Funding for New Mexico in Focus is provided by viewers like you.

>>Nash: This week on New Mexico Focus, Medicaid cuts are coming and two experts warn New Mexicans stand to absorb one of the biggest punches.

>>Charles: Everybody else is going to pick up the tab for that uncompensated care unfortunately.

>>Nash: and the governor's plan to expand the use of potentially toxic, so-called produced water.

Has a new foothold after a surprising committee vote.

New Mexico in Focus starts now.

Thanks for joining us this week I'm Nash Jones.

Governor Michelle Lujan Grisham has been pushing for New Mexico to make use of wastewater created by the prolific oil and gas operations in our state.

The legislature has shot the idea down two years in a row now, but recent moves by the State Water Quality Control Commission may be the workaround The state needs to move forward with a version of the idea without lawmaker approval.

Correspondent Jerry Refern, a reporter for Capital and Main, sits down with state Environment Secretary James Kenney to understand this new approach.

The role that he has in making it happen and what questions remain.

But first, we turn our attention to Medicaid, an essential federal program that helps cover health care costs for nearly 4 in 10 residents in our state.

Last month, President Trump signed a massive tax and spending bill that cuts more than $900 billion in federal funding from the program over the next decade.

The bill also creates new barriers to accessing the coverage, like work requirements and shortened reenroll deadlines.

We welcome back U.S. Congresswoman Teresa Leger Fernandez later in the show to get her thoughts on the safety net cuts and what New Mexico's all democratic representation in Congress can do for people who can't otherwise afford doctors or food.

But first, to make sense of these federal changes and ask how state officials can respond, Senior producer Lou DiVizio sits down with legislative Finance Committee director Charles Sallee and Democratic former state Senator Dede Feldman.

Here's the first part of that conversation.

>>Lou: Director Sallee state Senator Feldman, thank you both so much for being here.

Now, of course, health care funding Medicaid specifically is incredibly complex.

So in this first segment, I want to make sure we nailed down some of the basics.

First of all, our state has about 814,000 Medicaid enrollees right now.

These folks make up just under 40% of the population.

We also have the highest per capita percentage of Medicaid enrollees in the country.

Now, director Charles I know there's a ton in Trump's tax and spending plan, but without getting into any of the financial specifics yet, can you give us a brief summary of the changes in terms of federal dollars when it comes to Medicaid, both for our state and enrollees?

>>Charles: So the the biggest changes will be in a couple of years.

Potential losses of enrollment due to how the states are supposed to determine eligibility for the program, as well as potential losses of people falling off that aren't meeting work requirements or get caught up in administrative snafu, as well as reductions, to primarily hospitals, in the form of enhanced payments that states, have been encouraged to make to shore up their health care spending under the Biden administration.

Those are the big buckets.

>>Lou: Okay.

We'll get to the impact on hospitals in our next segment.

I want to focus on the individuals here.

How many enrollees could we lose, with these changes?

>>Charles: The health care authority estimates upwards of 90,000.

That would be, you know, roughly a half billion dollars in lost revenue to the state for their care.

>>Lou: Okay.

And these are issues that you're talking about.

Now, I know you just recently gave a presentation to the federal Funding Stabilization Subcommittee.

I recently spoke to a member of that subcommittee, Republican state Representative Jim Townsend.

What types of adjustments are you thinking about making or talking about making at this point?

>>Charles: Well, the first is to see the you know, the devil in the details with the regulations that will be coming out over the next year out of Washington, and how we need to adjust in administering the program, who exactly would be subject to the work requirements?

We think that it's mainly focused on able bodied adults without children, though the Senate did add a provision for adults with children, over ten would also be subject to work requirements.

>>Dede: Isn't it true, though, that, contrary to popular belief most of the adults that are on Medicaid now are actually employed, but their wages are simply too low and they hence qualify for Medicaid.

>>Dede: There is a large percentage of of individuals that are on Medicaid that are already working, whether they meet the new work requirements remains to be seen with those with those details.

At the same time, they may just be also underemployed.

You know, in this economy, making 14 or 15 an hour entry level unskilled job, working 30 hours a week, you wouldn't qualify for for Medicaid expansion.

>>Lou: Okay.

Given this these real world impacts Dede, >>Lou: Should state lawmakers be prioritizing backfilling these Medicaid cuts as early as a potential upcoming special session?

>>Dede: Well, as Charles said, the devil is in the details.

We really don't know exactly what the fine print says, and the law is not going to go into effect until 2027.

Conveniently after the next midterms, we'll have a new governor, too, by that point.

Yes.

The legislature should be considering, what to do to backfill.

And we have a number of trust funds that have been set up.

We're in a better position, I think, than most states, to, to utilize those reserves.

You know, Medicaid is such a, complicated, program that there are different, eligibility levels and benefits for each special population.

You know, nursing home residents, people with disabilities, people with mental illness, children, adults that were that came into the program with Obamacare.

It's it's very complicated.

And and with the system changes that will be needed based on the new regulations, the state has got to really change its IT system, in order to inform these different groups about what the new eligibility levels will be, it's going to be quite an ordeal, I think.

You know, Medicaid is one of those things where the, like, bone is connected to the shin bone is connected to the knee and so on.

So when you when you change something in one area, it really affects, you know, the price of private insurance, for example.

