Myth vs. Fact

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Public debate around medical malpractice in New Mexico is often driven by headlines, assumptions, and incomplete data.

This page breaks down the most common myths surrounding physician shortages, hospital liability, and the malpractice insurance system and contrasts them with verified facts from independent research, state agencies, and national experts. By grounding the conversation in evidence and real-world impacts, this section explains how New Mexico’s liability environment affects patients’ access to care, the stability of hospitals and clinics, and the ability to recruit and retain physicians across the state.

Myth 1: New Mexico has plenty of doctors — more per capita than neighboring states — so physician shortages aren’t real.

Fact:

Licensing numbers do not reflect how many physicians are actually available to treat New Mexico patients.

New Mexico’s license rolls include physicians who are retired, not practicing clinically, working remotely for out-of-state telemedicine companies, or not accepting new patients.

When we look at actual access, not licenses:

New Mexico has far more federally designated shortage areas than Texas, Arizona, Colorado, or Utah.
Many specialties have multi-month wait times, forcing patients to travel out of state.
The Legislature is funding a data project with New Mexico Tech to clean licensing records and accurately count active clinicians.

New Mexicans feel the shortage because it is real — and measurable.

Sources:

Health Resources & Services Administration. (2024). Health Professional Shortage Areas (HPSA) data. https://data.hrsa.gov
New Mexico Legislative Finance Committee. (2023). Health Care Access Briefing.
University of New Mexico. (2024). Specialty access reports.

New Mexico Tech & NM Department of Health. (2024). Healthcare workforce licensing data modernization project.

Myth 2: Hospitals shouldn’t be included in the Medical Malpractice Act — the law should apply to doctors only.

Fact:

Modern medicine is delivered through integrated hospital systems, and most physicians work inside them.

A significant majority of New Mexico physicians are hospital-employed or hospital-based (higher than national trends).
Nationally, only 47% of physicians remain in private practice (AMA).
When doctors become hospital employees, hospitals become legally responsible for their care.

If hospitals were removed from the Act:

Their liability exposure would become unlimited
Insurance costs would spike
High-risk specialties — such as OB, trauma, surgery, and ICU — could become unsustainable
Many New Mexico hospitals, especially rural ones, could not obtain affordable coverage

Including hospitals protects patient access, not corporate interests.

Source:

American Medical Association. (2022). Physician Practice Benchmark Survey: Private Practice Edition. AMA Research.
New Mexico Legislative Health & Human Services Committee. (2023–2024). Testimony on provider employment trends.
New Mexico Courts, Corrections & Justice Committee. (2023). Hearing on malpractice and hospital liability framework.

Myth 3: Malpractice reform is driven by corporate hospitals looking to avoid accountability.

Fact:

The biggest driver of recent reform efforts is market instability, not corporate preference.

Independent actuaries (WTW/MPLA) show:

New Mexico’s five-year average loss ratio is 175% (insurers pay $1.75 for every $1.00 collected).
The U.S. average is ~75%.
New Mexico has 50% more paid malpractice claims per capita than neighboring states.
We have 3× more claims per physician than Texas and Arizona.

A liability environment this unstable hurts patients because it drives:

Higher insurance premiums
Loss of medical specialists
Closure or reduction of essential hospital service lines
Fewer insurers willing to operate in the state

This is a systemic issue — not a corporate preference.

Sources:

WTW & Medical Professional Liability Association. (2025). New Mexico MPL Overview & National Analysis. MPLA Summit Presentation.
National Practitioner Data Bank. (2024). State-level medical malpractice claim trends. HRSA.
Medical Liability Monitor. (2024). Annual Rate Survey.

Myth 4: New Mexico has a healthy malpractice insurance market.

Fact:

New Mexico’s market is widely recognized as distressed.

Only a very small number of insurers still write malpractice policies in our state.
Several carriers have exited in recent years due to unpredictable risk and high verdict severity.
Fewer insurers mean higher premiums for doctors and hospitals — which directly impacts service availability.

When the insurance market contracts, patients feel the consequences first.

Sources:

WTW & MPLA. (2025). Loss Ratio and Market Participation Analysis.
Office of the Superintendent of Insurance (NM). (2023–2024). Medical Professional Liability Market Hearings.

New Mexico Legislative Finance Committee. (2024). Malpractice Market Stability Brief.

Myth 5: Expanding medical school enrollment will solve the physician shortage.

Fact:

Training more physicians is important, but retention is the real challenge.

According to the UNM School of Medicine Location Report (2024):

Only ~52% of physicians who complete both medical school and residency at UNM stay in New Mexico.

National data (AAMC) shows:

Only 55–57% of physicians remain in the state where they trained.

Why they leave:

Liability concerns
High premiums
Burnout
Unstable practice conditions
Better support/compensation in neighboring states

We cannot recruit or retain physicians without addressing the liability environment that drives many of them out.

Sources:

University of New Mexico School of Medicine. (2024). Location Report: Practice Outcomes of UNM-Trained Physicians. UNM HSC.
Association of American Medical Colleges. (2022). Physician Retention in Residency State Report. AAMC Research.
New Mexico Legislative Finance Committee. (2023). Health Care Workforce Pipeline Report.

Myth 6: Malpractice payouts primarily go to injured patients.

Fact:

New Mexico’s high claim frequency and severity mean a growing share of dollars is going to:

Litigation costs
Defense expenses
Insurance losses

This raises premiums for doctors and hospitals and contributes to service reductions — especially in rural communities. Malpractice compensation is important, but excessive volatility harms patient access.

Sources:

Mello, M. M., et al. (2010). Medical malpractice costs and consequences. Health Affairs.
Jena, A. B., et al. (2011). Malpractice liability and health care system costs. New England Journal of Medicine.
WTW/MPLA. (2025). Claim severity and frequency analysis.

Myth 7: The malpractice system is working fine — the problem is just corporate mismanagement.

Fact:

If the system were functioning well, we would not see:

Persistent hospital and clinic closures
Specialty care shortages
Multi-month wait times
A shrinking insurer pool
Medical service lines being discontinued
Rising out-of-state patient migration for basic care

Liability instability is one of several structural issues driving the broader crisis — and it must be addressed alongside workforce development and reimbursement reform.

Sources:

WTW/MPLA. (2025). New Mexico Market Overview.
New Mexico Hospital Association. (2023–2024). Testimony on service reductions and liability pressures.
New Mexico Office of the Superintendent of Insurance. (2023–2024). Carrier participation data.
HRSA. (2024). Health Professional Shortage Area Designations.