HB 122 Health Insurance Premium Surtax

HB 122 Health Insurance Premium Surtax by Reps Deborah Armstrong and Martínez. This bill increases the premium surtax on health insurance premiums from 1% to 3.75%. While the tax is designed to increase costs to insurance providers, there is no doubt that it will be passed onto consumers. This will only exasperate the situation for affordable health care insurance for those not served by Medicaid. 

Congress repealed the “health care provider fee” under the Affordable Care Act because it was costly for consumers. Unfortunately, the state is doing what the feds intended to stop, but at a steeper rate. While the intentions of HB 122 are to help those who can’t afford health insurance, this will increase the burden on those individuals and families who don’t meet the requirements for assistance, but who cannot afford another increase to their health care costs.

            The Kaiser Family Foundation estimates 16,855 uninsured New Mexicans are currently eligible to access a free, federally subsidized “bronze” health insurance plans on the health insurance exchange after tax credits are applied. That federal program alone covers the majority of people the sponsor is seeking to assist. Current health insurance taxes already being paid should be adequate to cover the subsidization of the shortfall from the general fund. There is no good reason to increase the medical insurance tax on New Mexicans. 

            This bill received more resistance in committees with Rep Anderson (DTS), and Reps Castellano and Sweetser voting against it in various committees. It passed the full House with Reps Madrid and Sweetser joining Republicans to vote against the bill.