HB0038

HOUSE BILL 38

57th legislature - STATE OF NEW MEXICO - second session, 2026

INTRODUCED BY

Kathleen Cates

AN ACT

RELATING TO INSURANCE; AMENDING SECTIONS OF THE HEALTH CARE PURCHASING ACT AND THE NEW MEXICO INSURANCE CODE TO REQUIRE COVERAGE FOR WHEELCHAIRS AND ACTIVITY CHAIRS; PROVIDING THAT DENIAL OF A WHEELCHAIR OR AN ACTIVITY CHAIR WITH RESPECT TO A HEALTH BENEFITS PLAN IS AN UNFAIR AND DECEPTIVE PRACTICE IN CERTAIN CIRCUMSTANCES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 13-7-46 NMSA 1978 (being Laws 2023, Chapter 196, Section 1) is amended to read:

"13-7-46. PROSTHETIC DEVICES--CUSTOM ORTHOTIC DEVICES--WHEELCHAIRS--ACTIVITY CHAIRS--MINIMUM COVERAGE.--

A. Group health coverage, including any form of self-insurance, offered, issued or renewed under the Health Care Purchasing Act shall provide coverage for [prosthetics and custom orthotics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs that is at least equivalent to that coverage currently provided by the federal medicare program and no less favorable than the terms and conditions that the group health plan offers for medical and surgical benefits if the item is for a person with documented permanent physical conditions, including limb loss, limb absence, limb difference, paralysis or neuromuscular or musculoskeletal conditions, that significantly limit the person's ability to independently and safely ambulate, stand, perform functional mobility or engage in physical activity necessary for whole-body health.

B. A group health plan shall cover the most appropriate prosthetic [or] device, custom orthotic device, wheelchair or activity chair determined to be medically necessary by the enrollee's treating physician and associated medical providers to restore or maintain the ability to complete activities of daily living or essential job-related activities and that is not solely for the comfort or convenience of the enrollee. This coverage shall include all services and supplies necessary for the effective use of a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair, including:

(1) formulation of its design, fabrication, material and component selection, measurements, fittings and static and dynamic alignments;

(2) all materials and components necessary to use it;

(3) instructing the enrollee in the use of it; and

(4) the repair and replacement of it.

C. A group heath plan shall cover a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair determined by the enrollee's provider to be the most appropriate model that meets the medical needs of the enrollee for performing physical activities, including running, biking and swimming, and to maximize the enrollee's upper limb function. This coverage shall include all services and supplies necessary for the effective use of a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair, including:

(1) formulation of its design, fabrication, material and component selection, measurements, fittings and static and dynamic alignments;

(2) all materials and components necessary to use it;

(3) instructing the enrollee in the use of it; and

(4) the repair and replacement of it.

D. A group health plan's reimbursement rate for prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs shall be at least equivalent to that currently provided by the federal medicare program and no more restrictive than other coverage under the group health plan.

E. Prosthetic [and] device, custom orthotic device, wheelchair or activity chair coverage shall be comparable to coverage for other medical and surgical benefits under the group health plan, including restorative internal devices such as internal prosthetic devices, and shall not be subject to spending limits or lifetime restrictions.

F. Prosthetic [and] device, custom orthotic device, wheelchair or activity chair coverage shall not be subject to separate financial requirements that are applicable only with respect to that coverage. A group health plan may impose cost sharing on prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs; provided that any cost-sharing requirements shall not be more restrictive than the cost-sharing requirements applicable to the plan's medical and surgical benefits, including those for internal devices.

G. A group health plan may limit the coverage for, or alter the cost-sharing requirements for, out-of-network coverage of prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs; provided that the restrictions and cost-sharing requirements applicable to prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs shall not be more restrictive than the restrictions and requirements applicable to the out-of-network coverage for a group health plan's medical and surgical coverage.

H. In the event that medically necessary covered [orthotics and prosthetics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs are not available from an in-network provider, the insurer shall provide processes to refer a member to an out-of-network provider and shall fully reimburse the out-of-network provider at a mutually agreed upon rate less member cost sharing determined on an in-network basis.

