New Mexico
Register / Volume XXXVI, Issue 23 / December 9, 2025
TITLE 8 SOCIAL
SERVICES
CHAPTER 401 HEALTH CARE AUTHORITY - HEALTH CARE
AFFORDABILITY FUND
PART 2 HEALTH CARE AFFORDABILITY PLAN
8.401.2.1 ISSUING
AGENCY:
Health Care Authority (“HCA”).
[8.401.2.1 NMAC - N/E, 11/7/2025]
8.401.2.2 SCOPE:
These rules govern the establishment and
provision of a health care affordability plan and administration of the health care
affordability fund (the “fund”), including new programs for individuals
losing other coverage. These rules do not change any program guidance issued prior
to these rules.
[8.401.2.2 NMAC - N/E, 11/7/2025]
8.401.2.3 STATUTORY AUTHORITY: Section 59A-23F-12 NMSA 1978 (the “health care
affordability plan”).
[8.401.2.3 NMAC - N/E, 11/7/2025]
8.401.2.4 DURATION: Temporary emergency
rule until permanent rules are promulgated.
[8.401.2.4 NMAC - N/E, 11/7/2025]
8.401.2.5 EFFECTIVE DATE: Effective November 7, 2025 unless a
later date is cited at the end of a section.
[8.401.2.5 NMAC - N/E, 11/7/2025]
[8.401.2.6 NMAC - N/E, 11/7/2025]
8.401.2.7 DEFINITIONS:
A. “Actuarial Value” means the
percentage of total average costs for covered benefits that a health insurance plan
will cover.
B. “Advance state payments”
means marketplace affordability program payments by the fund to a participating
health insurance issuer on a monthly basis to lower premium and state
out-of-pocket assistance for consumers.
C. “Affordability criteria”
means the factors used to determine the amount of premium assistance or state
out-of-pocket assistance that will be provided from the fund on behalf of an
eligible individual.
D. “DACA”
means deferred action for childhood arrivals.
E. “DACA
coverage program” means a coverage affordability program established
to provide financial assistance for eligible DACA recipients.
F. “Eligible plan” means a
health plan sold on the New Mexico health insurance exchange (the “exchange” or
“marketplace”) that meets the requirements for the marketplace affordability
program or a plan that the HCA designates as an eligible plan under the DACA
coverage program.
G. “Federal poverty level or FPL” means the federal
poverty level issued annually by the U.S department of health and human
services for the applicable coverage year for the health insurance exchange.
H. “Income criteria” means
parameters to establish eligibility for marketplace affordability programs or
programs to maintain coverage for individuals losing coverage due to federal
changes.
I. “Lawfully
present individual” means a non-citizen who has an immigration status
that allows them to purchase a QHP on the exchange.
J. “Modified adjusted gross income or MAGI” means
modified adjusted gross income as defined in 42 CFR § 435.60.
K. “Marketplace affordability
program” means a program of the fund that reduces premiums out-of-pocket costs
for individuals and families who purchase individual or family coverage on the
exchange.
L. “Participating health insurance
issuer” means a health insurance issuer who is authorized to sell a QHP on
the exchange, in the fully-insured individual market, or in the fully-insured
small group market who has confirmed in writing its intention to participate in
a program of the fund prior to the commencement of the plan year.
M. “Plan year” means the
year for which a participating health insurance issuer offers a health plan
that meets QHP standards.
N. “Premium assistance” means a
program of the fund that pays a participating health insurance issuer to cover
a portion of the premium obligation of a person who meets premium assistance
affordability criteria.
O. “Program of the fund” means a financial offering
allocated by the health care affordability fund including initiatives such as
the marketplace affordability fund and small business premium relief.
P. “QHP” means a qualified health plan that meets
established requirements for certification by the exchange.
Q. “Small business health insurance premium relief
initiative” means a program of the fund to reduce premiums for
small businesses that purchase plans that meet QHP standards in the small group
health insurance market.
R. “Small group plan purchaser”
means an employer who purchases one or more plan that meets QHP standard for
any of its employees or owners through the small business health options
program or directly from a health insurance issuer selling plans that meet QHP
standards in the small group health insurance market.
S. “State benchmark plan” means
a qualified health plan that has been approved for sale on the exchange and
that is identified by the secretary as the plan to be used in developing
affordability criteria. “State benchmark
plan” does not refer to the essential health benefits benchmark plan
established by the superintendent of insurance.
T. “State out-of-pocket assistance
program” means a program of the fund that reduces out-of-pocket costs for
households that meet eligibility and income criteria established by the secretary.
