How MICRA Noneconomic Damages Caps Will Work Starting in 2023

Assembly Bill 35 has changed the noneconomic damages cap applicable in medical malpractice cases in California. The changes will create new opportunities for plaintiff’s firms and have the potential to make large multi-party cases more common, since up to three separate noneconomic damages caps are potentially recoverable depending on the facts of the case. Understanding how these new changes will work is essential to healthcare providers, institutions and their attorneys, to successfully defend against medical malpractice claims starting on January 1, 2023.

• Implementation of AB 35’s Noneconomic Damages Caps

The aim of the amendments to Civil Code § 3333.2 made by AB 35 is to increase the amount of noneconomic damages available to medical malpractice plaintiffs to a level that will more adequately compensate plaintiffs in personal injury and wrongful death cases for their noneconomic damages, and then to continue to increase the amount of noneconomic damages available over time to keep up with inflation.

Currently, a medical malpractice plaintiff in a personal injury or wrongful death case is entitled to a maximum award of $250,000 for noneconomic damages. Under AB 35, that amount will be increased substantially starting January 1, 2023, and then incrementally thereafter. For all cases filed on or after January 1, 2023, the noneconomic damages award available to a personal injury plaintiff in a medical malpractice case will be $350,000 [Civ. Code § 3333.2(b)], and $500,000 for a wrongful death plaintiff [Civ. Code § 3333.2(b)]. Thereafter, from 2024 to 2033, the award cap for noneconomic damages will increase by $40,000 per year for personal injury plaintiffs and by $50,000 per year for wrongful death plaintiffs. From 2034 onward, the cap for both types of plaintiffs will increase by 2% per year as an adjustment for inflation. The noneconomic damages cap increases through the first 30 years under the new version of Civil Code § 3333.2 will be as shown in Table 1:

	Personal Injury	Wrongful Death
Year	Cap	Cap
2023	$350,000.00	$500,000.00
2024	$390,000.00	$550,000.00
2025	$430,000.00	$600,000.00
2026	$470,000.00	$650,000.00
2027	$510,000.00	$700,000.00
2028	$550,000.00	$750,000.00
2029	$590,000.00	$800,000.00
2030	$630,000.00	$850,000.00
2031	$670,000.00	$900,000.00
2032	$710,000.00	$950,000.00
2033	$750,000.00	$1,000,000.00
2034	$765,000.00	$1,020,000.00
2035	$780,300.00	$1,040,400.00
2036	$795,906.00	$1,061,208.00
2037	$811,824.12	$1,082,432.16
2038	$828,060.60	$1,104,080.80
2039	$844,621.81	$1,126,162.42
2040	$861,514.25	$1,148,685.67
2041	$878,744.54	$1,171,659.38
2042	$896,319.43	$1,195,092.57
2043	$914,245.81	$1,218,994.42
2044	$932,530.73	$1,243,374.31
2045	$951,181.35	$1,268,241.79
2046	$970,204.97	$1,293,606.63
2047	$989,609.07	$1,319,478.76
2048	$1,009,401.25	$1,345,868.34
2049	$1,029,589.28	$1,372,785.71
2050	$1,050,181.06	$1,400,241.42
2051	$1,071,184.69	$1,428,246.25
2052	$1,092,608.38	$1,456,811.17
2053	$1,114,460.55	$1,485,947.40

As Table 1 shows, the current $250,000 cap will increase rapidly, rising to more than double its current amount by the end of this decade. Additionally, and as will be discussed in the next section, certain plaintiffs may be entitled to three separate noneconomic damage awards, making some claims vastly more valuable.

• Multiple Noneconomic Damages Awards Now Available in Some Types of Multi-Party Litigation – Interaction with Civil Code § 1431.2 (Prop. 51)

Beyond simply raising the noneconomic damages cap in medical malpractice cases, AB 35 also makes it possible for a plaintiff to recover up to three separate noneconomic damages awards in multi-party litigation under certain circumstances. This is a significant change from how MICRA presently works.

