New Mexico Administrative Code › Title 3 - TAXATION › Chapter 2 - GROSS RECEIPTS TAXES › Part 241 - DEDUCTION - GROSS RECEIPTS TAX - RECEIPTS OF HEALTH CARE PRACTITIONERS › Section 3.2.241.10 - RECEIPTS OF HEALTH CARE PRACTITIONERS FROM MANAGED HEALTH CARE PROVIDERS AND HEALTH CARE INSURERS PURSUANT TO CONTRACT WITH INDEPENDENT PRACTICE ASSOCIATIONS

Current through Register Vol. 35, No. 13, July 16, 2024
A.
				For purposes of Section
				7-9-93
				NMSA 1978, an "independent practice association" means an entity which acts as
				an administrative intermediary between health care practitioners and other
				managed health care providers or health care insurers. Independent practice
				associations generally contract with health care practitioners, other managed
				health care providers and health care insurers. In order for receipts of a
				health care practitioner to be deductible under Section
				7-9-93
				NMSA 1978, each health care practitioner contracted with the independent
				practice association must be qualified to receive reimbursement from each
				managed health care provider and health care insurer contracted with the
				independent practice association subject to limitations and a fee schedule
				established by the independent practice association and agreed to by both
				parties through their individual contracts with the independent practice
				association. Thus, a single contract between a health care practitioner and an
				independent practice association eliminates the need for the individual
				contracts between the health care practitioner and the independent practice
				association's other managed health care providers and health care insurers.
				Receipts from payments by other managed health care providers and health care
				insurers to health care practitioners pursuant to the parties' contracts with
				an independent practice association and that are otherwise deductible under
				Section
				7-9-93
				NMSA 1978 are deductible. Receipts from payments by independent practice
				associations to health care practitioners are deductible under Section
				7-9-93
				NMSA 1978.
B. Example: A health
				care practitioner contracts with an independent practice association. The
				health care practitioner bills and receives payment through the independent
				practice association from a health care insurer that is also contracted with
				the independent practice association. The health care insurer is registered in
				New Mexico. Even though the health care practitioner does not have a direct
				contract with the health care insurer, he or she may deduct payments he or she
				receives for services that are otherwise deductible under Section
				7-9-93
				NMSA 1978 because he or she has contracted with the independent practice
				association.
C. Example: A health
				care practitioner contracts with an independent practice association. The
				health care practitioner bills the managed health care provider or health care
				insurer that the independent practice association has contracted with. The
				managed care provider or health care insurer makes payment to the independent
				practice association according to its contract with the independent practice
				association. The independent practice association then makes payment to the
				health care practitioner according to its contract with the health care
				practitioner. The receipts of the health care practitioner are deductible
				pursuant to Section
				7-9-93
				NMSA 1978.