On March 6, 2026, New Mexico Governor Michelle Lujan Grisham signed into law medical malpractice reform bill HB99, which she said “will help reduce the cost of medical malpractice insurance and attract more physicians to New Mexico.” The bill creates tiered caps on punitive damages — $1 million for independent providers, $6 million for locally owned hospitals and $15 million for large systems — and raises the evidentiary standard to from a preponderance of evidence to “clear and convincing,” requiring judicial review before punitive damage claims can proceed. The bill passed the House 66-3 and the Senate 40-2. The new law takes effect on May 20, 2026.
The new law provides, in part:
A. Except for punitive damages and past and future medical care and related benefits, the aggregate dollar amount recoverable by all persons for or arising from any injury or death to a patient as a result of malpractice shall not exceed six hundred thousand dollars ($600,000) per occurrence for malpractice claims brought against health care providers if the injury or death occurred prior to January 1, 2022. In jury cases, the jury shall not be given any instructions dealing with this limitation.
B. Except for punitive damages and past and future medical care and related benefits, the aggregate dollar amount recoverable by all persons for or arising from any injury or death to a patient as a result of malpractice shall not exceed seven hundred fifty thousand dollars ($750,000) per occurrence for malpractice claims against independent providers; provided that, beginning January 1, 2023, the per occurrence limit on recovery shall be adjusted annually by the consumer price index for all urban consumers.
C. The aggregate dollar amount recoverable by all persons for or arising from any injury or death to a patient as a result of malpractice, except for punitive damages and past and future medical care and related benefits, shall not
exceed seven hundred fifty thousand dollars ($750,000) for claims brought against an independent outpatient health care facility; for an injury or death that occurred in calendar years 2022 and 2023.
D. In calendar year 2024 and subsequent years, the aggregate dollar amount recoverable by all persons for or arising from an injury or death to a patient as a result of malpractice, except for punitive damages and past and future
medical care and related benefits, shall not exceed the following amounts for claims brought against an independent
outpatient health care facility:
(1) for an injury or death that occurred in calendar year 2024, one million dollars ($1,000,000) per occurrence; and
(2) for an injury or death that occurred in calendar year 2025 and thereafter, the amount provided in Paragraph (1) of this subsection, adjusted annually by the prior three-year average consumer price index for all urban consumers, per occurrence.
E. In calendar year 2022 and subsequent calendar years, the aggregate dollar amount recoverable by all persons
for or arising from any injury or death to a patient as a result of malpractice, except for punitive damages and past and future medical care and related benefits, shall not exceed the following amounts for claims brought against a hospital or a hospital-controlled outpatient health care facility:
(1) for an injury or death that occurred in calendar year 2022, four million dollars ($4,000,000) per occurrence;
(2) for an injury or death that occurred in calendar year 2023, four million five hundred thousand dollars ($4,500,000) per occurrence;
(3) for an injury or death that occurred in calendar year 2024, five million dollars ($5,000,000) per occurrence;
(4) for an injury or death that occurred in calendar year 2025, five million five hundred thousand dollars ($5,500,000) per occurrence;
(5) for an injury or death that occurred in calendar year 2026, six million dollars ($6,000,000) per occurrence; and
(6) for an injury or death that occurred in calendar year 2027 and each calendar year thereafter, the amount provided in Paragraph (5) of this subsection, adjusted annually by the consumer price index for all urban consumers, per occurrence.
Punitive Damages
A. Punitive damages may only be awarded in a malpractice claim if the prevailing party provides clear and convincing evidence demonstrating that the acts of the health care provider were malicious, willful, wanton, reckless, fraudulent or in bad faith.
B. A judgment of punitive damages against any of the following persons shall not be in an amount greater than the applicable limitation on monetary damages provided in Section 41-5-6 NMSA 1978.
The new law establishes a multi-tiered cap on punitive damages in medical malpractice cases that could increase in future years due to inflation. The initial cap is about $1 million for independent physicians and clinics, $6 million for locally owned hospitals and $15 million for larger, corporate-owned hospitals. The higher cap would apply to more than 30 hospitals statewide, including five Presbyterian Healthcare Services hospitals and five Lovelace Health System hospitals, and could also apply to the new Valencia County Hospital, a $61 million facility that is scheduled to open this fall and will be jointly operated by Lovelace and Community Hospital Corporation.
If you or a loved one may have been injured as a result of medical negligence in New Mexico, you should promptly find a New Mexico medical malpractice attorney who may investigate your medical malpractice claim for you and represent you or your loved one in a medical malpractice case, if appropriate.
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