The MICRA noneconomic damages cap currently limits a medical malpractice plaintiff to a single recovery of up to $250,000 in noneconomic damages no matter how many healthcare defendants are found to be responsible for the plaintiff’s harm. AB 35 sets out three categories of defendants who can be separately liable for an independent award of noneconomic damages: (1) health care providers; (2) health care institutions; and (3) unaffiliated health care providers or health care institutions. The text of the scheme for these three categories is set out as follows for both personal injury plaintiffs and wrongful death plaintiffs:

“(1) Civil liability for damages for noneconomic losses against one or more health care providers, collectively, shall not exceed [$350,000 in personal injury case or $500,000 in wrongful death case], regardless of the number of health care providers, which does not include any unaffiliated health care providers that are responsible for noneconomic losses pursuant to paragraph (3).

(2) Civil liability for damages for noneconomic losses against one or more health care institutions, collectively, shall not exceed [$350,000 in personal injury case or $500,000 in wrongful death case], regardless of the number of health care institutions, which does not include any unaffiliated health care institutions that are responsible for noneconomic losses pursuant to paragraph (3).

(3) Civil liability for damages for noneconomic losses against one or more health care providers or health care institutions that are unaffiliated with a defendant described in paragraph (1) or (2) based on acts of professional negligence separate and independent from the acts of professional negligence of a defendant described in paragraph (1) or (2) and that occurred at, or in relation to medical transport to, a health care institution unaffiliated with a health care institution described in paragraph (2), collectively, shall not exceed [$350,000 in personal injury case or $500,000 in wrongful death case], regardless of the number of defendants described in this paragraph, which does not include any unaffiliated health care providers or unaffiliated health care institutions that are responsible for noneconomic losses pursuant to paragraph (1) or (2).”

Subparts (d) and (e) of the new version of Civil Code § 3333.2 provide that no health care provider or health care institution defendant shall be liable for noneconomic damages in more than one of the three categories set out in this section. Additionally, subpart (f) provides:

“The applicable dollar amounts set forth in this section apply regardless of the number of defendant health care providers or health care institutions against whom the claim is asserted or the number of separate causes of actions on which the claim is based. For a claim subject to subdivision (b), the applicable dollar amounts set forth in subdivisions (b), (g), and (h) provide three separate limits of liability that may apply. For a claim subject to subdivision (c), the applicable dollar amounts set forth in subdivisions (c), (g), and (h) provide three separate limits of liability that may apply.”

The definitions applicable to these three new categories of defendants who can be separately liable for noneconomic damages are vital to understanding when a plaintiff may be eligible for multiple separate awards of noneconomic damages. Civil Code § 3333.2(j) provides the definitions of “health care provider,” “health care institution,” and “unaffiliated” as follows:

“(1) “Health care provider” means any person licensed or certified pursuant to Division 2 (commencing with Section 500) of the Business and Professions Code, or licensed pursuant to the Osteopathic Initiative Act, or the Chiropractic Initiative Act, or licensed pursuant to Chapter 2.5 (commencing with Section 1440) of Division 2 of the Health and Safety Code; and any clinic, health dispensary, or health facility, licensed pursuant to  Chapter 1 (commencing with Section 1200) or Chapter 1.3 (commencing with Section 1248) of Division 2 of the Health and Safety Code, and does not include health care institutions that are defined in paragraph (2). “Health care provider” includes the legal representatives of a health care provider and the health care provider’s employer, professional corporation, partnership, or other form of legally recognized professional practice organization.
(2) “Health care institution” means one or more health care facilities licensed pursuant to Chapter 2 (commencing with Section 1250) of Division 2 of the Health and Safety Code owned or operated by the same entity or its affiliates and includes all persons and entities for which vicarious liability theories, including, but not limited to, the doctrines of respondeat superior, actual agency, and ostensible agency, may apply.
(3) “Unaffiliated” means a specified health care provider, health care institution, or other entity not covered by the definition of affiliated, or affiliated with, as defined in Section 150 of the Corporations Code,^[[1]] or that is not employed by, performing under a contract with, an owner of, or in a joint venture with another specified entity, health care institution, health care provider, organized medical group, professional corporation, or partnership, or that is otherwise not in the same health system with that health care provider, health care institution, or other entity. Whether a health care provider, health care institution, or other entity is unaffiliated is determined at the time of the professional negligence.”