>>Lou: Director Sallee, is it feasible to make up for all of the losses that we'll see over a ten year period?

But with the surplus that we have with oil and gas money right now, is that possible?

>>Charles: No.

You know, the the federal government for the expansion population, which came as part of the Affordable Care Act, Obamacare, the federal government's paying 90% of those individuals premiums.

And if for some reason they don't sign back up, you know, where they're supposed to be for every six months, I'm not sure how the legislature can backfill those types of things or if they're not participating in the program according to its eligibility guidelines.

Does the state want to take on the responsibility of still paying for their their health care at that?

At that level, even the provider, rate changes.

And for the hospitals alone, that's over $1.1 billion.

They're helping put up the state match that's going to be phased down and phased out.

Over a period of ten years.

And I think that's a good reminder for your viewers.

Is this budget reconciliation process is not the normal congressional, appropriations process.

It's it's unlocking changes to programs that are part of what's called the mandatory federal budget, things that are really on autopilot.

Medicare, Medicaid.

There's some, food programs like snap.

Sometimes people call food stamps, and they're making these changes over a ten year horizon.

So in your viewers here, big numbers thrown out when they're watching the news or other programs, those are over a ten year period.

So big changes.

But like, Senator Feldman said, they kind of kick the can in those big change harder, kind of choices to after certain election cycles.

>>Lou: Some of these other requirements that you've spoken of, now folks will have to reapply for benefits every six months instead of every year.

In your presentation and to that subcommittee, you noted that that's expected to cut state spending in federal revenue by $158 million, along with $17 million in general fund revenue, because of what you called expected enrollment churn.

What does that mean, exactly?

>>Charles: Basically, that people won't sign back up, they won't meet the requirements.

Something will get lost in the mail.

And for some of them, they'll need health care and they'll go to a provider and they will have been removed from the Medicaid rolls, and they'll have to sign back up.

In other cases, they just won't sign back up.

And so there's basically a churning effect that that occurs at the department.

This is a proven strategy to reduce enrollment.

You know, in the past, the state had six month eligibility rate determinations.

It went to 12 months.

You got the enrollment levels shot up higher than what the state could afford.

So it went back to six months and the enrollment declined.

And so it's a I call it the hassle factor.

It's a it's a proven strategy.

That said, what the majority will say and party in DC is that you've got people that might not be eligible during that period because of a change in circumstance.

And so there's a balance that needs to be struck.

And I think there's technological solutions where you can do that to make sure that people still have incomes that are, meeting the eligibility guidelines in whatever their life circumstances, still meet those.

And that's really what the state's going to focus on is preventing these sort of, sort of things, making sure that if we're going to have work requirements, that it's administratively not as burdensome in order to meet them and maybe help people upskill and move off of Medicaid into the health exchange as an alternative as well.

>>Lou: How should individuals think about this?

The fact that their government is creating burdens with the explicit goal of keeping people who should be eligible for this benefit from receiving it just through paperwork and time?

>>Dede: Well, it's hard not to look at this through a partizan lens, first of all, because remember the what's happening at the macro level.

And that is the these programs Medicaid and Snap are being cut dramatically.

And it's a real burden on the states.

New Mexico in particular, since we're so different, dependent upon it, in order to cut taxes for the higher echelons, and also to increase funding on, immigration and immigration detention in particular.

So, that's, you know, that's, you know, that's that's a kind of a fact.

And it's not like this this bill, in my opinion, was done for any kind of good government reasons.

And there are good reasons to reform Medicaid.

>>Lou: As abudget expert at the state level, where you have to balance the budget every year.

What's it like watching the federal government say that they're cutting these programs to save money?

Yet at the end of the budget, the deficit will rise.

How how do you square that?

>>Charles: I don't I'm very concerned about the national debt, the annual deficit in 2024 was $1.9 trillion.

You could eliminate the entire Defense Department and all the defense spending, eliminate all the entire domestic discretionary spending, and you'd still have a deficit.

The annual debt payments this country is making are more than the entire defense budget.

They're more than all of Medicare, way more than all of Medicaid.

And this bill, frankly, adds 3 to 400 billion a year on top of that 1.9 trillion.

So these are really kind of nibbling around the edges when it comes to actual, reduced spending, again, because they're using that ten year window to make it out, like the numbers are bigger than maybe what they want.

They will be.

>>Lou: And just for some perspective on the national deficit and how does that impact folks here, their individual liv Will it impact the way that states have to operate their own budgets?

>>Charles: Well, the the bills are going to come do.

It's already crowding out potential other types of spending.

If you're if that's if the national annual debt, payments are second to only Social Security in your budget.

That's a problem.

That means it could be crowding out, you know, the your ability to, to borrow for a mortgage or other types of things.

There's going to be a day of reckoning.

And last point here before we move on to our next segment.

What does it do for the overall economy to have fewer people enrolled in Medicaid or some form of health insurance?

Who ends up carrying those burdens when people inevitably need medical care but don't have insurance?

>>Charles: Well, if they're not insured through some other means if they're not moving off of Medicaid and into the health exchange, if they're not moving into private, employer based health coverage, and they get sick and, and need health care coverage, then everybody else is going to pick up the tab for that uncompensated, care.

