Press Release: Governor Newsom Signs Legislation to Modernize California's Medical Malpractice System

GOVERNOR NEWSOM SIGNS LEGISLATION TO MODERNIZE CALIFORNIA’S MEDICAL MALPRACTICE SYSTEM

PUBLISHED: MAY 23, 2022

SACRAMENTO – Governor Gavin Newsom today signed AB 35, legislation to modernize the system for awarding damages in medical malpractice

cases in California. The legislation, put forth by Assembly Majority Leader Eloise Gómez Reyes and State Senator Tom Umberg, was supported by consumer groups, trial attorneys, health care insurers, and health care providers – marking the end to one of the longest running political battles in California politics.

The measure is co-sponsored by the Consumer Attorneys of California and Californians Allied for Patient Protection. It makes twosignificantchangestotheMedicalInjuryCompensation ReformAct(MICRA)byrestructuringMICRA’slimitonattorney feesandraisingMICRA’scaponnoneconomicdamages.

“After decades of negotiations, legislators, patient groups, and medical professionals have reached a consensus that protects patients and the stability of our health care system,” said Governor Newsom.

Existing law places limitations on the contingency fee an attorney can contract for or collect. The current system ties the limits to the amount recovered. An attorney can collect 40 percentofthefirst$50,000recovered,33percentofthenext $50,000,25percentofthenext$500,000,and15percentof anythingthatexceeds$600,000.Thislegislationinsteadties tiered fee limits to the stage of the representation at which the amount is recovered. Additionally,thislegislationincreasestheexisting$250,000 cap on non-economic damages and provides for future increases toaccountforinflation.Thelegislationestablishestwoseparate caps, depending on whether a wrongful death claim is involved. Inawrongfuldeathcase,thecapincreasesto$500,000.Each January1stthereafter,thiscapincreasesby$50,000untilit reaches$1million.Ifthemedicalmalpracticecasedoesnot involvewrongfuldeath,thecapstartsat$350,000,andincreases eachyearby$40,000untilitreaches$750,000.

“I’m proud to have worked together with all stakeholders to get this done. AB 35 provides a better system for both providers and patients, creating a fair process that will have a real impact on Californians for decades to come,” said Assembly Majority Leader Eloise Gómez Reyes. “Withtoday’ssigningof AB 35, we have achieved Governor Newsom signs MICRA modernization legislation what few thought was possible. This historic moment happened because the two sides of the ballot measure campaign put differences aside, found common ground, and recognized a rare opportunity to protect both our health care delivery system and the rights of injured patients. We are immensely grateful to the Legislature and Governor Newsom for helping to codify this landmark agreement inlaw.California’snewmodernizedMICRAstatuteswillprovide predictability and affordability of medical liability insurance rates for decades to come, while protecting existing safeguards against skyrocketing health care costs. The modernized law will also bring greater accountability, patient safety and trust by making it possible for physicians and patients to have a full and open conversation after an unforeseen outcome. CMA is proud to havebeenpartofthislandmarkachievementforthebenefitofall Californians. We look forward to a new era of long-term stability aroundMICRAthatwillallowCalifornia’sphysicianandprovider communities to focus on other ways to improve access to care and public health for all Californians,” said California Medical Association President Robert E. Wailes, M.D. “Injured patients deserve to be fairly compensated when their rights have been violated, and we commend the leadership of Governor Newsom to help get this done. Injured patients and their familiesarebetteroffunderthemodifiedMICRA,andwelook forward to continuing to serve in the best interest of our clients,” said Consumer Attorneys of California President Craig M. Peters. For full text of the bill, visit: http://leginfo.legislature.ca.gov. https://www.gov.ca.gov/2022/05/23/governor-newsom-signslegislation-to-modernize-californias-medical-malpractice-system/