Retiree Health Care

NMSA 1978 ch. 10, art. 7C

in effect

NMSA 1978, § 10-7C-1 Short title

10-7C-1. Short title Sections 1 through 16 [10-7C-1 to 10-7C-16 NMSA 1978] of this act may be cited as the "Retiree Health Care Act". Laws 1990, ch. 6, § 1.

NMSA 1978, § 10-7C-2 Purpose of act

10-7C-2. Purpose of act The purpose of the Retiree Health Care Act is to provide comprehensive core group health insurance for persons who have retired from certain public service in New Mexico. The purpose is to provide eligible retirees, their spouses, dependents and surviving spouses and dependents with health insurance consisting of a plan or optional plans of benefits that can be purchased by funds flowing into the retiree health care fund and by co-payments or out-of-pocket payments of insureds. Laws 1990, ch. 6, § 2.

NMSA 1978, § 10-7C-3 Legislative findings and declaration of policy

10-7C-3. Legislative findings and declaration of policy A. The legislature finds and declares that public employees face a severe problem in securing continuing medical insurance when they retire. Medical care inflation has far exceeded the general inflation rate for the past decade. It is expected that at least some of the factors that have contributed to this phenomenon will continue into the foreseeable future. As the public employee population grows older, the ratio of retirees to active employees is expected to continue to rise. This factor will be exacerbated as the life expectancy of the aged improves and the post-world war two generation approaches retirement age. Financial problems faced by the federal medicare system are becoming more serious, and it is apparent that there will be attempts to shift those costs to the public employer and employee. More such cost shifting is likely, and one of the purposes of the Retiree Health Care Act is, within the constraints of what can be afforded by the taxpayers, to alleviate this burden on the retiree as much as possible. B. The legislature further finds and declares that the public employees covered by the Retiree Health Care Act have entered into public employment in circumstances where they have received in exchange for their services a present salary and an expectation of receiving a future stream of benefits, including payment of certain retirement benefits. The legislature declares that the expectation of receiving future benefits may be modified from year to year in order to respond to changing financial exigencies, but that such modification must be reasonably calculated to result in the least possible detriment to the expectation and to be consistent with any employer-employee relationship established to meet that expectation. The legislature does not intend for the Retiree Health Care Act to create trust relationships among the participating employees, retirees, employers and the authority administering the Retiree Health Care Act nor does the legislature intend to create contract rights which may not be modified or extinguished in the future; rather the legislature intends to create, through the Retiree Health Care Act, a means for maximizing health care services returned to the participants for their participation under the Retiree Health Care Act. C. The legislature further finds and declares that nothing in the Retiree Health Care Act shall prohibit the legislature from increasing or decreasing participating employer and employee contributions, eligible retiree premiums or group health insurance coverages or plans, and that participation in the Retiree Health Care Act by retired and active public employees shall not be construed to establish rights between the retired and active public employees and the state for health care benefits which cannot be modified or extinguished in the future to meet changes in economic or social conditions. D. The legislature further finds and declares that the health care coverage provided under the Retiree Health Care Act shall constitute a state group health insurance plan, separate subsequent state group health insurance plan, state group insurance plan, separate subsequent state group insurance plan, state medical group insurance plan and separate subsequent state medical group insurance plan for the purposes of Sections 10-11-121, 10-12-15, 10-12A-11 and 22-11-41 NMSA 1978. E. The legislature further finds and declares that participation of current retirees in the Retiree Health Care Act is predicated on State ex rel. Hudgins v. Public Employees Retirement Board 58 N.M. 543, 273 P.2d 543 [743] (1954); the additional monthly participation fee to be paid by current retirees as a condition of participation in the Retiree Health Care Act is in lieu of the lump-sum consideration paid by the retirees who were the relators in that case. Laws 1990, ch. 6, § 3.