Unfortunately, higher having a higher uninsured, population doesn't mean that, you know, we aren't going to bear some form of cost, in the rest of society.

>>Dede: Yeah, even those people that have insurance, we'll see higher premiums.

And we'll we'll be paying more and, you know, this bill doesn't just affect Medicaid.

It affects the, health insurance exchanges, which were part of Obamacare as well.

I mean, essentially, this bill, though they didn't advertise it this way, is the undoing of Obamacare.

And and remember, in Obamacare, we were down to 8% uninsured nationwide.

Before Obamacare, New Mexico had a huge, I think, the second highest level of uninsured people in the country.

I think we're headed back there.

>>Lou: Thank you both.

We'll be right here, again for another chat in a moment, and we'll talk about hospitals and medical providers and how this bill will impact those also.

>>James: Why we entered into an agreement with New Mexico State University back in 2019 was for this exact question is we don't know what's in the water.

And we needed them to, develop the science and the technology to help us understand what is in that water.

>>Nash: Jerry Redfrern█s conversation with Environment Secretary James Kenney about expanded use of so-called produced water is coming up in about 30 minutes.

But before we send things back to Lou for the second part of his conversation about Medicaid cuts, we return to an interview we began last week with Congresswoman Teresa Leger Fernandez of New Mexico's third district.

This week, I asked Leger Fernandez about those cuts to Medicaid and what she can do in Congress to help people stay on the program when they need it and move off of it when they're ready.

Plus, we'll get into a national project that she's worried could damage an environmental landmark in her district.

Congresswoman, welcome back to New Mexico in Focus, >>Teresa: And thank you Nash for having me.

>>Nash: Under President Trump's big bill, more Medicaid patients will have to pay out of pocket to go see the doctor when previously it was it was completely covered.

Can you explain the changes to copays and who will bear the brunt of that?

>>Teresa: So I think one of the problems that we have is under the, big ugly bill that, what the federal what the Republicans have done is twofold.

One is they have pushed more of the cost to the individual patients into the states, and then they have made it more difficult for people to stay on Medicaid.

And so some of those co-pays will be in the form of when you go on in, and, and when you actually kind of register and do basic services.

And what we want to avoid, which is a problem, is we want people to be able to go into the doctor when they need to see them, so that they can get the kind of primary care they need.

Because we know if you don't do that, then it's going to get worse and acute, and it will cost the system more money.

And that's part of the problem of how they were looking at this.

Remember, Medicaid is for people who cannot otherwise afford to get health insurance, who cannot otherwise afford to get health care.

And so these are the people that, in my belief, the federal government and the federal government has thought this for decades.

We need to make sure that we have this basic needs of health care needs met for the people who cannot otherwise afford it.

>>Nash: Now, what about people who are on Medicaid are insured, but are in rural New Mexico?

And the threats to rural hospitals under this bill, we know, based on projections from the New Mexico Health Care Authority, that 6 to 8 rural hospitals in New Mexico are at risk of shutting down because of this bill.

A little later in the show, state Legislative Finance Committee Director Charles Selle explains the funding mechanism that that bill cuts off, reversing a Biden era change that that only started sending money recently, to rural hospitals.

What was that change and what will rolling it back mean for rural New Mexicans?

>>Teresa: So what we have seen is that there was a manner in which the states could, through, provider tax credits and other means, get money and then send it back to rural hospitals.

Rural hospitals are going to suffer for two reasons.

One is there may not be that money available from the state to assist them, and then their patients are going to lose their Medicaid eligibility intentionally.

So they're going to lose their Medicaid eligibility because they will have to recertify, and because it's going to be more complicated to get that Medicaid eligibility.

And that's where we're going to see people falling off the walls.

And this was intentional.

One of the things that the bill did was eliminate a medicaid simplification process.

Like under Biden.

They recognized that this whole like how you apply for Medicaid, it's 13 pages in New Mexico is complicated.

It's difficult.

Why are you making it so difficult?

And so under Biden, they said, let's simplify this.

But the Republicans did say, no, we don't want it.

Simple.

We want to make it hard because the purpose is to kick people off of Medicaid.

So one of the things that then happens for the rural hospitals is that people will present, not maybe not even knowing that they lost their Medicaid eligibility because it happens with, you know, they they didn't know they in the past had to recertify once a year.

And now it's every six months they'll present and they will be what they call, self-pay, no pay, which means we're not going to get a dime for covering this patient.

And when that happens, then eventually, if they're already financially unstable because it's hard to operate and rural New Mexico, they may have to either cut services or close down.

>> Nash: I know you said that the Republican, goal was to kick people off of Medicaid.

The stated goal is all about, uprooting fraud, waste and abuse.

Do you have concern about Medicaid fraud >> Fernandez: The CMS actually did a study and there was 5% of Medicaid.

Had some problems.

But of that 5%, most of that was because somebody filled out a piece of paper.

Wrong.

They checked the wrong box.

And so it's really maybe about a 1% issue around fraud.

And who is it that's engaging in the fraud?

We know that there were a lot of, nursing homes that sometimes engage in fraud, that's not the individual patient.

And so what the bill does is penalize the individual patients for perhaps some corporations that have been engaged in fraud.

So, yes, in every governmental program and every private corporation program, you're going to find fraud.

