California Assembly Bill 35
– By Keith Carlson, Esq.
Given legislation that’s gone into effect in 2024, California is now on the path to more than tripling the cap on certain damages in malpractice cases over the coming years. This came about with the signing of Assembly Bill 35, which significantly amended the Medical Injury Compensation Reform Act, or “MICRA.”
MICRA was passed in 1975 to combat skyrocketing health care costs stemming from increased medical-malpractice actions. It spawned a small industry in Sacramento, seeking to preserve the MICRA protections (supported by providers) and to lift them (supported by trial-lawyer groups).
Following much negotiation and wrangling in Sacramento, a “compromise” (of sorts) finally passed and was signed into law late in 2023. The trial lawyers were again planning to run an initiative to remove the caps. Such initiative drills are costly to defend and politically difficult to predict – the initiative at issue here was removed from the ballot as part of the deal allowing AB 35 to pass.
The biggest news is the $250,000 cap on non-economic damages has now been increased to $350,000 in malpractice cases. The cap will annually increase for a decade to $750,000 ($40,000 per year). Thereafter, an inflation adjustment of 2% will be added annually.
The law also doubled the wrongful-death cap and adds more annual increases to it, too.
Further, it significantly increased the judgement amount required should a defendant want to use periodic payments to satisfy the judgement. Previously, a $50,000 verdict would provide an avenue to pay over time; now the verdict would have to be $250,000.
On the providers’ side, it prevents someone’s apology or statement of sympathy from being used in any legal proceeding. So, while physicians will be liable for more damages, and must pay them immediately, they will be able to say “sorry” with less fear of liability.
Keith W. Carlson is counsel for the California Chiropractic Association and a founding partner with Carlson & Jayakumar LLP.