[8.401.2.7 NMAC - N/E, 11/7/2025]
8.401.2.8 MARKETPLACE AFFORDABILITY PROGRAM Premium and out-of-pocket
assistance: This rule governs the annual state premium
assistance and out-of-pocket assistance programs offered on the state exchange.
A. Affordability criteria: Annually, the secretary will publish guidance specifying
affordability criteria for the ensuing plan year. If the federal
government changes policies that will affect the cost of the program to the
state or the cost to enrollees after the issuance of the guidance, the secretary
may adjust the affordability criteria.
(1) These are the affordability criteria
that the secretary may consider in determining premium assistance eligibility
for a plan year.
The secretary will use these criteria to establish a premium sliding
scale based on household income:
(a) the
percentage of an enrollee’s MAGI as computed according to federal standards;
(b) the percentage of enrollee’s MAGI
that would be needed to purchase the state benchmark plan as established by the
secretary;
(c) the percentage of New Mexico
residents with income at or below a given FPL percentage; and
(d) The federal premium sliding scale
for marketplace coverage.
(2) These are the affordability
criteria that the secretary will consider to determine
state out-of-pocket assistance eligibility.
The secretary will use these criteria to establish state out-of-pocket
assistance variants that adjust the actuarial value of certain QHPs offered on
the exchange:
(a) an enrollee’s MAGI as computed
according to federal standards;
(b) plan type and metal level tiers that
qualify for state out-of-pocket assistance; and
(c) actuarial values for plans that
qualify for state out-of-pocket assistance.
(d) the availability of sufficient
appropriations to support the program.
B. Income eligibility parameters: Annually, the secretary will publish guidance specifying
income eligibility parameters for the ensuing plan year. If the federal government changes policies
that will affect the cost of the program to the state or the cost to enrollees
after the issuance of the guidance, the secretary may adjust the income
eligibility parameters. The income
eligibility parameters may differ for the premium assistance program, state
out-of-pocket assistance program or premium assistance for state residents who
are members of a federally-recognized tribes. In developing the criteria, the secretary may
consider the following factors:
(1) the income distribution of current marketplace
enrollees;
(2) the income distribution of
uninsured individuals who qualify for coverage on the New Mexico health
insurance exchange; or
(3) health insurance market stability
issues and year-over-year trends in premium rate affordability.
C. General eligibility requirements:
(1) To qualify for state out-of-pocket
and premium assistance, consumers must:
(a) be eligible to purchase a QHP on
the exchange;
(b) be eligible for the federal premium
tax credit or meet all eligibility criteria for the federal premium tax credit
except for household income requirements; and
(c) meet income criteria established annually
by the secretary.
(2) The secretary will issue criteria
for premium assistance that is available to members of
federally-recognized tribes. To qualify,
individuals must:
(a) meet all other criteria for state
premium assistance; and
(b) be a member of a
federally-recognized tribe.
D. Premium
and state
out-of-pocket assistance payment
disbursements: This rule governs
disbursements to participating health insurance issuers for premium assistance
or state out-of-pocket assistance provided to eligible enrollees who purchase
eligible plans. Monthly, by the 15th of
each month, the exchange shall report to the secretary the total amount due to
each participating health insurance issuer for premium assistance and state
out-of-pocket assistance for coverage of its eligible enrollee(s) for the applicable
calendar month.
(1) The monthly
payment amount due to a participating health insurance issuer for premium
assistance will be the monthly aggregate amount of premium assistance for all
eligible enrollees of the health insurance issuer for the month.
(a) Monthly
state premium assistance amounts will be calculated using the following
formula: gross monthly premium for state benchmark plan minus
monthly federal premium tax credit minus applicable percentage of income
established by the secretary multiplied by expected annual household income as
outlined in 45 C.F.R. § 155.305(f)(i) divided by 12.
(b) To
the greatest extent possible, within 10 days of receiving the monthly
accounting from the exchange, the secretary will, by voucher, request that the
secretary of finance and administration issue warrants as necessary to ensure
payment to each participating health insurance issuer for the monthly amount
determined to be due by the secretary.
(2) The monthly
payment amount to a participating health insurance issuer for state
out-of-pocket assistance will be determined as a percentage of gross monthly
premiums for enrollees of an eligible plan in a specified income tier,
aggregated across all qualifying income tiers.
(3) To facilitate
reconciliation, a health insurance issuer must track or accurately estimate
claim costs in accordance with guidance published by the secretary to allow for
the determination of actual out-of-pocket assistance amounts for the applicable
plan year.
E. Eligibility appeals: Appeals for this
program shall follow the same process that the exchange uses for federal
subsidies.
