The House Health and Human Services Committee unanimously passed a bill that would make sure the 55 percent of a health insurance premium surtax would continue to be distributed into the Health Care Affordability Fund.
Sponsored by state Rep. Reena Szczepanski, D-Santa Fe, HB 7 would prevent a percentage of the 55 percent of the health insurance premium surtax from being sent to the state’s general fund. Szczepanski said a bill to create the Health Care Affordability Fund was enacted in 2021 and because the programs funded by the 55 percent surtax did not exist in 2021, the original law allowed a reversion of funds starting in Fiscal Year 2025.
“It has led to major affordability improvements for consumers and small businesses in New Mexico. It has reduced consumer costs on the Be Well New Mexico Exchange to small businesses and their employees and to lower income New Mexicans who don’t qualify for other programs,” Szczepanski said.
Without enactment of this bill, the distribution of the health insurance premium surtax will drop to 30 percent. Szczepanski said the state’s health exchange currently has the highest enrollment in its history with more than 50,000 individuals enrolled. She said businesses save $45 million on premiums due to the 55 percent distribution of the tax into the fund and that it helps 6,000 businesses and 41,000 employees.
In a response to a question from state Rep. Jenifer Jones, R-Deming, about how the program works, Szczepanski said the 55 percent distribution enables small businesses purchasing private insurance through the state health exchange to have a 10 percent discount on premiums.
Colin Baillio, New Mexico Deputy Superintendent of Insurance, told the committee that the discount comes on top of federal funds leveraged from the federal government.
“It’s the best use of our state dollars. It’s not supplanting federal funds. The full amount is going to carriers so they can cover more people,” Baillio said.
The New Mexico Office of Superintendent of Insurance administers the program.
After the 9-0 vote, the bill heads next to the House Appropriations and Finance Committee.
