Category: Legislature

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Health Care Legislature Notable News Top Issues

National opinion piece: Medicaid Expansion: A Discouraging Message from New Mexico

The following appeared in National Review’s Capital Matters on March 2, 2023:

In December, New Mexico’s Legislative Finance Committee (an internal think tank for the state legislature) published a report on the state’s Medicaid program. Whether by design or accident, the report happened to coincide with the tenth anniversary of New Mexico’s Medicaid expansion. Then-governor Susana Martinez, a Republican, decided to accept the “Obamacare” expansion dollars which, at the time, were 100 percent federally funded.

The report is full of useful information about the impact of Medicaid expansion on New Mexico that likely applies to all states. In fact, the report by this internal government agency to our now-bright-blue state government gave critics of Medicaid expansion plenty of ammunition.

Today, only eleven states (including large ones such as Florida and Texas)have steadfastly refused to expand Medicaid under Obamacare. And in light of New Mexico’s experience as detailed in this new report, the decision made by those eleven states looks better today than it ever has.

In New Mexico, the LFC Medicaid study’s authors used “secret shoppers” to attempt to make appointments with primary-care physicians throughout the state. Shockingly, only 15 percent of them were able to make an appointment with a primary-care doctor.

This is just one of many data points that echo the point made by Obamacare critics over a decade ago, who said early and often that health care is not the same thing as “coverage.” But policy-makers did not heed those warnings, and since Medicaid was expanded, the number of recipients in New Mexico has exploded while the number of providers has declined rather dramatically. The LFC report, for example, revealed that 47 percent of New Mexico’s population is on Medicaid, which places the state at the very top of the list in terms of the percentage of its population receiving benefits.

The high number of Medicaid recipients is both a cause and an effect of New Mexico’s ongoing medical-provider shortage. While large numbers of newly “covered” recipients of the program may lead to problems in accessing timely care, the underlying issue is Medicaid’s abysmal reimbursement rates for doctors. Nationally in 2020, hospitals received just 88 cents for every dollar spent caring for Medicaid patients. Specifics vary by state and provider type, but there is no question that having a larger Medicaid population results in more “cost-shifting” from other programs and customers to cover Medicaid recipients. Put another way, costs increase for other patients in order to compensate for the Medicaid shortfall.

But the consequences of New Mexico’s overwrought Medicaid program don’t stop there. Sadly, with such a massive portion of the population on benefit, it is hardly a surprise that the number of people willing to enter the workforce is quite low.

According to the Bureau of Labor Statistics, New Mexico’s workforce-participation rate in December of 2022 was just 53.5 percent. That is higher than just one state (Mississippi) and trails the U.S. as a whole, which has a workforce-participation rate over 60 percent.

At a time of exceedingly low unemployment and a tight job market nationwide (for all skill levels), Medicaid is one of many “welfare” programs that appear to keep people out of the job market.

In the meantime, the program has also caused state spending to spiral out of control. Estimated to stand at $10.5 billion next year (a 56 percent increase since just fiscal year 2019), the amount spent on Medicaid alone will be greater than New Mexico’s entire general-fund budget ($9.4 billion) next year. Simply put, this is unsustainable, both in terms of the program’s growth, but also in terms of the federal government’s financial contribution to New Mexico and other states with massive Medicaid rolls.

So, what are we getting for all this spending? The Legislature’s Medicaid report did not even consider a detailed discussion of health-care outcomes and the impact (or lack thereof) of Medicaid expansion. The report did note, however, that “the state continues to face poor health outcomes overall.” And, even more interestingly, while providing routine medical care for the poor was a stated goal of advocates for expansion, the LFC notes that an increase in “emergency room visits for non-urgent reasons” is “potentially leading to worse outcomes.”

The bottom line is that a decade on, despite massive federal and state spending growth on Medicaid, the LFC’s latest report does not point to significant positive health care outcomes from Medicaid expansion for New Mexico’s population at large. But this should not come as a surprise. A widely discussed 2013 study out of Oregon involving a large, randomized control group “showed that Medicaid coverage generated no significant improvements in measured physical health outcomes in the first 2 years.”

Well, there you have it. The largest and most expensive expansion of the American welfare state in the last 50 years seems to have resulted in bigger government and more dependency in New Mexico and across the nation. However, here in the state with the highest percentage of people on Medicaid, evidence of improved health outcomes remains elusive.

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Education Legislature Notable News Top Issues

Opinion piece: 2023 Legislature Punts on Education reform

The following appeared at KRWG and in numerous other media outlets.