Whether a plaintiff qualifies to obtain three separate noneconomic damages awards in a given case will be subject to a fact intensive inquiry. The following fact pattern will be utilized as an example of how the new separate noneconomic liability limits will apply in a multi-party medical malpractice case where a plaintiff may be entitled to three separate noneconomic damages awards:

On March 3, 2022, plaintiff was transported by an independently owned and operated ambulance service to a hospital for treatment after being found disoriented on the bathroom floor. In route to the hospital, the emergency medical technician employed by the ambulance service placed two intravenous lines, one in each of plaintiff’s arms, to provide saline and a mixture of aspirin, glucose, insulin and potassium for suspected cardiac arrest. Intravenous fluids and medication were then administered in each line.

When plaintiff arrived at the hospital, a nurse who is an employee of the hospital, triaged plaintiff and injected pain medication into one of the previously placed intravenous lines. The nurse wrote in plaintiff’s chart that plaintiff is allergic to computer tomography (“CT”) contrast agents based on information relayed by plaintiff’s emergency contact.

Next, plaintiff was examined by an intensivist who is an independent contractor physician employed by a physicians’ group with a contract to provide emergency medical services to the hospital. The intensivist reviewed plaintiff’s chart, took plaintiff’s history, and became suspicious of aortic dissection as the cause of plaintiff’s symptoms. The intensivist failed to read the portion of plaintiff’s chart indicating plaintiff is allergic to CT contrast agents. The intensivist then rushed plaintiff to the radiology department and ordered plaintiff to undergo a CT scan without contrast, and a CT angiogram with a contrast agent to rule out possible aortic dissection.

The radiology imaging, including injection of the CT contrast agent, was performed by an independent contractor radiologist, who is an employee of a radiology physicians’ group with a contract to provide radiology imaging services to the hospital. Plaintiff’s imaging showed plaintiff did not suffer aortic dissection, but revealed plaintiff had a linear pocket of air around plaintiff’s heart, indicating the likely introduction of air into plaintiff’s blood stream by one of the health care practitioners who had rendered care to plaintiff from the time plaintiff was picked up by the ambulance until the time plaintiff had the CT contrast agent injected.

Plaintiff was treated at the hospital for the air embolism in a hyperbaric chamber. While in the hyperbaric chamber, plaintiff suffered an allergic reaction to the CT contrast agent, which required additional treatment. Additionally, while recovering from the allergic reaction to the CT contrast agent and air embolism at the hospital, plaintiff suffered a delayed onset of painful and anxiety inducing cardiac symptoms associated with the administration of the mixture of aspirin, glucose, insulin and potassium administered for suspected cardiac arrest by the emergency medical technician. Plaintiff was discharged several days later. Despite not being at risk for a heart attack, plaintiff developed severe anxiety of having a heart attack due to the symptoms plaintiff suffered as the result of the administration of the mixture of aspirin, glucose, insulin and potassium. Plaintiff later learned that the emergency medical technician failed to follow the appropriate protocol in administering that medication mixture to plaintiff.

On January 2, 2023, plaintiff files suit naming the ambulance company, the hospital, the intensivist, the intensivist’s physicians’ group, the radiologist, and the radiologist’s physician’s group, alleging a single cause of action for medical negligence, which includes allegations adequate to pursue a negligence per se theory of liability relating to the air embolism. Plaintiff alleges that each defendant failed to meet the standard of care, causing plaintiff harm due to the introduction of air into plaintiff’s blood stream. Additionally, plaintiff alleges the ambulance company negligently administered the mixture of aspirin, glucose, insulin and potassium, and that the intensivist negligently failed to review plaintiff’s chart, leading to the administration of the CT contrast agent which caused an allergic reaction. Plaintiff seeks economic and noneconomic damages.

