Fred Nathan, executive director of Think New Mexico, said that the state's high medical malpractice premiums—approximately double those of neighboring states—along with low Medicaid rates, are prompting health workers to leave. He made these comments on a podcast.
"New Mexico's medical malpractice premiums are about double our neighboring states. It should be the lowest," said Nathan. "That's because our system that we've built up over time is so unbalanced in favor of trial lawyers at the expense of health care providers and patients. So that's the primary reason and I hear this everywhere. Second is our Medicaid reimbursement rates despite the best efforts by our legislature to raise them are very low. And doctors and other health care providers will tell you that when they treat Medicaid patients, which make up about 42% of our patient population, they're losing money on nearly every procedure."
According to Think New Mexico's two-year healthcare workforce study, the state faces a "looming healthcare crisis," with severe shortages of doctors, nurses, dentists, and emergency medical technicians (EMTs), particularly in rural areas. The report indicates that New Mexico has already lost a significant portion of its primary care physicians since 2017 and projects thousands more provider vacancies by 2035, potentially undermining access to basic services. Nathan attributes this exodus directly to policy failures, arguing that lawsuit-driven malpractice costs and chronically weak Medicaid reimbursement make it financially unsustainable for clinicians to practice in the state.
Multiple analyses illustrate how far out of line New Mexico’s malpractice environment has become. The Legislative Finance Committee reports a base annual premium of about $43,020 for a standard physician liability policy in New Mexico, compared with roughly $22,000–$28,000 for the same coverage in nearby states—about double the regional norm. Think New Mexico’s action materials similarly note that malpractice premiums here are about twice as high as in surrounding states and continue to rise. This burden discourages new doctors from coming and pushes existing providers to relocate to Arizona, Texas, Colorado, or Utah where coverage is far cheaper.
Nathan also highlights Medicaid payment as a major stress point. Legislative briefings show that approximately 42% of New Mexico’s population is covered by Medicaid, significantly above the national average. This means a large share of patients are reimbursed at Medicaid rates. National research from KFF finds that low Medicaid fees are closely associated with fewer physicians participating in the program, limiting access for low-income patients. Nathan argues that when providers say they "lose money on nearly every procedure" for Medicaid patients, they describe exactly this dynamic: an underpaid payer dominating the market and eroding the financial viability of practices already squeezed by high malpractice premiums.
Fred Nathan Jr., founder and executive director of Think New Mexico—a nonpartisan think tank he launched in 1999—has spent decades driving policy wins on issues like full-day kindergarten and tax reform. Before founding Think New Mexico, he served as Special Counsel to Attorney General Tom Udall from 1991–1998.
