California Raised the Cap for Medical Malpractice Payment

A person in a lab coat with their arms folded holding a stethoscope
A person in a lab coat with their arms folded holding a stethoscope
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By Chujun Tang

 

SACRAMENTO, CA – Last week on May 23, Governor Newsom signed AB 35 to raise the amount of money patients can receive from medical malpractice cases with increased suffering and pain payments. It was the first attempt to raise suffering and pain awards since Governor Jerry Brown signed the Medical Injury Compensation Reform Act (MICRA) in 1975, setting a cap of 250,000 dollars for the suffering recompense. This bill could signal significant improvements in California’s medical malpractice system.

 

Newsom’s signature marked the final step in a reform process that began last month, when rival interest groups including doctors and lawyers announced a deal to avoid a costly battle at the ballot box in November. The reform is co-sponsored by the Consumer Attorneys of California and Californians Allied for Patient Protection.

 

“This agreement signals the end to one of the most long standing battles in California politics, and strikes a fair balance protecting patients, while ensuring that physicians and other medical professionals can treat patients without fear of financial ruin,” Newsom said, adding “this is an important victory for the stability and health of our healthcare system.”

 

Initially enacted five decades ago, MICRA imposed a compensation limit so that doctors were not buried by rising insurance premiums. Several Los Angeles Times investigations found the Medical Board of California reinstating physicians who had a track record of harming patients or who lost their licenses for sexual misconduct.

 

This new overhaul of the medical malpractice system will correct oversight like the aforementioned by both raising the award limit and proposing to permanently ban the doctors convicted of sexually assaulting patients. 

 

For instance, MICRA did not impose a limit on economic losses for patients in malpractice cases. If MICRA had adjusted the non-economic damage award limit annually to inflation, it would be about one million dollars now. But the number stayed the same for 47 years. Now, the limit will be raised, beginning with 350,000 dollars in 2023.

 

California lawmakers specified that the new limits for non-economic damage would increase by 40,000 dollars each year on January 1st for 10 years, and on January 1st, 2034, the limits for personal injury and wrongful death would be adjusted each year by 2% for inflation. The bill also mandates the minimum amount of the judgment required to request periodic payments be 250,000 dollars.

 

The reform would have a significant impact on individual cases. For example, two-year-old Steven Olsen of Chula Vista (San Diego County) slipped and fell on a walk in 1992. He was treated for a sinus injury by doctors who should have conducted a scan and found his brain injury. Olsen ended up with lifelong blindness and brain damage, and he was awarded 7 million dollars by a jury for suffering and pain—which was slashed to 250,000 dollars by MICRA. 

 

 

About The Author

Jordan Varney received a masters from UC Davis in Psychology and a B.S. in Computer Science from Harvey Mudd. Varney is editor in chief of the Vanguard at UC Davis.

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