HEALTH CARE PROFESSIONAL LOAN FUND CHANGES, the official text

HOUSE BILL 66

57th legislature - STATE OF NEW MEXICO - second session, 2026

INTRODUCED BY

Christine Chandler and Natalie Figueroa and Eleanor Chávez

AN ACT

RELATING TO HEALTH CARE PROFESSIONAL LOAN REPAYMENT; CREATING
THE HEALTH PROFESSIONS ADVISORY COMMITTEE TO SELECT RECIPIENTS
OF LOAN REPAYMENT AWARDS; REQUIRING AWARD RECIPIENTS TO BE
HEALTH PROFESSIONALS WHO CURRENTLY MAINTAIN PRACTICE IN NEW
MEXICO OR AGREE TO RELOCATE TO AND COMMENCE PRACTICE IN NEW
MEXICO; REQUIRING THE HIGHER EDUCATION DEPARTMENT TO DETERMINE
AND DISBURSE AWARD AMOUNTS; PROVIDING POWERS AND DUTIES;
PROVIDING ADDITIONAL AWARD CRITERIA; ADDING DEFINITIONS;
ALLOWING FEES TO BE ASSESSED UPON BREACH OF CONTRACT; AMENDING
THE HEALTH PROFESSIONAL LOAN REPAYMENT FUND; CONCLUDING THE
PROVISION OF LOANS MADE PURSUANT TO THE ALLIED HEALTH STUDENT
LOAN FOR SERVICE ACT; REPEALING SECTIONS OF THE NMSA 1978;
MAKING AN APPROPRIATION.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 21-22C-4 NMSA 1978 (being Laws 1994,
Chapter 57, Section 6) is amended to read:

"21-22C-4. ALLIED HEALTH LOANS--QUALIFICATIONS.--

A. [The commission] Prior to May 20, 2026, the
higher education department may grant a loan to a student it
deems qualified to receive the loan upon terms and conditions
it determines pursuant to the provisions of the Allied Health
Student Loan for Service Act and regulations adopted pursuant
to that act.

B. The [commission] higher education department
shall only receive, pass on and allow or disallow an
application for a loan made by a student enrolled or accepted
in an allied health profession program who is a bona fide
citizen and resident of the United States and of New Mexico and
who declares [his] the intent to practice an allied health
profession within a designated area of the state.

C. The [commission] higher education department
shall make a full and careful investigation of the ability,
character and qualifications of each applicant and determine
fitness to become a recipient of a student loan. The
investigation of each applicant shall include an investigation
of the ability of the applicant and the applicant's parent or
guardian to pay the applicant's expenses for an allied health
profession education. The [commission] higher education
department shall give preference to qualified applicants who
are unable, or whose parents or guardians are unable, to pay
the educational expenses.

D. The [commission] higher education department
shall arrange for loan recipients to receive assistance in
locating appropriate practice positions in designated
underserved areas."

SECTION 2. Section 21-22D-3 NMSA 1978 (being Laws 1995,
Chapter 144, Section 18, as amended) is amended to read:

"21-22D-3. DEFINITIONS.--As used in the Health
Professional Loan Repayment Act:

A. "award" means the grant of money to repay
eligible education debt;

B. "committee" means the health professions
advisory committee;

[A.] C. "department" means the higher education
department;

[B.] D. "health professional" means a [physician,
optometrist, podiatrist, physician's assistant, dentist, nurse,
member of an allied health profession as defined in the Allied
Health Student Loan for Service Act or a licensed or certified
health professional as determined by the department]
professional licensed pursuant to the:

(1) Medical Practice Act;

(2) Physical Therapy Act;

(3) Occupational Therapy Act;

(4) Speech-Language Pathology, Audiology and
Hearing Aid Dispensing Practices Act;

(5) Pharmacy Act;

(6) Nutrition and Dietetics Practice Act;

(7) Respiratory Care Act;

(8) Medical Imaging and Radiation Therapy
Health and Safety Act;

(9) Dental Health Care Act;

(10) Professional Psychologist Act;

(11) Counseling and Therapy Practice Act;