NMSA 1978, § 10-7C-4 Definitions

10-7C-4. Definitions As used in the Retiree Health Care Act: A. "active employee" means an employee of a public institution or any other public employer participating in either the Educational Retirement Act [Chapter 22, Article 11 NMSA 1978], the Public Employees Retirement Act [Chapter 10, Article 11 NMSA 1978], the Judicial Retirement Act [Chapter 10, Article 12B NMSA 1978], the Magistrate Retirement Act [Chapter 10, Article 12C NMSA 1978] or the Public Employees Retirement Reciprocity Act [Chapter 10, Article 13A NMSA 1978] or an employee of an independent public employer; B. "authority" means the retiree health care authority created pursuant to the Retiree Health Care Act; C. "basic plan of benefits" means only those coverages generally associated with a medical plan of benefits; D. "board" means the board of the retiree health care authority; E. "current retiree" means an eligible retiree who is receiving a disability or normal retirement benefit under the Educational Retirement Act, the Public Employees Retirement Act, the Judicial Retirement Act, the Magistrate Retirement Act, the Public Employees Retirement Reciprocity Act [Chapter 10, Article 13A NMSA 1978] or the retirement program of an independent public employer on or before July 1, 1990; F. "eligible dependent" means a person obtaining retiree health care coverage based upon that person's relationship to an eligible retiree as follows: (1) a spouse; (2) a child under the age of twenty-six who is: (a) a natural child; (b) a legally adopted child; (c) a stepchild living in the same household who is primarily dependent on the eligible retiree for maintenance and support; (d) a child for whom the eligible retiree is the legal guardian and who is primarily dependent on the eligible retiree for maintenance and support, as long as evidence of the guardianship is evidenced in a court order or decree; or (e) a foster child living in the same household; (3) a dependent child over twenty-six who is wholly dependent on the eligible retiree for maintenance and support and who is incapable of self-sustaining employment by reason of intellectual disability or physical handicap; provided that proof of incapacity and dependency shall be provided within thirty-one days after the child reaches the limiting age and at such times thereafter as may be required by the board; (4) a surviving spouse defined as follows: (a) "surviving spouse" means the spouse to whom a retiree was married at the time of death; or (b) "surviving spouse" means the spouse to whom a deceased vested active employee was married at the time of death; or (5) a surviving dependent child who is the dependent child of a deceased eligible retiree and whose other parent is also deceased; G. "eligible employer" means either: (1) a "retirement system employer", which means an institution of higher education, a school district or other entity participating in the public school insurance authority, a state agency, state court, magistrate court, municipality, county or public entity, each of which is affiliated under or covered by the Educational Retirement Act, the Public Employees Retirement Act, the Judicial Retirement Act, the Magistrate Retirement Act or the Public Employees Retirement Reciprocity Act; or (2) an "independent public employer", which means a municipality, county or public entity that is not a retirement system employer; H. "eligible retiree" means: (1) a "nonsalaried eligible participating entity governing authority member", which means a person who is not a retiree and who: (a) has served without salary as a member of the governing authority of an employer eligible to participate in the benefits of the Retiree Health Care Act and is certified to be such by the executive director of the public school insurance authority; (b) has maintained group health insurance coverage through that member's governing authority if such group health insurance coverage was available and offered to the member during the member's service as a member of the governing authority; and (c) was participating in the group health insurance program under the Retiree Health Care Act prior to July 1, 1993; or (d) notwithstanding the provisions of Subparagraphs (b) and (c) of this paragraph, is eligible under Subparagraph (a) of this paragraph and has applied before August 1, 1993 to the authority to participate in the program; (2) a "salaried eligible participating entity governing authority member", which means a person who is not a retiree and who: (a) has served with salary as a member of the governing authority of an employer eligible to participate in the benefits of the Retiree Health Care Act; (b) has maintained group health insurance through that member's governing authority, if such group health insurance was available and offered to the member during the member's service as a member of the governing authority; and (c) was participating in the group health insurance program under the Retiree Health Care Act prior to July 1, 1993; or (d) notwithstanding the provisions of Subparagraphs (b) and (c) of this paragraph, is eligible under Subparagraph (a) of this paragraph and has applied before August 1, 1993 to the authority to participate in the program; (3) an "eligible participating retiree", which means a person who: (a) falls within the definition of a retiree, has made contributions to the fund for at least five years prior to retirement and whose eligible employer during that period of time made contributions as a participant in the Retiree Health Care Act on the person's behalf, unless that person retires on or before July 1, 1995, in which event the time period required for employee and employer contributions shall become the period of time between July 1, 1990 and the date of retirement, and who is certified to be a retiree by the educational retirement director, the executive secretary of the public employees retirement board or the governing authority of an independent public employer; (b) falls within the definition of a retiree, retired prior to July 1, 1990 and is certified to be a retiree by the educational retirement director, the executive secretary of the public employees retirement association or the governing authority of an independent public employer; but this paragraph does not include a retiree who was an employee of an eligible employer who exercised the option not to be a participating employer pursuant to the Retiree Health Care Act and did not after January 1, 1993 elect to become a participating employer; unless the retiree: 1) retired on or before June 30, 1990; and 2) at the time of retirement, did not have a retirement health plan or retirement health insurance coverage available from the retiree's employer; or (c) is a retiree who: 1) was at the time of retirement an employee of an eligible employer who exercised the option not to be a participating employer pursuant to the Retiree Health Care Act, but which eligible employer subsequently elected after January 1, 1993 to become a participating employer; 2) has made contributions to the fund for at least five years prior to retirement and whose eligible employer during that period of time made contributions as a participant in the Retiree Health Care Act on the person's behalf, unless that person retires prior to the eligible employer's election to become a participating employer or less than five years after the date participation begins when the participation date begins before July 1, 2009, in which event the time period required for employee and employer contributions shall become the period of time, if any, between the date participation begins and the date of retirement or when the participation date begins on or after July 1, 2009, in which event the person and employer shall contribute to the fund an amount equal to the full actuarial present value of the accrued benefits as determined by the authority; and 3) is certified to be a retiree by the educational retirement director, the executive director of the public employees retirement board or the governing authority of an independent public employer; (4) a "legislative member", which means a person who is not a retiree and who served as a member of the New Mexico legislature for at least two years, but is no longer a member of the legislature and is certified to be such by the legislative council service; or (5) a "former participating employer governing authority member", which means a person, other than a nonsalaried eligible participating entity governing authority member or a salaried eligible participating entity governing authority member, who is not a retiree and who served as a member of the governing authority of a participating employer for at least four years but is no longer a member of the governing authority and whose length of service is certified by the chief executive officer of the participating employer; I. "fund" means the retiree health care fund; J. "group health insurance" means coverage that includes but is not limited to life insurance, accidental death and dismemberment, hospital care and benefits, surgical care and treatment, medical care and treatment, dental care, eye care, obstetrical benefits, prescribed drugs, medicines and prosthetic devices, medicare supplement, medicare carveout, medicare coordination and other benefits, supplies and services through the vehicles of indemnity coverages, health maintenance organizations, preferred provider organizations and other health care delivery systems as provided by the Retiree Health Care Act and other coverages considered by the board to be advisable; K. "ineligible dependents" includes: (1) those dependents created by common law relationships; (2) dependents while in active military service; (3) parents, aunts, uncles, brothers, sisters, grandchildren and other family members left in the care of an eligible retiree without evidence of legal guardianship; and (4) anyone not specifically referred to as an eligible dependent pursuant to the rules adopted by the board; L. "participating employee" means an employee of a participating employer, which employee has not been expelled from participation in the Retiree Health Care Act pursuant to Section 10-7C-10 NMSA 1978; M. "participating employer" means an eligible employer who has satisfied the conditions for participating in the benefits of the Retiree Health Care Act, including the requirements of Subsection M of Section 10-7C-7 NMSA 1978 and Subsection D or E of Section 10-7C-9 NMSA 1978, as applicable; N. "public entity" means a flood control authority, economic development district, council of governments, regional housing authority, conservancy district or other special district or special purpose government; and O. "retiree" means a person who: (1) is receiving: (a) a disability or normal retirement benefit or survivor's benefit pursuant to the Educational Retirement Act; (b) a disability or normal retirement benefit or survivor's benefit pursuant to the Public Employees Retirement Act, the Judicial Retirement Act, the Magistrate Retirement Act or the Public Employees Retirement Reciprocity Act; or (c) a disability or normal retirement benefit or survivor's benefit pursuant to the retirement program of an independent public employer to which that employer has made periodic contributions; or (2) is not receiving a survivor's benefit but is the eligible dependent of a person who received a disability or normal retirement benefit pursuant to the Educational Retirement Act, the Public Employees Retirement Act, the Judicial Retirement Act, the Magistrate Retirement Act or the Public Employees Retirement Reciprocity Act. Laws 1990, ch. 6, § 4; 1993, ch. 362, § 1; 1998, ch. 45, § 1; 2003, ch. 85, § 1; 2005, ch. 86, § 1; 2009, ch. 288, § 2; 2021, ch. 23, § 1.

