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Providers Tell Lawmakers New Mexico's Home-care System Faces Funding, Workforce Shortfalls
Summary
Presenters told the Legislative Health & Human Services committee that home health, hospice and personal care services are underfunded, many agencies operate at a loss, Mercer's study recommends higher wages and reimbursement, and the Health Care Authority has requested a $47 million FY27 expansion to implement rate-study recommendations.
Providers and advocacy groups told the Legislative Health & Human Services committee that New Mexico's home- and community-based services (HCBS) face a funding shortfall and a workforce crisis that threaten access to care.
Megan Lorino, executive director of the New Mexico Association for Home and Hospice Care, described the system's scale and fragility. She said about 14,000 Medicare beneficiaries a year receive home health services (72 Medicare-certified home-health agencies statewide); about 11,500 Medicare beneficiaries receive hospice; and roughly 32,000 New Mexicans rely on the Medicaid personal-care community benefit. "Our members provide hands-on care in the home to 57,500 New Mexicans each year," she said. Lorino warned that 50% of home-health agencies were operating at a loss and that federal ARPA recovery dollars have temporarily propped up programs.
She reviewed a Mercer study contracted by the Health Care Authority that modeled a wage floor and reimbursement ranges to recruit and retain staff. Mercer's lower-bound caregiver wage assumption presented in testimony was roughly $16 per hour (150% of the state minimum wage), with modeled reimbursement ranges near $32/hour for agency-based consumer-delegated services and about $25.50/hour for consumer-directed services; New Mexico's published fee schedule currently shows $20.40/hour (agency, 15-minute increments) and $17.20/hour (consumer-directed), below the Mercer-modeled levels. Presenters urged incremental increases and noted a federal "ensuring access to Medicaid" rule that will require states to direct a greater share of funds toward direct-care compensation.
Advocates raised pediatric palliative care as a specific priority: presenters said they are pursuing feasibility work and potential legislative vehicles to add a pediatric palliative benefit to the state plan to improve access for children with complex medical needs.
Jim Copeland, executive director of the Association of Developmental Disabilities Community Providers, described waiver and state-funded services for people with intellectual and developmental disabilities; he reported 8,724 New Mexicans are enrolled across three waivers and the state program and cautioned that rate studies are retrospective and may not capture current costs. Copeland said the Health Care Authority has requested a $47,000,000 FY27 expansion to implement recommended rates from the current study.
Why this matters: testimony links workforce wages, reimbursement policy and federal matching dollars to the capacity of agencies to serve homebound and medically fragile people; underfunding could increase institutionalization, raise acute-care costs and strain hospitals.
Committee outcome and next steps: presenters asked the committee to support Health Care Authority budget requests and to pursue legislative steps toward wage and reimbursement adjustments; members asked technical questions about CMS approval paths and certification requirements. No vote or appropriation was taken at this meeting; the committee recessed until the following day.