(12) Nursing Practice Act;

(13) Optometry Act; or

(14) Emergency Medical Services Act;

E. "licensed physician" means a health professional
who is a medical physician or an osteopathic physician licensed
to practice medicine in New Mexico pursuant to the Medical
Practice Act;

[C.] F. "loan" means a grant of money to defray the
costs incidental to a health education, under a contract
between the federal government or a commercial lender and a
health professional, requiring either repayment of principal
and interest or repayment in services;

[D.] G. "nurse in advanced practice" means a
registered nurse, including a:

(1) certified nurse practitioner, certified
registered nurse anesthetist or clinical nurse specialist,
authorized pursuant to the Nursing Practice Act to function
beyond the scope of practice of professional registered
nursing; or

(2) certified nurse-midwife licensed by the
department of health; and

[E.] H. "osteopathic primary care physician" means
an osteopathic physician licensed pursuant to the Medical
Practice Act with specialty training in family medicine,
general internal medicine, obstetrics, gynecology or general
pediatrics."

SECTION 3. Section 21-22D-4 NMSA 1978 (being Laws 1995,
Chapter 144, Section 19) is amended to read:

"21-22D-4. [COMMISSION POWERS AND DUTIES--PARTICIPANT
ELIGIBILITY--QUALIFICATIONS] HEALTH PROFESSIONS ADVISORY
COMMITTEE--CREATED--COMPOSITION.--

[A. The commission may grant an award to repay
loans obtained for health educational expenses of a health
professional upon such terms and conditions as may be imposed
by regulations of the commission.

B. Applicants shall be licensed or certified to
practice in New Mexico as health professionals and shall be
bona fide citizens and residents of the United States and of
New Mexico. Applicants shall declare their intent to practice
as health professionals within designated health professional
shortage areas of the state.

C. The commission shall make a full and careful
investigation of the ability, character and qualifications of
each applicant and determine fitness to become a health
professional in the health professional loan repayment program.

D. The commission shall assist selected health
professionals in locating practice positions in designated
health professional shortage areas.]

A. The "health professions advisory committee" is
created.

B. The committee is composed of the following nine
members:

(1) one representative appointed by the
secretary of health;

(2) one representative appointed by the
secretary of health care authority;

(3) two representatives appointed by the
secretary of higher education, who shall have experience in
public post-secondary health and medical education;

(4) three representatives appointed by the
chair of the New Mexico medical board; and

(5) two representatives of professional health
and medical associations appointed by the secretary of higher
education.

C. Members of the committee appointed pursuant to
Subsection B of this section shall serve staggered terms of
four years; provided that the initial term of members appointed
shall be less than six years. A vacancy on the board of an
appointed member shall be filled by appointment by the original
appointing authority for the remainder of the unexpired term of
office.

D. The members of the committee shall select a
chair, vice chair and other officers that the committee deems
necessary, who shall serve a term of two years. The committee
shall maintain minutes of all the meetings of the committee."

SECTION 4. Section 21-22D-5 NMSA 1978 (being Laws 1995,
Chapter 144, Section 20) is amended to read:

"21-22D-5. [DELEGATION OF DUTIES] HEALTH PROFESSIONS
ADVISORY COMMITTEE--DEPARTMENT--POWERS--DUTIES.--[The
commission may]

A. The committee shall:

(1) review applications provided by the
department;

(2) evaluate whether an applicant satisfies
the criteria provided pursuant to Subsection B of Section
21-22D-6 NMSA 1978;

(3) meet biannually and at the call of the
chair;

(4) select health professionals to receive
awards; and

(5) advise the department on determinations of
award amounts.

B. The department shall:

(1) determine award amounts in accordance with
the criteria provided pursuant to Subsection C of Section
21-22D-6 NMSA 1978;

(2) disburse funds to health professionals who
are selected by the committee to receive awards;

(3) assist awarded health professionals in
locating practice positions in designated shortage areas; and

(4) promulgate rules as necessary to
administer the Health Professional Loan Repayment Act.

C. The department may delegate to other agencies or
contract for the performance of services required by the
provisions of the Health Professional Loan Repayment Act."

