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The new law, which takes effect July 1, significantly reduces what employees pay for health care while closing the State Health Benefits program’s long-standing budget gap.
Source: Office of the Governor Michelle Lujan Grisham
Photo: Previous signing event, Courtesy
SANTA FE – New Mexico state employees will soon see lower health insurance premiums after Gov. Michelle Lujan Grisham signed Senate Bill 376 into law.
The new law, which takes effect July 1, significantly reduces what employees pay for health care while closing the State Health Benefits program’s long-standing budget gap.
“This is a major win for our state workforce,” said Kari Armijo, secretary of the New Mexico Health Care Authority. “With this new law, we’re lowering health coverage costs for thousands of state workers and protecting the sustainability of the program for years to come.”
Under SB 376, the state’s contribution to employee health insurance premiums will increase, significantly lowering costs for workers. The law also eliminates the state health benefits program’s budget shortfall and is expected to save millions of dollars in general funds in state fiscal year 2026.
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SB 376 addresses multiple challenges facing the New Mexico State Health Benefits Plan, which provides coverage to state, local and municipal employees. Currently, New Mexico has the lowest state contribution to employee health care premiums in the country, covering just 65% of costs. Additionally, many National Guard members struggle with high uninsured rates due to coverage costs — SB 376 includes provisions to offer premium assistance for eligible members, improving access to affordable coverage.
The bill passed 36-2 in the Senate and 52-13 in the House with strong bipartisan support.
