HOUSE BILL 563
51st legislature - STATE OF NEW MEXICO - first session, 2013
INTRODUCED BY
Thomas C. Taylor
AN ACT
RELATING TO HEALTH INSURANCE; ENACTING THE NEW MEXICO HEALTH INSURANCE EXCHANGE ACT; CREATING THE NEW MEXICO HEALTH INSURANCE EXCHANGE BOARD OF DIRECTORS; PROVIDING DUTIES; ALLOWING ASSESSMENTS; ELIMINATING THE NEW MEXICO HEALTH INSURANCE ALLIANCE BOARD OF DIRECTORS; PROVIDING TEMPORARY INSTRUCTIONS; REPEALING THE HEALTH INSURANCE ALLIANCE ACT; DECLARING AN EMERGENCY.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 6 of this act may be cited as the "New Mexico Health Insurance Exchange Act".
SECTION 2. [NEW MATERIAL] DEFINITIONS.--As used in the New Mexico Health Insurance Exchange Act:
A. "board" means the board of directors of the New Mexico health insurance exchange;
B. "exchange" means the New Mexico health insurance exchange, composed of an individual exchange and small business health options program, or "SHOP", exchange, under a single governance and administrative structure; and
C. "federal act" means the federal Patient Protection and Affordable Care Act, as amended by the federal Health Care and Education Reconciliation Act of 2010.
SECTION 3. [NEW MATERIAL] HEALTH INSURANCE EXCHANGE--CREATION.--
A. The "New Mexico health insurance exchange" is created as a nonprofit unincorporated public entity for the purpose of fostering a competitive marketplace for health insurance.
B. The exchange is an instrumentality of the state, except that the debts and liabilities of the exchange do not constitute the debts and liabilities of the state. Neither the exchange nor the board is an agency of the state. The board and the exchange shall be considered governmental entities for purposes of the Tort Claims Act, shall operate consistently with the provisions of the Governmental Conduct Act, the Inspection of Public Records Act, the Financial Disclosure Act and the Open Meetings Act and shall not be subject to the Procurement Code or the Personnel Act.
C. The exchange shall not duplicate, impair, enhance, supplant, infringe upon or replace, in whole or in any part, the powers, duties or authorities of the superintendent of insurance, including rate review and approval, except as directed by the federal act.
D. The exchange shall not solicit bids or engage in the active purchasing of insurance.
E. All health insurers and health maintenance organizations authorized to conduct business in this state and meeting the requirements of the federal act shall be eligible to participate in the exchange.
SECTION 4. [NEW MATERIAL] BOARD OF DIRECTORS.--
A. The exchange shall be governed by a board of directors. The board shall consist of fourteen members as follows:
(1) six voting members appointed by the
governor, including a consumer advocate;
(2) five voting members, one each appointed by
the president pro tempore of the senate, the minority floor leader of the senate, the speaker of the house of representatives, the minority floor leader of the house of representatives and the New Mexico legislative council;
(3) the secretary of human services, or the secretary's designee, who shall be a voting member;
(4) the superintendent of insurance, or the superintendent's designee, who shall be a nonvoting member, except when the superintendent's vote is necessary to break a tie; and
(5) the secretary of economic development, or the secretary's designee, who shall serve as a nonvoting, ex-officio member of the board.
B. Each voting member shall be entitled to one vote in person or by proxy at each meeting.
C. The governor shall appoint no more than four members who belong to the same political party.
D. The superintendent of insurance shall serve as chair of the board unless the superintendent declines, in which event, the superintendent shall appoint the chair.
E. The members appointed by legislators or the New Mexico legislative council shall be appointed for initial terms of three years or less, staggered so that the term of at least one member expires on June 30 of each year. The members appointed by the governor shall be appointed for initial terms of three years or less, staggered so that the term of at least one member expires on June 30 of each year. Following the initial terms, members shall be appointed for terms of three years. A member whose term has expired shall continue to serve until a successor is appointed and qualified.