SECTION 5. Section 21-22D-6 NMSA 1978 (being Laws 1995,
Chapter 144, Section 21, as amended) is amended to read:

"21-22D-6. HEALTH PROFESSIONAL LOAN REPAYMENT PROGRAM--AWARD CRITERIA--CONTRACT TERMS--PAYMENT.--

[A. Prior to receiving an award, the health
professional shall file with the higher education department a
declaration of intent to practice as a health professional in
areas of New Mexico designated as underserved by the
department. The department shall consult with the department
of health when designating areas as underserved.

B. Award criteria shall provide that:

(1) amounts shall be dependent upon the
location of the practice the applicant's total health
professional education indebtedness and characteristics of the
practice;

(2) preference in making awards shall be to
individuals who have graduated from a New Mexico post-secondary
educational institution]

A. The "health professional loan repayment program"
is created and shall be administered by the department. A
health professional shall apply for an award on a form provided
by the department. The department shall forward those
applications to the committee.

B. The committee shall select health professionals
to receive awards based on the following criteria:

[(3) recruitment awards] (1) a health
professional shall [be made to eligible participants who agree]
currently maintain practice in New Mexico or have agreed to
relocate to [an approved designated area] and commence practice
in New Mexico within ninety days of the grant of an award. An
award shall not be disbursed until the health professional
commences practice in New Mexico;

[(4)] (2) highest priority shall be given to
[participants in practices in which health profession vacancies
are difficult to fill, practices that require after hours call
at least every other night and practices that have heavy
obstetrical responsibilities;

(5) award amounts may be modified based upon
available funding or other special circumstances; and

(6) an award shall not exceed the total
medical education indebtedness of any participant] full-time
licensed physicians;

(3) designated health professional shortage
areas and a health professional's total eligible education debt
and characteristics of the practice; and

(4) the number of awards shall be limited to
the amount of funds in the health professional loan repayment
fund.

C. Award amounts shall be determined by the
department in accordance with the following:

(1) funds shall be disbursed in amounts that
result in the payment of the full obligation of all awards
provided by the committee in a given year;

(2) an award to a licensed physician shall be
in an amount equal to seventy-five thousand dollars ($75,000)
per year for four consecutive years, with the exception that:

(a) the total award amount shall not
exceed the licensed physician's total eligible education debt; (b) the award amount shall be prorated
based on a four-year award period and in proportion to the
licensed physician's total educational debt; and

(c) part-time employment as a licensed
physician shall be prorated based on the percentage of hours
worked relative to full-time employment; and

(3) an award to a health professional other
than a licensed physician shall:

(a) be calculated by multiplying forty
thousand dollars ($40,000) by the quotient of the number of
years of full-time post-secondary training required for initial
licensure in the field of practice of the health professional
divided by eight;

(b) not exceed the health professional's
total eligible education debt;

(c) be prorated based on a three-year
award period and in proportion to the health professional's
total educational debt; and

(d) be prorated based on the percentage
of hours relative to full-time employment if the health
professional maintains part-time employment in the health
professional's respective health profession.

D. The department shall encumber the full amount of
the award during the first year of a health professional's
award period at a published schedule as determined by the
department.

[C.] E. The following education debts are not
eligible for repayment pursuant to the Health Professional Loan
Repayment Act:

(1) amounts incurred as a result of
participation in state loan-for-service programs or other state
programs whose purpose states that service be provided in
exchange for financial assistance;

(2) scholarships that have a service component
or obligation;

(3) personal loans [from friends or
relatives]; and

(4) loans that exceed individual standard
school expense levels.

[D.] F. The loan repayment award shall be evidenced
by a contract between the health professional and the
department acting on behalf of the state. The contract shall
provide for the payment by the state of a stated sum to the
health professional's debtors and shall state the obligations
of the health professional under the program, including a
minimum [three-year] four-year period of service for licensed
physicians and three-year period of service for health
professionals other than licensed physicians, quarterly
reporting requirements and other policies established by the
department. The department may cancel the contract made
between the department and the health professional for any
reasonable cause deemed sufficient by the department.