The defendants named by plaintiff encompass all three categories of defendants defined in the amended version of Civil Code § 3333.2. The hospital is a “health care institution,” the intensivist, radiologist and their physicians’ groups fall within the “health care provider” category and potentially the “unaffiliated” provider category, and the independently owned and operated ambulance company similarly falls under the definition of an “unaffiliated” provider category and the “health care provider” category. Because the three separate categories are represented by the named defendants, plaintiff has the ability to obtain three separate noneconomic damage awards, depending on how the alleged acts of negligence are determined to be related, or unrelated, to one another.

The emergency medical technician employed by the ambulance company may have introduced air when initially placing the intravenous lines and administering saline and medication. Additionally, the ambulance company is potentially liable for causing plaintiff’s delayed onset cardiac symptoms due to the improper administration of the mixture of aspirin, glucose, insulin and potassium.

The nurse potentially introduced air into plaintiff’s blood stream by injecting pain medication into the previously placed intravenous line, making the hospital potentially liable for the air embolism under respondeat superior.

The intensivist failed to recognize plaintiff’s documented allergy to CT contrast agents and ordered plaintiff to undergo a CT angiogram with contrast, leading to an allergic reaction. As such, the intensivist and the intensivist’s physicians’ group potentially liable.

Similarly, the radiologist may have introduced air into plaintiff’s blood stream when injecting the CT contrast agent prior to the CT angiogram, making the radiologist and the radiologist’s physicians’ group potentially liable to plaintiff.

As set out above, there are three distinct acts of negligence which could impose liability: (1) the air embolism, which might be the fault of the ambulance company, the hospital or the radiologist; (2) the negligent administration of the mixture of aspirin, glucose, insulin and potassium by the ambulance company’s employee; and (3) the intensivist’s negligent failure to review the plaintiff’s chart, leading to plaintiff suffering an allergic reaction to the CT contrast agent.

If plaintiff were to prevail against all defendants on all theories of liability, plaintiff could be eligible for three separate noneconomic damages awards of $350,000 each, a total of $1,050,000. The three awards would be split between the three categories of defendants severally based on a determination of fault made by the jury pursuant to Civil Code § 1431.2 (Prop. 51), assuming the total noneconomic damage award by the jury is equal to, or exceeds $1,050,000, and the percentage of fault for each category of defendants is determined to be at least 1/3 at fault.

The hospital would be liable for $350,000 in noneconomic damages because the hospital is the only defendant who fits into the “health care institution” category defined by Civil Code § 3333.2(j)(2). The hospital’s liability stems from the nurse potentially negligently introducing air into plaintiff’s blood while injecting pain medication, creating an air embolism, under the negligence per se theory of liability.

The intensivist, radiologist and their physicians’ groups would be severally liable for a second separate $350,000 noneconomic damage award since they all fit within the “health care provider” category defined by Civil Code § 3333.2(j)(1). The intensivist and related physicians’ group face liability for the intensivist negligently ordering plaintiff to have a CT angiogram with contrast despite the plaintiff’s chart indicating plaintiff is allergic to CT contrast agents. The radiologist and related physicians’ group face liability under the negligence per se theory relating to the introduction of air into plaintiff’s blood stream creating an air embolism due to the radiologist injecting plaintiff with CT contrast.

The ambulance company could also be independently liable for a third separate $350,000 noneconomic damage award to plaintiff since the ambulance company’s employee, the emergency medical technician, negligently administered the mixture of aspirin, glucose, insulin and potassium. This is because the ambulance company is the only named defendant in plaintiff’s lawsuit who fits into the “unaffiliated” health care provider, institution or entity category defined by Civil Code § 3333.2(j)(3), and the harm plaintiff suffered due to the administration of the mixture of aspirin, glucose, insulin and potassium, was “separate and independent from the acts of professional negligence of a defendant described in paragraph (1) [the physicians and their groups] or (2) [the hospital].” See Civ. Code §§ 3333.2(b)(3) & (c)(3). This rules out separate liability for a noneconomic damages award for the potential introduction of air into plaintiff’s blood stream by the emergency medical technician, since the acts of negligence imposing liability on the hospital and radiologist relate to the air embolism.

