Legislators press Health Care Authority on Medicaid, SNAP staffing and behavioral‑health spending ahead of FY26 budget decisions

Members of the Appropriations & Finance Committee spent a large portion of a multi‑hour hearing examining the Health Care Authority’s (HCA) fiscal 2026 budget request, with attention focused on Medicaid enrollment projections, caseworker staffing in the Income Support Division (SNAP/eligibility), assisted‑living and nursing‑facility rates, and behavioral‑health investments.

The hearing matters because Medicaid and related programs make up the largest share of state spending on health and safety‑net services, and small changes to staffing or provider rates can affect access across rural and tribal communities.

LSC analyst Eric Chenier summarized updated data that have reduced the HCA’s projected Medicaid caseload and spending, telling legislators “Approximately 42 percent of New Mexico population is covered by Medicaid,” and that federal funds constitute most of the program’s revenues. Chenier said updated projections show enrollment declined from roughly 1,000,000 enrollees to about 840,000 as of January, a change that trims the state general‑fund need for FY26.

Carrie Armijo, cabinet secretary of the Health Care Authority, described the executive request and the agency’s priorities. “The executive recommendation total is $15,500,000,000. Eighty‑five point seven percent of that comes from federal funding,” she said, adding the agency’s general‑fund base request is about $2.2 billion, roughly a 10 percent increase over FY25. Armijo said three areas drive the request: Medicaid program costs, the developmental disabilities waiver, and Income Support Division administration.

Several legislators pressed the agency about the Income Support Division (ISD), which handles SNAP and Medicaid eligibility. Armijo said ISD has about 590 full‑time equivalent staff and that the executive recommendation includes $5.8 million in general fund to retain 158 existing caseworkers. She warned that the Legislative Finance Committee (LFC) recommendation would fund far fewer personnel, noting LFC’s plan would fund “only 432” ISD FTE in FY26 and that, without sufficient staffing and the merit/retention differentials, the agency could face federal penalties and withholds tied to timeliness and accuracy.

Lawmakers repeatedly returned to provider rates and capacity. Armijo highlighted that the January rate increases raised many primary care and behavioral‑health codes to 150 percent of Medicare; she also said assisted‑living providers have not received increases since 2019 and that 30 assisted‑living facilities closed since 2023. Several members pressed the secretary on nursing‑facility “rebasing” (a cost‑of‑care reset). Armijo said nursing facilities have received annual increases but acknowledged a full rebasing has not occurred in many years and estimated a rebasing would cost about $18 million in general fund. Members asked whether a multi‑year “glide path” could spread the cost.

Behavioral health funding and planning drew sustained attention. Chenier reviewed the LSC’s gaps analysis and said New Mexico’s behavioral‑health rankings on several measures remain poor even as provider counts and federal grants have increased. Armijo said the agency recently produced a behavioral‑health needs and gaps analysis and a multi‑agency action plan; she asked legislators to consider how to ensure funds are strategically coordinated across many state and local actors.

Committee members also asked about MISER, the Medicaid management information system replacement. Chenier said the executive recommended roughly $15 million for ongoing MISER operating costs and modules continuing to come online, and Armijo reported six of nine modules are live or in production.

During the hearing the committee took a formal budget motion. Vice Chair Dixon moved that the committee adopt the Legislative Finance Committee recommendation for the Health Care Authority; the motion was seconded by Representative Garrett and was approved (Representative Pettigrew recorded in opposition). The committee vote effectively adopts the LFC’s FY26 recommendation for the agency as the committee’s position going forward.

What’s next: Members said staff and agency analysts should continue reconciling the updated Medicaid projections and that the committee will use the updated numbers when writing final budget language and resolving differences on provider rates, ISD staffing, and nonrecurring specials such as rural hospital support.