2023 New Mexico Statutes › Chapter 10 - Public Officers and Employees › Article 7 - Compensation and Working Conditions Generally › Section 10-7-4 - Group insurance; cafeteria plan; contributions from public funds.

A. All state departments and institutions and all political subdivisions of the state, excluding municipalities, counties and political subdivisions of the state with twenty-five employees or fewer, shall cooperate in providing group term life, medical or disability income insurance for the benefit of eligible employees or salaried officers of the respective departments, institutions and political subdivisions.
B. The group insurance contributions of the state or any of its departments or institutions, including institutions of higher education, shall be made as follows:
(1) at least seventy-five percent of the cost of the insurance of an employee whose annual salary is less than fifteen thousand dollars ($15,000);
(2) at least seventy percent of the cost of the insurance of an employee whose annual salary is fifteen thousand dollars ($15,000) or more but less than twenty thousand dollars ($20,000);
(3) at least sixty-five percent of the cost of the insurance of an employee whose annual salary is twenty thousand dollars ($20,000) or more but less than twenty-five thousand dollars ($25,000); and
(4) at least sixty percent of the cost of the insurance of an employee whose annual salary is twenty-five thousand dollars ($25,000) or more.
C. The group insurance contributions of school districts and charter schools shall be made as follows:
(1) at least eighty percent of the cost of the insurance of an employee whose annual salary is less than fifty thousand dollars ($50,000);
(2) at least seventy percent of the cost of the insurance of an employee whose annual salary is fifty thousand dollars ($50,000) or more but less than sixty thousand dollars ($60,000); and
(3) at least sixty percent of the cost of the insurance of an employee whose annual salary is sixty thousand dollars ($60,000) or more.
D. Effective July 1, 2004, the group insurance contributions of the state or any of its executive, judicial or legislative departments, including agencies, boards or commissions, shall be made as follows; provided that the contribution percentage shall be the same for all affected public employees in a given salary bracket:
(1) up to eighty percent of the cost of the insurance of an employee whose annual salary is less than thirty thousand dollars ($30,000);
(2) up to seventy percent of the cost of the insurance of an employee whose annual salary is thirty thousand dollars ($30,000) or more but less than forty thousand dollars ($40,000); and
(3) up to sixty percent of the cost of the insurance of an employee whose annual salary is forty thousand dollars ($40,000) or more.
E. Except as provided in Subsection H of this section, effective July 1, 2005, the group insurance contributions of the state or any of its executive, judicial or legislative departments, including agencies, boards or commissions, shall be made as follows; provided that the contribution percentage shall be the same for all affected public employees in a given salary bracket:
(1) up to eighty percent of the cost of the insurance of an employee whose annual salary is less than fifty thousand dollars ($50,000);
(2) up to seventy percent of the cost of the insurance of an employee whose annual salary is fifty thousand dollars ($50,000) or more but less than sixty thousand dollars ($60,000); and
(3) up to sixty percent of the cost of the insurance of an employee whose annual salary is sixty thousand dollars ($60,000) or more.
F. Effective July 1, 2013, the employer shall pay one hundred percent of basic life insurance premiums for employees, and employees who choose to carry disability insurance shall pay one hundred percent of the premium.
G. The state shall not make any group insurance contributions for legislators. A legislator shall be eligible for group benefits only if the legislator contributes one hundred percent of the cost of the insurance.
H. An employer shall pay one hundred percent of the employee group insurance contributions due and payable on or after July 1, 2016 for an employee who is injured while performing a public safety function or duty and, as a result of the injury, is placed on approved workers' compensation leave.
I. As used in this section, "cost of the insurance" means the premium required to be paid to provide coverages. Any contributions of the political subdivisions of the state, except the public schools and political subdivisions of the state with twenty-five employees or fewer, shall not exceed sixty percent of the cost of the insurance.
J. When a public employee elects to participate in a cafeteria plan as authorized by the Cafeteria Plan Act [10-7-14 to 10-7-19 NMSA 1978] and enters into a salary reduction agreement with the governmental employer, the provisions of Subsections B through G of this section with respect to the maximum contributions that can be made by the employer are not violated and will still apply. The employer percentage or dollar contributions as provided in Subsections B through E of this section shall be determined by the employee's gross salary prior to any salary reduction agreement.