If the only claim plaintiff alleged against the defendants related to the negligent introduction of air into his blood stream causing an air embolism to develop, then the ambulance company, the hospital, and the radiologist each may be responsible under the negligence per se theory of liability. However, as Civil Code § 3333.2 has been amended, it appears plaintiff would only be eligible for up to two separate $350,000 noneconomic damage awards. One that would apply to the radiologist, the radiologist’s physician’s group and the ambulance company, and a second against the hospital. This is because the ambulance company in this scenario (where only the air embolism is at issue) would fall under the “health care provider” category, but not the “health care institution” category. Since there is no alleged act of negligence that is “separate and independent from” the alleged introduction of air into plaintiff’s blood stream, none of the defendants would qualify as an “unaffiliated” provider, institution or entity, foreclosing the availability of a third separate award of noneconomic damages.

Where multiple defendants fall under the same category for purposes of noneconomic damages, under Civil Code § 1431.2, each defendant in the category is severally liable for their share of noneconomic damages in direct proportion to the jury’s determination of their culpability. The intent for Civil Code § 1431.2 to still apply is evidenced by the language in subparts (e) and (f) of amended Civil Code § 3333.2, which state, relevantly:

“(e) No health care institution defendant shall be liable for damages for noneconomic losses in more than one of the categories set forth in this section, regardless of the application or combined application thereof.

(f) The applicable dollar amounts set forth in this section apply regardless of the number of defendant health care providers or health care institutions against whom the claim is asserted or the number of separate causes of actions on which the claim is based.”

As such, when more than one defendant are liable for the same category of noneconomic damages, then the award would be split in the same manner it was prior to the amendments in AB 35.

What is more difficult to determine, is how noneconomic damages will be apportioned under Civil Code § 1431.2 when multiple categories of noneconomic damages are available. Currently, with only a single limit on noneconomic damages, apportionment is relatively easy since the percentage of fault assigned to each defendant is then applied to the $250,000 noneconomic damage award cap. However, under the new scheme apportionment will be a more intensive inquiry.

Currently, in cases where all defendants are health care providers subject to the $250,000 noneconomic damages cap, courts can reduce a noneconomic damage award to $250,000 and then apply apportionment under Civil Code § 1431.2. This way each health care provider is only liable for their respective allocation of fault within the cap imposed on a noneconomic damage award to a plaintiff, and is not responsible for noneconomic damages which are the fault of other health care provider defendants who are insolvent, meeting the purposes of both MICRA and Proposition 51. See Gilman v. Beverly California Corp. (1991) 231 Cal.App.3d 121.

Alternatively, under the present version of Civil Code § 3333.2, in cases where noneconomic damages are awarded against defendants who are protected by MICRA and those who are not, the appropriate way to apportion damages is to first apply Civil Code § 1431.2 to the total noneconomic damage award made by the jury with their determination as to the percentage fault attributable to each defendant, and then to further divide the award among the health care provider defendants within the $250,000 MICRA cap. As explained in Bigler-Engler v. Berg, Inc. (2017) 7 Cal.App.5^th 276, “Proposition 51… determines a defendant’s liability for noneconomic damages, according to that defendant’s fault, whereas MICRA establishes a cap on the recovery of such damages for certain defendants. Because the applicability of MICRA’s cap cannot be determined unless a defendant’s liability is known, Proposition 51 logically must apply first. If one defendant is subject to the MICRA cap, and that defendant’s liability, as determined by the jury’s determination of noneconomic loss and proportionate fault, exceeds $250,000, a trial court must apply the MICRA cap to limit any judgment against that defendant to that amount. If the defendant’s liability does not exceed $250,000, the MICRA cap does not apply.” Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 327.