What we need to do is say, where is the fraud and how do we address it.

Those are words they are using to try to justify something else, because we know that 92% of the people on Medicaid are already working, the ones who are not, or because they can't work.

>> Nash: And New Mexico does have more folks in this situation, disproportionately so in terms of how many people rely on Medicaid, for their medical care.

What idea is to you and others in the congressional delegation have to help reverse that reality?

>> Fernandez: We can reverse this reality when Democrats, win control of the House back in 2026 and perhaps win in control of the Senate, and we need to be focused on that.

In the meantime, I think there are things we can do with the state, to try to make sure that people don't lose their eligibility.

So if they wanted people to lose eligible, what can we do at the state level?

And I've been meeting with, the clinics and hospitals I've mentioned, and we're starting to brainstorm of how do we make sure that we help people stay eligible.

Can we get them?

We call it “promotores” in Spanish.

We're people step in and help you fill out the forms.

Can we change the way the state is doing some of those forms to to simplify it, to do what we were going to do at the federal level?

Can we do that at the state level?

Can we automate?

Can we utilize our artificial intelligence to actually keep people on the worlds?

There are things we can do here to help.

>> Nash: If those keep people on the rolls, what does it look like to support folks in getting off of Medicaid eventually, because they can access other kinds of healthcare?

>> Fernandez: Well, you get off of Medicaid when you you are able to get a full time job that pays enough so that you can actually afford the Affordable Care.

But remember, Democrats had passed, we when we had a chance to pass this kind of bill.

What we did was lower the Affordable Care Act premiums.

And what Republicans have done is increase the Affordable Care Act premiums in this bill.

That's the other thing people don't talk enough about is if you're, somebody 57 years old, guess what?

You're going to pay about an extra $5,500 for your health care premiums.

Thanks to the Republicans, there are about 14,000 people in New Mexico.

They're going to face higher affordable care premium.

So if you're getting a three blue cross somewhere on the the you know, the exchange, you know, whoever it is you're going to now no longer get those tax credits.

And we need to remember all of this was done to provide those tax credits for the billionaires.

Right.

And that's why we're so angry about this.

It's not that there's not enough money.

They they chose to say we are going to cut $1.4 trillion.

We're going to go after Medicaid, we're going to go after Snap.

We're going to go after education so that we can give that $1.4 trillion to the richest Americans and corporations and make it permanent.

>> Nash: You mentioned snap.

Let█s talk about that just a lit bit.

The bill would cut that program by $186 billion over a decade.

What does that mean for New Mexicans who otherwise cannot afford food?

>> Fernandez: People are going to go hungry in New Mexico.

And when people go hungry because they lost their snap benefits, we're talking about and we tried to protect these.

We're talking about veterans.

We're talking about disabled.

We're talking about children.

We're talking about people who deserve to be fed for a wealthy enough country that we should not have people going hungry.

And the other piece is, we are going to be hurting our own rural economy, because when they cut, the ability of somebody to go get fresh fruits and vegetables and meat at your farmers markets with your double up bucks, that means that the rancher and the farmer who is selling to people who have those snap double up books, it's not going to be able to sell to them, when they cut the ability of our food depots to buy from local ranchers and farmers, that hurts our local economy.

So what they are doing is not making not only hurting our children who might be hungry and our veterans who might be hungry.

They are also hurting our rural economy.

>> Nash: If you'll stay with me for just a bit, I want to get to a little bit of local news.

I'm sure you saw the story break this week that the NNSA, the National Nuclear Security Administration, has paved the way for the, 14 mile transmission line to be built in Caja Del Rio, to benefit, predominantly the Los Alamos National Lab.

You've objected publicly to this project.

You called on then President Biden in December to declare Colorado Rio a national monument, which could help prevent, the construction of, this additional transmission line and infrastructure.

Have you made a similar request to President Trump?

Would you?

>> Fernandez: We would definitely make a request that they created as a national monument.

And, this president does not believe in national monuments, and he's trying to undo it by, trying to he's.

We had a request to protect the Pecos.

They've undone that.

We've had the they have on their radar to remove the protections for Chaco.

And I think that you can have a national monument and still meet the, energy needs of Los Alamos, but you need to do it in a manner, that reflects, and respects, the needs for the environmental protections and the cultural protections that were at issue.

And so I also call that there'll be a robust environmental, review and that there will be, good communication and collaboration with the local tribes and, and communities.

>> Nash: Continuing with environmental impacts in your district.

You sent a letter late last month to U.S. Forest Service Chief Tom Schultz about what his agency's response was to the rule of fire.

What prompted the letter?

>> Fernandez: So we, I want to start off, I believe it is important to have managed fire by and and to address the fact that we have failed our forests, over these many years.

And that's why you then end up with a, hermit's peak.

Because our forests are overgrown and climate change is putting us all at risk.

But the Forest Service also needs to step up.

And if they are doing a managed fire that was, not started by the forest, unlike Hermits Peak, we should never been started.

They need to make sure that the people who are at risk are notified, that they make sure that they protect livestock.

We heard from the ranchers in our district, and I don't know if you've seen those pictures.

They're just gruesome of the cows that were there.

Others were burnt, their hopes were burned.

It was just gruesome.

