LAS CRUCES – An emergency bill introduced in the last week of the 2023 legislative session may have curtailed the loss of doctors in New Mexico due to increasing claims caps in medical malpractice cases.
Senate Bill 523 changed wording of the Medical Malpractice Act to redefine what is an independent or outpatient medical practice versus hospital owned, and established claim caps accordingly. Doña Ana County doctors were involved in advocating for changes to the law and reacted to the passage of the emergency bill.
Why is there a problem with medical malpractice claims?
New Mexico’s Medical Malpractice Act was established to protect both doctors and patients in cases of negligence. New Mexico doctors are required to have malpractice insurance to practice in the state.
In 2021, the legislature passed a bill, House Bill 75, amending the Medical Malpractice Act to establish a cap on claim payouts at $750,000. The cap was to increase incrementally to $6 million by 2026. This cap was the same for independent and hospital-owned practices. These caps applied to both outpatient health care facilities not majority owned and majority-controlled by a hospital, as well as hospitals and outpatient facilities majority owned or controlled by hospitals.
Caps are the maximum damages doctors are liable for in malpractice cases, not including punitive damages or past and future medical care.
Doctors in Doña Ana County and throughout the state disagreed with the established law, particularly because it was passed in 2021 in the midst of the COVID-19 pandemic.
“During the pandemic, all of us were focused on, what we see in patients and dealing with that and so (House Bill 75) got passed very covertly and a lot of us didn’t notice or pay attention until it was brought to my attention by one of my former classmates from UNM,” said Cynthia Settles, a pediatrician at Full Bloom Pediatrics in Las Cruces.
What changed during the 2023 legislative session?
Senate Bill 296 was introduced at the beginning of the session to address the increasing claims caps. However, it stalled in the Senate Tax, Business and Transportation Committee fairly early during the session. Doctors and advocates continued to encourage lawmakers to reconsider the bill.
Sen. Peter Wirth (D-Santa Fe) and Sen. Gregory Baca (Bernalillo) joined Gov. Michelle Lujan Grisham in a press conference March 14 to announce compromises had been made and an emergency bill was to be introduced that final week of the session.
Senate Bill 523 redefined practices and established a cap of $1 million for independent practices not affiliated with hospitals.
Hospitals and affiliated practices will also cease to participate in the Patient’s Compensation Fund – a state fund created under the Medical Malpractice Act to ensure compensation for patients.
“All parties have come together and have reached an agreement,” Lujan Grisham said. “(The bill) confirms and assures that we protect patients by making sure that independent practices like the ambulatory surgical centers can in fact get insurance to protect the practice and the patients if there’s an issue.”
Lookman Lawal, heart specialist and chief medical officer at Southwestern Cardiac Arrhythmia Institute, said if changes had not been made to the medical malpractice laws in the state he would likely have closed his practices in New Mexico.
Lawal’s practice is based in El Paso but he opened offices in Las Cruces, Alamogordo and Deming to make it easier for patients to access his services. He specializes in electrophysiology and treating patients with heart rhythm problems. He said part of the reasoning for opening in New Mexico was to be closer to older patients and reduce the worry of insurance coverage for out-of-state practitioners.
“I was seriously considering leaving the state,” Lawal said. “I told my patients, you may have to start coming to see me in El Paso because … I don’t think I’ll be able to afford to pay the high premiums.”
He said many of his fellow independent doctors were faced with the same question – whether to leave the state. Lawal explained that not many malpractice insurance companies will cover such a high claim, and even if they will, the premiums are not affordable.
“Already we’re dealing with the low payments from the Medicaid and other insurance companies in New Mexico. We’re dealing with very high overhead costs,” he said. “So now to add very high premiums to all that, it’s just something that we cannot absorb.”
In general, Lawal said he believes the Medical Malpractice Act needs an overhaul to encourage more quality doctors to practice in the state, which will in turn protect patients and improve overall health.
Settles is originally from La Mesa and after several years practicing in other states, her family returned to her home state. She said her insurance premiums did increase, however not as much as for doctors doing higher risk procedures.
“The problem is the cost becomes prohibitive as a private physician to be able to pay that,” Settles said.
She mentioned that she is aware several doctors in the area were unable to manage the increasing costs and joined hospital systems.
“It just pushes that choice that patients have of having that private physician with everyone being bought up by hospitals and corporations,” she said.
Lawal said the recent bill is a step in the right direction, but there is still work to be done, particularly in advocating for patients to receive a larger percentage of the money awarded to them by the court in malpractice cases. He said trail lawyers currently are entitled to a large portion of the recovery which incentivizes raising the claim cap.
Settles explained that the core concern is patient care and patient access. New Mexico has an aging population of doctors and problems with recruiting younger doctors, Settles said. And aside from Albuquerque and Santa Fe, the entire state is an underserved area.
“New Mexico is a fairly litigious state because it’s a poor state and you have very few doctors who are dealing with volume and if there’s large volume we’re taking more patients and we get more complex patients by the time they come in. And so all of those things increase our liability,” Settles said. “It makes us high risk and target for these malpractice suits to come through.”
“I’m here because I’m from New Mexico. My family’s from here. I wanted my children to be raised in that culture. But, you know, it’s not favorable to doctors at this point and it’s not helping us to recruit doctors to the state,” she said.
Senate Bill 523 passed in the House by a vote of 40-2 and unanimously in the Senate. The bill is awaiting a signature from the governor.