Senate quickly approves nursing home bed tax repeal

By Barry Massey

SANTA FE — The Senate gave quick approval Thursday to a measure that will repeal a politically unpopular tax on nursing home care.

House Speaker Ben Lujan, D-Santa Fe, said the House would take up a similar proposal early next week, raising the possibility that the Legislature could reach a final agreement on the measure and send it to Gov. Bill Richardson early in the session.

On Tuesday, Richardson surprised lawmakers by proposing the repeal of the nearly $9-a-day surcharge imposed on each occupied bed at nursing homes, residential treatment centers and intermediate care facilities for the mentally retarded.

The tax was approved in 2004 to help finance Medicaid, and under current law it’s scheduled to be eliminated in mid-2007.

The state expects to collect almost $21 million from the tax in the upcoming budget year.

Under the legislation approved unanimously by the Senate, the tax would be repealed effective July 1.
The Senate expedited the bill — pulling it out of a committee and then passing it after only brief discussion before recessing for the weekend.

“We need to get it done, show the folks we’re getting some things done here for them and it’s not just all capital outlay,” said Republican Leader Stuart Ingle of Portales.

Capital improvements are a big issue this session because more than $1 billion in financing is available.

Some Republicans have called for a rebate to elderly New Mexicans of any of the tax they paid through higher costs for nursing home care. However, Medicaid and Medicare cover the costs of nursing home care for many people. The Senate-passed bill does not provide for a rebate.

In the past, lawmakers have been told that perhaps 1,000 people privately pay for nursing home care and potentially faced cost increases because of the tax. Those individuals or their families would pay the tax — potentially about $3,200 a year — if a care facility passed the surcharge along through higher rates.