Health Care Authority gets $66M boost as New Mexico braces for federal rollbacks

NEW MEXICO (KRQE) –In response to looming federal funding cuts and changing qualification requirements for both Medicaid and the Supplemental Nutrition Assistance Program (SNAP), the recent special session in New Mexico pumped nearly $66 million into the state’s Health Care Authority (HCA) — the agency that oversees those programs. But officials say it’s only the beginning of a long financial fight.

“I think it’s a testament to New Mexico and the state we live in that we were able to come together and really come up with solutions for this time,” said HCA Cabinet Secretary Kari Armijo. “I’ve heard that we’re the only state so far that has really taken action to prepare for these federal reductions.”

Armijo said she’s proud to live in a state that is taking action quickly and added, “We are going to have to keep doing that.”

The money is meant to help the HCA prepare for what’s coming in the years ahead — and to offset changes that Armijo said have already started taking effect.

“I feel like we’re really well-positioned, and there was a lot of support for making sure that the agency has what it needs, not only to support families, but to just get ready,” said Armijo.

Thanks to House Bill 1, the HCA will now be able to maintain SNAP benefits for seniors and people with disabilities, and continue enhanced premium subsidies for many people purchasing insurance through Be Well’s Marketplace — one of the issues at the federal level that has contributed to the government shutdown.

This funding will hold the HCA over to at least the end of June 2026.

Armijo says the agency will also be able to implement major staffing changes and increase infrastructure support — both necessary to respond to the upcoming changes.

The funds will also ensure nutrition support continues for immigrants with lawful status who no longer qualify for federal benefits.

“We received some additional support to maintain SNAP benefits for individuals with a lawful immigration status, but who will be losing federal SNAP benefits, so we’ll be able to continue to support those folks,” said Armijo.

While many immediate concerns have been addressed, state leaders acknowledged throughout the session that no amount of funding may fully offset the losses.

“The federal reconciliation bill is going to reduce federal payments to New Mexico’s health care providers, specifically hospitals, by $8.5 billion over the next decade,” said Armijo.

That $8.5 billion figure does not include cuts to food security programs.

“So the state can’t fix or plug all of those holes, but we’re really trying to prepare for and minimize those impacts for New Mexico’s families,” added Armijo.

Leading up to the session, Republican lawmakers argued the federal funding cuts do not qualify as an emergency — a requirement for calling a special session — because many of the cuts are still years away.

Instead, they argued that dysfunction at the Children, Youth and Families Department (CYFD), rising juvenile crime, and unresolved medical malpractice reform were the emergencies that should have taken priority.

Sec. Armijo said acting now was critical to ensure the state remains compliant with federal healthcare rules — and avoids costly penalties.

“If we waited until the 30-day session, and we didn’t get any budgetary resources or additional staff or any extra support, we would really not meet those federal deadlines. We would really be out of compliance and facing major compliance penalties from the federal government,” she said.

Armijo said she is grateful to Governor Michelle Lujan Grisham and the legislature for their support of the programs administered by HCA, as the agency prepares for what she called monumental changes.

“New Mexico is really leading the country right now in terms of just preparing and getting ready to implement these big changes in a way that protects our families and our healthcare system and our food infrastructure across the state,” she added.

During the upcoming 30-day session, Armijo said lawmakers are expected to take a closer look at what it will take to prevent New Mexicans from losing their health insurance.

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