NMSA 1978, § 10-7C-5 Authority created

10-7C-5. Authority created There is created the "retiree health care authority", which is established to provide for comprehensive group health insurance programs under the Retiree Health Care Act. Laws 1990, ch. 6, § 5; 2002, ch. 75, § 1; 2002, ch. 80, § 1; 2021, ch. 23, § 2.

NMSA 1978, § 10-7C-6 Board created; membership; authority

10-7C-6. Board created; membership; authority A. The "board of the retiree health care authority" is created. The board shall be composed of not more than thirteen members. B. The board shall include: (1) one member who is not employed by or on behalf of or contracting with an employer participating in or eligible to participate in the Retiree Health Care Act and who shall be appointed by the governor to serve at the pleasure of the governor; (2) the educational retirement director or the educational retirement director's designee; (3) one member to be selected by the New Mexico coalition of school administrators; (4) one member who is a teacher who is certified and teaching in elementary or secondary education to be selected by a committee composed of one person designated by the New Mexico association of classroom teachers, one person designated by the national education association of New Mexico and one person designated by the American federation of teachers New Mexico; (5) one member who is an eligible retiree of a public school and who is selected by the New Mexico association of educational retirees; (6) the executive secretary of the public employees retirement association or the executive secretary's designee; (7) one member who is an eligible retiree receiving a benefit from the public employees retirement association and who is selected by the retired public employees of New Mexico; (8) one member who is an elected official or employee of a municipality participating in the Retiree Health Care Act and who is selected by the New Mexico municipal league; (9) the state treasurer or the state treasurer's designee; (10) one member who is a classified state employee selected by the personnel board; and (11) the director of the state benefits division of the health care authority. C. The board, in accordance with the provisions of Paragraph (3) of Subsection D of Section 10-7C-9 NMSA 1978, shall include, if they qualify: (1) one member who is an eligible retiree of an institution of higher education participating in the Retiree Health Care Act and who is selected by the New Mexico association of educational retirees; and (2) one member who is an elected official or employee of a county participating in the Retiree Health Care Act and who is selected by the New Mexico association of counties. D. Every member of the board shall serve at the pleasure of the party that selected that member. E. The members of the board shall begin serving their positions on the board on the effective date of the Retiree Health Care Act or upon their selection, whichever occurs last, unless that member's corresponding position on the board has been eliminated pursuant to Subsection D of Section 10-7C-9 NMSA 1978. F. The board shall elect from its membership a president, vice president and secretary. G. The board may appoint such officers and advisory committees as it deems necessary. The board may enter into contracts or arrangements with consultants, professional persons or firms as may be necessary to carry out the provisions of the Retiree Health Care Act. H. The members of the board and its advisory committees shall receive per diem and mileage as provided in the Per Diem and Mileage Act [10-8-1 to 10-8-8 NMSA 1978] but shall receive no other compensation, perquisite or allowance. Laws 1990, ch. 6, § 6; 1993, ch. 362, § 2; 2003, ch. 382, § 1; 2024, ch. 39, § 18.

