NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.

The LFC is only preparing FIRs on bills referred to the Senate Finance Committee, the Senate Ways and Means Committee, the House Appropriations and Finance Committee and the House Taxation and Revenue Committee. The chief clerks are responsible for preparing and issuing all other bill analyses.

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(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

New Mexico Health Policy Commission

Department of Health did not respond

SUMMARY

Synopsis of Senate Corporations & Transportation Committee Amendments

    1. Removes the phrase, "Health Care Access Act and" from page 7 of the bill to now show that transfer of available appropriations made to fulfill the purposes of the Rural Primary Care Act to the essential community provider fund pursuant the Health Care Access Act for the purpose of matching available federal funds; provided that the resulting distributions from the essential community provider fund are used by essential community providers to meet the purposes of Subsections A through E of this section only and not the Health Care Access Act.

    2. Strikes House Appropriations and Finance Committee amendment 17 which removes the following language: "The department shall be benefitted by distributions from the fund for the purposes of the Rural Primary Care Act in the same proportion as the transfers made by the department to the fund."

    3. Inserts the following language on page 7, line 3. "The department shall be benefitted by distributions from the fund for the purposes of the Rural Primary Health Care Act in the same proportion as the transfers made by the department to the fund, but in no case shall the department receive a distribution from the fund for the purpose of the Rural Primary Health Care Act that is less than the transfer it makes to the fund, plus any matching funds received as a result of the transfer."

Synopsis of HAFC Amendment

The House Appropriations and Finance Committee amendments to Committee Substitute for House Bill 739 do the following:

1. On page 2, line 4, strikes existing language and adds new language to now read, " a unit of local government when making transfers to the fund pursuant to the Indigent Hospital and County Health Care Act or from other sources; the department when making transfers to the fund from appropriations made for the purpose of the Rural Primary Health Care Act; or a state institution that makes transfers to the fund for the purposes of obtaining benefits pursuant to the Health Care Access Act;"

2. Adds "or human services department" at several locations in the bill.

3. Strikes "medically" and inserts in lieu thereof "health care" at several locations in the bill.

4. On page 3, line 18, strikes "contributed" and inserts in lieu thereof, "transferred".

5. On page 4, line 10, adds language to now read: "If, within that time frame, the department or the human services department is able to match the money transferred by the contributing entity, distributions shall be made from the fund pursuant to Section % of the Health Care Access Act"

6. The word "payments" is changed to the word, "distributions" at several locations in the bill.

7. On page 4, line 24 and 25 and on page 5, line 1, strikes paragraph 1 in it's entirety and inserts language that is attached to this analysis as an addendum.

Adds language on page 7, lines 1 and 2 to now read: "The department shall be benefitted by distributions from the fund for the purposes of the Rural Primary Health Care Act in the same proportion as the transfers made by the department to the fund".

Synopsis of Bill

The House Consumer and Public Affairs Committee substitute for House Bill 739 creates the Health Care Access Act and amends sections of the Rural Primary Care Act, the County Indigent Fund Act and the County Supported Medicaid Fund. The bill creates the Essential Community Provider Fund which is envisioned to provide funds for essential community providers who will utilize this fund to deliver needed health care services to underserved citizens of the counties.

Significant Issues

A section-by-section description of the bill has been done by the Health Policy Commission and is included here as an attachment to this analysis.

FISCAL IMPLICATIONS

The fiscal implications of this legislation have not been quantified; however, use of funding appropriated to DOH to match monies put in the fund by the counties can significantly increase the amount of money spent for health care in the county. The potential to leverage Medicaid with these monies is unknown at this time and there is some question that monies transferred from the County Supported Medicaid Fund may not qualify for federal match. There seems to be consensus however that at least a percentage of this fund is eligible for federal match.

ADMINISTRATIVE IMPLICATIONS

Administration of the provisions of this legislation will require DOH to establish rules, regulations and operating procedures to properly allocate and account for the monies flowing into and out of this fund.

CONFLICT/DUPLICATION/COMPANIONSHIP/RELATIONSHIP

HB-270, SB-452, SB-320 also amend provisions of the County Indigent Fund Act.

TECHNICAL ISSUES

There are no appropriations in the bill, but there are provisions for transfer of monies and distribution of funds.

OTHER SUBSTANTIVE ISSUES

The Sole Community Provider Fund leverages county funds for lump-sum payments to sole community hospitals and this already provides a means of supplying much needed funding to hospitals.

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Attachment

Provided by the Health Policy Commission ATTACHMENT

Section 2: states that the legislature finds it necessary to provide flexible and shared solutions to address the problems of the underserved.

Section 3: establishes definitions of Department of Health (DOH), essential community provider, essential community provider network, and fund. Essential Community Providers may be:

• Sole community provider hospitals
• Hospitals qualified to receive disproportionate share Medicaid/Medicare payments
• Primary care providers in federally designated medically underserved areas
• School health programs linked to an eligible provider
• Federally qualified health centers and rural health clinics
• Non-profit primary care clinics
• Essential access community hospitals
• Home health agencies
• Behavioral health agencies
• Other health providers deemed to be essential by DOH

Section 4: creates the essential community provider fund, consisting of money contributed from local governments, money appropriated to the fund, and money transferred to DOH. Unexpended or unencumbered balances do not revert.

Effective July 1, 1999, money may be transferred into the fund from local governments, and the DOH will match that with state (such as rural primary healthy care funds) or federal funds. If DOH cannot match that money within a timeframe to be established by DOH, the money will revert back to the local government.

Section 5: provides a framework for payments to providers and also stipulates that local governments shall be benefitted by payments from the fund for their citizens in the same proportion as the contributions.

Sections 6 and 7: amend the Rural Primary Care Health Care Act, Section 24-1A, 3.1 NMSA, expanding the allowable uses of the Rural Primary Health Care appropriations to include: "develop and fund programs established in the Health Care Access Act by utilizing appropriations made to fulfill the purposes of the Rural Primary Health Care Act and to match available federal funds; provided that the resulting allocations are supplemental to existing levels."

Section 8: amends the County Indigent Fund Act, Section 27-5-6 NMSA, Powers and Duties of the Board, adding to allowable uses of county indigent funds to include: "transfers to the essential community provider fund for the purposes of obtaining benefits pursuant to the Health Care Access Act; provided that such transfers made pursuant to this subsection are in addition to, and not in lieu of transfers made and required pursuant to subsections N and O of this section." Existing Subsections N and O refer to the formulas used to transfer money to the State Treasurer for the Sole Community Provider Fund and the County Supported Medicaid Fund.

Section 9: amends the County Supported Medicaid Fund Act, Section 27-10-3 NMSA, adding the following language:

• Subsection B in reference to the County Supported Medicaid Fund allows the funds to also be used for the program for essential community providers pursuant to the Health Care Access Act...
• Subsection D adds of health after the department, changing the meaning of the department from Human Services Department to DOH as the department responsible for budgeting and accounting of payments to the county supported Medicaid fund.