[8.401.2.8 NMAC - N/E, 11/7/2025]
8.401.2.9 MINIMIZING
COVERAGE DISRUPTIONS: This
rule governs the agency’s efforts to ensure a smooth transition into a QHP
offered on the New Mexico health insurance exchange for individuals who no
longer qualify for medicaid and the availability of
sufficient appropriations to support the program.
A. Medicaid
transition premium relief program: The
secretary will issue a notice of program guidance establishing a program that
fully covers the cost of the first month’s premium for any QHP sold on the
individual health insurance exchange for eligible individuals and their families. This premium payment will also cover any
premium cost non-essential health benefits no later than plan year 2027. The premium relief will be available to all
members of a household that meet the eligibility requirements in Subsection B of
this section. The payment may be used to
effectuate coverage.
B. Eligibility
for medicaid transition premium relief program: To qualify, a person in the household must:
(1) be a resident of the state of New Mexico who is
eligible to purchase a QHP on the exchange;
(2) enroll in a QHP on the exchange within 120 calendar
days of losing medicaid coverage.
(3) no longer be enrolled in medicaid
at the time their QHP coverage begins;
(4) be determined eligible for federal premium tax
credits; and
(5) have an expected household income at or below four
hundred percent of the FPL.
C. Eligibility
appeals: Appeals for this program shall follow the same process
that the exchange uses for federal subsidies.
[8.401.2.9 NMAC
- N/E, 11/7/2025]
8.401.2.10 SMALL BUSINESS HEALTH INSURANCE
PREMIUM RELIEF INITIATIVE: This rule governs the agency’s small business
health insurance premium relief initiative, which applies to plans that meet
QHP standards sold through the small business health options program or
purchased directly from a health insurance issuer selling plans that meet QHPs
standards in the small group health insurance market.
A. Premium reduction percentage guidance: Annually, based on available funding, the secretary
will issue guidance establishing a premium reduction percentage that will apply
to all plans that meet QHP standards sold in the small group health insurance
market. Health insurance issuers
participating in the market shall discount charges to small group plan purchasers
by the percentage established by the secretary and show the amount of the
discount in all invoices to the purchaser.
The secretary will allow issuers to apply the discount directly or
through a credit on the following month’s premium. The guidance will establish the percentage
reduction, reporting requirements, timetable and process for issuer
reimbursement, and other requirements. The
secretary may issue additional guidance, if needed.
B. Reporting requirements and annual verification of
accurate payments: Health insurance
issuers selling plans that meet QHP standards in the small group health
insurance market must report data related to enrollment, premiums, and
reimbursement from the health care affordability fund to the health care
authority on a regular basis, based on the requirements of the guidance. Following each calendar year, on a date
established by the secretary, issuers must report data requested by the agency
to verify the accuracy of payments made from the fund. The secretary will require issuers to
replenish the fund if it is determined that any overpayment has been issued.
C. Payments to participating issuers: On a regular basis, as established in the guidance,
HCA will make payments from the health care affordability fund to issuers for
the remainder of the gross premium that would otherwise be owed by small group plan
purchasers if the small business health insurance premium relief initiative
were not in effect. The data received by
HCA pursuant to Subsection B of 8.401.2.11 NMAC of this rule serves as the
basis for HCA’s regular payments to issuers from the health care affordability
fund. Issuers must invoice the agency in
accordance with the HCA’s instructions
in order to receive payment.
D. Notification of small group plan purchasers: The secretary will specify a date before the
initiative goes into effect by which health insurance issuers must notify their
small group plan purchasers about the premium reductions provided by the
initiative. Issuers subject to the rule
should reflect the premium reduction amount in all invoices.
E. Treatment as third-party payment: For the purposes of the federal risk
adjustment program and federal medical loss ratio requirements, the state
payment under this section should be considered a third-party payment that is
part of the gross premium.
[8.401.2.10 NMAC - N/E, 11/7/2025]
8.401.2.11 MAINTAINING COVERAGE FOR THOSE LOSING ELIGIBILITY FOR
FEDERAL FINANCIAL ASSISTANCE DUE TO SECTION 71301 AND 71302 OF PUBLIC LAW
119-21: This rule governs the agency’s coverage
protection program for certain lawfully present individuals.
A. Affordability criteria: Annually, the secretary will publish guidance
specifying affordability criteria for the ensuing plan year. If the federal government changes policies
that will affect the cost of the program to the state or the cost to enrollees
after the issuance of the guidance, the secretary may adjust the affordability
criteria.
