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+++ version:(document, no version)
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-HOUSE BILL 241
+Fiscal impact reports (FIRs) are prepared by the Le gislative Finance Committee (LFC) for standing finance
+committees of the Legislature. LFC does not assume responsibility for th e accuracy of these reports if they
+are used for other purposes.
 
-57th legislature - STATE OF NEW MEXICO - second session, 2026
+F I S C A L    I M P A C T    R E P O R T
 
-INTRODUCED BY
+BILL NUMBER: House Bill 241
+SHORT TITLE: Medical Malpractice Court Notices
+SPONSOR: Lujan/Herndon/Szczepanski
+LAST
+UPDATE:
+ ORIGINAL
+DATE:
 
-Tara L. Lujan and Pamelya Herndon and Reena Szczepanski
+02/03/26
 
-AN ACT
+ANALYST: Rommel
 
-RELATING TO PHYSICIANS; REQUIRING COURTS TO NOTIFY THE NEW
-MEXICO MEDICAL BOARD WHEN PHYSICIANS ARE NAMED AS DEFENDANTS IN
-MEDICAL MALPRACTICE CASES; EXTENDING THE PERIOD IN WHICH THE
-NEW MEXICO MEDICAL BOARD MAY SUMMARILY SUSPEND LICENSEES;
-REQUIRING THE NEW MEXICO MEDICAL BOARD TO POST CERTAIN
-INFORMATION RELATING TO MEDICAL MALPRACTICE CLAIMS ON THE
-BOARD'S WEBSITE.
+ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT*
+(dollars in thousands)
+Agency/Program FY26 FY27 FY28 3 Year
+Total Cost
+Recurring or
+Nonrecurring
+Fund
+Affected
+NMMB No fiscal impact $133.1 $135.2 $268.3 Recurring Other state
+funds
+AOC No fiscal impact Indeterminate
+but minimal
+Indeterminate
+but minimal  Recurring General Fund
+Parentheses ( ) indicate expenditure decreases.
+*Amounts reflect most recent analysis of this legislation.
 
-BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
+Relates to House Bill 99
 
-     SECTION 1.  Section 61-6-15.1 NMSA 1978 (being Laws 2008,
-Chapter 74, Section 1) is amended to read:
+Sources of Information
 
-     "61-6-15.1.  SUMMARY SUSPENSION OR RESTRICTION OF
-LICENSE.--
+LFC Files
 
-          A.  The board may summarily suspend or restrict a
-license issued by the board without a hearing, simultaneously
-with or at any time after the initiation of proceedings for a
-hearing provided under the Uniform Licensing Act, if the board
-finds that evidence in its possession indicates that the
-licensee:
+Agency or Agencies Providing Analysis
 
-                (1)  poses a clear and immediate danger to the
-public health and safety if the licensee continues to practice;
+New Mexico Medical Board
+Office of the Superintendent of Insurance
+Administrative Office of the Courts
 
-                (2)  has been adjudged mentally incompetent by
-a final order or adjudication by a court of competent
-jurisdiction; or
+Agency or Agencies That Were Asked for Analysis but did not Respond
+New Mexico Attorney General’s Office
 
-                (3)  has pled guilty to or been found guilty of
-any offense related to the practice of medicine or for any
-violent criminal offense in this state or a substantially
-equivalent criminal offense in another jurisdiction.
+SUMMARY
 
-          B.  A licensee is not required to comply with a
-summary action until service has been made or the licensee has
-actual knowledge of the order, whichever occurs first.
+Synopsis of Choose an item.
 
-          C.  A person whose license is suspended or
-restricted under this section is entitled to a hearing by the
-board pursuant to the Uniform Licensing Act within [fifteen]
-thirty days from the date the licensee requests a hearing."
+House Bill 241 (HB241) amends the Medical Practice Act, Sec tion 66-6-1 NMSA 1978 et. seq.
+as follows:
 
-     SECTION 2.  Section 61-6-16 NMSA 1978 (being Laws 1989,
-Chapter 269, Section 12, as amended) is amended to read:
+1) Section 61-6-15.1(C) NMSA 1978 (governing summary  suspension or restriction of license):
+provides that a person whose license is suspende d or restricted under this section is entitled
+to a hearing by the New Mexico Medical Board (hereinafter “board”) pursuant to the
+House Bill 241 – Page 2
 
-     "61-6-16.  REPORTING OF MALPRACTICE CLAIMS, SETTLEMENTS
-AND JUDGMENTS, PROFESSIONAL REVIEW ACTIONS AND ACCEPTANCE OF
-SURRENDERED LICENSE--IMMUNITY FROM CIVIL DAMAGES--PENALTY.--
+Uniform Licensing Act within 30 days, rather than 15, from the date the licensee requests a
+hearing.
 
-          A.  When a malpractice claim is filed in a court of
-New Mexico, the court shall notify the board of any licensees
-named as defendants in the lawsuit.  The court shall notify the
-board if a claim against a licensee is dismissed, or if a claim
-is amended to no longer include a licensee as a defendant.
+2) Section 61-6-16 NMSA 1978 (governing reporti ng of malpractice cla ims, settlements and
+judgments, professional review actions and acceptance of su rrendered license, immunity
+from civil damages and penalties): requires, when  a malpractice claim is filed in a court of
+New Mexico, the court to notify the board of any licensees named as defendants in the
+lawsuit. Under HB241, the court is required to notify the board if a claim against a licensee is
+dismissed, or if a claim is amended to no l onger include a licensee as a defendant. The bill
+further requires a malpractice clam that results in at least $1 million in payments to be
+reviewed by the board. Subsect ion D requires the board to maintain a database of all
+notification reports made to the board pursuant to this section and specifies what the database
+is to display, including all payments made by or  on behalf of a licensee as a direct result of
+the licensee’s care and any disciplinary actions taken against the licensee.
 
