Troubled New Mexico has another significant worry: It’s losing its doctors.  In 2024, it was the only state to have fewer doctors than it had in 2019.  The number lost was 248, significant for a state of just 2.1 million.

What gives?  Why is N.M. losing physicians?  The short answer is below: average pay, miserable public schools, out-of-control crime.  Here’s a deeper dive.

Med school graduates leave school with enormous debt.  The average combined undergraduate and medical school debt of a recent graduate is a whopping $246,659.

Using an online calculator with a principal sum of $247,000, an interest rate of 8.54%, and a 10-year loan term, the monthly payment is $3,070; the total of payments over 10 years is $368,000; and the interest amount paid is $121,000.  For a 20-year loan term, the numbers are $2,150; $516,000; and $269,000.

Once they start practicing, doctors need to make or be paid a ton of money to pay off their student loans.  The problem is that N.M. doctors are earning, on average, substantially less than the doctors in the surrounding five states.

In December 2025, USA Facts published the article “How Much Are Doctors Paid?”  The article highlights a study in the Quarterly Journal of Economics.  Here are the numbers for N.M. and the surrounding five states.

Average Physician Earnings in N.M. and the surrounding 5 States 2017

The average earnings for the five states other than NM are $348,380, which is $80,080 higher than the NM number of $268,300.  In other words, the average of the five other states is 29% higher than the N.M. number.

Although the numbers are from 2017, the article states that they’re considered more accurate than more recent data sets because the latter do not include physician business income, which can be substantial.

Why are N.M. physicians earning, on average, less than those in the surrounding states?  There are three suspects.

Suspect #1 is the fact that between 40% and 50% of the state population is on Medicaid, and Medicaid has miserable reimbursement rates.  Medicare reimbursement rates are set by the federal government, but Medicaid rates are set by the states.  Medicare rates are supposed to reimburse the cost of a medical procedure but not provide any profit.  Medicaid rates are typically a percentage of Medicare rates.  So an office consult with a reimbursement of $130 with private insurance may reimburse $100 with Medicare and only $75 with Medicaid.  Medicaid typically does not even cover the cost of the medical procedure.

Suspect #2 is a miserable tax that only New Mexico and Hawaii have.  Whereas most states have a sales tax that applies to the sale of goods, New Mexico has a gross receipts tax that applies to the sale of both goods and services.  The tax varies by location.  In Albuquerque, the state’s largest city, the rate is 7.625%.  So, in the previous example, where Medicaid reimbursed just $75 for an office visit, the provider has to also deduct $5.72 in tax and send that amount to the state for gross receipts taxes.  That tax is not reimbursed by Medicaid.  Ouch.

Suspect #3 is high malpractice insurance rates.  It is estimated that malpractice rates for N.M. doctors are about twice as high as the region average.

(It’s beyond the scope of this article to discuss the malpractice crisis in N.M.  Think New Mexico, a prominent public policy research organization, has published an excellent policy study with multiple recommendations for improving healthcare in N.M., including ways to reduce malpractice awards and malpractice insurance costs.)

And now for the really bad part.  It’s often a deal-breaker for those considering moving to New Mexico.  You can be certain that these matters will never be discussed by the prospective New Mexico employer in a job interview unless raised by the candidate.  It’s two elephants in the room.

The first is that New Mexico has the nation’s worst ranked public school system.  It has been awful for a long time.  If the state expects physicians to come to and stay in the state, they will need to earn enough to have the option to send their children to private school.

The second elephant is the crime issue.  Sadly, New Mexico is a crime haven.  It is #1 in the country for property crime per capita among states and #2 in the country for violent crime per capita.  Only Alaska has more violent crime per capita at the state level than New Mexico.  Albuquerque is the state’s crime hub.

What can be done to get doctors to come to and stay in New Mexico?  The free-market capitalist solution is cold, hard cash.  If doctors are paid enough, they will come.

Prospective employers will argue that they simply can’t afford to pay such high wages.  That may be true.  But New Mexico is swimming in record revenues, mostly from oil and gas leases and taxes.  The Permian Basin in southeastern New Mexico is the nation’s most productive drilling site and is flooding the state treasury with money.  To give an idea of how much money the state has, as of last August, the state’s investment account was estimated to have 64 billion dollars.  New Mexico’s current governor, Michele Lujan-Griffin, entered office of January 1, 2019 and will leave office on December 31, 2026.  When she entered office, the state’s budget for the 2018–2019 year was $7.8 billion.  The current budget for the 2025–2026 tax year is $13.6 billion.  That’s an increase of 74%.

In conclusion, New Mexico, the Land of Enchantment, isn’t very enchanting for physicians.  It’s time for the N.M. Legislature, AKA the Solons of Santa Fe, to utilize some of the state’s vast wealth to attract doctors to come to, and stay in, the state.

Image: Pkd2016 via Wikimedia Commons, CC BY-SA 2.0.

[H/T American Thinker]