Newly-introduced law demands medical cannabis coverage in New Mexico from health insurers

The largest medical cannabis producer in New Mexico is urging the state to clarify the details of a new law that permits certain Medical Cannabis Program-enrolled patients to obtain free treatment.

“Patients are suffering physically and emotionally and should have [free] access to medical cannabis under the law,” said the president and CEO of New Mexico Top Organics-Ultra Health, Duke Rodriguez.

Rodriguez was talking about Senate Bill 317, which became effective on January 1. 

Based on the law, patients who suffer from specifically mentioned behavioral problems can obtain medical cannabis free of charge, so long as they are covered by an accredited health insurance plan.

Signed into law in 2021, SB 317 states that accredited group health plans or individual plans “under the Health Care Purchasing Act that offers coverage of behavioral health services shall not impose cost sharing”.

The law which does not apply to patients who are covered by Medicaid stipulates that plan providers shall not impose a copay for patients who are approved to receive “all medication” for behavioral health conditions.

Although insurers were informed of the change back in June, when the state Office of the Superintendent of Insurance sent health insurance firms a letter outlining the new law, Rodriguez is concerned that insurers and patients might still be unaware of the rule change.

Law may apply to tens of thousands of New Mexico’s medical cannabis patients

Data released by the State Department of Health implies that New Mexico’s medical cannabis law may apply to tens of thousands of qualifying patients. 

During his recent discussion with reporters, Rodriguez noted that many patients find it hard to afford the average per-gram cost of medical cannabis in New Mexico, which exceeds $10.

Currently, some 130,345 people are registered under the New Mexico Medical Cannabis Program. Of this amount, 71,000+ suffer from post-traumatic stress disorder (PTSD), which is listed as an eligible behavioral health condition. 

In addition to behavioral issues, the new law also covers certain pain disorders and substance abuse. 

In order to get confirmation of “cannabis [insurance] coverage as a behavioral health service,” the leading medical cannabis provider in the U.S. sent letters of inquiry to numerous health insurance firms, the State Personnel Office and the Office of the Superintendent of Insurance.

Ultra Health “constantly receives questions from qualified medical cannabis patient customers regarding how they can obtain insurance payments for their medical cannabis,” reads a section of the company’s letter.

State of New Mexico must refund medical cannabis producers for collected taxes 

Ultra Health’s concerns regarding the health insurance law have arisen after the New Mexico Supreme Court ruled that medical cannabis, similarly to other prescription drugs, is not contingent on the state’s gross receipts tax.

The order, which was issued on Wednesday, February 23, ratifies a state Court of Appeals ruling from 2020. Rodriguez says he is “thrilled” to learn of the high court’s final judgment.

Based on the ruling, the state must issue refunds to medical cannabis producers for taxes that have been collected since the tax refund requests were initially made. Industry insiders have made a rough calculation that ranges from $25 million to $30 million.

According to Ultra Health officials, the state will refund the company $7.4 million, in addition to interest on taxes it has afforded dating back to 2018. The Taxation and Revenue Department was reportedly disheartened by the Supreme Court’s decision.

We respect the decision and will move forward to issue refunds to the affected taxpayers once the court’s decision is mandated to become final,” said a spokesman for the Department, Charlie Moore. 

Shifting focus back to SB 317, sponsors of the bill Martin Hickey of Albuquerque and Jeff Steinborn of Las Cruces recently told reporters that medical cannabis insurance coverage should be offered as standard for registered patients. 

Ultra Health’s chief legal officer Kristina Caffrey has requested responses no later than March 11 so that we may evaluate whether to pursue this issue in other forms.”

Rodriguez is optimistic that state officials health insurance providers will “get on this” without delay.