And we need to make sure that the Forest Service steps up and actually takes care and protects ranchers and farmers and their livestock, when they have a part, to the extent they can, you know, we can out, you know, Mother Nature, it's Mother Nature.

But was there something they could do?

And that's why I wanted to know.

I wanted to know did they have enough staff?

Because the Forest Service keeps telling us we have enough staff.

And then you actually look at the statistics.

You look at you, Dalvin, to, ProPublica has a great report of where they doubt into what are the employment records and they don't have enough staff.

>> Nash: Well, so, did they respond to your letter?

>> Fernandez: They had they have said that They had they have said that they did have enough people.

And, you know, given what the, documents show, I don't really believe that's true.

>> Nash: Congresswomen Teresa Leger Fernandez Thank you so much.

>> Fernandez: Thank you so much Nash.

>> Nash: Thanks again to Congresswoman Leger Fernandez for stopping by.

And if you want to catch the first half of our conversation, you can catch that over on the New Mexico in Focus YouTube page.

Rural health care facilities in our state have been struggling financially for years.

And now, as Trump's tax and spending bill cuts $137 billion in spending for rural Medicaid, the New Mexico Health Care Authority expects several hospitals to close their doors.

For more on how this will hit our state's smaller communities, let's return now to senior producer Lou Divizio█s conversation with Legislative Finance Committee director Charles Salley and former state Senator Didi Feldman.

>> Lou: Now, the New Mexico Health Care Authority estimates 6 to 8 rural hospitals, including Taos, Las Vegas and Clayton could close as a result of this reconciliation bill.

Director, can you explain the funding mechanism that this bill cuts off and why it could doom those hospitals?

>> Sallee: So those hospitals have been on challenge financially for many years with the budget reconciliation bill will do Is it will first say hospitals You can't put up as much money for the state match to the extra, payments.

You're getting above Medicare going to be phased out over a ten year period.

And, and be reduced 10% a year.

At the same time, you have to keep in mind that Medicare's payments will be increasing the rates that they make.

So it may not even be a full 10%.

>> Lou: So who steps up in this to save these hospitals?

Is it up to the state legislature?

And what would that look like?

>> Sallee: What the state has done is worked with the hospital association two sessions ago to come up with a new program that the federal government signed off on, last year, that basically would allow the hospitals to put up what I call a provider tax, and then they would draw down the federal match and then those payments would go out to hospitals based on the volume of number of surgeries and, and different types of services that they provided.

So the vast majority of that money, would go out basically to your bigger hospitals that have a larger patient volume.

So not as much of the money would go out to those rural hospitals.

But the payments just started going out this year, and we've already gotten reports back that some of those, financially, distressed hospitals are already seeing a positive benefit that will be ratcheted down over a ten year period, 10% a year.

The hospitals won't be able to put up as much of the the matching funds and instead of paying, commercial, rates for, hospitals in the state that the federal government had already signed off on.

Now, the federal government says you can't pay more than what Medicare, will pay, but we're going to give you a ten year window to to ease into that.

So it remains to be seen on the impact is going to vary depending on the hospital, how many Medicaid patients they have.

But definitely the state's going to probably need to look at doing something.

Some of those could be offset in the near term.

There was a $50 billion new rural provider, fund created at the federal level.

We think, if the formula works out, as has written, that we could see 500 million over the next five years, from the federal government that could help shore up some of those very rural, remote hospitals that you just spoke about.

>> Lou: Okay.

Now, Dede, of course, have worked on Medicaid in the past?

In the early 2000, working on Medicaid reform in the state legislature.

I want to talk about Medicaid reliance on what are called managed care companies.

Those receive Medicaid dollars and contract with medical providers and hospitals to provide the care for those.

More than 800,000 enrollees.

Those companies right now are Blue Cross Blue Shield, Presbyterian, Molina, and United Health Care.

Why does New Mexico do it this way?

And would eliminating those third parties save the state or enrollees any money?

>> Dede: Well, this was very controversial when Medicaid managed care was introduced during the Johnson administration in 1997.

And, it was it was done because managed care was then thought of as a much more efficient, system of, providing patient care at a lower cost.

And of course, that has its downsides because, it's another middleman in between the funding and the, and the ultimate recipient, the patient.

And then that, the, the managed care companies who are experts at managing their care, getting them the right preventive care, early for children in particular, so that they wouldn't need the emergency care.

>> Lou: So the idea was that these companies have both the medical and financial knowledge to get people where they need to go quicker, therefore saving money.

>> Dede: Yes.

And it was.

But it all boils down to their provider networks.

And whether they have enough providers, that are, in their network or willing to accept Medicaid and Medicare payments.

And this is where, this is where it's, the rubber is meeting the road right now in New Mexico in that there are just not enough providers, particularly in the rural areas, to provide particularly specialty care like ob gyn, which is not really special, but we lack those providers and they're not in the networks.

Of, of the, of the managed care companies.

>> Lou: Yeah, I'll get back to that because that is an important point.

As far as the messaging coming from the White House on this bill, Republicans are saying that people in the Medicaid system are gaming that system.

Is it accurate to say that Medicaid is rife with waste, fraud, and abuse?

And do you see any potential upsides to this reconciliation bill?

>> Sallee: We've not seen a huge rash of those issues, in our Medicaid program, like we have in states like Florida, where they are routinely you're seeing, you know, people being prosecuted for ripping off Medicare and Medicaid.

