Medical malpractice bill advances after committee excludes most hospitals from punitive damages cap

SANTA FE — A bipartisan attempt to overhaul New Mexico's medical malpractice laws cleared its first assigned committee Friday, but only after a sweeping change was made to the bill over its sponsors' opposition.

After more than two hours of emotional debate and testimony, the House Health and Human Services Committee voted 7-3 to advance the legislation to its next assigned committee.

However, House Minority Whip Alan Martinez, R-Bernalillo, who voted against the bill, said the amendment to exclude hospital systems and hospitals owned by out-of-state corporations from a proposed $6 million cap on punitive damages had "poisoned" the bill. A smaller $1 million cap would be put in place for independent doctors.

"It's very hard for me to support the amended bill, because I think we gutted a good bill with that," Martinez said.

Rep. Christine Chandler, D-Los Alamos, who crafted the legislation, House Bill 99, that two dozen other lawmakers have signed onto, called the change to the bill "short-sighted." She also pointed out most of New Mexico's hospitals — including those run by Presbyterian Health Services — would not be covered by the proposed punitive damages cap.

In fact, the only hospitals covered by the cap would be hospitals in Taos, Grants, Gallup, Farmington and Las Cruces, according to the New Mexico Hospital Association.

"I don't think it strikes the right balance in the legislation we need," Chandler told the Journal after Friday's hearing.

But she said it was too soon to say whether she and other bill backers would seek to strip the amendment out of the legislation as it advances.

A simmering issue at Roundhouse

New Mexico's medical malpractice laws have emerged as a hot-button issue during this year's 30-day legislative session amid a statewide health care provider shortage and rising hospital insurance costs.

Backers of changing the state's current system have cited a recent legislative survey that found 65% of currently practicing physicians are considering leaving the state to practice elsewhere. Of those doctors, most cited the potential of stiff punitive damages stemming from medical malpractice cases as the reason. 

In addition, Gov. Michelle Lujan Grisham has urged lawmakers to act on the issue before the session ends Feb. 19, and said she would consider calling them back to Santa Fe for a special session later this year if no bills are approved. 

But patient safety advocates have argued that giving hospitals more protection under the state's medical malpractice laws could undermine other necessary changes, such as improved hospital staffing levels.

During a Friday news conference, several family members of individuals harmed by medical procedures spoke about the pain and suffering their loved ones endured.

"Patient safety and accountability go hand in hand," said Ahtza Chavez of New Mexico Native Vote, whose father, Everett Chavez, died in 2018 after seeking medical care in Albuquerque. "You cannot claim to care about improving health care while also making it harder for harmed patients to seek justice."

The news conference was held by New Mexico Safety Over Profit, a nonprofit group funded largely by trial lawyers that has advocated against changes to the state's medical malpractice laws.

Johana Bencomo, the group's executive director, said Friday the group had not taken a stance on the bill advancing at the Roundhouse, but described the adopted amendment as a "significant improvement."

That sentiment was echoed by Feliz Rael, the president of the New Mexico Trial Lawyers Association.

“While the bill isn’t perfect, we are very pleased to see protection for patients that are harmed by multibillion-dollar corporations,” Rael said.

Elusive agreement could cloud bill's outlook 

Trial lawyers, hospital administrators and physician groups have taken part in closed-door negotiations organized by the Governor's Office in recent weeks to try to strike a deal on changes to the medical malpractice laws. 

But those talks stalled this week due to disagreements over whether some of largest hospital corporations in the state should get the same limits on punitive damages as independent physicians.

During Friday's hearing of the House Health and Human Services Committee, Chandler said the bill would be pushed forward regardless of the outcome of those talks.

"I know many of us are concerned about the real and perceived health care shortage in the state," said Chandler, who also expressed frustration about politically-charged rhetoric by both sides of the debate.

Currently, New Mexico has no limit on punitive damages, which bill supporters say has led to huge damage awards against hospitals, attracted out-of-state malpractice attorneys to New Mexico and driven up the cost of malpractice insurance. A legislative analysis of the bill said medical malpractice insurance premiums could drop by 3% if the measure is enacted.

The state does have a current cap on compensatory damages that cover actual losses such as medical bills and lost wages. In contrast, punitive damages are awarded to address reckless and willful misconduct.

Meanwhile, the bill approved Friday does make several other changes in addition to the punitive damages cap. That includes clarifying how many medical malpractice claims can be filed for a single medical injury and extending hospitals' participation in a patient compensation fund through 2029.

After winning approval Friday, the bill now advances to the House Judiciary Committee.

Dan Boyd covers state government and politics for the Journal in Santa Fe. Follow him on X at @DanBoydNM or reach him via email at dboyd@abqjournal.com.