On April 8, 2025, Gov. Lujan Grisham signed SB 120 into law.
The new law aims to make permanent prohibitions on cost-sharing for behavioral health services and to provide exemptions for certain types of plans.
The law prohibits group health insurance policies, healthcare plans, or certificates of insurance issued, delivered, issued for delivery, or renewed in the state that offer coverage for behavioral health services from imposing cost-sharing on those services in-network. Behavioral health services are defined broadly as “professional and ancillary services for the treatment, habilitation, prevention and identification of mental illnesses, substance abuse disorders and trauma spectrum disorders, including inpatient, detoxification, residential treatment and partial hospitalization, intensive outpatient therapy, outpatient therapy and all medications, including brand-name pharmacy drugs when generics are unavailable.”
The effective date of the law’s provisions is January 1, 2026. There are exemptions for certain types of plans, such as those that are considered excepted benefits, catastrophic plans, and, importantly, high-deductible health plans with HSAs until an insured's deductible has been met (unless otherwise permitted by federal law).
Employers that sponsor fully insured plans should be aware of this update and should contact their carriers for further information.