NMSA 1978, § 10-7C-7 Board; duties

10-7C-7. Board; duties In order to achieve the purposes of the Retiree Health Care Act, the board may take all actions reasonably necessary to implement that act, including but not limited to the following: A. employ or contract for the services of the state fiscal agent or select its own fiscal agent in accordance with the Procurement Code [13-1-28 to 13-1-199 NMSA 1978]; B. employ or contract for persons to assist it in carrying out the Retiree Health Care Act and determine the duties and compensation of these employees; C. collect and disburse funds; D. collect all current and historical claims and financial information necessary for effective procurement of lines of insurance coverage; E. promulgate and adopt necessary rules, regulations and procedures for implementation of the Retiree Health Care Act; F. negotiate insurance policies covering additional or lesser benefits as determined appropriate by the board, but the board shall maintain all coverage as required by federal or state law for each eligible retiree. In the event it is practical to wholly self-insure part or all of the retiree health care coverages, the board may do so; G. procure group health care and other coverages authorized by the Retiree Health Care Act in accordance with the Procurement Code and the Health Care Purchasing Act [Chapter 13, Article 7 NMSA 1978]; H. establish the procedures for contributions and deductions; I. determine methods and procedures for claims administration; J. administer the fund; K. contract for and make available to all eligible retirees and eligible dependents basic and optional group health insurance plans. The optional coverage may include a lower deductible, lower coinsurance or additional categories of benefits permitted under this section and all other applicable sections of the Retiree Health Care Act to provide additional levels of coverages and benefits. Any additional contributions for these optional plans shall be paid for by the eligible retiree or eligible dependent. The coverage provided by the plans shall be secondary to all other benefit coverages to which the eligible retiree or eligible dependent is entitled. In the event a covered eligible retiree becomes employed by an employer offering its employees a basic plan of benefits, the coverage provided by the plan under the Retiree Health Care Act shall be secondary to such coverage regardless of whether the employee enrolls in that employer's plan. In the event the eligible retiree or eligible dependent is entitled to receive medicare hospital insurance benefits at no charge, then the coverage provided by the plan under the Retiree Health Care Act shall be secondary to medicare hospital and medical insurance to the extent permitted by federal law; L. provide, at its discretion, different plans for eligible retirees and eligible dependents covered by medicare than the plans provided for eligible retirees and eligible dependents who are not covered by medicare; and M. promulgate and adopt rules and regulations governing eligibility, participation, enrollment, length of service and any other conditions or requirements for providing substantially equal treatment to participating employers. Laws 1990, ch. 6, § 7; 1997, ch. 74, § 5; 1998, ch. 45, § 2.

NMSA 1978, § 10-7C-7.1 Board may provide for an administration building; payment of obligations from contributions

10-7C-7.1. Board may provide for an administration building; payment of obligations from contributions The board may take all actions reasonably necessary to provide an administration building for the authority, including the acquisition of real property for that purpose. The board is authorized to make payments from the first money received each month as contributions pursuant to Section 10-7C-15 NMSA 1978 to pay principal of, interest on and other expenses or obligations related to revenue bonds issued by the New Mexico finance authority to plan, design, acquire, construct, furnish and equip an administration building for the authority, including the acquisition of real property. Laws 2000, ch. 79, § 1.

