California is set to make significant changes to state law limiting the amount of money an injured patient can receive. In any action for injury that does not involve death, the cap on non-economic damages will increase to $350,000, with incremental increases over the next 10 years to $750,000. In any action for wrongful death, the cap on non-economic damages will increase to $500,000, with incremental increases over the next 10 years to $1 million. These changes in state law take effect January 1, 2023 and will impact demands for arbitration and cases filed on or after that date. Beginning January 1, 2034, the limitations on non-economic damages will be adjusted annually for inflation by 2%. These caps 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.

In addition to increasing the cap on non-economic damages, the reforms made by Assembly Bill 35 include revisions to limits on attorney contingency fees. If recovery is made prior to the filing of a civil complaint or arbitration demand, then attorney contingency fees are limited to 25% of the amounts recovered and if recovery is made after filing of a civil complaint or arbitration demand, then attorney contingency fees are limited to 33% of the amount recovered. Going forward, attorney fee limits will be based on the stage of representation, rather than the amount recovered by the patient.

Although California law had long protected medical professionals offering expressions of sympathy, the new state law broadly expands these protections. Under Chapter 3 of the Health and Safety Code, expressions of sympathy or regret or accepting fault relating to the pain, suffering, or death of a person or to an adverse patient safety event or unexpected health care outcome that is made prior to the filing of a lawsuit or demand for arbitration will be confidential, privileged, protected, not subject to subpoena, discovery, or disclosure, and will not be admitted into evidence in any civil, administrative, regulatory, licensing, or disciplinary action or proceeding. Statements made after a patient or family member has filed a lawsuit or made a demand for arbitration would not be covered by these confidentiality protections.