K. 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 responsible public body that administers a plan offered pursuant to this section shall report annually by September 1 to appropriate interim legislative committees on the effectiveness of the cost-containment measures required by this subsection.
L. Within available revenue, school districts, charter schools and participating entities pursuant to the Public School Insurance Authority Act [Chapter 22, Article 29 NMSA 1978] may contribute up to one hundred percent of the cost of the insurance of all employees and institutions of higher education may contribute up to eighty percent of the cost of the insurance of all employees.
History:
Laws 1941, ch. 188, § 1; 1941 Comp., § 10-416; 1953 Comp., § 5-4-12; Laws 1965, ch. 181, § 1; 1969, ch. 86, § 1; 1970, ch. 73, § 1; 1973, ch. 387, § 1; 1981, ch. 151, § 1; 1986, ch. 84, § 1; 1987, ch. 256, § 1; 1987, ch. 289, § 7; 1989, ch. 27, § 1; 1989, ch. 231, § 9; 1991, ch. 191, § 2; 1994, ch. 62, § 18; 1999, ch. 44, § 1; 2003, ch. 412, § 1; 2004, ch. 82, § 1; 2013, ch. 186, § 1; 2016, ch. 39, § 1; 2023, ch. 83, § 1.
ANNOTATIONS
Cross references.
— For continuation of group health insurance after retirement or death of insured,
see
10-11-121 NMSA 1978.
For state police group life insurance,
see
29-2-29 NMSA 1978.
For group life insurance for the corrections department,
see
33-1-12 NMSA 1978.
The 2023 amendment,
effective July 1, 2023, amended the group insurance contributions for school districts and charter schools; in Subsection B, after "higher education", deleted "and the public schools"; added a new Subsection C and redesignated former Subsections C through K as Subsections D through L, respectively; and in Subsection L, after "Public School Insurance Authority Act", added "may contribute up to one hundred percent of the cost of the insurance of all employees".
The 2016 amendment,
effective July 1, 2016, required affiliated public employers to pay member contributions and group insurance contributions for certain employees who are injured while performing a public safety function and are placed on approved workers' compensation leave; in Subsection A, after "departments, institutions and", added "political"; in Subsection D, added "Except as provided in Subsection G of this section"; and added new Subsection G and redesignated the succeeding subsections accordingly.
The 2013 amendment,
effective April 5, 2013, changed basic life insurance premiums for employees who carry disability insurance; and added Subsection E.
The 2004 amendment,
effective May 19, 2004, amended Subsection B to insert "at least" at the beginning of Paragraphs (1) through (4), added Subsections C and D, redesignated former Paragraph (5) of Subsection B as Subsection E, redesignated Subsections C and D as Subsections G and H and added new Subsection I.
Temporary provisions.
— Laws 2004, ch. 82, § 3 provided that a salary adjustment in January, 2005 shall not reduce the state contributions pursuant to this section even if the salary adjustment places the employee in a higher salary bracket provided the contribution may be lowered for salary adjustments on and after January 2006.
The 2003 amendment,
effective July 1, 2003, added Paragraph B(5).
The 1999 amendment,
effective July 1, 1999, inserted "and political subdivisions of the state with twenty-five employees or fewer" in Subsection A and in the last sentence of Subsection B, and made minor stylistic changes.
The 1994 amendment,
effective March 4, 1994, added Subsection D.
The 1991 amendment,
effective April 4, 1991, substituted "excluding municipalities and counties" for "may and, by July 1, 1975" in Subsection A and made a minor stylistic change in Subsection C.
Constitutionality and effect of section.
— Provision by the state under this section of group or other forms of insurance for the benefit of eligible employees is a valid use of public funds and not a pledge of credit or donation in contravention of the state constitution, since such contribution is in fact an increment to a public employee's salary and is a benefit to the state or its subdivisions through its concomitant effect of attracting and maintaining capable public personnel in public positions. 1964 Op. Att'y Gen. No. 64-83.
