SENATE JOINT MEMORIAL 6

50th legislature - STATE OF NEW MEXICO - second session, 2012

INTRODUCED BY

Gerald Ortiz y Pino

FOR THE LEGISLATIVE HEALTH AND HUMAN SERVICES COMMITTEE

A JOINT MEMORIAL

REQUESTING THE HUMAN SERVICES DEPARTMENT TO UNDERTAKE A STUDY ON THE POSSIBLE BENEFITS OF IMPLEMENTING A BASIC HEALTH PROGRAM TO SERVE INDIVIDUALS WITH LOW INCOMES WHO DO NOT QUALIFY FOR MEDICAID.

     WHEREAS, the federal Patient Protection and Affordable Care Act requires that most Americans obtain health insurance coverage by January 1, 2014; and

     WHEREAS, according to a 2010 Henry J. Kaiser family foundation survey, the average cost of health insurance premiums in the United States is, currently, four thousand five hundred three dollars ($4,503), with three thousand six hundred six dollars ($3,606) in premiums and nine hundred twenty-four dollars ($924) in cost-sharing; and

     WHEREAS, many Americans with low incomes cannot afford to pay health insurance copayments and premiums of four thousand five hundred three dollars ($4,503); and

     WHEREAS, the federal Patient Protection and Affordable Care Act provides that individuals and families with incomes below four hundred percent of the federal poverty level that purchase coverage through health insurance exchanges are eligible for tax credits and cost-sharing subsidies to offset the cost of health insurance; and

     WHEREAS, according to research by the nonpartisan urban institute, even with these federal tax credits, individuals and families with incomes of one hundred fifty percent of the poverty level will have to pay premiums of approximately six hundred fifty dollars ($650) a year, in addition to office visit and prescription copayments; and

     WHEREAS, according to the same urban institute study, individuals and families with incomes of two hundred percent of the federal poverty level that receive a tax credit and cost-sharing subsidy will incur approximately one thousand three hundred sixty-five dollars ($1,365) in premiums, annual deductibles and inpatient, outpatient and prescription copayments; and

     WHEREAS, the federal Patient Protection and Affordable Care Act forces individuals and families to estimate their annual incomes in order to receive federal tax credit and cost-sharing subsidies for health insurance purchases on a health insurance exchange; and

     WHEREAS, when individuals and families underestimate their annual incomes, the federal Patient Protection and Affordable Care Act mandates that premium and cost-sharing subsidy recipients with household incomes under two hundred percent of the federal poverty level repay the federal internal revenue service as much as three hundred dollars ($300) for individuals and six hundred dollars ($600) for joint filers; and

     WHEREAS, the federal Patient Protection and Affordable Care Act also gives states the option to provide an alternative to what may be unaffordable insurance in the private market, the basic health program, which would provide coverage to individuals who are not eligible for medicaid and whose incomes are below two hundred percent of the federal poverty level; and

     WHEREAS, the federal Patient Protection and Affordable Care Act provides states with an incentive to offer the basic health program to low-income individuals by paying states ninety-five percent of what they would have spent for tax credits and cost-sharing subsidies if basic health program members had enrolled in private insurance on the states' health insurance exchanges; and

     WHEREAS, New Mexico currently covers some single adults with incomes below two hundred percent of the federal poverty level under the state coverage insurance program; and

     WHEREAS, New Mexico currently covers children under the children's health insurance program whose household incomes are below two hundred thirty-five percent of the federal poverty level; and

     WHEREAS, the urban institute's health insurance reform simulation model estimates an annual state savings of two million seven hundred thousand dollars ($2,700,000) in New Mexico if the state provides coverage under the basic health program to individuals who are currently covered under the state coverage insurance and children's health insurance programs; and

     WHEREAS, the urban institute estimates that New Mexico could control roughly two million two hundred sixty thousand dollars ($2,260,000) a year in federal funds by providing basic health program coverage to eligible individuals with low incomes who do not qualify for medicaid; and

     WHEREAS, according to the urban institute's health insurance reform simulation model, the average individual eligible for a basic health program would save approximately one thousand three hundred twenty-one dollars ($1,321) a year; and

     WHEREAS, the urban institute estimates that, in New Mexico, the lower premiums available through a state basic health program would result in seven thousand four hundred individuals who are currently uninsured gaining coverage; and

     WHEREAS, obtaining coverage for individuals who could not otherwise afford it, even with federal tax and cost-sharing subsidies, would result in fewer cases of uncompensated care and in a healthier and more productive New Mexico;

     NOW, THEREFORE, BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO that the governor and the secretary of human services be requested to work with stakeholders, including individuals with low incomes, small employers and interested health maintenance organizations, to undertake a study to determine the feasibility and potential benefits of implementing a basic health program in the state to cover eligible individuals with low incomes who do not qualify for medicaid; and

     BE IT FURTHER RESOLVED that the basic health program study include consideration of the state's options for making basic health program coverage contiguous with medicaid coverage to ensure a seamless transfer for individuals who move between medicaid and basic health program coverage; and

     BE IT FURTHER RESOLVED that the basic health program study include estimates on a basic health program's effect on the health care work force and any health insurance exchange operating in the state; and

     BE IT FURTHER RESOLVED that copies of this memorial be transmitted to the governor and the secretary of human services.

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