NMSA 1978, § 10-7C-7.2 New Mexico finance authority revenue bonds; purpose; appropriation

10-7C-7.2. New Mexico finance authority revenue bonds; purpose; appropriation A. The New Mexico finance authority may issue and sell revenue bonds in compliance with the New Mexico Finance Authority Act [Chapter 6, Article 21 NMSA 1978] in installments or at one time in an amount not exceeding two million five hundred thousand dollars ($2,500,000) for the purpose of planning, designing, acquiring, constructing, equipping and furnishing an administration building for the retiree health care authority, including the acquisition of real property for that purpose. B. The New Mexico finance authority may issue and sell revenue bonds authorized by this section when the board of the retiree health care authority certifies the need for issuance of the bonds. The net proceeds from the sale of the bonds are appropriated to the retiree health care authority for the purposes described in Subsection A of this section. C. The first money received each month as contributions to the retiree health care fund pursuant to Section 10-7C-15 NMSA 1978 in an amount sufficient to pay the principal of, interest on and any other expenses or obligations related to the revenue bonds is appropriated to the New Mexico finance authority and shall be distributed monthly to the New Mexico finance authority to be pledged irrevocably for the payment of the principal of, interest on, any premium and expenses related to the issuance and sale of the bonds authorized pursuant to this section. D. The amounts from the retiree health care fund distributed to the New Mexico finance authority shall be deposited in a special bond fund or account of the New Mexico finance authority. Any money remaining in the special fund or account from distributions made to the New Mexico finance authority during each fiscal year, after all principal of, interest on and any other expenses or obligations related to the bonds in that fiscal year are fully paid, shall be returned to the retiree health care fund. Upon payment of all principal of, interest on and any other expenses or obligations related to the bonds, the New Mexico finance authority shall certify to the retiree health care authority that all obligations for the bonds issued pursuant to this section have been fully discharged and direct the retiree health care authority to cease distributing money to the New Mexico finance authority. E. The legislature shall not repeal, amend or otherwise modify any law that affects or impairs any revenue bonds of the New Mexico finance authority secured by a pledge of the contributions to the retiree health care fund, unless the revenue bonds have been discharged in full or provisions have been made for a full discharge. F. The New Mexico finance authority may additionally secure the revenue bonds issued pursuant to this section by a pledge of money in the public project revolving fund with a lien priority on the money in the public project revolving fund as determined by the New Mexico finance authority. Laws 2000, ch. 79, § 2.

NMSA 1978, § 10-7C-8 Fund created; investment; premiums; appropriation

10-7C-8. Fund created; investment; premiums; appropriation A. There is created the "retiree health care fund". All money in the fund shall be invested as provided for in Subsection D of this section. All income earned from investment of the fund shall be credited to the fund. Except as otherwise specifically provided herein, the money in the fund is appropriated to the board to carry out the provisions of the Retiree Health Care Act. Any funds remaining at the end of any fiscal year shall not revert to the general fund. B. The board shall provide for the collection of premiums from eligible retirees and eligible dependents which money when combined with other money appropriated to the fund shall be sufficient to provide the required insurance coverage and to pay the expenses of the authority. All premiums and other money appropriated to the fund shall be credited to the fund. C. All premiums and other money collected by the authority shall be received and disbursed directly by the authority. Receipts and disbursements are subject to audit by the state auditor. D. The board shall determine which money in the fund constitutes the long-term reserves of the authority. The state investment officer shall invest the long-term reserves of the authority in accordance with the provisions of Sections 6-8-1 through 6-8-16 NMSA 1978. The state treasurer shall invest the money in the fund that does not constitute the long-term reserves of the fund in accordance with the applicable provisions of Chapter 6, Article 10. Laws 1990, ch. 6, § 8.