Constitutionality of payments.
— Payments by the state under this section do not violate N.M. Const. art. V, § 12 and are not payments of additional fees or compensation. 1968 Op. Att'y Gen. No. 68-01.
Objective of section
was to expressly provide authority for the state, state institutions and political subdivisions of the state to make contributions from public funds to pay a portion of the cost of group insurance policies carried for the benefit of their employees up to certain prescribed maximums. Such contributions may be validly made if the amounts contributed by the state employer are kept within the statutory limitation. 1963 Op. Att'y Gen. No. 63-44.
See also
1963 Op. Att'y Gen. No. 63-25.
Meaning of "departments".
— The term "departments" as utilized in this section has application to the three basic departments of state government recognized in N.M. Const., art. III, § 1, that is, the legislative, executive and judicial departments. 1963 Op. Att'y Gen. No. 63-44.
"For the benefit of" construed.
— The words "for the benefit of" the employee should be construed to include an employer's payment toward the premium of a group hospitalization insurance policy which covers both an employee and his or her dependents. 1969 Op. Att'y Gen. No. 69-59.
Dependents.
— The legislature did not intend to limit this employment benefit to the individual employee regardless of whether or not he had dependents. 1969 Op. Att'y Gen. No. 69-59.
Payment of retirees health insurance premiums not authorized.
— This section is a general law providing municipalities with the authority to pay health insurance costs for employees and their family members, and does not authorize a municipality to pay a portion of its retirees' health insurance premium costs for its employees who retire under the Public Employee's Retirement Act. 1989 Op. Att'y Gen. No. 89-04.
District attorney's office covered.
— The district attorney's office is covered under the provisions of this section through Section 10-7-6 NMSA 1978, inclusive. 1959 Op. Att'y Gen. No. 59-106.
Constables and magistrates.
— Constables and justices of the peace (now magistrates) are not eligible for group insurance as provided by New Mexico statutes. 1959 Op. Att'y Gen. No. 59-42 (rendered prior to 1969 amendment).
Section applies to cattle sanitary board (now New Mexico livestock board)
and constitutes a legal limitation upon the maximum amount of contribution which the board may make in providing funds for group insurance programs covering the board's employees. 1963 Op. Att'y Gen. No. 63-44.
Employees of adjutant general's office ineligible.
— Persons employed by the office of the adjutant general of New Mexico in maintenance, technical, clerical and fiscal positions throughout the state of New Mexico who are paid by the federal government, and are participants in the state public employees' retirement association program, are nevertheless not eligible for participation in the state group insurance program. 1964 Op. Att'y Gen. No. 64-97.
This section does not contemplate voluntary official organizations.
1957 Op. Att'y Gen. No. 57-41.
Scope of contribution.
— The contribution provided for in this section applies only to those plans of group insurance or other types of insurance approved by the governing authority of the respective subdivisions and of this state. 1965 Op. Att'y Gen. No. 65-06.
Computation of contribution.
— It is lawful for governmental units referred to in this section to compute the percentage of their contribution to an employees' group hospitalization plan based upon the entire cost for both individual and dependent coverage. 1969 Op. Att'y Gen. No. 69-59.
Maximum contribution applies even if additional coverage provided.
— A city may not contribute a greater share of the premium of each policy even if the policy contains coverage enabling the city to make a savings on workmen's compensation insurance. 1963 Op. Att'y Gen. No. 63-25.
Participation in group insurance programs by school employees is optional
with each individual employee, and such participation may not be required in the absence of assent by each employee. 1963 Op. Att'y Gen. No. 63-100.
Effect of Public Purchases Act.
— The purchase of group insurance for employees of state agencies must be made in compliance with the Public Purchases Act (now the Procurement Code, 13-1-28 NMSA 1978 et seq.) including the requirement for bids. 1969 Op. Att'y Gen. No. 69-117.
Am. Jur. 2d, A.L.R. and C.J.S. references. —
81A C.J.S. States § 109.