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F I S C A L I M P A C T R E P O R T

SPONSOR Picraux

ORIGINAL DATE

LAST UPDATED

01/28/08

HM 9

SHORT TITLE Continue Obstetric Health Care Task Force

SB

ANALYST Hanika-Ortiz

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)

FY08

FY09

FY10 3 Year

Total Cost

Recurring

or Non-Rec

Fund

Affected

Total

$.01

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Health Policy Commission (HPC)

SUMMARY

Synopsis of Bill

House Memorial 9 requests the New Mexico HPC continue the work of its task force on obstetric

health care practitioner liability insurance to find solutions to the continuing crisis in obstetric

health care.

The Memorial includes all health care practitioners that practice in obstetrics.

The Memorial further recognizes that there is a continuing crisis in obstetric health care access

due to escalating malpractice premiums. The escalating costs threaten access to childbirth

services, especially in underserved and rural areas where certified nurse-midwives provide many

services. The Memorial further confirms that one-third of all vaginal births in New Mexico are

delivered by certified nurse-midwives.

The Memorial proposes that the task force submit its findings and recommendations by October

2008 to the Legislative Health and Human Services Committee, the Legislative Finance

Committee, and the Office of the Governor.

FISCAL IMPLICATIONS

There will be costs to State agencies and others (as requested) to provide staff time to participate

on the task force.

House Memorial 9 – Page

2

SIGNIFICANT ISSUES

In October of 2007, the HPC published the Childbirth Injury and Obstetrical Liability Insurance

report, which identified the issues regarding obstetric health care access due to the escalating

malpractice premiums. The information collected by the task force indicates that this is an issue

throughout the entire State, especially for rural areas where there are fewer care options.

The following was provided by HPC:

Findings on Medical Malpractice Insurance

The task force has found the following regarding the cost and availability of professional liability

coverage for providers of obstetrical services in New Mexico:

•

Problems with the cost and availability of medical malpractice insurance are experienced

primarily by those certified nurse midwives (CNM) who do births and are not employees

of large systems.

•

Obstetrician practices that employ CNMs confirmed to commission study members that

the cost of CNM malpractice insurance to the practice has increased substantially and

may threaten the practices ability to maintain them as employees.

•

Professional liability insurance is unavailable to licensed midwives who provided care for

most of the 1% of New Mexico births that occur in the home. Those providers who

perform home births do so at their own legal and financial risk.

•

For licensed midwives who work in birthing centers, professional liability insurance is

available from only one company, whose rates are unregulated, and at a cost that is

rapidly increasing and threatens the ability of licensed midwives to stay in business.

•

For CNMs in private practice or in small clinics, professional liability insurance is

available primarily from one company, whose rates are unregulated, and at a cost that is

rapidly increasing and threatens the continued economic viability of CNMs.

•

Professional liability insurance remains available in New Mexico, at a substantial though

relatively stable cost, for most independent Obstetrician/Gynecologists and family

Doctors who perform deliveries.

•

The proportion of malpractice insurance premiums written by carriers on surplus lines

increased from 15.0% in 2002 to 36.0% in 2006 for providers other than physicians and

surgeons in New Mexico. These carriers are not subject to regulation under New Mexico

insurance laws.

•

Data is not available to the commission task force concerning the extent to which cost of

obstetrical malpractice insurance, settlements and suits has influenced business costs for

large governmental and corporate organizations.

PERFORMANCE IMPLICATIONS

The HPC will provide staff for the Obstetric Health Care Practitioner Liability Insurance Task

Force. The HPC staff will also provide resources and assist in the development and writing of

the Task Force’s findings and recommendations.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Duplicates SM 1

House Memorial 9 – Page

3

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

The HPC believes it may be unable to continue to pursue solutions to the continuing crisis in

obstetric health care due to liability insurance.

POSSIBLE QUESTIONS

Who else sits on the task force other than HPC staff members.

AHO/bb