Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance
committees of the Legislature. LFC does not assume responsibility for the accuracy of these reports if they
are used for other purposes.
F I S C A L I M P A C T R E P O R T
SPONSOR
Berghmans/Hamblen/Charley/O’Malley/
Stewart
LAST UPDATED
ORIGINAL DATE 03/07/2025
SHORT TITLE Coverage for Certain Health Care
BILL
NUMBER Senate Bill 508
ANALYST Chilton
ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT*
(dollars in thousands)
FY25 FY26 FY27
3 Year
Total Cost
Recurring or
Nonrecurring
Fund
Affected
MAD $0.0 $1,497.1 $2,994.3 $4,491.4 Recurring
General
Fund
MAD $0.0 $4,135.5 $8, 271.1 $12,406.6 Recurring
Federal
Funds
MAD $0.0 $13.3 $13.3 Nonrecurring
General
Fund
MAD $0.0 $39.7 $39.7 Nonrecurring
Federal
Funds
MAD Total $0.0 $5,685.6 $11,265.4 $16,951.0
Recurring and
Nonrecurring
SHB $0.0 $927.0 $1,854.0 $2,781 Recurring
Member
premiums
SHB $0.0 $1,426.2 $2,852.3 $4278.5 Recurring
General
Fund (via
SHB
premiums)
SHB Total $0.0 $2,353. 2 $4,706.3 $7,059.5 Recurring TOTAL SHB
OSI
No fiscal
impact
Up to $150.0 Up to $300.0 Up to $450.0 Recurring
Other State
Funds
Parentheses ( ) indicate expenditure decreases.
*Amounts reflect most recent analysis of this legislation.
Sources of Information
LFC Files
Agency Analysis Received From
Office of the Superintendent of Insurance (OSI) Health Care Authority (HCA) Retiree Health Care Authority (RHCA) Agency Analysis was Solicited but Not Received From
Public School Insurance Authority (PSIA)
Senate Bill 508 – Page 2
SUMMARY
Synopsis of Senate Bill 508
Sections 1 to 5 of Senate Bill 508 (SB508) apply to group health coverage and amendsSection
13-7 NMSA 1978, the Health Care Purchasing Act. In Section 2, abortion care without cost-
sharing is to be provided by all group health plans. Section 3 mandates a special enrollment
period for pregnant persons. Section 4 requires gender-affirming care be covered for all who
wish it. Section 5 amends existing statute and requires coverage for up to 12 months of
contraceptives and related medical costs. Cost-sharing is permitted where generic or
therapeutically equivalent contraceptives are available, but a brand-name product is chosen.
Section 6 to 9 apply to Medicaid, amending the Public Assistance Act, Section 27-2, requiring
twelve-months of contraception availability, and specifying that family-planning-related
services, including abortion care, spontaneous abortion management, preventive services,
cervical cancer screening, prevention and treatment of sexually transmitted infections, mental
health care and prevention of pregnancy by any approved means are authorized for
reimbursement without quantity limitation, utilization controls, or prior authorization. Payment
for treatment from any licensed health care provider is mandated. Section 8 would require
Medicaid and Medicaid managed care organizations to pay for lactation support and, in Section
9, for gender-affirming care.
Sections 10 to 13 apply to individual or group health insurance policies, adding to Section
59A-22. Section 10 deals with abortion coverage, Section 11 with contraceptives and
contraceptive devices, including the 12-month prescription coverage requirement, and Section
12 provides for special enrollment periods during pregnancy. Section 13 requires coverage for
gender-affirming care.
Sections 14 to 17 apply to group or blanket insurance policies and certificates of insurance, in
Section 59A-23, and make the same requirements as those applying to individual and group
health insurance policies.
Sections 18 to 21 apply to individual or group health maintenance plans, making the same
coverage requirements. Section 19K allows religious entities purchasing group or individual care
to decline to provide contraceptive devices or drugs.
Section 22 to 25 apply similar requirements to non-profit health plans.
The effective date of this bill is July 1, 2026.
FISCAL IMPLICATIONS
There is no appropriation in Senate Bill 508.
The Health Care Authority (HCA) calculates possible effects on the budgets of the Medicaid
program and on the state health benefits program; they are included in the table above. Among
its comments on the provisions in this bill, HCA states the following regarding two of the
categories of benefits to Medicaid recipients included in the bill: Senate Bill 508 – Page 3
Section 7(C) permits beneficiaries to receive family planning or family planning related
services from any licensed health care providers without restriction to managed care
network providers. Managed care organizations (MCOs) must reimburse providers for
rendered services. One of the basic tenants of managed care is to control healthcare costs
while maintaining quality by coordinating and managing the delivery of healthcare
services through a network of providers. Section 7(C) would preclude the MCOs from
effectively managing and controlling health care costs, possibly resulting in a non-
quantifiable efficiency loss.
Section 7(D) unbundles the global reimbursement rates for abortion services currently
used by the Medicaid program. The section requires reimbursing distinct and non-
bundled procedural services, using a modifier to reflect the increased time and training
required to perform such services. Medicaid’s bundled rates for abortion codes are set
higher than the distinct procedural services they replaced. Thus, unbundling would result
in fewer payments for those services, which would negatively affect abortion providers.
Note: the Medicaid program implemented global rates for abortion codes for delivering
medical, counseling and pharmacy services on July 1, 2022, with Supplement #23-07
following a year of stakeholder communication and development with community
reproductive health providers.
Office of the Superintendent of Insurance (OSI) predicts “significant” costs to that agency if this
bill is enacted: “The requirements of this bill will have a significant impact on OSI’s operating
budget. There is no appropriation for the implementation. This is an unfunded mandate.” This
analysis estimates that OSI may need as many as three FTEs at an average total cost of $100
thousand each per full year to implement SB508’s provisions.
SIGNIFICANT ISSUES
RHCA believes that this bill would have minimal impact on its budget or its members, given that
its members are mostly older, though its premiums may be increased due to the additional
services provided without copay for other New Mexicans.
The requirement that health insurance plans pay for all CDC-recommended immunizations
applies to those over 18 years of age; all vaccines for all individuals younger than that are paid
for through the Vaccine Purchase Act, 2015 Senate Bill 121.
ADMINISTRATIVE IMPLICATIONS
Regarding Medicaid, HCA states that:
[HCA] would likely have to submit for a state plan amendment to add fertility services.
This means that the entire reproductive health page of our state plan would be open to
negotiation with the federal government and CMS. Unbundling abortions services would
require MCO policy manual changes. The required financial services IT system changes
would not start until FY26 and would cost approximately $53 thousand to complete with
75% to 25% federal funds to state funds split, or $39.8 thousand to $13.3 thousand,
respectively.
Senate Bill 508 – Page 4
TECHNICAL ISSUES
As noted by HCA:
In section 6(B) the federal requirement for coverage would include one medication
covered from each class. It is common practice to only cover one agent instead of every
agent in the class as it can help lower costs for the insurer (and patient if cost sharing
exists) and also makes it easier for pharmacies to stock the medication.
HCA also noted that “basic fertility services” need to be defined.
OSI makes the following points:
Cost-sharing elimination provisions are exempt from high deductible health benefit plans
until eligible insured's deductible has been met. This does not take into account
catastrophic and high deductible plans that are HSA eligible.
There is no language in this legislation outlining enforcement expectations for Office of
the Superintendent of Insurance staff, such as audits of insurance claims or internal policy
reviews. As a result, OSI is assuming that its main enforcement will be through
complaints. Without any expectations on enforcement, OSI’s main obligation for this
legislation will be to ensure that insurance policies comply with the requirements of
SB508.
LAC/hj/SL2