This bill mandates the Health Care Authority to conduct regional commercial insurance market assessments every two years, starting July 1, 2026. The assessments will determine the average commercial insurance reimbursement rates for health care services in neighboring states—Arizona, Colorado, Utah, Oklahoma, and Texas—that are covered by New Mexico's Medicaid program. Additionally, the bill establishes that the Medicaid reimbursement rate for these services will be the greater of either 200% of the Medicare reimbursement rate or the regional average commercial insurance reimbursement rate.

Furthermore, the bill stipulates that health care entities receiving increased Medicaid reimbursement must allocate at least 75% of the additional revenue towards enhancing compensation for health care workers or hiring more staff who directly interact with patients. The bill defines "health care entity" broadly to include various licensed providers, and it clarifies the definitions of Medicaid and Medicare as they relate to the federal Social Security Act.