In October of last year, results for the Nation’s Report Card (NAEP) placed New Mexico dead-last in education among all states, the District of Columbia, and DoD schools. The test covered reading for 4th and 8th graders and math for the same age groups. New Mexico was last across all categories. These results should have been a wakeup call for Gov. Lujan Grisham and the Legislature.

Bold solutions are needed and there’s no time like a 60-day session to enact big reforms. Unfortunately, as the legislative session hurtles onward, neither serious education reform nor prevention of future mistakes like those made during the COVID pandemic are likely to come to pass.

As a parent, I know first-hand that the Gov.’s COVID 19 lockdowns and chaos had a major, negative impact on young people. Kept out of their classrooms for over a year, often in rural areas with poor broadband service and working parents, it is no surprise that New Mexico students suffered more during the Pandemic than those living in wealthier “blue” states. Locking kids out of school is now widely seen as a mistake that had no noticeable impact on the spread of COVID.

Sadly, efforts to give the Legislature a seat at the table in future emergencies, HB 80 and HJR 3 (one was a bill, the other an amendment), both failed on party lines in the House Judiciary Committee. They would have simply required the Legislature to approve declared emergencies lasting longer than 90 days, but that was too much for the majority Democrats.

Having the Legislature debate and vote on whether to lock kids out of their schools for over a year shouldn’t be a partisan issue.

COVID is hardly the only reason for New Mexico schools’ poor performance. The system has always been near the very bottom in producing student outcomes. Sadly, aside from continuing to spend more and more money, the Legislature and Gov. remain unwilling to shake up the system in ways that would improve outcomes.

My organization has long pushed for “money to follow the student.” The best single bill attempting to do that was Sen. Craig Brandt’s SB 109 which would have set up a system of “education savings accounts” similar to the one adopted last year in Arizona. The bill was killed on partisan lines in its first committee (Senate Education).

Though necessary, school choice remains a dirty word among New Mexico’s education establishment. But choice isn’t the only way to improve education results. Just ask the folks in Mississippi where simple reforms to how reading is taught have resulted in massive learning gains, especially in 4th grade reading.

What did Mississippi do to achieve success? It pushed teachers to teach reading through phonics, it invested resources into teaching teachers how to teach phonics effectively, and it made sure that students understood the subject material before passing them on to the next grade (they ended social promotion).

If that sounds familiar, it’s because Mississippi’s initiative broadly reflects the reform efforts of former Gov. Susana Martinez. Sadly, union-backed Democrats in the Legislature prevented those efforts from being codified into law. Her reforms were immediately undone by Gov. Lujan Grisham.

But, as the New York Times notes, Mississippi went from 49th on 4th grade reading in 2013 to 29th in 2019. Mississippi further increased its already substantial lead on New Mexico in the first post-COVID NAEP test in 2022. Notably, Mississippi spends about $10,000 per student while New Mexico spends $15,000.

New Mexico’s children (and its employers) desperately need a high-performing education system. Unfortunately, without the Legislature and Gov. embracing bold reforms that upset the status quo, improvement is unlikely to occur anytime soon.

Doing the same thing and expecting a different result is a worthy definition of insanity. It also appears to describe New Mexico’s education policy.

Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

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Legislature Notable News Top Issues

New Mexico’s increasingly partisan Legislature

The Rio Grande Foundation tracks and rates legislation in New Mexico and has done so since 2014 (find our Freedom Index archive here). Bills are given scores as bad as -8 and as good as +8 and when those bills move to the floor for votes, the points with a “yes” or “no” vote are attributed to all of the legislators in both parties.

Currently just a few floor votes have been tallied, but that number is starting to grow along with the numbers associated with each legislator. We strongly encourage citizens and anyone interested in what is happening in New Mexico to check out our Freedom Index and use it.

A side benefit of our software provider BillTrack50 is some interesting “data nuggets.” For example, the chart below shows whether bills enacted by the Legislature and Gov. were sponsored by Democrats, Republicans, or both parties. Understanding that a Republican, Susana Martinez was Gov. from 2010 through 2018, Democrats remained quite influential in passing bills throughout that time.

Since Lujan-Grisham and the Democrats took over all three branches of New Mexico government in 2019, the number of GOP-sponsored bills passing began to shrink dramatically. Just one GOP-sponsored bill passed in 2022.

You can find out more interesting nuggets for yourself here.

