Senate tax committee advances healthcare payment transparency and procurement fixes, holds larger tax proposals; mixed votes on insurance and municipal items

Senate Tax, Business and Transportation Committee members on Thursday debated a string of bills affecting health-care providers, local government revenue and state procurement rules, advancing some measures and holding larger tax proposals for later packaging.

The committee discussed two high-profile health-care measures: one that would eliminate most gross receipts tax (GRT) on independent health-care providers (Senate Bill 295) and another that would require Medicaid managed care organizations (MCOs) to show and pass through gross-receipts-tax reimbursements to providers (Senate Bill 249). Lawmakers halted the broader tax-cut proposal for further work but approved the transparency bill on a unanimous roll call.

Why it matters: The measures intersect state revenue, local government budgets and the financial operations of doctors, dentists, therapists and independent clinics across New Mexico. Sponsors and supporters said changes could make the state more competitive for providers; opponents warned of damage to municipal budgets and potential budget trade-offs at the state level.

Senate Bill 295 — provider GRT: sponsor Senator Steinborn told the committee the measure “provides us the opportunity to help make a big dent in the issue of recruiting and keeping medical providers in the state of New Mexico.” The proposal would remove GRT on most independent practitioners while excluding Medicaid reimbursements so the state does not lose federal match dollars, Steinborn said. Proponents — including Carrie Robin Bruner of the New Mexico Medical Society and Tom Skrypsma of the New Mexico Dental Association — told the panel the tax is a longtime complaint for providers and a factor in recruitment and retention. “Dentists are leaving the state right now in alarming amount,” Skrypsma said.

Opponents and local-government advocates warned of fiscal hits to cities and counties. Lisonbee Nichols of the New Mexico Municipal League told the committee municipalities “are heavily reliant on gross receipts tax revenue” and urged lawmakers to consider local impacts. Senator Steinborn and other sponsors acknowledged the bill reduces the local portion of GRT and said they intend to seek local input on shared approaches and potential offsets. The committee did not vote on SB295 and placed it on hold pending broader tax-capacity decisions.

Senate Bill 249 — Medicaid/GRT transparency: Senator Brandt and witnesses described SB249 as a transparency measure rather than a new revenue or tax cut. Sponsor remarks characterized the problem this way: Medicaid appropriations already include GRT funding, but some MCO contracts do not separately itemize the GRT on provider reimbursements, leaving individual providers unable to confirm they have been reimbursed for the tax embedded in their capitation or fee rates. As a result, providers are sometimes left paying the tax from their own receipts. Carrie Robin Bruner explained the mechanics and called for MCOs to show the GRT and remit it to providers.

The committee recorded a unanimous vote to move SB249 forward (9–0 recorded in committee).

Procurement code cleanup (Senate Bill 206): Senator Padilla and Anna Silva (Secretary-designate, General Services) presented a multi-part cleanup and modernization of the state procurement code. Sponsors proposed raising several small-purchase and direct-purchase thresholds and streamlining rules to reflect current costs, with one amendment reverting a public-works threshold to $55,000 to avoid prevailing-wage conflicts. The committee adopted the amendment and voted the bill out (due pass, recorded as unanimous in committee).

Municipal stormwater utility (Senate Bill 7): Senator Sherr presented legislation allowing municipalities to create stormwater utilities and charge fees to fund stormwater management. Supporters said the bill is optional for local governments and would give towns a tool to sustain stormwater maintenance and capital work; Sarah Curteau, a wildlife biologist and consultant, told the committee the bill “only does two things: it allows municipalities to create a stormwater utility and charge a just and reasonable fee.” The committee gave SB7 a due pass.

Other measures advanced - Motorcycle license plate update (look-twice plate): Senator Bergman’s amendment lets motorcyclists use the “Look Twice for Motorcycles” plate in a motorcycle-sized format; the committee approved it as amended. - Charitable solicitations (Senate Bill 259): The committee adopted an amendment to tighten transparency for donations and third-party collectors; Goodwill Industries and other nonprofit witnesses supported the change. Committee action recorded: due pass as amended. - Telehealth for social workers (Senate Bill 252): Senator Figueroa presented an amendment preserving supervision requirements while restoring telehealth authority to licensed master social workers (LMSWs). The committee adopted the amendment and moved the bill forward.

Foster-child coverage under homeowner policies (Senate Bill 284): Senator Duhigg sponsored a bill that would prevent foster children placed in a home from being categorically excluded from a premises-liability or homeowners insurance claim solely because of placement status. The proposal drew support on child-welfare grounds and concern from some members who warned insurers could face new exposures and upward pressure on rates. The committee recorded mixed support and a motion result recorded in committee as 6–2 no recommendation (no-rec), reflecting those differing views.

Health-plan changes for state employees (Senate Bill 376, as amended): The committee considered a package of changes to the State Health Benefits Plan, including an 80/20 employer-employee contribution standard, a targeted premium-assistance program for lower-income employees funded through the Health Care Affordability Fund, and a requirement that the Health Care Authority submit actuarially sound budget requests. Sponsors said the package reduces employee costs and eliminates a plan deficit; testimony cited a projected five-year general-fund savings. The committee passed the bill as amended.

Held tax proposals: two larger tax measures introduced by Senator Tobason — a targeted physician student-loan rebate program (up to $50,000 over five years) and a 10-year moratorium on state income tax for income derived from providing health-care services — were presented but held for possible inclusion in a later tax package. Sponsors said both are intended to attract and retain medical professionals; committee leaders said they are holding the bills to consider tax-package capacity and to coordinate offsets before a vote.

What’s next: the committee moved multiple bills to the next round (several as “due pass” or “due pass as amended”) and held the larger tax proposals for package negotiation. Sponsors and committee members asked agencies and local governments for additional fiscal breakdowns and requested clarifying language on practice definitions and local impacts before final floor consideration.

Ending: Committee leaders said they will continue discussions with affected cities, counties and providers to refine language and assess local and state fiscal capacity before any final tax decisions.