F. Whenever a vacancy on the board occurs, the appointing authority of the position that is vacant shall fill the vacancy by appointing an individual to serve the balance of the unexpired term. The individual appointed to fill a vacancy shall meet the requirements for initial appointment to that position.
G. A majority of the voting members shall be business representatives or individuals who are not directly affiliated with the insurance industry.
H. The board shall be composed, as a whole, to ensure representation of the state's Native American population, ethnic diversity, cultural diversity and geographic diversity. Members shall have demonstrated knowledge or experience in at least one of the following areas:
(1) individual health insurance coverage;
(2) small employer health insurance;
(3) health benefits administration;
(4) health care finance;
(5) administration of a public or private
health care delivery system;
(6) the provision of health care services;
(7) the purchase of health insurance coverage;
(8) health care consumer navigation or
assistance;
(9) health care economics or health care
actuarial sciences;
(10) information technology; or
(11) starting a small business with fifty or
fewer employees.
I. Members may be reimbursed by the exchange as
provided in the Per Diem and Mileage Act for nonsalaried public
officers but shall receive no other compensation, perquisite or
allowance from the exchange.
J. A member may be removed from the board by a majority vote of two-thirds of the members. The board shall set standards for attendance and may remove a member for lack of attendance, neglect of duty or malfeasance in office. A member shall not be removed without proceedings consisting of at least one ten-day notice of hearing and an opportunity to be heard. Removal proceedings shall be before the board and in accordance with procedures adopted by the board.
SECTION 5. [NEW MATERIAL] POWERS AND DUTIES OF THE BOARD.--
A. The board shall determine and establish the development, governance and operation of the exchange and shall perform all functions necessary to operate the exchange, but the board shall not promulgate rules. The board shall:
(1) appoint an executive director to administer the exchange;
(2) create an initial operational and financial plan and thereafter approve such plans as created by the executive director;
(3) create technical and advisory groups, as the board deems necessary, to report to the board. The advisory groups, if any, shall meet regularly throughout the year to discuss issues related to the exchange and make recommendations to the board;
(4) provide a written report, on or before January 15 of each year, to the governor and the legislature concerning the planning and establishment of the exchange;
(5) consider the desirability of structuring the exchange as one entity that includes two underlying entities to operate in the individual and small employer markets, respectively;
(6) limit any small business health options program to those employers with at least one but no more than fifty employees, until such time as the federal act requires the participation of employers with more than fifty employees;
(7) consider the unique needs of rural New Mexicans as they pertain to access, affordability and choice in purchasing health insurance;
(8) consider the affordability and cost in the context of quality care and increased access to purchasing health insurance;
(9) investigate requirements, develop options and determine waivers, if appropriate, to ensure that the best interests of New Mexicans are protected;
(10) establish conflict of interest policies; and
(11) conduct periodic audits to ensure the general accuracy of the financial data submitted to the exchange.
B. When carrying out its functions pursuant to the New Mexico Health Insurance Exchange Act, the board shall not exercise any duty or power pursuant to the Health Insurance Alliance Act.
C. The board may:
(1) apply for planning and establishment grants made available to the exchange pursuant to the federal act and apply for, receive and expend other gifts, grants and donations. Each grant application is subject to review and approval by the board; and
(2) enter into information-sharing agreements with federal and state agencies and other state exchanges to carry out its responsibilities under the New Mexico Health Insurance Exchange Act so long as the agreements include adequate protections with respect to the confidentiality of the information that is shared and comply with all state and federal laws, rules and regulations.
SECTION 6. [NEW MATERIAL] EXCHANGE ASSESSMENTS.--Until January 1, 2016, the board may charge assessments or user fees to carriers, qualified employers or producers or otherwise to generate funding necessary to support exchange operations; provided that assessments shall be limited solely to the reasonable administrative costs of the exchange.