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Economy Health Care Legislature Notable News Tax and Budget Taxes Top Issues

Solutions for New Mexico’s medical provider shortage: part 2 of the two part series

New Mexico has a shortage of medical providers across most practice areas (as discussed in Part 1 of this series). So, as the 2023 legislative session gets rolling, what can be done about it?

The Rio Grande Foundation has looked high and low throughout New Mexico laws impacting medical providers and has produced a series of recommendations laid out in an extensive policy paper.

1) While forward looking in nature, HB 75 passed in 2021 and was revised later on that same year makes New Mexico’s medical malpractice much more plaintiff and attorney friendly through the increase in damage award caps is  causing a great deal of concern among providers even though it will not be implemented until 2024;

2) Stop taxing medical providers via gross receipts tax. The State is one of the few states in the entire nation that levies the equivalent of a “sales” tax on certain medical services. In New Mexico’s largest city, Albuquerque, the rate of taxation is currently 7.75 percent. Rates tend to be even higher in outlying areas of New Mexico. This could be part of a broad reform or more targeted.

3) Reduce Medicaid dependency.  According to the American Hospital Association, Medicaid underpaid hospitals by $24.8 billion in 2020. For Medicaid, hospitals received payment of only 88 cents for every dollar spent by hospitals caring for Medicaid patients in 2020. In 2020, 62 percent of hospitals received Medicaid payments less than cost.

4) Expand scope of practice/telemedicine.

There are several additional ideas outlined in the report along with more detailed discussion of the ideas listed above. All of it can be found here.

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Health Care Legislature Notable News Top Issues

Release: RGF digs into medical provider shortage in Part 1 of two part series

In a new policy brief which explores the shortage of medical providers in the State of New Mexico, the Rio Grande Foundation digs into an analysis of which areas of medical practice face the most acute shortages and compares New Mexico counties, New Mexico with its neighbors, and also looks at geographical trends regarding the availability of medical providers nationwide.

Forming part one of a two part series on the topic, the document titled, “The Existence and Extent of a Medical Provider Shortage in New Mexico” is an attempt to gain a foothold when it comes to the statistics behind the medical provider shortage.

Among the findings:

  1. New Mexico is not alone in the Southwest in having a relative shortage of medical professionals. Compared to the Northeast and Midwest, there is already a shortage of healthcare workers in states in the South and West. Interestingly, the region where doctors are paid the least in nation is the Southwest, where many older adults who require healthcare services choose to retire.
  2. Physicians in the north central part of the nation average pay of $319,000 per year. In the southeast, however, physician salaries are more than $40,000 a year less, running at around $277,000 a year. New Mexico’s average physician salary was even less, ranking third from the bottom of lowest-earning states with an average annual physician compensation rate of $261,000.

  3. Our research does indicate that New Mexico has a serious shortage of health care workers in a variety of medical fields. These especially include primary care physicians, surgeons, registered nurses, OB-GYN’s, pharmacists and EMT’s. Fortunately, the state currently appears to have an adequate number of physician assistants, dentists, and nurse practitioners.

In a follow-up report Rio Grande Foundation will provide specific ideas on how policymakers, especially those here in New Mexico, can address the State’s medical provider shortage.

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Economy Legislature Notable News Open Government Tax and Budget Top Issues Videos

MLG delays bringing state employees back to the office: RGF comments on KOAT Channel 7

In the wake of an LFC report stating that New Mexico taxpayers are spending $18 million annually on unused office space, Gov. Lujan Grisham (after the election) decided to require that all state employees return to their offices by the star of 2023.

According to news reports, however, the Gov. has rescinded that requirement. Employees will be required to return NEXT month at the start of February. This is another case of poor leadership from the Gov. COVID (and remote work) has been going on for nearly 3 years now. The Gov. and her team should have figured out who needs to be in the office 5 days a week and who doesn’t (and how to manage them effectively) by now.

Could some state buildings be shuttered and sold off? Should the locations of gov’t buildings be shifted to reduce commute times? How can we make sure remote employees are actually doing their work?

These aren’t easy questions, but they should have been answered long ago. RGF’s Paul Gessing appeared in a story on KOAT Channel 7 to discuss the issue. You can find his segment here and below and the first portion here.

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Economy Legislature Notable News Oil & Gas Tax and Budget Taxes Top Issues

Published opinion piece: Use surplus strategically to solve long-term problems

The following appeared in the Santa Fe New Mexican on December 24, 2022 and in numerous other news sources.

