Committee recommends do-pass on bill to require insurance coverage for medical cannabis, with fiscal questions

Representative Christina Parajon introduced House Bill 527, which would require insurance coverage for medical cannabis across individual and group health plans, Medicaid, and state employee coverage.

Christina Caffrey, general counsel for Ultra Health, said medical cannabis functions as a prescription substitute in New Mexico and noted state Court of Appeals rulings that treated medical cannabis as functionally equivalent to prescription medicine for certain tax and workers’ compensation contexts. She said the state’s regulatory framework and tracing for licensed cannabis retailers create guardrails comparable to prescription medications for the purpose of state policy.

Insurers opposed the bill. Marla Schoetz, representing Blue Cross Blue Shield of New Mexico, said insurers lack a model to reimburse cannabis because it remains a federal Schedule I substance, is not FDA-approved, does not have a national drug code and cannot be processed through traditional pharmacy claims systems; she warned the mandate could raise premiums and lacks guardrails for potential abuse. Jason Espinosa of the National Federation of Independent Business said coverage mandates typically raise costs that fall on small employers.

Supporters, including Ultra Health and patient advocates, argued the state already treats medical cannabis as a medicine in several legal contexts and asked the committee to require coverage similar to other therapies; testifiers noted workers’ compensation decisions already require payment for medical cannabis in New Mexico.

After public testimony, members moved a do-pass recommendation. The committee recorded a 5–2 do-pass vote; committee discussion highlighted fiscal and federal-law questions and asked insurers to help design feasible reimbursement mechanisms if the bill moves forward.