We haven't seen those types of activities here.

Not to say that it hasn't happened or isn't happening.

But the scale of which is very different than I think you're hearing with the rhetoric out of Washington, DC.

>> Dede: And then not to say that we haven't been looking for Medicaid fraud and abuse, the Martinez administration looked into the behavioral health, area and decertified a entire swath of providers from providing Medicaid.

And, it resulted in absolute chaos.

And no and no fraud was found >> Lou: Back to those providers, Dede, in addition to hospitals, there's concern that we are already in a situation of a provider shortage that it could get worse.

And you wrote about that in your op ed for New Mexico in Depth.

Can you explain exactly how that could happen?

>> Dede: Well, it's happening already.

Because, you know, the the Medicaid, to certain degree, Medicaid payment level is sort of a benchmark for the other payment levels.

And, when the, you know, Medicaid is unstable, then all the other payments sort of take notice.

And, and they're the premiums are going up.

It's a situation of chaos, really.

And, providers, providers just can't handle it.

I think and in addition to the malpractice problem, which, you know, is came to the fore last session and for the past couple of years, I think it's going to be very difficult for providers in New Mexico to continue, providing the level of services that they're there providing.

Now, I don't know, do you agree with that?

>> Sallee: That's going to be a hard sell.

And so what?

The state did it again with the approval of the federal government, that's now being changed.

The state said, well, let's help shore up primary care, infant and maternal health care, behavioral health in the state, move to basically increase Medicaid payments to 150% of what Medicare would pay in an effort to help shore up the health care system for all of us.

Now, those rate, increases are not in jeopardy due to budget reconciliation.

That wasn't part of the bill.

They are due at risk through administrative, decisions at CMS.

If they come back and say no, we no longer want to support support this.

And so that's another, wild card that that's out there that is separate and apart from the budget reconciliation.

>> Lou: Okay.

Dede, going back to a little bit of history in your op-ed, federal lawmakers have expanded the Medicaid program over the years.

Republican Senator Pete Domenici, of course, from here in New Mexico, helped expand the program, in the early 2000█s when the Affordable Care Act was passed, a year later, it gave states the option to expand Medicaid further and Republican Governor Susana Martinez opted to do so.

Why has funding Medicaid turned into a partisan issue now in 2025?

>> Feldman: Well, I think really Medicaid has always been a partisan issue.

And, you know, it's a philosophical difference, I think, between Republicans and Democrats in that, you know, Democrats believe in a safety net, believe that poor people should, and low income people should, should receive health care in order to be better students, be better -- more productive workers and and to -- uphold the economy in general.

Whereas Republicans, I think, they support private insurance, and feel that everybody should be working and should be, insured privately.

That's, you know, wishful fullfiment in New Mexico where the government already pays for our health insurance anyway, through, the Indian Health Service, Veterans, Tricare, Medicaid, Medicare.

It's just done rather inefficiently.

But there's always a fear, I think, on the part of the Republicans on this is going to be socialized medicine.

And then, here comes Obamacare, you know, where Obamacare.

It was, passed in 2010, in somewhat the same method, as the as this current bill.

And, yet it became very popular because its pillar was the expansion of Medicaid, the establishment of state exchanges, and a number of insurance regulations where people with preexisting conditions could no longer be denied care, denied coverage, rather.

And, so, you know, there were there was a lot of, opposition, as we know, to that in the past.

And I think this is what has resurfaced now and, and is part of this partisan attitude.

>> Lou: Okay.

Director, many of these changes are scheduled to take effect at the end of 2026, as you've mentioned.

And the cuts, as you've also mentioned, won't reach their maximum impact until about ten years from now.

Are the concerns over potential losses in coverage and impacts on hospitals and providers justified with such a long runway?

For these changes, and with the possibility of of changes to our elected officials every election cycle?

>> Salle: Yeah, I think there's clearly stuff that was passed through reconciliation under the Biden administration that was just all undone.

So, there's potential depending on what happens in the next couple of election cycles, that some of the worst fears could be, undone as well.

That said, the fact that it is a ten year window that we're really looking at, and that many of these provisions don't kick in for a number of years, gives us a window into what can we do to make the system run more efficiently, that people who want and need the program are able to access it in a, in a in an easy way.

That we're only enrolling people that actually qualify, for the program to make sure that they get the services that they need.

And probably have to work around the edges to, to figure out, what to do with potentially the rural hospitals.

And again, I'm really concerned about our, medical system, that uses some of these state directed payments basically to vastly expand their, medical education programs, which benefit all of us as a state, to be able to have high quality doctors coming out of our medical school here.

>> Lou: Understood.

Director Sallee, Dede Feldman thank you both so much for being here.

>> Sallee: Thank you.

>> Feldman: Thank you.

>> Nash: Thanks to Dede Feldman and Charles Sallee for helping us hack through the complicated labyrinth that is Medicaid and the fundamental changes coming down the pike.

Switching gears now, something called produced water has been a flashpoint in New Mexico over the last several years.

That's the water that comes out of the wells after hydraulic fracturing, or fracking, to extract the oil and gas from the ground.

The stuff is loaded with chemicals, though no one's exactly sure how harmful it is.

