How Will MICRA Updates Affect Medical Professionals?

Governor Gavin Newsom recently signed into law a bill that raised the amount of money a patient can receive for pain and suffering in a medical malpractice case. It has been over 40 years since the Medical Injury Compensation Reform Act was signed, setting the cap for suffering recompense at $250,000. The new assembly bill, AB 35, increases the cap on non-economic damages in cases NOT involving a wrongful death claim to $350,000 and will increase each year by $40,000 until it reaches $750,000. The cap for cases with a wrongful death will increase to $500,000 and will increase each year by $50,000 until it reaches $1 million. Currently, MICRA only sets a cap on non-economic damages such as pain and suffering.

So, what does this mean for medical professionals?

Unfortunately for doctors and other medical professionals in California, this update will likely mean rising rates in Medical Malpractice Insurance premiums. Insurance carriers will now be taking on the risk of much higher claims for non-economic damages, and will need to receive higher premiums to make up for this added risk. Over the next few years, medical professionals can expect their premiums to steadily rise, as insurance carriers will need to find the money to offset the added risk of higher payments for malpractice claims.

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