NMSA 1978, § 10-7C-9 Participation

10-7C-9. Participation A. All eligible employers shall participate in the Retiree Health Care Act except as provided in Subsection D or Subsection E of this section. Participating employers are required to continue existing group health insurance coverages until such time as similar coverages are offered by the board. B. Participation in the basic health insurance coverages provided by the authority shall be conditioned upon receipt by the board of a certificate of eligibility from the educational retirement director, the executive secretary of the public employees retirement association, the executive director of the public school insurance authority or the governing body of an independent public employer. Once eligibility is established for each eligible retiree, the board shall contribute from money in the fund the authority's portion of the premium for the basic plan of benefits commencing no earlier than January 1, 1991 plus the balance of the premium, which shall be collected from the retiree. C. Each eligible retiree shall accept or reject enrollment in the basic plan of benefits on an enrollment form provided by the board. An eligible retiree who rejects enrollment or fails to return a properly executed enrollment form within the open enrollment period as established by the board forfeits all entitlement and eligibility for benefits under the Retiree Health Care Act until the next open enrollment period as established by the board. D. On or before January 1, 1991, municipalities, counties and institutions of higher education that are retirement system employers may at their option determine by ordinance, or for institutions of higher education, by resolution, to be excluded from coverage under the Retiree Health Care Act; that determination shall be subject to the following conditions: (1) any contributions paid into the fund by a municipality, county or institution of higher education that exercises timely an irrevocable option not to participate in the Retiree Health Care Act under this subsection shall be returned without interest to that municipality, county or institution of higher education for return of the employee contributions to the employees and for crediting of the employer contributions to the appropriate fund of the municipality, county or institution of higher education. If the determination to be excluded from coverage is exercised by a municipality, county or institution of higher education prior to July 1, 1990, then that municipality, county or institution of higher education shall not be required to make the contributions that would otherwise be required by Section 10-7C-15 NMSA 1978; (2) any municipality, county or institution of higher education, in addition to complying with all other required notice and public hearing or meeting requirements, shall, no less than thirty days prior to the public hearing or public meeting on a proposed ordinance or proposed resolution, notify the authority of the public hearing or public meeting by certified mail; and (3) in the event that: (a) the number of active employees employed by municipalities contributing to the fund reaches a number equaling sixty percent or more of all active employees employed by all municipalities that are retirement system employers, the municipal position on the board of the authority shall be restored within sixty days of the date that percentage is reached; provided, however, that if a municipality with a population greater than one hundred thousand that is located in a class A county exercises this option, then the sixty-percent requirement shall be applied to the remaining municipalities only; (b) the number of active employees employed by counties contributing to the fund reaches a number equaling sixty percent or more of all active employees employed by all counties that are retirement system employers, the county position on the board of the authority shall be restored within sixty days of the date that percentage is reached; provided, however, that if a class A county exercises this option, then the eighty-percent requirement shall be applied to the remaining counties only; or (c) the number of active employees employed by institutions of higher learning contributing to the fund reaches a number equaling seventy percent or more of all active employees employed by an institution of higher education contributing to the educational retirement fund, the institution of higher education position on the board shall be restored within sixty days of the date that percentage is reached. E. An independent public employer may become a participating employer if that employer satisfies the requirements imposed pursuant to Subsection M of Section 10-7C-7 NMSA 1978 and if that employer also files with the authority on or prior to January 1, 1991 or prior to July 1, 1993 or July 1 of any year a written irrevocable election by the governing body of that employer to participate in the Retiree Health Care Act. Any such independent public employer or retirement system employer, as defined in Subsection G of Section 10-7C-4 NMSA 1978 that chooses to become a participating employer after January 1, 1998 shall begin making the appropriate employer and employee contributions to the fund on the July 1 immediately following the adoption of the ordinance or resolution. On the following January 1, eligible retirees of those participating employers and their eligible dependents shall be eligible to receive group health insurance coverage pursuant to the provisions of the Retiree Health Care Act. F. A municipality or county that enacted an ordinance or an institution of higher education that enacted a resolution prior to January 1, 1991 pursuant to Subsection D of this section to be excluded from coverage under the Retiree Health Care Act may become a participating employer if that employer satisfies the requirements imposed pursuant to Subsection M of Section 10-7C-7 NMSA 1978 and if that employer also enacts an ordinance or resolution, as applicable, after a public hearing and published notice of the hearing, prior to July 1, 1993 or July 1 of any year to choose to become a participating employer under the Retiree Health Care Act. Any such municipality, county or institution of higher education that chooses to become a participating employer after January 1, 1998 shall begin making the appropriate employer and employee contributions determined by the board to the fund on the July 1 immediately following the adoption of the ordinance or resolution. On the following January 1, eligible retirees of those participating employers and their eligible dependents shall be eligible to receive group health insurance coverage pursuant to the provisions of the Retiree Health Care Act. Laws 1990, ch. 6, § 9; 1993, ch. 362, § 3; 1998, ch. 45, § 3.

NMSA 1978, § 10-7C-10 Expulsion from program for falsification

10-7C-10. Expulsion from program for falsification A. After written notice to the participating employee, eligible retiree or eligible dependent and hearing with a fair opportunity to appear and present the case personally or by counsel, the board may expel from participation in the retiree health care plan or plans any participating employee, eligible retiree or eligible dependent who submits a false claim under, or has falsified or attempted to falsify, any claim for health benefits or life insurance offered by the authority. B. On its motion or on the receipt of a complaint, the board may call and hold a hearing to determine whether a participating employee, eligible retiree or eligible dependent has submitted a false claim under, or has falsified or attempted to falsify any claim for health benefits or life insurance offered under the Retiree Health Care Act. C. If the board, at the conclusion of the hearing, issues a decision that finds that a participating employee, eligible retiree or eligible dependent submitted a false claim or has falsified or attempted to falsify any claim for health benefits or life insurance offered under that act, the board shall expel the participating employee, eligible retiree or eligible dependent from participation in any or all coverage plans or impose conditions upon continued or future participation. Laws 1990, ch. 6, § 10.