As the State’s Permian oil production boom continues in New Mexico the budget surpluses available to legislators each session grow as well. The latest announced budget surplus is $3.6 billion which is a positively mind-blowing 43 percent. This surplus is on top of already dramatic spending growth of 30 percent during the first four years of the Lujan Grisham Administration.

More spending growth this year is to be expected, but the capacity for government to continue expanding after years of rapid growth is somewhat limited by the ability of government to manage existing resources available to it. This is not surprising since New Mexico’s state and local government is already among the very largest in the nation.

But I’m not here to rail about the size of New Mexico government (at least not this time). Rather, I’m here to remind legislators of both parties that such massive surpluses present rare opportunities to lead our State to a better future.

Gov. Lujan Grisham has already proposed rebates of $750 or $1,500 for New Mexicans depending on marital status. Rebates are a bi-partisan idea, one supported in the recent campaign by her Republican opponent Mark Ronchetti, though details differed. To be clear the Rio Grande Foundation does not oppose tax rebates if they are not an excuse to (yet again) punt on long-overdue tax reform. Returning a portion of the budget surplus is not going to move New Mexico’s economy forward and diversify it in the same way as long-overdue tax reform would.

The same can be said for an idea that often garners bipartisan support in Santa Fe: that is bolstering various permanent and “rainy day” funds. Quite honestly, New Mexico has numerous big problems facing it. There is no better time to address these problems than right now. If policymakers use the surplus to diversify and improve the State’s economy in ways that will make it more competitive with its neighbors, the well-being of future New Mexicans won’t be so contingent on the vagaries of oil and gas.

New Mexico’s litany of current economic challenges includes:

  • A low workforce participation rate that has historically lagged behind our neighbors and remains well below pre-pandemic levels and has even dropped in recent months;
  • Poverty rates that are among the very highest in the nation;
  • A medical provider shortage that, while driven in part by regulations is worsened by gross receipts taxation of medical practitioners including Medicaid services;
  • Lack of economic diversity in a state that relies heavily on oil and gas for money and government (federal, state, and local) for employment opportunities;
  • Water and other infrastructure issues.

These problems (and more) can at least partially be solved by using New Mexico’s financial largesse wisely. New Mexico policymakers have long focused on government-driven approaches to these problems. State and local government spends a very high percentage of the economy.

Majority Democrats have an opportunity to not only pump more funding into their priorities, but they could show that they are pro-business and interested in using oil and gas revenues to diversify the State economy for a time when the oil and gas industry isn’t as bullish.

Republicans, rather than leaving the bold ideas to Democrats, should offer their own serious reform ideas and bills in the upcoming session. Ideally, the minority GOP could influence Democrats toward a more pro-growth agenda. Worst case, in two years they can point to their detailed policy ideas and use them to challenge Democrats for failing to take advantage of this unique opportunity.

Regardless of your political affiliation or beliefs we all must realize that 43 percent budget surpluses don’t come around often. We can’t solve all of New Mexico’s problems even with this massive surplus, but with strategic moves like those outlined here we can certainly move the needle.

Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

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Economy Energy and Environment Legislature Notable News Oil & Gas Tax and Budget Taxes Top Issues

Legislature blessed with $3.6 billion in “new” money in upcoming session

According to the latest news reports New Mexico has a mind-blowing $3.6 billion budget surplus available to it when the Legislature convenes in January. This is, of course, derived largely from a production-driven boom in New Mexico’s oil and gas industry. Between now and January we and others will have plenty of time to discuss potential uses for the money. For now we’d like to simply help people grapple with the sheer size of this surplus.

  1. The budget surplus alone is a mind-blowing 43% of the current $8.4 billion budget which is in itself a 30% bigger budget than when Susana Martinez left office.
  2. The budget surplus alone is virtually the same size as the FY23 (current year) K-12 budget ($3.8 billion) which is a 41% increase over 5 years.
  3. The budget surplus is more than 7X the State’s “public safety” budget and 3.5X the entire higher education budget.
  4. The State could ELIMINATE the entire gross receipts tax ($3.047 billion) for FY 2024 and still have nearly $600 million left over.
  5. The State could ELIMINATE ALL personal and corporate income taxes ($2.107 billion for FY 2024 and still have $1.5 billion left over.

What WILL happen is anybody’s guess. With New Mexico’s continued economic struggles there are plenty of opportunities for the type of pro-growth tax reform the State sorely needs.

As a quick reminder, New Mexico’s state and local spending is already tops in the nation according to the website US Government Spending:

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Economy Education Energy and Environment Legislature Notable News Tax and Budget Taxes Top Issues

Several questions for NM’s Blue Majority (and one for the Red Minority)

The following article appeared in Las Cruces Sun-News on November 27, 2022.

