On May 23, 2022, California Governor Gavin Newsom signed Assembly Bill 35. The new bill marks the first time in fifty years that lawmakers have increased the financial compensation victims of medical malpractice can seek for non-economic damages.
In the 1970s, California lawmakers had to address the current healthcare crisis. At the time, high malpractice insurance premiums forced many medical institutions across California to close their doors.
Lawmakers blamed the skyrocketing insurance rates on the large malpractice judgments victims had received. To address the issue, lawmakers passed the Medical Injury Compensation Reform Act of 1975 (MICRA), which capped the amount of pain and suffering compensation a victim could receive at $250,000.
If we considered annual inflation, $250,000 in 1975 would equal $1.3 million in 2022. But the problem with MICRA is that it doesn't account for inflation. Today, $250,000 remains the cap for victims seeking non-economic damages.
So what does the Assembly Bill 35 mean for the future of California malpractice suits?
Starting January 1, 2023, AB 35 will increase the cap on noneconomic damages to $350,000. After that, the cap will increase to $750,000 over the next decade.
Furthermore, in a wrongful death lawsuit, starting January 1, 2023, the pain and suffering cap will increase to $500,000, gradually rising to $1 million over the next ten years. After the first decade, lawmakers will adjust the cap by 2% annually to account for inflation.
Another flaw of MICRA is that no matter how many healthcare professionals the judgment found liable, the victim was still only eligible for one pain and suffering payment of up to $250,000.
Assembly Bill 35 addresses this blind spot. As of January 1, 2023, victims of medical malpractice cases involving multiple healthcare professionals will be eligible for up to three pain and suffering payments in lawsuits. Victims can potentially receive a maximum reward of up to 1.5 million in pain and suffering compensation.
Although Assembly Bill 35 will only apply to cases filed after January 1, 2023, Governor Newsom's signature is a landmark victory for victims of medical malpractice suits and their advocates.
