On May 16, 2022, Governor Gavin Newsom signed AB 35 (MICRA Modernization) into law. The Governor's action followed a bipartisan and nearly unanimous vote by the state Legislature. As part of the landmark agreement reflected in AB 35, proponents of FIPA have removed the initiative from the November ballot. The law will go into effect January 1, 2023. Under the modernized MICRA law, the underlying principles of MICRA were preserved -- ensuring access to care and protecting our health care delivery system from runaway costs.
The ‘Fairness for Injured Patients Act’, or FIPA, was the ballot initiative that set to end MICRA in November. FIPA would have effectively eliminated MICRA’s cap on non-economic damages by introducing a new broadly defined “catastrophic injury” category, made attorney’s fees additive on top of damages, and allowed trial lawyers to go after physicians’ personal assets. AB 35 makes significant, but much more modest, changes to MICRA’s cap on noneconomic damages, which is currently $250k and has not changed since MICRA was adopted in 1975:
Cases not involving a patient death will have a limit of $350k on the effective date of January 1, 2023, with an incremental increase over the next 10 years to $750k and a 2.0% annual inflationary adjustment thereafter. The cap
Cases involving a patient death will have a limit of $500k on the effective date of January 1, 2023, with an incremental increase over the next 10 years to $1 million and a 2.0% annual inflationary adjustment thereafter.
Critical MICRA guardrails will remain in place with modest updates include the ability to pay awards of future damages over time and limits on plaintiff’s attorney’s contingency fees. CMA has prepared a fact sheet that includes additional details on this important legislation.
Click here to read the full statement from CMA President, Robert E. Wailes, MD.
In 2014, trial lawyers sponsored an anti-MICRA initiative that appeared on the November 2014 ballot called Proposition 46. Prop. 46 is a deceptive initiative that contains a number of unrelated provisions designed to mislead and deceive voters. Prop. 46 would weaken the Medical Injury Compensation Reform Act (MICRA), California's model medical malpractice reform law that keeps malpractice rates in California stable by limiting noneconomic damages in malpractice awards while providing unlimited economic and punitive damages.
NSMS worked with CMA to fight and handily defeat Proposition 46, clearly saying NO to changes in MICRA that would have quadrupled the cap on non-economic damages. On November 4, 2014, the voters of California spoke loudly and definitively to defeat Prop. 46. According to the Secretary of State’s current results, 67% of California voters said no to the trial lawyers’ deceitful proposition, and only 33% said yes.
This victory is a testament to the effectiveness of professional medical associations, which have steadfastly defended this assault on California’s tort reform – Medical Injury Compensation Reform Act (MICRA) – to preserve access to care and the ability of physicians to serve their patients.
The California Medical Association (CMA) was masterful in its response to trial lawyer vitriol, ensuring that our State Legislators and the public understood the ruse the trial lawyers were running and the consequences that their self-serving proposal would have for Californians. CMA also effectively brought together one of the largest and most diverse coalitions ever amassed against a statewide proposition, from organized labor to the Chamber of Commerce, the ACLU, California NAACP, Planned Parenthood, local governments, taxpayer organizations, and on and on. CMA engaged editorial boards and political parties on both s ides of the aisle to understand the terrible consequences of Proposition 46 and oppose it.
Proposition 46 taught us the power of a strong coalition, and this time around it will be even more important.