SECTION 7. Section 59A-56-4 NMSA 1978 (being Laws 1994, Chapter 75, Section 4, as amended) is amended to read:
"59A-56-4. ALLIANCE CREATED--BOARD CREATED.--
A. The "New Mexico health insurance alliance" is created as a nonprofit public corporation for the purpose of providing increased access to health insurance in the state. All insurance companies authorized to transact health insurance business in this state, nonprofit health care plans, health maintenance organizations and self-insurers not subject to federal preemption shall organize and be members of the alliance as a condition of their authority to offer health insurance in this state, except for an insurance company that is licensed under the Prepaid Dental Plan Law or a company that is solely engaged in the sale of dental insurance and is licensed under a provision of the Insurance Code.
B. The alliance shall be governed by [a board of directors constituted pursuant to the provisions of this section. The board is a governmental entity for purposes of the Tort Claims Act, but neither the board nor the alliance shall be considered a governmental entity for any other purpose.
C. Each member shall be entitled to one vote in person or by proxy at each meeting.
D. The alliance shall operate subject to the supervision and approval of the board. The board shall consist of:
(1) five directors, elected by the members, who shall be officers or employees of members and shall consist of two representatives of health maintenance organizations and three representatives of other types of members;
(2) five directors, appointed by the governor, who shall be officers, general partners or proprietors of small employers, one director of which shall represent nonprofit corporations;
(3) four directors, appointed by the governor, who shall be employees of small employers; and
(4) the superintendent or the superintendent's designee, who shall be a nonvoting member, except when the superintendent's vote is necessary to break a tie.
E. The superintendent shall serve as chairman of the board unless the superintendent declines, in which event the superintendent shall appoint the chairman.
F. The directors elected by the members shall be elected for initial terms of three years or less, staggered so that the term of at least one director expires on June 30 of each year. The directors appointed by the governor shall be appointed for initial terms of three years or less, staggered so that the term of at least one director expires on June 30 of each year. Following the initial terms, directors shall be elected or appointed for terms of three years. A director whose term has expired shall continue to serve until a successor is elected or appointed and qualified.
G. Whenever a vacancy on the board occurs, the electing or appointing authority of the position that is vacant shall fill the vacancy by electing or appointing an individual to serve the balance of the unexpired term; provided when a vacancy occurs in one of the director's positions elected by the members, the superintendent is authorized to appoint a temporary replacement director until the next scheduled election of directors elected by the members is held. The individual elected or appointed to fill a vacancy shall meet the requirements for initial election or appointment to that position.
H. Directors may be reimbursed by the alliance as provided in the Per Diem and Mileage Act for nonsalaried public officers but shall receive no other compensation, perquisite or allowance from the alliance] the board of directors of the New Mexico health insurance exchange appointed pursuant to the New Mexico Health Insurance Exchange Act."
SECTION 8. TEMPORARY PROVISION.--On the effective date of this act, the board of directors of the New Mexico health insurance alliance, appointed pursuant to the Health Insurance Alliance Act prior to the effective date of this act, shall cease to exist and the New Mexico health insurance alliance shall be governed pursuant to the Health Insurance Alliance Act by the board of directors of the New Mexico health insurance exchange appointed pursuant to the New Mexico Health Insurance Exchange Act. In exercising its duties, the board of directors of the New Mexico health insurance exchange shall neither apply any provisions of the Health Insurance Alliance Act to the New Mexico health insurance exchange nor apply any provisions of the New Mexico Health Insurance Exchange Act to the New Mexico health insurance alliance.
SECTION 9. DELAYED REPEAL.--Sections 59A-56-1 through 59A-56-25 NMSA 1978 (being Laws 1994, Chapter 75, Sections 1 through 25, as amended) are repealed effective January 1, 2015.
SECTION 10. SEVERABILITY.--If any part or application of this act is held invalid, the remainder or its application to other situations or persons shall not be affected.
SECTION 11. EMERGENCY.--It is necessary for the public peace, health and safety that this act take effect immediately.
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