The House of Representatives committee passed the Senate Finance substitute for Senate Bill 249 on a voice vote after testimony from providers, an industry association and legislative analysts.

Representative Duncan, who presented the measure, said the bill “just breaks that sum out. It shows what they’re getting paid for their services they provided and the GRT.” He said the change is intended to make explicit the portion of Medicaid payments meant to cover gross-receipts tax so providers can see the reimbursement for services separate from the GRT amount.

The measure drew support from providers and associations. Dana Gray, executive director of Desert States Physical Fair Struggle, testified, “We agree with a greater need for transparency in claims payment processes. We stand in full support and urge a do pass.” Vicente Vargas, executive director of the New Mexico Healthcare Association for assisted living, said the substitute would streamline billing and help prevent managed-care organizations from using GRT calculations “as leverage during the negotiation of Medicaid contracts with nursing facilities.”

Committee members pressed presenters on fiscal and administrative details. Representative Montoya asked whether the bill would have a fiscal impact; witnesses said the Health Care Authority told analysts the change would not add to Medicaid program costs. Jennifer Fabian, an economist with the Legislative Finance Committee, said the operational cost estimate came from the Health Care Authority and that most administrative burden would fall to MCOs and providers. The committee discussed a fiscal-impact report that estimated about $450,000 in implementation costs, with an estimated $45,000 general-fund share after federal match for information-technology upgrades.

Committee discussion also clarified how existing capitation rates are intended to cover the GRT. Witnesses explained that the state’s capitation rates with MCOs are intended to include funds to reimburse providers for GRT, but reporting and pass-through practices by MCOs have not always resulted in providers receiving an explicit, itemized GRT amount. The substitute instructs itemization of the GRT portion on reimbursements so providers can reconcile what was paid for services and what was designated for tax payment.

Representative Lundstrom asked which agency audits the MCO reporting; a presenter replied that the Health Care Authority establishes capitation rates with an actuary and is responsible for ensuring the accuracy of the data reported by MCOs. Representative Silva asked whether this change conflicts with other bills proposing GRT deductions or exemptions, including HB344 and HB295; presenters said SB249’s substitute does not create a tax exemption or deduction but requires transparency so funds already in the capitation rates reach providers.

On a motion to pass the substitute, Representative Hernandez moved and Representative Gallegos seconded. The substitute passed in committee and will advance in the legislative process.

Votes at a glance: The committee reported the substitute passed; the committee called the roll and the motion passed (committee recorded as approving the Senate Finance substitute for Senate Bill 249). Specific individual roll-call assignments were recorded in the committee minutes.

This action will return to the House legislative process for further scheduling and floor consideration.