NMSA 1978, § 10-7C-11 Purchase of group insurance

10-7C-11. Purchase of group insurance A. The board shall be designated as the group policyholder for any plans established under the Retiree Health Care Act. B. The group insurance coverages provided under the plans may include but are not limited to life insurance, accidental death and dismemberment, hospital care and benefits, surgical care and treatment, medical care and treatment, dental care, eye care, obstetrical benefits, prescribed drugs, medicines and prosthetic devices, medicare supplement, medicare carveout, medicare coordination and other benefits, supplies and services through the vehicles of indemnity coverages, health maintenance organizations, preferred provider organizations and other health care delivery systems as provided by the Retiree Health Care Act and other coverages considered by the board to be advisable. C. To the extent practicable, each basic plan of benefits shall cover preexisting conditions. D. Any group medical insurance plan offered pursuant to this section shall include effective cost-containment measures to control the growth of health care costs. The board shall report annually by September 1 to appropriate interim legislative committees on the effectiveness of the cost-containment measures required by this subsection. Laws 1990, ch. 6, § 11; 1994, ch. 62, § 20.

NMSA 1978, § 10-7C-12 Automatic coverage; effect of preexisting conditions

10-7C-12. Automatic coverage; effect of preexisting conditions A. An eligible retiree who applies for coverage during the initial and subsequent open enrollment periods as established by the board may not be denied any of the group insurance basic coverages provided under the Retiree Health Care Act except as provided in Section 10 [10-7C-10 NMSA 1978] of that act. B. An eligible retiree or an eligible dependent who applies for optional coverage under the program after the first offering to the eligible retiree or eligible dependent is not entitled to coverage for preexisting conditions existing during the six-month period immediately preceding the date on which optional coverage takes effect. Laws 1990, ch. 6, § 12.

NMSA 1978, § 10-7C-13 Payment of premiums on health care plans

10-7C-13. Payment of premiums on health care plans A. Except as otherwise provided in this section, each eligible retiree shall pay a monthly premium for the basic plan in an amount set by the board not to exceed fifty dollars ($50.00) plus the amount, if any, of the compounded annual increases authorized by the board, which increases shall not exceed nine percent until fiscal year 2008 after which the increases shall not exceed the authority's group health care trend. In addition to the monthly premium for the basic plan, each current retiree and nonsalaried eligible participating entity governing authority member who becomes an eligible retiree shall also pay monthly an additional participation fee set by the board. That fee shall be five dollars ($5.00) plus the amount, if any, of the compounded annual increases authorized by the board, which increases shall not exceed nine percent until fiscal year 2008 after which the increases shall not exceed the authority's group health care trend. The additional monthly participation fee paid by the current retirees and nonsalaried eligible participating entity governing authority members who become eligible retirees shall be a consideration and a condition for being permitted to participate in the Retiree Health Care Act. A legislative member or a former participating employer governing authority member shall pay a monthly premium for any selected plan equal to one-twelfth of the annual cost of the claims and administrative costs of that plan allocated to the member by the board. In addition, a legislative member or a former participating employer governing authority member shall pay the additional monthly participation fee set by the board pursuant to this subsection as a consideration and condition for participation in the Retiree Health Care Act. Eligible dependents shall pay monthly premiums in amounts that with other money appropriated to the fund shall cover the cost of the basic plan for the eligible dependents. B. Eligible retirees and eligible dependents shall pay monthly premiums to cover the cost of the optional plans that they elect to receive, and the board shall adopt rules for the collection of additional premiums from eligible retirees and eligible dependents participating in the optional plans. An eligible retiree or eligible dependent may authorize the authority in writing to deduct the amount of these premiums from the monthly annuity payments, if applicable. C. The participating employers, active employees and retirees are responsible for the financial viability of the program. The overall financial viability is not an additional financial obligation of the state. D. For eligible retirees who become eligible for participation on or after July 1, 2001, the board may determine monthly premiums based on the retirees' years of credited service with participating employers. Laws 1990, ch. 6, § 13; 1993, ch. 362, § 4; 1999, ch. 286, § 1; 2000, ch. 31, § 1; 2001, ch. 335, § 2; 2003, ch. 85, § 2; 2005, ch. 86, § 2.

NMSA 1978, § 10-7C-14 Exemption from legal process

10-7C-14. Exemption from legal process All insurance benefit payments, participating employee and participating employer contributions, eligible retiree and eligible dependent contributions, optional benefits payments and any rights, benefits or payments accruing to any person under the Retiree Health Care Act, as well as all money in the fund created by that act, are exempt from execution, attachment, garnishment or any other legal process and may not be assigned except as specifically provided by that act. Laws 1990, ch. 6, § 14.

