SB0381

SENATE BILL 381

50th legislature - STATE OF NEW MEXICO - first session, 2011

INTRODUCED BY

Stuart Ingle

AN ACT

RELATING TO TAXATION; AMENDING AND ENACTING SECTIONS OF THE NMSA 1978 TO PROVIDE FUNDING FOR EMERGENCY MEDICAL SERVICES, AMBULANCE SERVICES AND RELATED REGIONAL OFFICES, PLANNING AND ADMINISTRATION; PROVIDING FOR AN EMERGENCY MEDICAL SERVICES PREMIUM SURTAX ON CERTAIN INSURANCE PREMIUMS; CREATING THE EMERGENCY MEDICAL SERVICES PROTECTION FUND; MAKING AN APPROPRIATION.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. [NEW MATERIAL] EMERGENCY MEDICAL SERVICES PROTECTION FUND.--

A. The "emergency medical services protection fund" is created in the state treasury. The fund shall consist of proceeds from the emergency medical services premium surtax imposed pursuant to Subsection D of Section 59A-6-2 NMSA 1978, as well as any other gifts, grants, fees, bequests or money otherwise accruing to the fund. Earnings from investment of the fund shall be credited to the fund, and money in the fund shall not revert or be transferred to any other fund at the end of a fiscal year. Money in the fund shall be appropriated by the legislature annually to the department of health for the purposes set forth in Subsection B of this section upon warrants drawn by the secretary of finance and administration pursuant to vouchers signed by the secretary of health or the secretary of health's authorized representative.

B. For fiscal year 2012 and beyond, distributions from the emergency medical services protection fund shall be used only for the purposes set forth below, in amounts that the secretary of health deems appropriate within the guidelines indicated:

(1) no less than thirty-four percent of the distributions shall be made to provide funds to ambulance services that:

(a) receive less than one thousand emergency calls per year; and

(b) have no paid, full-time personnel;

(2) no less than thirty-one percent of the distributions shall be used to support local emergency medical services entities that respond to at least twenty-five but not more than one thousand emergency calls per year and that have no paid, full-time personnel by providing funds for:

(a) the use of advanced technology equipment;

(b) operational costs other than salaries and benefits of local emergency medical services personnel;

(d) the training and licensing of local emergency medical services personnel;

(3) no more than thirty-one percent of the distributions shall be used for the department of health to contract with nonprofit entities to establish or operate regional offices that provide regional emergency medical services planning and development services, technical assistance and support and coordination with emergency medical services agencies statewide; and

(4) no more than four percent of the distributions shall be made to the department of health for administration of the emergency medical services protection fund.

C. As used in this section:

(1) "ambulance" means a vehicle, including a motor vehicle or watercraft, designed and used or intended to be used for the transportation of sick or injured persons;

(2) "emergency medical services" means the services rendered by providers in response to an individual's need for immediate medical care to prevent loss of life or aggravation of physical or psychological illness or injury;

(3) "local emergency medical services entity" means an ambulance service, medical rescue service, fire department rescue service, air ambulance service or other prehospital care provider:

(a) that responds to an individual's need for immediate medical care in order to prevent loss of life or aggravation of physical or psychological illness or injury on a routine, not seasonal, basis; and

(b) that meets department of health guidelines concerning personnel training, use of run forms that the emergency medical services bureau has approved, participation in mutual aid agreements and medical control; and

(4) "regional office" means an emergency medical services planning and development agency formally recognized and supported by the department of health.

SECTION 2. Section 59A-6-2 NMSA 1978 (being Laws 1984, Chapter 127, Section 102, as amended) is amended to read:

"59A-6-2. PREMIUM TAX--HEALTH INSURANCE PREMIUM SURTAX--EMERGENCY MEDICAL SERVICES PREMIUM SURTAX.--

A. The premium tax provided for in this section shall apply as to the following taxpayers:

(1) each insurer authorized to transact insurance in New Mexico;

(2) each insurer formerly authorized to transact insurance in New Mexico and receiving premiums on policies remaining in force in New Mexico, except that this provision shall not apply as to an insurer that withdrew from New Mexico prior to March 26, 1955;

(3) each plan operating under provisions of Chapter 59A, Articles 46 through 49 NMSA 1978;

(4) each property bondsman, as that person is defined in Section 59A-51-2 NMSA 1978, as to any consideration received as security or surety for a bail bond in connection with a judicial proceeding, which consideration shall be considered "gross premiums" for the purposes of this section; and

(5) each unauthorized insurer that has assumed a contract or policy of insurance directly or indirectly from an authorized or formerly authorized insurer and is receiving premiums on such policies remaining in force in New Mexico, except that this provision shall not apply if a ceding insurer continues to pay the tax provided in this section as to such policy or contract.

