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F I S C A L I M P A C T R E P O R T

SPONSOR Wirth

ORIGINAL DATE

LAST UPDATED

1/22/07

HB 15

SHORT TITLE Domestic Partner Health Care Coverage

SB

ANALYST Earnest

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicate of Senate Bill 182

SOURCES OF INFORMATION

LFC Files

Responses Received From

Human Resources Department (HSD)

Public Regulation Commission (PRC)

SUMMARY

Synopsis of Bill

House Bill 15 requires insurers to offer health insurance coverage for those small employers

who elect to offer this coverage for the domestic partners of their full- and part-time employees.

Domestic partners are defined as “unmarried partners over eighteen years of age who: (1) are in

a mutually exclusive, committed relationship; (2) have shared a primary residence for twelve or

more consecutive months; (3) are jointly responsible for the common welfare of each other; and

(4) share financial obligations."

FISCAL IMPLICATIONS

None identified.

House Bill 15 – Page

2

SIGNIFICANT ISSUES

According to PRC, many insurers offer health insurance coverage for domestic partners as part

of a group health insurance plan when the employer wants to offer such coverage to their em-

ployees, but some insurers don’t. This creates an un-level playing field in the market place and

creates confusion for employers. While many large employers have the clout to negotiate for this

coverage, small employers may have more difficulty in finding domestic partner coverage for

their employees.

According to HSD:

•

The bill was recommended by the Insure New Mexico! Council as a method to insure

more people in New Mexico.

o

The Council consisted of large and small employers, insurance companies,

brokers, labor representatives and advocates.

•

The opportunity to offer employer-sponsored health insurance for full- and part-time

employees’ domestic partners in the small group market will help address New Mex-

ico’s high rate of uninsured.

•

Offering coverage to employees’ domestic partners helps companies recruit candi-

dates by providing them the option of choosing their own or their partner’s health in-

surance plan.

•

Employers would be able to shop around to provide the most affordable coverage

through competition among insurance carriers.

•

The bill does not require all small employers to offer coverage for the domestic part-

ners of their full- and part-time employees.

ADMINISTRATIVE IMPLICATIONS

HB 15 may require insurers to re-file certain group contracts with the PRC’s Insurance Division.

While this could result in increased workloads, the Insurance Division believes that this addi-

tional review can be accomplished with existing staff without fiscal or performance implications.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Duplicates Senate Bill 182.

OTHER SUBSTANTIVE ISSUES

Data Shows Many Do Not Have Health Care Coverage in New Mexico

•

Approximately 401,000 New Mexicans (21.1% of the state’s population) do not have

health insurance (Census Current Population Survey, 2005).

•

New Mexico has one of the highest rates of uninsured in the country.

•

Among uninsured adults in New Mexico, 25% work one part-time job and 41% report

working multiple part-time jobs (HRSA Household Survey, 2004).

•

The largest percent of the uninsured (approximately 60%) are between the ages of 18-34,

when they are most likely to be establishing a career (HRSA Household Survey, 2004).

House Bill 15 – Page

3

State Employees Have Coverage for Domestic Partners

•

Of the 20,318 state employees enrolled in group medical coverage, 1,077 (5.3%) are en-

rolled in domestic partner coverage.

Health and Insurance Companies Provide Domestic Partner Coverage to Their Employees

•

Large insurance companies such as Blue Cross and Blue Shield of New Mexico, Love-

lace Health System and Presbyterian Health Services provide domestic partner health in-

surance coverage for their own employees.

o

Insurance companies understand there is no actuarial risk to their own organizations.

o

As large employers, they want to be competitive and not bound by antiquated under-

writing guidelines.

o

They support getting more New Mexicans insured.

BE/mt