To: The New Mexico State House, The New Mexico State Senate, and Governor Michelle Lujan Grisham

Medicaid Reimbursement Should Not Be Subject to Gross Receipts Tax

I am a clinical psychologist currently working with Native American youth and families in New Mexico. New Mexico charges a gross receipt tax on Medicaid and Medicare Federal monies. As a private practitioner who serves almost exclusively native youth and families (19 pueblos and four recognized tribes), I receive about 96% of my income from Medicaid. I feel that I, and others who take Medicaid and Medicaid fee-for-service monies, are unfairly penalized by having to pay gross receipts tax on disbursements from Optum Health. The gross receipts tax is traditionally reserved for retail businesses that charge the consumer a "tax" on items bought and sold. I cannot bill my clients a “gross receipts tax” as the clients I see receive Medicaid due to compromised incomes and are living below the poverty line, usually unable to afford bus fare or food. How can I charge them gross receipts tax when they see me? So then it is I who absorbs this tax, as well as being additionally liable for federal and personal state income tax on these same "fee-for-service" monies. It is simply not fair.
I make home visits on pueblos, make school visits, and participate in Individualized Education Plan (IEP) team decision making meetings, often translating the western educational model to indigenous grandmothers raising native children whose parents are absent due to substance abuse and violent relationship issues. The issue of gross receipts must be addressed.
The kind of private practice I currently pursue will not be able to survive should the current level of gross receipts levied on state monies be continued. It is estimated that Medicaid in the state of New Mexico currently serves 100,000 people and that with the new health care reforms this number will grow to 300,000. Remember, all state (Medicaid) monies are subject to gross receipts tax. Who will stay in business to help these growing numbers?
There are currently 550 practicing psychologists in the state of New Mexico and only 134 accept Medicaid and Medicare. Why? One of the reasons is that this unfair tax continues to make it difficult for private practitioners to make a living and still serve the culture of poverty pervasive throughout this state.
I passionately believe that competent professionals should be able to practice in rural areas without the burden of this tax. Please join me in becoming a unified front advocating for competent care in Indian country and underserved populations in the State of New Mexico.

Why is this important?

In the state of New Mexico, an unfair tax (Gross Receipts Tax) is levied on all professionals who serve populations (such as Native Americans, minorities, and those living in the culture of poverty) who receive state Medicaid and Medicare monies disbursed federally.