(1) These are the
affordability criteria that the secretary may consider in determining premium
assistance eligibility for a plan year. The secretary will use these criteria to
establish a household income based on:
(a) the percentage of an enrollee’s MAGI as
computed according to federal standards;
(b) the percentage of
an enrollee’s MAGI that would be needed to purchase the state benchmark plan as
established by the secretary;
(c) the number of individuals
projected to enroll in the benefit; and
(d) the availability of appropriations to
support the program.
(2) These are the
affordability criteria that the secretary will consider to
determine state out-of-pocket assistance eligibility. The secretary will use these criteria to
establish state out-of-pocket assistance variants that adjust the actuarial
value of certain QHPs offered on the exchange:
(a) an enrollee’s MAGI as computed
according to federal standards;
(b) plan type and metal level tiers that
qualify for state out-of-pocket assistance;
(c) actuarial values for plans that
qualify for state out-of-pocket assistance; and
(d) the availability of sufficient
appropriations to support the program.
B. Income eligibility parameters: Annually, the secretary will publish guidance
specifying income eligibility parameters for the ensuing plan year. The secretary shall prioritize households
under two hundred percent of the federal poverty level if appropriations are
not sufficient to cover populations above that level. If the federal government changes policies
that will affect the cost of the program to the state or the cost to enrollees
after the issuance of the guidance, the secretary may adjust the income
eligibility parameters.
C. General
eligibility requirements:
(1) To qualify for
state premium and out-of-pocket assistance under this coverage protection program,
consumers must:
(a) be eligible to
purchase a QHP on the exchange;
(b) be a lawfully
present individual who has become ineligible for the federal premium tax credit
due to the enactment of Section 71301 and 71302 of Public Law 119-21; and
(c) meet income
criteria established annually by the secretary.
D. Premium and state out-of-pocket assistance payment
disbursements: This rule governs
disbursements to participating health insurance issuers for premium assistance
or state out-of-pocket assistance provided to eligible enrollees who purchase
eligible plans. Monthly, by the 15th of
each month, the exchange shall report to the secretary the total amount due to
each participating health insurance issuer for premium assistance and state
out-of-pocket assistance for coverage of its eligible enrollee(s) for the
applicable calendar month.
(1) The monthly
payment amount due to a participating health insurance issuer for premium
assistance will be the monthly aggregate amount of premium assistance for all
eligible enrollees of the health insurance issuer for the month.
(a) Monthly state
premium assistance amounts will be calculated using the following formula:
gross monthly premium for state benchmark plan minus applicable percentage of
income established by the secretary multiplied by expected annual household
income as outlined in 45 C.F.R. § 155.305(f)(i)
divided by 12.
(b) To
the greatest extent possible, within 10 days of receiving the monthly
accounting from the exchange, the secretary will, by voucher, request that the
secretary of finance and administration issue warrants as necessary to ensure
payment to each participating health insurance issuer for the monthly amount
determined to be due by the secretary.
(2) The monthly
payment amount to a participating health insurance issuer for state
out-of-pocket assistance will be determined as a percentage of gross monthly
premiums for enrollees of an eligible plan in a specified income tier.
(3) To facilitate
reconciliation, a health insurance issuer must track or accurately estimate
claim costs in accordance with guidance published by the secretary to allow for
the determination of actual out-of-pocket assistance amounts for the applicable
plan year.
E. Eligibility appeals: Appeals for this
program shall follow the same process that the exchange uses for federal
subsidies.
[8.401.2.11 NMAC - N/E, 11/7/2025]
8.401.2.12 PROGRAM
FOR UNINSURED DACA RECIPIENTS LOSING ELIGIBILITY FOR EXCHANGE COVERAGE AND
FEDERAL FINANCIAL ASSISTANCE: This rule governs the DACA coverage program
for certain individuals with DACA status. Coverage options for the DACA coverage program
are to be provided through off-exchange plans offered by issuers selling plans
that meet QHP standards on the exchange and are funded through appropriations
authorized by the legislature for the purpose of providing “resources for
planning, design and implementation of health care coverage initiatives for
uninsured New Mexico residents.” The
secretary may establish enrollment caps if necessary to ensure program
sustainability. To enroll in the
DACA coverage program, individuals must be determined eligible through HCA’s
approved vendor.
A. Affordability criteria: Annually, the secretary will publish guidance
specifying affordability criteria for the ensuing plan year. If the federal government changes policies
that will affect the cost of the program to the state or the cost to enrollees
after the issuance of the guidance, the secretary may adjust the affordability
criteria.
