Is there a lawyer in the house?

There’s good and bad medicine for New Mexico in state lawmakers’ medical malpractice ‘reform’

It’s no secret New Mexico’s health care system faces significant challenges, just coming up for air after the flood of COVID-19 patients stressed intensive care units and threatened to overwhelm hospital staff. That was true pre-COVID-19, and it is true now.

An Albuquerque Journal report in 2019 found the state ranked 48th among 50 states for access to health care in a study that included the number of physicians per 100,000 population — a problem exacerbated by the fact we have the oldest doctor workforce in the nation, with many physicians eyeing retirement. When the pandemic hit, we learned the hard way we were near the bottom nationally in hospital and ICU beds per capita. Providers struggle with Medicaid reimbursement rates that don’t cover their costs — a big deal since we just became No. 1 nationally in Medicaid patients at 43% of the population.

So in light of these grim numbers, it might sound odd to say we are at a crossroads in New Mexico when it comes to health care policy. But that’s exactly where we are in the form of two pieces of legislation under consideration in Santa Fe.

One of them, Senate Bill 239, sponsored by Sen. Liz Stefanics, D-Santa Fe, and Sen. Gay Kernan, R-Hobbs, would make important changes in the state’s medical malpractice landscape by strengthening the state Patient Compensation Fund’s fiscal outlook. More providers would fall under the umbrella of the fund and its procedures and caps governing medical malpractice lawsuits, while boosting the cap by $150,000.

The other, House Bill 75, sponsored by Rep. Daymon Ely, D-Corrales, is a trial-lawyers’ bill that could push some providers already teetering on the ledge off into a fiscal abyss by kicking hospitals out of the fund. One plausible scenario of knocking over that domino: fewer health care providers in New Mexico and some hospitals in rural areas closing their doors, with others statewide shifting more resources to litigation and claims rather than new technology, staff and facilities to better serve patients.

Some background is helpful.

The Patient Compensation Fund has its roots in the medical malpractice premium crisis of the 1970s. Lawmakers realized that unless they provided some protection against runaway malpractice verdicts, doctors would flee the state. The current law caps economic damages at $600,000 along with unlimited future medical expenses — striking a balance between protecting providers and compensating patients. The measure by Stefanics and Kernan would boost the cap to $750,000, a reasonable amount that providers say isn’t out of line with limits in other states.

In a related, worrisome development, a state district judge in Albuquerque has ruled the long-standing cap is unconstitutional. That issue is pending before the state Supreme Court. If the lower court ruling is upheld, it will be devastating to health care in this state.

Even with the fund and the cap, other states for a variety of reasons are more litigation friendly to physicians, including neighboring Texas (which also has no state income tax), Colorado and Arizona. We have a tough time recruiting medical providers already. Let’s make it better, not worse.

SB 239 would bring more health care providers into the fund. As it stands now, it’s primarily doctors and hospitals. Nurse practitioners aren’t covered. Neither are nurse midwives. The only nurses covered are certified nurse anesthetists. All that puts a litigation target on the backs of front-line nurses, and it’s why the New Mexico Nurses Association and New Mexico Medical Society support SB 239 and oppose HB 75.

Dr. Dion Gallant, president of the medical society, said expanding the definition of qualified health providers under the act makes sense. There is a need to keep patients at the center, he said. Otherwise, we will decimate access critical to health care.

We don’t just need facilities. We need more providers of all kinds, from family practice professionals to nurses to specialists in areas including neurology, cardiology and more. They are all part of a health care ecosystem. Linda Siegle, representing New Mexico nurse practitioners, nurses and midwives, pointed out how we became painfully aware during the COVID-19 crush that we could stand up more hospital beds than providers to staff them. And she said we now pay thousands of “traveling” nurses from out of state helping to fill the gaps here.

Troy Clark, chief executive officer of the New Mexico Hospital Association, points out one national group already lists seven or eight hospitals here as at risk for closure. HB 75 exacerbates that risk, while an overhaul of the existing fund as proposed by Stefanics and Kernan would improve viability and strengthen the system.

Nearly two dozen hospitals around the state, including Presbyterian, Lovelace and Christus St. Vincent — have opted into the fund. Others in the University of New Mexico system are protected by the state Tort Claims Act — which has an even lower cap on claims. Only a handful of eligible hospitals in New Mexico have chosen not to participate in the Patient Compensation Fund.

No one disputes the fund actuarials — the current deficit is about $56 million — need to be addressed to reflect the more recent addition of hospitals, which began in 2009 with most joining in 2016 or later. Expanding the pool of providers who are covered and adjusting amounts paid into the fund are the best way to do it. The state’s new Superintendent of Insurance, Russell Toal, has developed a proposal to make revisions to the fund, and his work is reflected in Stefanics’ and Kernan’s bill.

As for the road HB 75 would take us down? It’s a bill with no upside for hospitals, doctors, nurses or the patients they take care of — unless they have a huge malpractice claim. It’s bad medicine that will have a major impact for years to come.

On the other path, doctors, nurses, nurse practitioners, midwives and health care workers across the board would benefit from the overhaul in SB 239 — giving them a reason to stay here. Or come here. That’s why the major medical associations all support it. And that translates into better access and care for New Mexicans. Lawmakers and the governor have a chance to significantly improve health care in New Mexico with SB 239. They should do it. Stat.