The Gilman court provided an example which is instructive in understanding how allocation of noneconomic damages will work under Civil Code § 3333.2 as amended, when multiple defendants are found liable for noneconomic damages. “If a jury awards plaintiff $1 million… in noneconomic damages and apportions fault as follows — 25 percent to plaintiff; 25 percent to a drug company (not a health care provider under MICRA); 40 percent to Dr. A; and 10 percent to Dr. B — then the judgment would be calculated as follows: First, plaintiff’s negligence will reduce the $1 million verdict to $750,000 (ibid.); the drug company will be severally liable for 25 percent of the verdict, or $250,000; the health care providers’ total liability will be $250,000 pursuant to MICRA; this amount will be apportioned 80 percent to Dr. A and 20 percent to Dr. B according to their respective percentage of fault. If any of the concurrent tortfeasors is insolvent, the liability of the other tortfeasors remains unchanged.” Gilman, supra, 231 Cal.App.3d at p. 129, fn. 10.

Utilizing the same principles outlined in Gilman, it is likely the new MICRA noneconomic damages caps will be applied after Proposition 51 apportionment of fault is determined. For example, if the jury awards $2,000,000 in noneconomic damages in the air embolism scenario set out previously, where only two categories of noneconomic damages are in play, and the jury finds that the hospital was 33% at fault, the ambulance company 33% at fault, and the radiologist 34% at fault, then the Proposition 51 allocation of noneconomic damages would be: $660,000 against the hospital; $660,000 against the ambulance company; and $680,000 against the radiologist. However, since the noneconomic damage award exceeds what is available under MICRA, the award will be reduced to fit within the new noneconomic damages caps. Since the hospital is the only party who falls into the “health care institution” category of noneconomic damages, Civil Code § 3333.2 would limit the hospital’s liability for noneconomic damages to $350,000. The ambulance company and radiologist, on the other hand, both fall into the “health care provider” category, so they would be severally liable for a separate $350,000 award of noneconomic damages. Based on principles applied in previous cases, because the radiologist and ambulance company were both found to be responsible for more than the collective $350,000 cap applicable to them, they would split that cap based on their relative fault. The total noneconomic damages awarded against them as determined by the jury is $1,340,000 ($660,000 + $680,000). The ambulance company’s relative proportion of fault is 49.25% (660,000 / 1,340,000). The radiologist’s relative proportion of fault is the remaining 50.75%. Thus, the ambulance company is responsible for $172,375 in noneconomic damages, and the radiologist is responsible for $177,625 in noneconomic damages. This results in plaintiff obtaining the highest award of noneconomic damages possible, which is $700,000 under the new damages caps.

Considering the negligence per se theory in this scenario posits that the air embolism was equally likely to have been caused by the emergency medical technician, the nurse, or the radiologist, it seems unfair and inequitable for the hospital to be liable for its own separate $350,000 noneconomic damages award while the ambulance company and radiologist get to split a second $350,000 noneconomic damages award. However, as drafted, and based on case law interpreting the interaction of Proposition 51 and MICRA in cases with non-health care provider defendants, that seems to be how this hypothetical case would play out.

If the jury were to award a small total of noneconomic damages applied to all defendants in this negligence per se scenario, the result would likely be different. For example, if the jury awarded plaintiff a total of $250,000 in noneconomic damages, then Civil Code § 1431.2 would still mandate that each defendant is only responsible for its proportionate share based on the jury’s determination of each defendant’s percentage of fault. If the jury finds the radiologist was 50% at fault, and the hospital and ambulance company each at 25% fault, then the radiologist would be responsible for $125,000 and the hospital and ambulance company would each be responsible for $62,500. Since these amounts all fall under the two new MICRA noneconomic damages caps, then MICRA would not have to be applied to reduce the award.

