California’s malpractice payouts would rise under deal to avoid ballot fight

SACRAMENTO — Cash payments in California medical malpractice cases would go up for the first time in nearly five decades under a deal between rival interest groups announced Wednesday that avoids a costly battle at the ballot box in November.

The overhaul to the long-standing Medical Injury Compensation Reform Act of 1975, known as MICRA, will be outlined in a bill scheduled to be introduced Wednesday in the California Legislature, with the deal requiring that it be signed into law by Gov. Gavin Newsom before June 28 — the deadline for removing a related measure from the Nov. 8 statewide ballot.

“I never thought this would happen,” said trial attorney Nick Rowley, who bankrolled the effort to gather voter signatures for placing a measure on the ballot. “I never thought we would work out a legislative solution.”

California’s medical malpractice cap imposes a $250,000 limit on how much patients can be awarded for damages that are not directly related to medical bills and economic losses, such as lost earnings. But critics have argued that a cap on awards for pain and suffering severely limits how much injured children, retirees and stay-at-home parents can receive while also deterring attorneys from taking on the complex cases.

The deal reached after several weeks of intense negotiations between attorneys and doctors groups would raise the legal cap on pain and suffering awards to $350,000 beginning Jan. 1. That amount would gradually increase over a 10-year period to $750,000.

In cases involving a patient’s death, the cap on pain and suffering awards would increase to $500,000 on Jan. 1 and would grow to $1 million over the next decade. After that, the cap would be adjusted annually by a 2% cost of living increase.

Then-Gov. Jerry Brown signed MICRA into law in 1975 amid concerns that doctors were retiring or leaving California due to rising insurance premiums, blamed on the size of malpractice awards. Patient groups have long argued that MICRA needs to be updated, pointing out that if the cap had been annually adjusted for inflation, it would now be $1.3 million.

The agreement will be contained in amendments to Assembly Bill 35 and coauthored by Assembly member Eloise Gómez Reyes, D-San Bernardino, and state Sen. Tom Umberg, D-Orange.