NMSA 1978, § 10-7C-15 Retiree health care fund contributions

10-7C-15. Retiree health care fund contributions A. Following completion of the preliminary contribution period, each participating employer shall make contributions to the fund pursuant to the following provisions: (1) for participating employees who are not members of an enhanced retirement plan, the employer's contribution shall equal: (a) one and three-tenths percent of each participating employee's salary for the period from July 1, 2002 through June 30, 2010; (b) one and six hundred sixty-six thousandths percent of each participating employee's salary for the period from July 1, 2010 through June 30, 2011; (c) one and eight hundred thirty-four thousandths percent of each participating employee's salary for the period from July 1, 2011 through June 30, 2012; and (d) two percent of each participating employee's salary beginning July 1, 2012; (2) for participating employees who are members of an enhanced retirement plan, the employer's contribution shall equal: (a) one and three-tenths percent of each participating employee's salary for the period from July 1, 2002 through June 30, 2010; (b) two and eighty-four thousandths percent of each participating employee's salary for the period from July 1, 2010 through June 30, 2011; (c) two and two hundred ninety-two thousandths percent of each participating employee's salary for the period from July 1, 2011 through June 30, 2012; and (d) two and one-half percent of each participating employee's salary beginning July 1, 2012; and (3) each employer that chooses to become a participating employer after January 1, 1998 shall make contributions to the fund in the amount determined to be appropriate by the board. B. Following completion of the preliminary contribution period, each participating employee, as a condition of employment, shall contribute to the fund pursuant to the following provisions: (1) for a participating employee who is not a member of an enhanced retirement plan, the employee's contribution shall equal: (a) sixty-five hundredths of one percent of the employee's salary for the period from July 1, 2002 through June 30, 2010; (b) eight hundred thirty-three thousandths of one percent of the employee's salary for the period from July 1, 2010 through June 30, 2011; (c) nine hundred seventeen thousandths of one percent of the employee's salary for the period from July 1, 2011 through June 30, 2012; and (d) one percent of the employee's salary beginning July 1, 2012; (2) for a participating employee who is a member of an enhanced retirement plan, the employee's contribution shall equal: (a) sixty-five hundredths of one percent of the employee's salary for the period from July 1, 2002 through June 30, 2010; (b) one and forty-two thousandths percent of the employee's salary for the period from July 1, 2010 through June 30, 2011; (c) one and one hundred forty-six thousandths percent of the employee's salary for the period from July 1, 2011 through June 30, 2012; and (d) one and one-fourth percent of the employee's salary beginning July 1, 2012; and (3) as a condition of employment, each participating employee of an employer that chooses to become a participating employer after January 1, 1998 shall contribute to the fund an amount that is determined to be appropriate by the board. Each month, participating employers shall deduct the contribution from the participating employee's salary and shall remit it to the board as provided by any procedures that the board may require. C. On or after July 1, 2009, no person who has obtained service credit pursuant to Subsection B of Section 10-11-6 NMSA 1978, Section 10-11-7 NMSA 1978 or Paragraph (3) or (4) of Subsection A of Section 22-11-34 NMSA 1978 may enroll with the authority unless the person makes a contribution to the fund equal to the full actuarial present value of the amount of the increase in the person's health care benefit, as determined by the authority. D. Except for contributions made pursuant to Subsection C of this section, a participating employer that fails to remit before the tenth day after the last day of the month all employer and employee deposits required by the Retiree Health Care Act to be remitted by the employer for the month shall pay to the fund, in addition to the deposits, interest on the unpaid amounts at the rate of six percent per year compounded monthly. E. Except for contributions made pursuant to Subsection C of this section, the employer and employee contributions shall be paid in monthly installments based on the percent of payroll certified by the employer. F. Except in the case of erroneously made contributions or as may be otherwise provided in Subsection D of Section 10-7C-9 NMSA 1978, contributions from participating employers and participating employees shall become the property of the fund on receipt by the board and shall not be refunded under any circumstances, including termination of employment or termination of the participating employer's operation or participation in the Retiree Health Care Act. G. Notwithstanding any other provision in the Retiree Health Care Act and at the first session of the legislature following July 1, 2013, the legislature shall review and adjust the distributions pursuant to Section 7-1-6.1 NMSA 1978 and the employer and employee contributions to the authority in order to ensure the actuarial soundness of the benefits provided under the Retiree Health Care Act. H. As used in this section, "member of an enhanced retirement plan" means: (1) a member of the public employees retirement association who, pursuant to the Public Employees Retirement Act [Chapter 10, Article 11 NMSA 1978], is included in: (a) state police member and adult correctional officer member coverage plan 1; (b) municipal police member coverage plan 3, 4 or 5; (c) municipal fire member coverage plan 3, 4 or 5; or (d) municipal detention officer member coverage plan 1; or (2) a member pursuant to the provisions of the Judicial Retirement Act [Chapter 10, Article 12B NMSA 1978]. Laws 1990, ch. 6, § 15; 1998, ch. 45, § 4; 2001, ch. 335, § 3; 2009, ch. 287, § 2; 2009, ch. 288, § 3.

NMSA 1978, § 10-7C-16 Retiree health care fund; budget

10-7C-16. Retiree health care fund; budget Expenditures for the administration of the Retiree Health Care Act shall be made as provided by an operating budget adopted by the board and approved by the state budget division of the department of finance and administration as provided by law and pursuant to appropriation by the legislature. Laws 1990, ch. 6, § 16; 1995, ch. 29, § 1; 1998, ch. 45, § 5.

Source: New Mexico Compilation Commission (nmonesource.com)URL: https://nmonesource.com/nmos/nmsa-unanno/en/item/18510/index.doFetched: 10/20/2026