I. A group health plan shall not impose any annual or lifetime dollar maximum on coverage for prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs other than an annual or lifetime dollar maximum that applies in the aggregate to all terms and services covered under the group health plan.

J. If coverage is provided through a managed care plan, an enrollee shall have access to medically necessary clinical care and to prosthetic [and] devices, custom orthotic devices, wheelchairs, activity chairs and technology from not less than two distinct prosthetic [and] device, custom orthotic device, wheelchair or activity chair providers in the managed care plan's provider network located in the state.

K. Coverage for prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs shall be considered habilitative or rehabilitative benefits for purposes of any state or federal requirement for coverage of essential health benefits, including habilitative and rehabilitative benefits.

L. If coverage for prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs is provided, payment shall be made for the replacement of a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair or for the replacement of any part of such [devices] items, without regard to continuous use or useful lifetime restrictions, if an ordering health care provider determines that the provision of a replacement [device] item, or a replacement part of such [a device] an item, is necessary because of any of the following:

(1) a change in the physiological condition of the patient;

(2) an irreparable change in the condition of the [device] item or in a part of the [device] item; or

(3) the condition of the [device] item or the part of the [device] item requires repairs, and the cost of such repairs would be more than sixty percent of the cost of a replacement [device] item or of the part being replaced.

M. Confirmation from a prescribing health care provider may be required if the prosthetic [or] device, custom orthotic device, wheelchair or activity chair or part being replaced is less than three years old.

N. A group health plan subject to the Health Care Purchasing Act shall not discriminate against individuals based on disability, including limb loss, absence or malformation.

O. For the purposes of this section, "activity chair" means a device that is designed specifically to enable a person with mobility impairment to participate in physical activities by providing better speed, safety, stability, maneuverability and balance than a standard wheelchair that is designed for activities of daily living."

SECTION 2. Section 59A-16-21.4 NMSA 1978 (being Laws 2023, Chapter 196, Section 2) is amended to read:

"59A-16-21.4. UNFAIR TRADE PRACTICES ON THE BASIS OF DISABILITY PROHIBITED.--

A. Any of the following practices with respect to a health benefits plan are defined as unfair and deceptive practices and are prohibited:

(1) canceling or changing the premiums, benefits or conditions of a health benefits plan on the basis of an insured's actual or perceived disability;

(2) denying a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair benefit [for an individual with limb loss or absence] that would otherwise be covered for a non-disabled person seeking medical or surgical intervention to restore or maintain the ability to perform the same physical activity if the item is for a person with documented permanent physical conditions, including limb loss, limb absence, limb difference, paralysis or neuromuscular or musculoskeletal conditions, that significantly limit the person's ability to independently and safely ambulate, stand, perform functional mobility or engage in physical activity necessary for whole-body health;

(3) failure to apply the most recent version of treatment and fit criteria developed by the professional association with the most relevant clinical specialty when performing a utilization review for a request for coverage of prosthetic [or] device, custom orthotic device, wheelchair or activity chair benefits; and

(4) failure to apply medical necessity review standards developed by the professional association with the most relevant clinical specialty when conducting utilization management review or processing appeals regarding benefit denial.

B. For purposes of this section:

(1) "activity chair" means a device that is designed specifically to enable a person with mobility impairment to participate in physical activities by providing better speed, safety, stability, maneuverability and balance than a standard wheelchair that is designed for activities of daily living; and

(2) "health benefits plan" means a policy or agreement entered into, offered or issued by a health insurance carrier to provide, deliver, arrange for, pay for or reimburse the costs of health care services; provided that "health benefits plan" does not include the following:

[(1)] (a) an accident-only policy;

[(2)] (b) a credit-only policy;

[(3)] (c) a long- or short-term care or disability income policy;

[(4)] (d) a specified disease policy;

[(5)] (e) coverage provided pursuant to Title 18 of the federal Social Security Act, as amended;

[(6)] (f) coverage provided pursuant to Title 19 of the federal Social Security Act and the Public Assistance Act;

[(7)] (g) a federal TRICARE policy, including a federal civilian health and medical program of the uniformed services supplement;

[(8)] (h) a fixed or hospital indemnity policy;

[(9)] (i) a dental-only policy;

[(10)] (j) a vision-only policy;

[(11)] (k) a workers' compensation policy;

[(12)] (l) an automobile medical payment policy; or

[(13)] (m) any other policy specified in rules of the superintendent."