(1) These are the
affordability criteria that the secretary may consider in determining premium
assistance eligibility for a plan year. The secretary will use these criteria to
establish a premium sliding scale based on household income:
(a) the percentage of an enrollee’s MAGI as
computed according to federal standards;
(b) the percentage of
an enrollee’s MAGI that would be needed to purchase the state benchmark plan as
established by the secretary;
(c) the number of
individuals projected to enroll in the benefit;
(d) the off-exchange plans eligible for
state assistance; and
(e) the availability of appropriations to
support the program.
(2) The secretary
shall establish affordability criteria for the out-of-pocket assistance program
no later than the 2027 plan year and consider the following criteria in
establishing such a program:
(a) an enrollee’s MAGI as computed
according to federal standards;
(b) plan type and metal level tiers that
qualify for state out-of-pocket assistance;
(c) actuarial values for plans that
qualify for state out-of-pocket assistance; and
(d) the availability of sufficient
appropriations to support the program.
(3) The secretary may
establish a temporary out-of-pocket assistance program during the 2026 plan
year to help eligible individuals under two hundred percent of the FPL with deductible
costs.
B. Income eligibility parameters: Annually, the secretary will publish guidance
specifying income eligibility parameters for the ensuing plan year. The secretary shall prioritize households
under two hundred percent of the federal poverty level if appropriations are
not sufficient to cover populations above that level. If the federal government
changes policies that will affect the cost of the program to the state or the
cost to enrollees after the issuance of the guidance, the secretary may adjust
the income eligibility parameters.
C. General eligibility requirements:
(1) To qualify for
state premium and out-of-pocket assistance under the DACA coverage program,
consumers must:
(a) DACA recipient as
established by federal guidelines;
(b) not have access to
other health coverage that meets federal minimum essential coverage standards
or other third-party payor programs;
(c) be a resident of
New Mexico;
(d) not be
incarcerated;
(e) meet income
criteria established annually by the secretary.) meet income
criteria established annually by the secretary.
D. Premium and state out-of-pocket assistance payment
disbursements: This rule governs
disbursements to participating health insurance issuers for premium assistance
or state out-of-pocket assistance provided to eligible enrollees who purchase
eligible plans. Monthly, by a date established by the secretary in guidance, issuers
shall report to the secretary the total amount due for premium assistance for
coverage of its eligible enrollees for the applicable calendar month.
(1) The monthly
payment amount due to a participating health insurance issuer for premium
assistance will be the monthly aggregate amount of premium assistance for all
eligible enrollees of the health insurance issuer for the month.
(a) The methodology
for calculating monthly state premium assistance amounts shall ensure similar
affordability criteria as premium assistance under the marketplace
affordability program.
(b) To
the greatest extent possible, within 10 days of receiving the monthly
accounting from the issuer, the secretary will, by voucher, request that the
secretary of finance and administration issue warrants as necessary to ensure
payment to each participating health insurance issuer for the monthly amount
determined to be due by the secretary.
(2) The monthly
payment amount to a participating health insurance issuer for state
out-of-pocket assistance will be determined as a percentage of gross monthly
premiums for enrollees of an eligible plan in a specified income tier,
aggregated across all qualifying income tiers.
(3) To facilitate
reconciliation, a health insurance issuer must track or accurately estimate
claim costs in accordance with guidance published by the secretary to allow for
the determination of actual out-of-pocket assistance amounts for the applicable
plan year.
E. Appeal rights and process:
(1) Applicants or their authorized
representatives may appeal any adverse program eligibility or assistance
decision, including eligibility status, income/residency findings, assistance
tier, or effective date.
(2) The authorized eligibility
determination vendor shall issue a written notice that states the decision and
effective date, the reasons, how to appeal, the filing deadline, and the
availability of free language services and disability accommodations.
(3) Appeals must be filed within 30
calendar days of the notice date. Late appeals may be accepted for good cause. Appeals may be filed by methods specified in
guidance. An authorized representative may be designated at any time.
(4) An impartial member of the agency’s
eligibility vendor shall decide first-level appeals. A written decision is due
within 20 calendar days of receipt, or within 3 business days if expedited due
to risk of care disruption. If no timely
decision is issued, the appellant may proceed to a final appeal.
(5) A final appeal may be filed with the
Health Care Affordability Bureau within 30 calendar days of the vendor decision
or a vendor delay. The Bureau will conducts review and
issue a written decision within 45 calendar days, or within 5 business days if
expedited. The Bureau’s decision is the final administrative action. [8.401.2.11 NMAC - N/E, 11/7/2025]
History of 8.401.2
NMAC: [RESERVED]