-          [A.] B.  All entities that make payments under a
-policy of insurance, self-insurance or otherwise in settlement
-or satisfaction of a judgment in a medical malpractice action
-or claim, hospitals, health care entities and professional
-review bodies shall report to the board all payments relating
-to malpractice actions or claims arising in New Mexico that
-involve a licensee and that are paid as a direct result of the
-licensee's care, all appropriate professional review actions of
-licensees and the acceptance or surrender of clinical
-privileges by a licensee while under investigation or in lieu
-of an investigation.  For the purposes of this section, the
-meaning of these terms shall be as contained in Section 431 of
-the federal Health Care Quality Improvement Act of 1986, 42
-USCA Section 11151.
+This bill does not contain an effective date and, as  a result, would go into effect 90 days after the
+Legislature adjourns, which is May 20, 2026.
 
-          C.  A malpractice claim that results in at least one
-million dollars ($1,000,000) in payments shall be reviewed by
-the board.
+FISCAL IMPLICATIONS
 
-          D.  The board shall maintain a database of all
-notification reports made to the board pursuant to this
-section.  The database shall be posted on the board's website
-and shall display all active malpractice claims against a
-licensee, all payments made by or on behalf of a licensee as a
-direct result of the licensee's care and any disciplinary
-actions taken against the licensee.
+The New Mexico Medical Board (NMMB) would re quire additional legal staffing to comply
+with the legislation. The board may experience a dditional costs associated with administrating
+the provisions of HB241. The board has noted in creased legal services costs pursuant to its
+statutory duties in recent fiscal years.  For FY27, the board requested $100 thousand additional
+budget adjustment auth ority to address increased costs of  contractual legal services. This
+authority is included in the HAFC substitute for House Bill 2, the General Appropriation Act.
 
-          [B.] E.  The hospitals required to report under this
-section, health care entities or professional review bodies
-that provide such information in good faith shall not be
-subject to suit for civil damages as a result of providing the
-information.
+NMMB further notes:
 
-          [C.] F.  A hospital, health care entity or
-professional review body failing to comply with the reporting
-requirements provided in this section shall be subject to civil
-penalty not to exceed ten thousand dollars ($10,000)."
+Implementation would require si gnificant increase in [staffi ng], including professional
+staff (i.e., attorneys) to analyze notifications  from courts, conduct claim reviews, manage
+data accuracy, respond to inquiries, and a ddress disputes. New positions may include
+attorneys, investigators, and administrative s upport. Specialty-specific clinical reviewers
+and professionals may be required for comple x cases, increasing personnel or contractual
+costs.
 
-- 4 -
+AOC notes that additional fisc al impact on the judiciary woul d be related to the court’s
+notification to the New Mexico Medical Board, which should be minor. New laws, amendments
+to existing laws and new hearings have the pote ntial to increase caseloads in the courts, thus
+requiring additional resources to handle the increase.
+
+SIGNIFICANT ISSUES
+
+OSI notes that Section 2 obligates  the board to review any malpr actice claim that results in at
+least $1 million in payments. Most settlement agreements contain a c onfidentiality provision
+which prohibits the parties from disclosing the financial terms of the settlement. This practice
+could frustrate the effectiveness of the proposed legislation.
+
+House Bill 241 – Page 3
+
+The proposed legislation would br ing the NMMB in line with other states’ medical licensing
+laws, as well as the practices encouraged by th e Federation of State Me dical Boards, to publish
+on individual licensees’ pubic-fa cing profiles including each licensee’s exposure to medical
+malpractice claims.
+
+NMMB further notes:
+
+The New Mexico Medical Malpractice Act, Section 41-5-27, NMSA 1978, already
+requires reporting of “judgments” arising under that Act. At this time, the NMMB is not
+receiving reports from the courts as appear to  be required by this statute. For that reason,
+the NMMB recently sent a lett er to all New Mexico Distri ct Court Clerk’s Offices and
+the Administrative Office of the Courts reques ting that New Mexico state courts comply
+with the requirements of this statute.
+
+ADMINISTRATIVE IMPLICATIONS
+
+NMMB notes the following:
+
+Under the proposed legislation, the New Mexi co Medical Board would be required to
+promulgate and amend rules in order to  incorporate the changes made by HB241.
+Automatic review of qualifying claims may significantly increase the Medical Board’s
+workload. Without additional staffing, fundin g, or access to specialt y-specific clinical
+expertise, the Board ma y experience delays or backlogs . This could reduce the Board’s
+ability to prioritize complaints involving ongoing or systemic risks to patient safety.
+
+HB241 requires the Medical Board to implement  and maintain a database of malpractice
+claim notifications and outcomes. This raises  concerns regarding data standardization,
+verification, and accuracy, particularly where information is reported by multiple entities,
+including insurers, ho spitals, and licensees. The proposal does not establish procedures
+for correcting errors, updati ng case status, or removing di smissed claims, nor does it
+identify mechanisms for resolving disputed information.
+
+CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP
+
+Relates to House Bill 99, which proposes several changes to the Medical Malpractice Act.
+
+HLR/cf /ct