SECTION 3. Section 59A-22-62 NMSA 1978 (being Laws 2023, Chapter 196, Section 3) is amended to read:

"59A-22-62. MEDICAL NECESSITY AND NONDISCRIMINATION STANDARDS FOR COVERAGE OF [PROSTHETICS OR ORTHOTICS] PROSTHETIC DEVICES, CUSTOM ORTHOTIC DEVICES, WHEELCHAIRS OR ACTIVITY CHAIRS.--

A. An individual health plan that is delivered, issued for delivery or renewed in this state that offers coverage for prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs shall consider these benefits habilitative or rehabilitative benefits for purposes of any state or federal requirement for coverage of essential health benefits.

B. When performing a utilization review for a request for coverage of prosthetic [or] device, custom orthotic device, wheelchair or activity chair benefits, an insurer shall apply the most recent version of evidence-based treatment and fit criteria as recognized by relevant clinical specialists or their organizations. Such standards may be named by the superintendent in rule.

C. An insurer shall render utilization review determinations in a nondiscriminatory manner and shall not deny coverage for habilitative or rehabilitative benefits, including [prosthetics or orthotics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs, solely on the basis of an insured's actual or perceived disability.

D. An insurer shall not deny a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair benefit [for an individual with limb loss or absence] that would otherwise be covered for a non-disabled person seeking medical or surgical intervention to restore or maintain the ability to perform the same physical activity if the item is for a person with documented permanent physical conditions, including limb loss, limb absence, limb difference, paralysis or neuromuscular or musculoskeletal conditions, that significantly limit the person's ability to independently and safely ambulate, stand, perform functional mobility or engage in physical activity necessary for whole-body health.

E. A health benefits plan that is delivered, issued for delivery or renewed in this state that offers coverage for [prosthetics and] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs shall include language describing an insured's rights pursuant to Subsections C and D of this section in its evidence of coverage and any benefit denial letters.

F. Prosthetic [and] device, custom orthotic device, wheelchair or activity chair coverage shall not be subject to separate financial requirements that are applicable only with respect to that coverage. An individual health plan may impose cost sharing on prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs; provided that any cost-sharing requirements shall not be more restrictive than the cost-sharing requirements applicable to the plan's coverage for inpatient physician and surgical services.

G. A health plan that provides coverage for [prosthetic or orthotic] services related to prosthetic devices, custom orthotic devices, wheelchairs or activity chairs shall ensure access to medically necessary clinical care and to prosthetic [and] devices, custom orthotic devices, wheelchairs, activity chairs and technology from not less than two distinct prosthetic [and] device, custom orthotic device, wheelchair or activity chair providers in the managed care plan's provider network located in the state. In the event that medically necessary covered [orthotics and prosthetics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs are not available from an in-network provider, the insurer shall provide processes to refer a member to an out-of-network provider and shall fully reimburse the out-of-network provider at a mutually agreed upon rate less member cost sharing determined on an in-network basis.

H. If coverage for prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs is provided, payment shall be made for the replacement of a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair or for the replacement of any part of such [devices] items, without regard to continuous use or useful lifetime restrictions, if an ordering health care provider determines that the provision of a replacement [device] item, or a replacement part of such [a device] an item, is necessary because of any of the following:

(1) a change in the physiological condition of the patient;

(2) an irreparable change in the condition of the [device] item or in a part of the [device] item; or

I. Confirmation from a prescribing health care provider may be required if the prosthetic [or] device, custom orthotic device, wheelchair, activity chair or part being replaced is less than three years old.