And that's because oil and gas companies aren't required to disclose what exactly is in the water.

Historically, the state has restricted the use of produced water to the oil fields it came from.

But Governor Michelle Lujan Grisham wants to expand its use to address climate change driven water shortages.

Last year, and again earlier this year, the legislature shot down the governor's proposal.

And in May, the state Water Quality Control Commission adopted a rule essentially doing the same thing before the commission's rule went into effect though, a pop up oil and gas industry group petition to reopen the rulemaking process.

And last month, Environment Department Secretary James Kenney made a rare appearance at the commission's monthly meeting and convinced the group to take up the industry proposal.

The move appears to have worked.

This week in collaboration with nonprofit news organization Capital, in Maine.

Kenny sat down with correspondent Jerry Redfern to explain.

Here's that conversation.

>> Redfern: Secretary Kenney, thank you for joining us today.

>> Kenney: It's a pleasure to be here.

>> Redfern: I'd like to start with the August 12th Water Quality Control Commission meeting, where several state secretaries and department heads are actually part of the commission.

But generally speaking, secretaries and department heads tend to send delegates to vote in their place.

An interesting thing happened on the 12th.

You had the state engineer, you had the state's secretary of health.

You had the secretary from the department of Agriculture, you had the director of gaming fish.

And you also had yourself the secretary of the New Mexico Environment Department, all showing up in person.

Apparently for the first time in recent memory, all voting to take up a motion from the oil and gas industry to be able to reuse treated produced water outside the oil field.

A big question floating around, since all of these department heads showed up for this particular meeting, did Governor Michelle Lujan Grisham ask you to attend this particular meeting?

And did she tell you to support this particular initiative?

>> Kenney: Yeah.

So, great question.

And it's rare that we all get together the way we did at the WQCC.

In fact, I can't remember a time that we did that in the past.

I think the answer and the governor did not explicitly ask us to all show up.

However, the governor has asked the cabinet to support the 50 year Water Action Plan, and a key aspect of the 50 year Water Action Plan is the reuse of a number of types of water in the state of New Mexico, including produced water.

It's probably important for you in the viewers to also note that the legislature mandated that the Environment Department developed rules, and we've been on that journey since 2019, in pursuit of science based rules.

But back to your question.

I think the governor, expects her A Team her cabinet secretaries to show up when a priority is being heard at these commissions.

And we did.

We showed up.

>> Redfern: If you say so.

So, some of the wells with the highest produced water to oil ratio are actually either on or next to tribal lands up in the San Juan Basin in the northwest corner of the state.

So, how were tribal interests noted in this particular discussion?

>> Kenney: So, again, let's go back a little bit to get to where we are today.

And and with respect to the Environment Department's efforts around water reuse, which includes produced water but not exclusively produced water, we've been engaging with tribal communities on that topic, multiple times a year for the past, you know, six and a half years.

With respect to the Water Alliance petition, which you noted earlier, is an oil and gas, organization, which I don't know that to be true.

I think there's oil and gas -- >> Redfern: It is.

[Laughs] >> Kenney: Companies who are members -- Okay.

But I don't think that that's how they represent themselves.

But nonetheless, we can we can table who they are that there is a petition.

The Environment Department itself has not engaged around that petition with tribal communities.

However, just recently in our annual state, tribal engagement that the Indian Affairs Department hosted, we brought up the topic of water reuse and the way the environment department is going to move on additional water reuse regulations, this year and next year.

So, it's an ongoing conversation, but the Water Alliance, that's their job to engage with tribal members.

>> Redfern: Part of the big reason we're talking about all of this is that the oil and gas industry does use all sorts of chemicals when they hydraulically fracture wells.

If industry is not telling the state what chemicals are in water, what they're putting down the wellbore, how is the state going to test for them, and how are you going to be able to assure the people of New Mexico that that water is clean and can be reused, as, I don't know, drinking water or on fields?

>> Kenney: Yeah.

So, big point here that we're not suggesting or we at the Environment Department are not suggesting that that water should be used for drinking.

So, just want to clarify that right up front.

I will admit to you those rules that our state rules don't go far enough to enforce the disclosure of trade secret chemicals.

So, I'm not debating that.

But it's not also that all chemicals are unknown.

There' are chemicals that the industry uses that are not known, but there are some that are known.

why we entered into an agreement with New Mexico State University back in 2019 was for this exact question, is we don't know what's in the water.

And we needed them to, develop the science and the technology to help us understand what is in that water.

And, Jerry, I'll just mention one thing.

Going back to my days of crawling around steel mills and chemical plants when I was with EPA, you know, we would often grab samples of what we thought was in the water, but we would identify through the analytical chemistry process things like, why are we getting these strange results?

So, the analytical chemistry back, even from the 90s, can start to detect these things that maybe the oil and gas companies aren't talking about.

But we also gap-filled that science with NMSU over the last six and a half years.

>> Redfern: Okay, so this brings up two quick questions.

I think this is kind of what I was saying.

In general, water testing, you might get an anomaly.

Are you going to have the chance to always go back, especially with the huge amounts of water we're talking about, of produced water in the state of New Mexico, always going to have the chance to go back and check and see if it is something like a PFAS?

