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F I S C A L I M P A C T R E P O R T
SPONSOR Heaton
ORIGINAL DATE
LAST UPDATED
2/06/06
HB 704
SHORT TITLE
NURSING CARE FOR MENTALLY
RETARDED
SB
ANALYST Weber
APPROPRIATION (dollars in thousands)
Appropriation
Recurring
or Non-Rec
Fund
Affected
FY06
FY07
$3,200.0
Recurring
General Fund
(Parenthesis ( ) Indicate Expenditure Decreases)
Duplicates SB 666
Relates to SB 734
Relates to Appropriation in the General Appropriation Act
REVENUE (dollars in thousands)
Estimated Revenue
Recurring
or Non-Rec
Fund
Affected
FY06
FY07
FY08
$8,200.0
Recurring
Federal
Medicaid
(Parenthesis ( ) Indicate Expenditure Decreases)
SOURCES OF INFORMATION
LFC Files
Responses Received From
Human Services Department (HSD)
SUMMARY
Synopsis of Bill
House Bill 704 appropriates $3.2 million from the general fund to the Human Services
Department for the purpose of providing monthly supplemental reimbursement to Medicaid
certified nursing facilities and intermediate care facilities for the mentally retarded to cover the
cost of staffing recruitment, retention, wages and benefits and other operating expenses.
Supplemental reimbursement amounts per facility shall be based on a rate that is equivalent to
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House Bill 704 Page 2
five percent of the monthly Medicaid payment per facility.
FISCAL IMPLICATIONS
The appropriation of $3.2 million contained in this bill is a recurring expense to the general fund.
Any unexpended or unencumbered balance remaining at the end of FY07 shall revert to the
general fund.
SIGNIFICANT ISSUES
During each month of FY07, each NF and ICF MR would be reimbursed their current rate and
the monthly supplemental amount. HSD indicates that at the end of FY07 these facilities are
already scheduled to have their rates rebased. The rebasing of rates is determined in part by the
amounts being reimbursed during the months of FY07. This regularly scheduled rebasing of the
facility rates for FY08 would normally result in some increase to the facility rates. However, the
monthly supplemental amounts that HB 704 proposes to pay the facilities during the months of
FY07 could be considered in the FY08 rebasing of rates. Consequently, the monthly
supplemental payments would likely result in an additional increase in the facility rates for FY08
beyond the increase the facilities would normally receive in the rebasing already scheduled for
FY08.
The appropriation will be matched with federal funds to make available an additional $8.2
million for a total of $11.4 million. The appropriation will result in a corresponding budget
increase in succeeding years in the base Medicaid budget.
POSSIBLE QUESTIONS
Why is only this particular set of providers singled out for an increase when almost no Medicaid
provider has had an increase for the past several years.
MW/yr:mt