J. The provisions of this section do not apply to excepted benefits plans subject to the Short-Term Health Plan and Excepted Benefit Act.

K. For the purposes of this section, "activity chair" means a device that is designed specifically to enable a person with mobility impairment to participate in physical activities by providing better speed, safety, stability, maneuverability and balance than a standard wheelchair that is designed for activities of daily living."

SECTION 4. Section 59A-23-32 NMSA 1978 (being Laws 2023, Chapter 196, Section 4) is amended to read:

"59A-23-32. MEDICAL NECESSITY AND NONDISCRIMINATION STANDARDS FOR COVERAGE OF [PROSTHETICS AND ORTHOTICS] PROSTHETIC DEVICES, CUSTOM ORTHOTIC DEVICES, WHEELCHAIRS OR ACTIVITY CHAIRS.--

A. A group health plan that is delivered, issued for delivery or renewed in this state that covers essential health benefits or covers prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs shall consider these benefits habilitative or rehabilitative benefits for purposes of state or federal requirements on essential health benefits coverage.

C. An insurer shall render utilization review determinations in a nondiscriminatory manner and shall not deny coverage for habilitative or rehabilitative benefits, including [prosthetics or orthotics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs, solely based on an insured's actual or perceived disability.

F. Prosthetic [and] device, custom orthotic device, wheelchair or activity chair coverage shall not be subject to separate financial requirements that are applicable only with respect to that coverage. A group health plan may impose cost sharing on prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs; provided that any cost-sharing requirements shall not be more restrictive than the cost-sharing requirements applicable to the plan's coverage for inpatient physician and surgical services.

G. A group health plan that provides coverage for [prosthetic or orthotic] services related to prosthetic devices, custom orthotic devices, wheelchairs or activity chairs shall ensure access to medically necessary clinical care and to prosthetic [and] devices, custom orthotic devices, wheelchairs, activity chairs and technology from not less than two distinct prosthetic [and] device, custom orthotic device, wheelchair or activity chair providers in the managed care plan's provider network located in the state. In the event that medically necessary covered [orthotics and prosthetics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs are not available from an in-network provider, the insurer shall provide processes to refer a member to an out-of-network provider and shall fully reimburse the out-of-network provider at a mutually agreed upon rate less member cost sharing determined on an in-network basis.

(1) a change in the physiological condition of the patient;

(2) an irreparable change in the condition of the [device] item or in a part of the [device] item; or

I. Confirmation from a prescribing health care provider may be required if the prosthetic [or] device, custom orthotic device, wheelchair or activity chair or part being replaced is less than three years old.

J. The provisions of this section do not apply to excepted benefits plans subject to the Short-Term Health Plan and Excepted Benefit Act.

SECTION 5. Section 59A-46-72 NMSA 1978 (being Laws 2023, Chapter 196, Section 5) is amended to read:

"59A-46-72. MEDICAL NECESSITY AND NONDISCRIMINATION STANDARDS FOR COVERAGE OF [PROSTHETICS AND ORTHOTICS] PROSTHETIC DEVICES, CUSTOM ORTHOTIC DEVICES, WHEELCHAIRS OR ACTIVITY CHAIRS.--

A. An individual or group health maintenance organization contract that is delivered, issued for delivery or renewed in this state that covers essential health benefits and covers prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs shall consider these benefits habilitative or rehabilitative benefits for purposes of state or federal requirements on essential health benefits coverage.

C. An insurer shall render utilization review determinations in a nondiscriminatory manner and shall not deny coverage for habilitative or rehabilitative benefits, including [prosthetics or orthotics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs, solely based on an insured's actual or perceived disability.

F. Prosthetic [and] device, custom orthotic device, wheelchair or activity chair coverage shall not be subject to separate financial requirements that are applicable only with respect to that coverage. An individual or group health plan may impose cost sharing on prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs; provided that any cost-sharing requirements shall not be more restrictive than the cost-sharing requirements applicable to the plan's coverage for inpatient physician and surgical services.

