Bill would set minimum Medicaid payments for personal care services

The New Mexico Health Care Authority would set minimum hourly Medicaid payments for personal care services. The rates cover Medicaid agencies that employ workers to help people with daily activities. In agency-managed care, the agency delivers all care. In recipient-directed care, the recipient controls care decisions and the agency handles payments. The rates exclude gross receipts taxes, a tax on business receipts. They set payments to providers rather than worker wages.

Personal care provider agencies would spend at least 70% of their Medicaid personal care payments on direct care workforce costs. The requirement covers Medicaid personal care agencies that employ care workers. Covered workers are employees outside administration who spend most of their work hours providing personal care. Agencies would subtract gross receipts taxes before calculating the 70% share. Counted costs include worker pay, employee expenses such as benefits, and training and supervision reasonably tied to providing personal care. Agencies would provide those accounting records within a reasonable amount of time when the Health Care Authority requests them.

The proposal would set aside $51.4 million from New Mexico’s general fund for the Health Care Authority. The money would support updates to Medicaid’s personal care payment schedule and higher payments under the proposed rates. Any money left at the end of fiscal year 2027 would return to the general fund. The Health Care Authority could spend this money during fiscal year 2027.