Court: N.M. malpractice law covers physician-formed businesses

Businesses formed by physicians are covered by a state law that caps the damages in medical malpractice that can be collected from healthcare providers, the New Mexico Supreme Court ruled last week. The court affirmed a May 2012 Court of Appeals decision which concluded that the state’s Medical Malpractice Act includes professional entities under which physicians practice and that “the Legislature intended professional medical organizations…to be qualified by the Act.”

The court reached its decision after reviewing the definition of “professional services” in the Professional Corporations Act and determined that the statute and the Medical Malpractice Act must be read together. Read together, these statutes established that the corporations and other organizations, although not licensed to practice medicine, meet the definition of “qualified healthcare providers” when the persons providing professional services through them are licensed. “Now that the Court has determined that these statues are to be read consistently, there should be no further need to amend the definition of ‘healthcare provider’ currently contained in the Medical Malpractice Act,” the New Mexico Medical Society concluded.