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F I S C A L I M P A C T R E P O R T
SPONSOR Altamirano
ORIGINAL DATE
LAST UPDATED
2/08/06 HB
SHORT TITLE
MEDICAID BEHAVIORAL HEALTH FEE-
FOR-SERVICE
SB 508
ANALYST Weber
APPROPRIATION (dollars in thousands)
Appropriation
Recurring
or Non-Rec
Fund
Affected
FY06
FY07
$2,000.0
Recurring
General Fund
(Parenthesis ( ) Indicate Expenditure Decreases)
Relates to Appropriation in the General Appropriation Act
REVENUE (dollars in thousands)
Estimated Revenue
Recurring
or Non-Rec
Fund
Affected
FY06
FY07
FY08
$5,100.0
$5,100.0 Recurring
Federal
Medicaid
(Parenthesis ( ) Indicate Expenditure Decreases)
SOURCES OF INFORMATION
LFC Files
Responses Received From
Human Services Department (HSD)
Children Youth and Families Department (CYFD)
Department of Health (DOH)
Health Policy commission
SUMMARY
Synopsis of Bill
Senate Bill 508 appropriates $2 million from the general fund to the Human Services Department
pg_0002
Senate Bill 508 Ė Page 2
for the purpose of increasing Medicaid behavioral health fee-for-service payments.
FISCAL IMPLICATIONS
The appropriation of $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
The total funding available including the Medicaid match will be $7.2 million. HSD indicates
that specifying the funding can only be used to increase fee-for-service rates may result an
inequity in reimbursement for services provided to recipients through a managed care
arrangement versus those in fee-for-service. This is in spite of the fact that all reimbursements
are made by a single entity contractor under the Behavioral Health Collaborative. Failure to
increase the Medicaid rates equally, regardless of the managed care or fee-for service status of
the recipient, may cause providers to feel they are being reimbursed unfairly and result in
unequal recipient access to services.
The Health Policy Commission contributes:
According the New Mexico Health Resources (NMHR), a private, non-profit agency organized
to support efforts to recruit and retain healthcare personnel in New Mexico, Medicaid
reimbursement rates have not been adjusted in several years and are the lowest rates in the state
for health services. Low reimbursement rates effect behavioral health professionals particularly
psychiatrists. NMHR noted that in 2005 there were only 34 licensed psychiatrists practicing in
the state and all but four were in the Albuquerque and Santa Fe areas.
The 2002 Health Policy Commissionís Physician Survey indicated that one of the top three
reasons given for leaving the state is due to the Medicaid reimbursement rate.
New Mexicoís prevalence of substance abuse/mental disorders is statewide and behavioral health
professionals are needed in rural areas, maybe more so than in urban areas. Medicaidís low
reimbursement rates impact professionals statewide.
MW/yr