[E.] G. Recipients shall serve a complete year in
order to receive credit for that year. The minimum credit for
a year shall be established by the department.

[F.] H. If a health professional does not comply
with the terms of the contract, the department shall assess [a
penalty of] up to [three times] the full amount of award

disbursed [plus eighteen] and may assess a fee of no more than
eighteen percent interest of the amount of the award disbursed,
unless the department finds acceptable extenuating
circumstances for why the health professional cannot serve or
comply with the terms of the contract. If the department does
not find acceptable extenuating circumstances for the health
professional's failure to comply with the contract, the
department shall require immediate repayment [plus the amount
of the penalty].

[G.] I. The department shall [adopt regulations]
promulgate rules to implement the provisions of this section
[the regulations] that may provide for the disbursement of
[loan repayment] awards to the lenders of health professionals
in annual or other periodic installments."

SECTION 6. Section 21-22D-7 NMSA 1978 (being Laws 1995,
Chapter 144, Section 22) is amended to read:

"21-22D-7. CONTRACTS--ENFORCEMENT.--The general form of
the contract required shall be prepared and approved by the
attorney general and signed by the health professional and the
designated representative of the [commission] department on
behalf of the state. The [commission] department is vested
with full and complete authority and power to sue in its own
name for any balance due the state from any student on any such
contract."

SECTION 7. Section 21-22D-8 NMSA 1978 (being Laws 1995,
Chapter 144, Section 23) is amended to read:

"21-22D-8. HEALTH PROFESSIONAL LOAN REPAYMENT FUND
CREATED--PURPOSE--METHOD OF PAYMENT.--

A. The "health professional loan repayment fund" is
created as a nonreverting fund in the state treasury. [All
money appropriated for the health professional loan repayment
program shall be credited to the fund, and all payments for
penalties or repayment of awards received by the commission
shall be credited to the fund or shall be deposited with the
commission's administrative agent. All payments for loan
repayment awards shall be made upon vouchers signed by the
designated representative of the commission and upon warrant
issued by the secretary of finance and administration.] The
fund consists of appropriations, distributions, gifts and
grants. The department shall administer the fund, and money in
the fund is appropriated to the department to provide awards
pursuant to the Health Professional Loan Repayment Act;
provided that:

(1) no less than fifty percent of the
available funds in the health professional loan repayment fund
as of the beginning of each fiscal year shall be encumbered for
licensed physicians who receive an award; and

(2) funds that are encumbered but unexpended
shall be used for licensed physician awards in the next fiscal
year.

B. Disbursements from the fund shall be made by
warrant of the secretary of finance and administration pursuant
to vouchers signed by the secretary of higher education or the
secretary's authorized representative."

SECTION 8. Section 21-22D-10 NMSA 1978 (being Laws 1995,
Chapter 144, Section 25) is amended to read:

"21-22D-10. REPORTS.--[The commission] By November 1 of
each year, the department shall make annual reports to the
governor and to the legislature [prior to each regular session]
of its activities, the [loan repayment awards] amount of each
award granted, [the names and addresses of loan repayment award
recipients, the names and locations of the practices of those
health professionals who are serving in a designated health
professional shortage area of the state pursuant to the Health
Professional Loan Repayment Act and the name of each loan
repayment award recipient who is not serving in a designated
health professional shortage area, the reason the person is not
serving and the amount owed and paid on the loan and loan
repayment award] the cumulative total award amount, the number
of awards made by profession type and the county and
municipality where each health professional that received an
award practices in the state."

SECTION 9. REPEAL.--Sections 21-22D-2 and 21-22D-9 NMSA
1978 (being Laws 1995, Chapter 144, Sections 17 and 24, as
amended) are repealed.

SECTION 10. APPROPRIATION.--Twenty-five million dollars
($25,000,000) is appropriated from the general fund to the
health professional loan repayment fund for expenditure in
fiscal year 2027 and subsequent fiscal years to make awards
pursuant to the Health Professional Loan Repayment Act. Any
unexpended balance remaining at the end of a fiscal year shall
not revert to the general fund.

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