The Environment Department has been on remarkable crusade taking on the federal government and the US Air Force for PFAS that has shown up in drinking water around Cannon Air Force Base in Clovis.

And was it last week your department came out with a report showing that these PFAs chemicals are actually showing up in people's blood?

People who live around the Air Force base.

I'm wondering -- this seems like a bit of a dichotomy to me.

On the one side, there's this very difficult testing this work to keep PFAs out of New Mexico from things that the Air Force has done.

But PFAS -- we haven't gotten into this, too much, is also a chemical that has been used, perhaps still is used in fracturing fluids by the oil and gas industry.

How do you square that circle?

>> Kenney: Yeah, I think on the PFAS question, taking that one first, it's an easy circle to square by saying that when people in Clovis are waking up are trying to figure out, Can I drink my water when it contains 650,000% more than the Safe Drinking Water Act standard, I think that's an easy question.

That's the risk we're chasing.

The on the flip side and I and by no means should you or others think that I think the oil and gas industry gets a free pass around PFAS.

Absolutely not.

But I don't know of any water -- drinking water contamination caused by people in oil and gas operations.

That's not to say it hasn't happened.

I don't know of it.

If it has happened, then the Environment Department will go vigorously after the oil and gas industry that caused that.

But I think you're raising a different point with your first question, which is, how can you be comfortable moving forward with, you know, science based standards when you see the cause of other industries releasing these chemicals?

And I and I again, I'm going to come back to the point of with PFAS analogous to oil and gas, there is no there has not been any standard, for PFAS, And we're trying to rein it in now.

I think that's the difference here., we're trying to develop standards for the oil and gas industry.

>> Redfern: Okay, I get that.

And you bring up yet another really interesting point I'd like to take up here, which is science-based and back in May, the Water Quality Control Commission passed a rule saying that for the foreseeable future, New Mexico would not be releasing treated, produced water in any particular way outside of oil field use.

What we're talking about now, that was based on scientific reports done by people at the Environment department, scientists at the Environment Department.

This was based on testimony that came from scientists from New Mexico Tech, all of whom were saying, we can't be sure at this point with what we know today that we will be catching everything that comes out of treated, produced water.

We just don't know it.

It's not safe to do it at this point.

That is why back in May, the water Quality Control Commission voted the way that it did.

Again, you know, help me square the circle out.

How you have that.

>> Kenney: Yeah, so, back in in the rulemaking, you're talking about the WQCC said, “Hey, no discharge.” And, “We█re going to revisit this or sunset this within the next five years.” NMED had, our petition -- that was the petition that we developed and that they ruled on, the science that went into that, rulemaking, was science up through 2022.

So there's been no accounting of the science from 2023 forward.

And in fact, NMED is about 75, 80% there on its next round of water reuse rules, which we were getting ready to petition the WQCC for bringing those back in 2026.

So, you know, my scientists and engineers here working with NMSU we're bringing back a petition to the WQCC next year.

Anyway, so I think the, you know, the fight that we're having today, is a fight that we're going to have next year as well.

So, yeah -- that's where we are at the department.

>> Redfern: Thinking about this again in a slightly different direction.

The environment -- the New Mexico Environment Department has a huge umbrella, the list -- you have an absolute laundry list of things that you cover, from cannabis dispensaries to dry cleaners to cement operations, yada, yada, yada, all these things.

Now you're adding something very complicated, very scientifically technical, and that could possibly directly impact water sources here in the state of New Mexico.

Where do you think the funding is going to come from to be able to monitor this?

Is this something you're going to go and ask the legislature for, or is this -- where's the money coming from?

>> Kenney: So we've done a lot to reorganize ourselves and ready ourselves, because the one thing that I do know is every session I did more to do.

Not a complaint.

But, you know, there's a lot of work that needs to happen in this space.

And I'm appreciative we have a legislature that that wants to work on environmental issues.

I don't want to have us as a marginalized department.

So, you raise a good question about how it will be funded.

And I think it should be on the backs of industry.

>> Redfern: Okay.

Well, that was my -- That was the direct follow up question to that.

Has industry brought up that they would fund this themselves?

>> Kenney: I don't have the answer to that question.

I think that's going to be something that the WQCC would probably take off as a as part of this petition.

But whether it's mining operations or dairy operations, I'm thinking of all the things that have a groundwater permit.

They're paying fees for those permits.

And in last session, we reorganized our groundwater rules to allow for our department to raise some fees as well.

This is not an elective class for the Environment Department.

We've been mandated by the legislature to address this issue.

So, the question of what's in a rule, will either be done by the Environment Department or the petitioners, but the notion that we can avoid or somehow not do -- perform a -- this is not a discretionary duty for us, which is a non-discretionary duty under state law that we have to go forward.

>> Redfern: Right, and I think that just to reiterate, I think that does bring up the question of how are you going to pay for that non-discretionary duty going forward?

I'd really like to thank you.

I wish we had more time to go.

These are some really fascinating topics.

Thank you for taking the time to -- to work through them with me.

>> Kenney: Yeah.

Thank you for having me.

>> Nash: Thanks to Capital & Main, reported Jerry Redfern, Secretary Kenney and everyone else who contributed to the show for New Mexico PBS, I'm Nash Jones.

Until next week.

Stay focused.

Funding for New Mexico in Focus is provided by viewers like you.