Confusion clouds the dire need to fix the flawed ’21 malpractice act

House Bill 75 passed in 2021, while the eyes and ears of our citizens and doctors were overwhelmed with the devastation and uncertainty of COVID-19.

It was not doctors who let hospitals into the Patient Compensation Fund. Yet, it is doctors, independent doctors, who are paying for someone else’s mistake.

House Bill 88 aims to reverse the mistake made by the previous Superintendent of Insurance to lower the malpractice cap of independent providers and facilities.

I thought that, with the urgent need for physicians in this state, HB 88 would pass in the House. I was wrong.

It was very interesting listening in on the House committee. Below are a few points I’d like to shed light on:

A House member mentioned “there are hundreds of independent facilities” in this state and only a few (were at the hearing). The member seemed unconvinced that physicians, with their respective facilities, have a difficult time getting malpractice coverage, while others don’t.

Not all independent facilities do the same kind of procedures. Some procedures are covered more easily than others by malpractice companies. Independent facilities don’t just have a generalized blanket malpractice insurance. Each procedure has to be covered by malpractice. The more procedures there are, the higher the malpractice premium. The more complex procedures also have higher malpractice premium.

This is the hierarchy of health insurance reimbursement: independent clinics are paid the lowest, followed by urgent care, followed by emergency rooms. The hospitals are reimbursed the highest. Procedures that are done in outpatient settings are reimbursed lower than those done in hospitals. Having more outpatient facilities do procedures cuts down on the cost to patients.

The same House member seemed unconvinced that the change affected physician recruitment, and that increasing pay would compensate for the high malpractice insurance and would attract more physicians to this state.

The only way physicians would get higher pay is to have the health insurance companies increase their reimbursement rates. Medicare has decreased reimbursement rates, and health insurance companies, legally, can do the same.

Unless the House member would like to introduce a bill to mandate that the health insurance companies increase their reimbursement rate by 4% every year, doctors in this state are not going see higher pay. Other industries can adjust their prices according to inflation and cost of living — except the medical industry. Forty years ago, a primary care doctor needed just a 1,000 patient panel. Today, each physician needs a panel of 3,000 patients.

A lawyer from the other side stated The Doctors Company listed on its website that it is still covering malpractice after HB 75 passed. This lawyer is unconvinced that some facilities cannot get malpractice coverage. The Doctors Company is not covering certain facilities — please see the website. Malpractice companies are not covering the $6 million cap. It is the higher cap that outpatient facilities cannot find coverage for, not the lower one. The Patient Compensation Fund covers up to only $250,000.00.

Another House member asked why the malpractice companies were not at the hearing. I don’t know whether having the malpractice companies there would have made any difference. This bill is not about them. This bill is about independent providers. These providers do not have anyone backing them.

I am not picking on any single member of the House. But some of the comments made by them do not make any sense from a medical business perspective.

I am a primary care doctor in Albuquerque. I own a “mom and pop” clinic and am the only provider. I did my own billing for years. Reimbursement rates don’t go up. As a matter of fact, one company cut down on reimbursement. While I don’t have difficulty with getting malpractice coverage — the procedures I do are not complex and I get the lowest reimbursement — I understand bigger facilities are having issues with it. The problem they face is real, not made up.

Having outpatient and independent facilities pay the same malpractice cap amount as the hospitals is unfair, based on their respective reimbursements. While we cannot compare ourself to other states, it is important to point out states that have a large population of physicians have either tort reform or malpractice reform. HB 88 did not have many friends in the House; (here’s to) SB 296 making more friends in the Senate.