Is New Mexico’s Compensatory Damage Cap the Next to Fall?

Arguments in favor of and against New Mexico’s medical malpractice compensatory damage cap were made last month, and now the question as to whether it is constitutional rests in the hands of five justices on the state’s Supreme Court. The compensatory cap limits economic and noneconomic damages, but not medical costs or punitive damages, to $600,000.

Enacted in 1976, the New Mexico Medical Malpractice Act defined the standard of care, established a state-sponsored patient compensation fund, implemented statute of limitation guidelines, mandated the screening of all alleged cases of medical malpractice and capped the amount of recoverable damages in medical liability trials. In 2018, District Judge Victor Lopez determined that the compensatory cap improperly interfered with a plaintiff’s constitutional right to a trial by jury.

The underlying case, Siebert v. Okung, alleges Rebecca Okun, MD, an obstetrician/ gynecologist and employee of Women’s Specialists of New Mexico, performed a hysteroscopy on Susan Siebert. The procedure created a hole in Siebert’s uterus and intestine. Okun failed to notice these holes and sent Siebert home after the procedure.

Siebert became infected because of the perforations, requiring numerous surgeries, followed by extensive in-patient hospital and rehabilitation center care. She spent months on a ventilator and a feeding tube. She lost her job and suffered permanent brain damage.

Siebert sued Okun and Women’s Specialists of New Mexico in District Court, where a jury found for Siebert and against the defendants in the amount of $2.6 million.

Following entry of judgment, the defendants moved for a reduction in the judgment based on the language of the New Mexico Medical Malpractice Act, which provides that,  except for medical care and related benefits, medical malpractice damages are to be capped at $600,000. Siebert opposed the motion, arguing the cap is unconstitutional.

District Judge Victor Lopez agreed with Siebert and held the cap unconstitutional. He primarily found that the cap abridged the right of trial by jury, but also determined other constitutional rights might be “implicated,” including equal protection, due process and separation of powers. He refused to reduce the judgment.

The defendants appealed to the New Mexico Court of Appeals, which forwarded the case directly to the New Mexico Supreme Court without any ruling on the merits by the Court of Appeals.

During last month’s hour-long oral arguments before the New Mexico Supreme Court, Bennett Cooper, attorney for Okun and Women’s Specialists of New Mexico, emphasized that what is at stake is not just the compensatory damage cap, but the entire Medical Malpractice Act, due to issues of severability. In other words, should the compensatory damage cap be determined unconstitutional, all the protections afforded by the Medical Malpractice Act would likewise disappear.

“Over 40 years ago, the legislature protected patients and physicians of New Mexico by securing the availability of medical malpractice insurance,” Cooper argued. “This was a reasonable, prescient approach and likely the most pro-patient medical malpractice reform law anywhere in the country. The district court’s ruling on the issue of jury rights endangers the entire medical malpractice act.”

Lisa Curtis, the attorney representing Siebert, argued that the New Mexico Constitution is very specific in that every New Mexican has the right to have damages determined by a jury.

“In New Mexico, the right to trial by jury, as it has heretofore existed, shall be secured to all and remain inviolate,” Curtis stated before the Court. “An inviolate right constitutionalizes the jury’s role. In fact, our Second Judicial District Judge Lopez found that [the compensatory damage cap] violates Susan Siebert’s specific inviolate constitutional right to a jury trial. The jury awarded Ms. Siebert $2.6 million in compensatory damages, and very importantly here, the defendants moved to reduce, or limit, the jury’s verdict … If you were to eviscerate the jury’s finding on damages, then you are eviscerating the jury’s right to make a determination of the case and the facts of it.”

The New Mexico Supreme Court is expected to reach a decision in Siebert v. Okun sometime next year. Keep an eye on our News Section for the latest updates.