B. Each such taxpayer shall pay in accordance with this subsection a premium tax of three and three-thousandths percent of the gross premiums and membership and policy fees received or written by it, as reported in Schedule T and supporting schedules of its annual financial statement on insurance or contracts covering risks within this state during the preceding calendar year, less all return premiums, including dividends paid or credited to policyholders or contract holders and premiums received for reinsurance on New Mexico risks.

C. In addition to the premium tax imposed pursuant to Subsection B of this section, each taxpayer described in Subsection A of this section that transacts health insurance in New Mexico or is a plan described in Chapter 59A, Article 46 or 47 NMSA 1978 shall pay a health insurance premium surtax of one percent of the gross health insurance premiums and membership and policy fees received by it on hospital and medical expense incurred insurance or contracts; nonprofit health care service plan contracts, excluding dental or vision only contracts; and health maintenance organization subscriber contracts covering health risks within this state during the preceding calendar year, less all return health insurance premiums, including dividends paid or credited to policyholders or contract holders and health insurance premiums received for reinsurance on New Mexico risks. Except as provided in this section, all references in the Insurance Code to the premium tax shall include both the premium tax and the health insurance premium surtax.

D. In addition to the premium tax imposed pursuant to Subsection B of this section, each taxpayer described in Subsection A of this section that transacts property insurance in the state or offers insurance as described in Section 59A-7-4 NMSA 1978 shall pay an emergency medical services premium surtax of one-tenth percent on the gross insurance premiums and membership and policy fees that the insurer receives on homeowners' insurance, as the superintendent defines "homeowners' insurance" by rule, during the preceding calendar year, less all returned homeowners' insurance premiums, including dividends paid or credited to policyholders and homeowners' insurance premiums received for reinsurance on New Mexico risks. Except as provided in this section, all references in the Insurance Code to the premium tax shall include both the premium tax and the emergency medical services premium surtax.

[D.] E. For each calendar quarter, an estimated payment of the premium tax, [and] the health insurance premium surtax and the emergency medical services premium surtax shall be made on April 15, July 15, October 15 and the following January 15. The estimated payments shall be equal to at least one-fourth of either the payment made during the previous calendar year or eighty percent of the actual payment due for the current calendar year, whichever is greater. The final adjustment for payments due for the prior year shall be made with the return, which shall be filed on April 15 of each year, at which time all taxes for that year are due. Dividends paid or credited to policyholders or contract holders and refunds, savings, savings coupons and similar returns or credits applied or credited to payment of premiums for existing, new or additional insurance shall, in the amount so used, constitute premiums subject to tax under this section for the year in which so applied or credited.

[E.] F. Exempted from the taxes imposed by this section are:

(1) premiums attributable to insurance or contracts purchased by the state or a political subdivision for the state's or political subdivision's active or retired employees; and

(2) payments received by a health maintenance organization from the federal secretary of health and human services pursuant to a contract issued under the provisions of 42 U.S.C. Section 1395 mm(g)."

SECTION 3. Section 59A-6-5 NMSA 1978 (being Laws 1984, Chapter 127, Section 105, as amended) is amended to read:

"59A-6-5. DISTRIBUTION OF DIVISION COLLECTIONS.--

A. All money received by the division for fees, licenses, penalties and taxes shall be paid daily by the superintendent to the state treasurer and credited to the "insurance department suspense fund" except as provided by:

(1) the Law Enforcement Protection Fund Act;

(2) Section 59A-6-1.1 NMSA 1978; and

(3) the Voter Action Act.

B. The superintendent may authorize refund of money erroneously paid as fees, licenses, penalties or taxes from the insurance department suspense fund under request for refund made within three years after the erroneous payment. In the case of premium taxes erroneously paid or overpaid in accordance with law, refund may also be requested as a credit against premium taxes due in any annual or quarterly premium tax return filed within three years of the erroneous or excess payment.

C. The "insurance operations fund" is created in the state treasury. The fund shall consist of the distributions made to it pursuant to Subsection D of this section. The legislature shall annually appropriate from the fund to the division those amounts necessary for the division to carry out its responsibilities pursuant to the Insurance Code and other laws. Any balance in the fund at the end of a fiscal year greater than one-half of that fiscal year's appropriation shall revert to the general fund.

D. At the end of every month, after applicable refunds are made pursuant to Subsection B of this section, the treasurer shall make the following transfers from the balance remaining in the insurance department suspense fund:

(1) to the "fire protection fund", that part of the balance derived from property and vehicle insurance business;

(2) to the insurance operations fund, that part of the balance derived from the fees imposed pursuant to Subsections A and E of Section 59A-6-1 NMSA 1978 other than fees derived from property and vehicle insurance business; [and]

(3) to the emergency medical services protection fund, that part of the balance derived from the emergency medical services surtax imposed pursuant to Subsection D of Section 59A-6-2 NMSA 1978; and

[(3)] (4) to the general fund, the balance remaining in the insurance department suspense fund derived from all other kinds of insurance business."

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