This Election Day a majority of New Mexico voters seemingly ignored the State’s manifest failures of governance. Instead, voters prioritized abortion rights while penalizing anyone who could plausibly be painted as “election deniers.”

Thus, New Mexico, one of America’s “bluest” states for decades, became even more Democrat dominant. Democrats now control every office of significance in State government as well as all five seats in Congress.

Whether the results are a sign of satisfaction with the status quo or just animus towards Republicans, the fact is that New Mexico’s governing Democrats faces serious challenges. Here are some that need to be addressed in the next few months:

  1. PNM (the State’s largest utility) has repeatedly expressed concerns about having enough electricity during the summer of 2022. The San Juan Generating Station coal plant was allowed to continue operating for an additional three months during this past summer due to fears of blackouts and brownouts. That will not be an option next summer. In fact, there has been little improvement in New Mexico’s electricity supply situation since then. What will the Gov., her new PRC, and the Legislature do to keep the lights on for New Mexicans? Waiting until the heat of next summer is not an option. Decisions need to be made right away.
  2. Speaking of the PRC, the Gov. now has a chance to mold New Mexico’s powerful regulatory body into something of her choosing. Will she prioritize geographical and ideological diversity or make the body a rubber stamp for her California-style policies? And, will they push through the Avangrid/PNM merger (rejected by the elected PRC but supported by the Gov.) as one of their first acts?
  3. New Mexico is one of just 11 states still in a COVID 19 emergency. It has been in a an “emergency” since March of 2020 (more than 2.5 years at this point). Will the new Legislature demand a “seat at the table” or continue to allow the Gov. to keep control until she sees fit? What does this mean for “democracy?”
  4. Voters approved Amendment 1 which taps into New Mexico’s permanent fund to boost education spending. With an expected $2.5 billion surplus, education spending is likely to rise even further. The State’s recent NAEP scores placed New Mexico at the very bottom across all four grade levels and subjects tested. Will New Mexico simply continue increasing education spending or will needed reforms be enacted?
  5. Speaking of that budget surplus, the Gov. and Legislature undertook a series of tax cuts in the 2022 session in anticipation of the election. Can New Mexico taxpayers expect further tax relief? If so, will those tax cuts be superficial, or will they address the State’s knotty economic challenges like “pyramiding” of the gross receipts tax?

Most of these questions are for New Mexico’s (even more) ascendent Democrat majority, but there is one question for the GOP: what can be done to boost voter turnout (and overall political engagement) in New Mexico’s most conservative areas? Overall voter turnout was 52 percent. In liberal Santa Fe County that number was over 63 percent. But, in conservative bastions like Lea, Eddy, Chaves, San Juan, Otero, Curry, and Roosevelt counties, turnout lagged the statewide average, sometimes by double-digit margins.

Many conservatives feel like their vote doesn’t make a difference either due to the State’s “blue” status or allegations of election fraud. Either way, New Mexico’s GOP must figure out how to engage its base through grassroots activism to become relevant.

No matter which side of the aisle you’re on, New Mexicans of all political stripes face more questions than answers.

Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

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Economy Legislature Notable News Tax and Budget Taxes Top Issues

New Mexico remains among “Least Free” US states in latest Index of Economic Freedom

The 2022 edition of the Canada-based Fraser Institute’s Economic Freedom of North America 2022 is out and for yet another year New Mexico remains at the very bottom among US states in terms of economic freedom. Economic freedom is the ability of individuals to make their own economic decisions
about what to buy, where to work and whether to start a business.

Unsurprisingly, New Mexico performed particularly poorly in:

  • Government spending as a percent of personal income (49th);
  • Sales tax revenue as a percent of personal income (48th); and
  • Government employees as a percent of overall employees (49th).

New Mexico DID get high marks for having relatively low property taxes (7th).

“When governments allow markets to decide what’s produced, how it’s produced and how much is produced, citizens enjoy greater levels of economic freedom,” said Fred McMahon, the Dr. Michael A. Walker Research Chair in Economic Freedom at the Fraser Institute and co-author of this year’s report, which measures government spending, taxation and labor market restrictions using data from 2020, the latest year of available comparable data. Florida was the top performing state in the index followed by New Hampshire. Rounding out the top five freest states are South Dakota (3rd), Texas and Tennessee (tied for 4th ).

The very worst performing states were New York at 50th followed by California.