HED states that Senate Bill 38 requires NMHED to establish criteria and guidelines for a

nonresident student to provide proof of appropriate health insurance. Senate Bill38 requires

Senate Bill 38 – Page

2

proof of health insurance prior to nonresident student admission. The bill states that nonresident

students shall not be admitted to public postsecondary institutions unless:

•

They can provide proof of being covered by a health insurance policy or plan that

provides substantially the same or greater coverage than a health insurance policy or plan

generally offered to students by the institution; or

•

They purchase coverage under the health insurance policy or plan generally offered to

students by the institution.

The HED notes that Senate Bill 38 may help to contain student health care costs. For example,

per the University of New Mexico (UNM) Student Health Center Director, currently, students

are not required to have health insurance to receive services at the center; and, 50% of students

who receive services do not have health insurance. Requiring health insurance could help defray

rising student health care costs. Alternately, making health insurance coverage a condition of

admission, may adversely impact educational access and affordability. For example, per the

UNM Student Health Center Director, in a recent random student survey, 70% of students polled

felt that having appropriate health insurance was an affordability issue. Senate Bill 38 could have

an adverse impact on postsecondary institution enrollment numbers, consequently impacting

institution funding as the NMHED funding formula is based on enrollment.

ADMINISTRATIVE IMPLICATIONS

The HED states that since Senate Bill 38 requires the NMHED to establish appropriate criteria

and guidelines for a nonresident student to provide proof of health insurance, designated staff

would need to be well versed in institution student admission policies and have substantial

knowledge of the health care system and best practices. If SB3 (Health Security Act) or a similar

bill is enacted, coordination would be necessary with the new Health Security Commission or

other group formed to support implementation.

CONFLICT, RELATIONSHIP

The HED points out that SB38 conflicts somewhat with SB3, the Health Security Act,

specifically to Section 22 which requires educational institutions to purchase health insurance

coverage under the health security plan for its nonresident students, through fees assessed to

those students. SB3 further states that the governing body of the educational institution shall set

the fees at the amount determined by the Health Security Act Commission. SB3 also describes

how a nonresident student may satisfy the requirement for health care coverage: by proof of

coverage under a policy or plan in another state that is acceptable to the commission. In this case,

the student would not be assessed a fee.

Additionally, SB38 requires NMHED to establish criteria and guidelines for a nonresident

student to provide proof of appropriate health insurance. This conflicts with SB3 which states

that the Health Security Act Commission shall adopt rules to determine proof of an individual's

eligibility for the health security plan or a student's proof of nonresident health care coverage.

Senate Bill 38 is related to Senate Bill 37 which requires resident students to provide proof of

health insurance prior to postsecondary institution admission.

Senate Bill 38 – Page

3

OTHER SUBSTANTIVE ISSUES

The HPC states:

Currently three states - Massachusetts, New Jersey, and Idaho - require college students

to have insurance coverage. (Source: Insurance Options for College Students in Texas: A

study of Student Health Insurance Plans, Texas Department of Insurance November

2005.)

Massachusetts

The statute requiring college students to carry health insurance in Massachusetts has been

in place since 1989. It requires all students attending college three-fourths of full-time or

more to have coverage in a qualifying student health insurance program offered through

their college or an alternate plan with comparable coverage.

New Jersey

In 1991, the New Jersey Legislature passed legislation requiring all full-time students in

public and private institutions of higher education to have health insurance coverage. In

addition, it required all institutions of higher education to make student health insurance

plans available to their students.

Idaho

In 2002, the Idaho Board of Education implemented regulations requiring public, four-

year universities to offer student health insurance and all full-time students at such

institutions to maintain health insurance coverage.

In addition, the governing boards of large university systems have instituted coverage

requirements in Montana, California, Illinois, and Minnesota. Finally, many individual

schools have chosen to require insurance for students. (Source: Insurance Options for

College Students in Texas: A study of Student Health Insurance Plans, Texas Department

of Insurance November 2005, page 15.)

Nationally, about 90 percent of private colleges

and 25 percent of public universities mandate health insurance coverage for students.

GH/nt