G. An individual or group health plan that provides coverage for [prosthetic or orthotic] services related to prosthetic devices, custom orthotic devices, wheelchairs or activity chairs shall ensure access to medically necessary clinical care and to prosthetic [and] devices, custom orthotic devices, wheelchairs, activity chairs and technology from not less than two distinct prosthetic [and] device, custom orthotic device, wheelchair or activity chair providers in the managed care plan's provider network located in the state. In the event that medically necessary covered [orthotics and prosthetics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs are not available from an in-network provider, the insurer shall provide processes to refer a member to an out-of-network provider and shall fully reimburse the out-of-network provider at a mutually agreed upon rate less member cost sharing determined on an in-network basis.

(1) a change in the physiological condition of the patient;

(2) an irreparable change in the condition of the [device] item or in a part of the [device] item; or

J. The provisions of this section do not apply to excepted benefits plans subject to the Short-Term Health Plan and Excepted Benefit Act.

SECTION 6. Section 59A-47-66 NMSA 1978 (being Laws 2023, Chapter 196, Section 6) is amended to read:

"59A-47-66. MEDICAL NECESSITY AND NONDISCRIMINATION STANDARDS FOR COVERAGE OF [PROSTHETICS AND ORTHOTICS] PROSTHETIC DEVICES, CUSTOM ORTHOTIC DEVICES, WHEELCHAIRS OR ACTIVITY CHAIRS.--

A. An individual or group health care plan that is delivered, issued for delivery or renewed in this state that covers essential health benefits and covers prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs shall consider these benefits habilitative or rehabilitative benefits for purposes of state or federal requirements on essential health benefits coverage.

C. An insurer shall render utilization review determinations in a nondiscriminatory manner and shall not deny coverage for habilitative or rehabilitative benefits, including [prosthetics or orthotics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs, solely based on an insured's actual or perceived disability.

D. An insurer shall not deny a prosthetic [or] device, a custom orthotic device, a wheelchair or an activity chair benefit [for an individual with limb loss, or absence] that would otherwise be covered for a non-disabled person seeking medical or surgical intervention to restore or maintain the ability to perform the same physical activity if the item is for a person with documented permanent physical conditions, including limb loss, limb absence, limb difference, paralysis or neuromuscular or musculoskeletal conditions, that significantly limit the person's ability to independently and safely ambulate, stand, perform functional mobility or engage in physical activity necessary for whole-body health.

F. Prosthetic [and] device, custom orthotic device, wheelchair or activity chair coverage shall not be subject to separate financial requirements that are applicable only with respect to that coverage. An individual or group health care plan may impose cost sharing on prosthetic [or] devices, custom orthotic devices, wheelchairs or activity chairs; provided that any cost-sharing requirements shall not be more restrictive than the cost-sharing requirements applicable to the plan's coverage for inpatient physician and surgical services.

G. An individual or group health plan that provides coverage for [prosthetic or orthotic] services related to prosthetic devices, custom orthotic devices, wheelchairs or activity chairs shall ensure access to medically necessary clinical care and to prosthetic [and] devices, custom orthotic devices, wheelchairs or activity chairs and technology from not less than two distinct prosthetic [and] device, custom orthotic device, wheelchair or activity chair providers in the managed care plan's provider network located in the state. In the event that medically necessary covered [orthotics and prosthetics] prosthetic devices, custom orthotic devices, wheelchairs or activity chairs are not available from an in-network provider, the insurer shall provide processes to refer a member to an out-of-network provider and shall fully reimburse the out-of-network provider at a mutually agreed upon rate less member cost sharing determined on an in-network basis.

(1) a change in the physiological condition of the patient;

(2) an irreparable change in the condition of the [device] item or in a part of the [device] item; or

J. The provisions of this section do not apply to excepted benefits plans subject to the Short-Term Health Plan and Excepted Benefit Act.

SECTION 7. APPLICABILITY.--The provisions of this act apply to policies, plans, contracts and certificates delivered or issued for delivery or renewed, extended or amended in this state on or after January 1, 2027.

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