On Friday, January 30, a bipartisan attempt to overhaul New Mexico’s medical malpractice laws cleared its first assigned NM Legislature committee, but only after a sweeping change was made to the bill over the sponsor’s opposition. House Bill 99 known as the Medical Malpractice Reform bill passed the House Health and Human Services Committee by a vote 7-3, but only after the committee passed an “unfriendly amendment” that eliminated caps on punitive damages for corporately owned hospitals. An “unfriendly amendment” is one that the bill’s sponsor does not support.
House Bill 99 would set caps on punitive damages in malpractice cases, pay for plaintiffs’ medical costs as they’re incurred and increase the standard of proof needed to award damages. The amendment excludes hospital systems and hospitals owned by out-of-state corporations from a proposed $6 million cap on punitive damages. A smaller $1 million cap would be put in place for independent doctors. The medical malpractice reform bill is co-sponsored by Rep. Christine Chandler (D-Los Alamos) and as originally introduced is backed by New Mexico Gov. Michelle Lujan Grisham.
Rep. Christine Chandler, D-Los Alamos, who crafted House Bill 99 and is sponsoring it along with two dozen other lawmakers, called the amendment to the bill “short-sighted.” Chandler 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. According to the New Mexico Hospital Association, the only hospitals covered by the cap would be hospitals in Taos, Grants, Gallup, Farmington and Las Cruces. Chandler told the Albuquerque Journal this after the hearing:
“I don’t think it strikes the right balance in the legislation we need. ”
Supporters of House Bill 99 argue that the bill is a key step in fixing the state’s health care worker shortage. Republicans and Democrats worked on the original bill in a unified effort. The unified effort was destroyed when Representative Liz Thomson (D-Albuquerque), who proposed the amendment, said she believed it was important not to cap punitive damages for hospitals owned by out-of-state corporations or private equity firms. Thomson said this:
“We want to tell these huge national corporations that they cannot cut corners on medical care and leave people damaged.”
Feliz Rael, President of the New Mexico Trial Lawyers Association, an organization that historically and consistently has opposed medical malpractice reform, said this:
“While the bill isn’t perfect, we are very pleased to see protection for patients that are harmed by multi-billion-dollar corporations.”
State Rep. Alan Martinez, R-Bernalillo, warned that the last-minute amendment was simply unfair because Republicans and Democrats had agreed to the original bill text and it was partially “gutted” by the amendment.
House Minority Whip Alan Martinez, R-Bernalillo, who voted against the committee amended bill, said this:
“It’s very hard for me to support the amended bill, because I think we gutted a good bill with that. … We were going to fix medical malpractice. Now we’re carving out certain people. … You have taken a good, negotiated bill and poisoned it with this amendment.”
Committee Democrats who voted to support the bill after the “unfriendly amendment” said they believed it would empower plaintiffs. Rep. Joanne Ferrary (D-Las Cruces) said the amendment would give “the right back to the jury to hold multi-billion dollar corporations accountable.”
Representative Chandler told reporters she believes the majority of physicians in the state work at the corporately owned hospitals that the amendment would impact. Although the amendment still extends protections to those practitioners, Chandler said she believes the lack of a cap for their employers could still affect whether doctors want to work there.
HB 99 approved as amended by the committee did 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.
During the January 30 hearing of the House Health and Human Services Committee, Chandler said the bill would be pushed forward regardless of the amendments and said this:
“I know many of us are concerned about the real and perceived health care shortage in the state. ”
After the committee hearing, Chandler was asked by the media if she thought the amendment threatened her bill’s future. She said this:
“Not clear. I have to assess. … We may keep talking about this for a while.”
Representative Chandler said that if HB 99 fails to get enacted, she would not be surprised if Lujan Grisham calls a special session later in the year to address malpractice.
House Bill 99 as amended will now be heard by the House Judiciary Committee which bill sponsor Rep. Christine Chandler chairs. The bill must pass the full House and Senate before the session ends Feb. 19.
DEAL ON PUNITIVE DAMAGES DIFFICULT
The state does have a cap on compensatory damages that cover actual losses such as medical bills and lost wages. However, New Mexico has no limit on punitive damages which are awarded to address reckless and willful misconduct. HB 99 bill supporters of say punitive damages have led to disproportionate awards of damages 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 says medical malpractice insurance premiums could drop by 3% if the measure is enacted.
Trial lawyers, hospital administrators and physician groups have taken part in closed-door negotiations organized by the Governor’s Office to try to strike a deal on changes to the medical malpractice laws. Those talks stalled due to disagreements over whether some of the largest hospital corporations in the state should get the same limits on punitive damages as independent physicians.
Links to quoted or relied upon news sources are here:
https://sourcenm.com/2026/01/30/new-mexico-medical-malpractice-bill-clears-its-first-hurdle/
COMMENTARY AND ANALYSIS
New Mexico’s medical malpractice laws have for decades been at the center of “tort reform” efforts to place caps on punitive damages and attorney’s fees in lawsuits filed in medical malpractice cases. Medical malpractice reform has emerged as hot-button issue during 2026 thirty day New Mexico Legislative session predominately because of a statewide health care provider shortage and rising hospital insurance costs.
Supporters of changing the state’s current medical malpractice laws 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.
Patient safety advocates argue that giving hospitals more protection under the state’s medical malpractice laws will undermine other necessary changes, such as improved hospital staffing levels.
Gov. Michelle Lujan Grisham has urged lawmakers to act on the issue before the session ends February 19. She also has said she will consider calling a Special Session if no bill on medical malpractice reform is approved by the 2026 Legislature.
It’s a damn shame that so much progress was made with the bipartisan attempt to overhaul New Mexico’s medical malpractice laws only to be gutted in committee. Such is the politics of New Mexico that plays out in Santa Fe.