Based on the plain language of AB 35, the amount of noneconomic damages a plaintiff may be entitled to, and how an award of noneconomic damages would be split by multiple defendants will greatly depend on the facts of the case and the total award of noneconomic damages determined by the jury. However, in cases where a large award of noneconomic damages seems likely, it appears that hospitals who do not directly employ physicians to provide medical services to patients will be disproportionately impacted by the amendments in AB 35.

• Potential Impacts on the Defense of Medical Malpractice Claims

AB 35’s changes to Civil Code § 3333.2 will substantially increase the value of certain types of medical malpractice claims. This may have the effect of increasing the number of claims filed, since plaintiff attorneys may be willing to take on cases that they would have passed on previously due to the $250,000 damages cap. The potential for up to three separate noneconomic damage awards will also likely lead to more claims being pursued against hospitals since they cannot legally employee physicians to provide patient care pursuant to California’s prohibition on the corporate practice of medicine. The new law would likely lead to more cases where a hospital and physician are named in the lawsuit, since it could lead to separate noneconomic damage awards with two damage caps instead of one. As of January 1, 2023, that would equate to a potential noneconomic damage award of $700,000. This amount is likely sufficient for some plaintiff attorneys to justify the expense of hiring medical experts to review a case. Similarly, ambulance companies unaffiliated with hospital systems may face more claims in cases where there is an argument to be made that something occurring in transit to a hospital involved a separate and independent injury to a plaintiff.

For hospitals and other healthcare institutions who fall under an exception to California’s prohibition on the corporate practice of medicine (e.g. county hospitals, state agencies, nonprofit research clinics, hospitals operated for the purpose of medical education, etc.), the negligence of their employee physicians will only subject them to one potential award of noneconomic damages. This is because the definition of “health care institution” set out in Civil Code § 3333.2(j) “includes all persons and entities for which vicarious liability theories, including, but not limited to, the doctrines of respondeat superior, actual agency, and ostensible agency,” and Civil Code § 3333.2(e) provides that “[n]o health care institution defendant shall be liable for damages for noneconomic losses in more than one of the categories set forth in this section, regardless of the application or combined application thereof.”

Other changes made by AB 35 will also make filing a case more enticing for plaintiff’s attorneys. Business and Professions Code § 6146 previously decreased the percent a plaintiff’s attorney could retain as a contingency fee in a medical malpractice case the larger the award was. Prior to the proposals in AB 35, a plaintiff’s attorney could obtain 40% of the first $50,000, 33.33% of the next $50,000, 25% of the next $500,000, and then 15% of any award beyond $600,000. Now, AB 35 changes the fees available to 25% of any amount of recovery if the case is settled prior to a civil complaint or demand for arbitration being filed, and then 33% of any recovery after the case is filed in civil court or a demand for arbitration is filed. Additionally, if a plaintiff’s attorney has to try the case, or arbitrate it, the plaintiff’s attorney may file a motion with the court or arbitrator seeking permission for a contingency fee in excess of 33%.

The increased noneconomic damages cap in combination with the increased contingency fee provisions under AB 35 is a recipe for an increase in the willingness of plaintiff attorneys to take on medical malpractice cases that previously would not have been economically viable. As such, we expect to see more medical malpractice cases being filed after January 1, 2023 to take advantage of the increased noneconomic damages caps.

In addition to these important changes to MICRA, Code of Civil Procedure § 377.34, which governs survival claims, was also amended effective January 1, 2022, with a sunset provision of December 31, 2025, to permit the recovery of noneconomic damages for a decedent’s pain and suffering, damages that were not previously recoverable in survival claims. Pursuant to the recently enacted amendment to § 377.34, any survival case filed between January 1, 2022 and January 1, 2026 allows a decedent’s representative or successor in interest recover noneconomic damages, subject to the MICRA cap. This may also increase the number of cases filed between January 1, 2023 and January 1, 2026. If you have any questions about how the changes to MICRA might impact your exposure to liability, reach out to us at frontdesk@hassard.com

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[1] “A corporation is an ‘affiliate’ of, or a corporation is ‘affiliated’ with, another specified corporation if it directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with the other specified corporation.” Corp. Code § 150.