For nearly fifty years, California's Medical Injury Compensation Reform Act — MICRA — held non-economic damages in medical malpractice cases to $250,000. Adjusted for inflation, that cap had shrunk to roughly $70,000 in 1975 dollars by the time it was finally restructured. Assembly Bill 35, signed by Governor Newsom in May 2022, replaced the static cap with a scheduled-increase model that took effect January 1, 2023 and continues climbing through 2033.
The Consumer Attorneys Association of Los Angeles and Consumer Attorneys of San Diego have both filed amicus in the MICRA-cap line of California Supreme Court matters, and their published materials track the annual cap progression alongside the underlying tort-reform debate.
Three years into the schedule, here is where the 2026 caps land and what the trajectory looks like for the rest of the decade.
The 2026 Numbers
AB 35 split MICRA into two cap tracks — one for non-death cases, one for death cases — and indexed both for annual increases. As of January 1, 2026:
- Non-death cases: the cap is approximately $470,000 in non-economic damages. The schedule was $350,000 in 2023 and increases by $40,000 annually through 2033.
- Death cases: the cap is approximately $650,000. The schedule was $500,000 in 2023 and increases by $50,000 annually through 2033.
Once the scheduled increases complete in 2033, the caps will sit at $750,000 (non-death) and $1,000,000 (death). After that, the statute provides for 2% annual inflation indexing in perpetuity.
What the Cap Covers, and What It Doesn't
MICRA's caps apply only to non-economic damages — pain and suffering, loss of consortium, disfigurement, and similar non-monetary loss — in actions for professional negligence against health-care providers. Several things the cap does not touch:
- Economic damages. Past and future medicals, lost wages, lost earning capacity, and future care costs are uncapped.
- Punitive damages. The cap doesn't reach punitive awards in cases where punitives are available.
- Multiple defendants. AB 35 also restructured how the cap applies when multiple health-care providers or institutions are defendants. Plaintiffs can recover up to the cap from each of three defendant categories: health-care providers, health-care institutions, and unaffiliated providers. That can effectively triple the non-economic ceiling in some cases.
- Non-medmal PI. The cap does not apply at all to auto, premises liability, product liability, or most other personal injury actions outside of a professional-negligence claim against a health-care provider.
Why the Cap Still Matters for General PI Practice
Even firms that don't take medical-malpractice cases brush up against MICRA in three recurring contexts:
- Mixed-fault cases involving subsequent medical treatment. A PI plaintiff whose initial injury was caused by a tortfeasor and whose treating provider committed independent malpractice in the course of treating that injury may have a second cause of action subject to MICRA. The two claims interact at settlement.
- Cross-defendant indemnification. Where a defendant in a PI action seeks indemnification from a treating provider on a malpractice theory, MICRA shapes the recovery ceiling on that cross-claim.
- Future-care valuation. Life-care planners pricing future medical care for a PI plaintiff use current rates — rates that themselves reflect provider liability premiums shaped by MICRA. The cap influences the broader cost of care, even where it does not directly cap recovery.
The Practical Settlement Impact
Three years in, plaintiff's counsel and defense counsel have largely settled into a new equilibrium. Cases that pre-reform were settling at or near the $250,000 cap now settle at numbers reflecting the higher current cap, with the trajectory through 2033 factored into multi-year matters. Cases with significant economic damages — which is to say, most serious medmal cases — have seen the most movement, because the cap was always a binding constraint there and is now a less binding one.
Looking Ahead
The annual increase mechanism runs on autopilot — no legislative action required — through January 1, 2033. After that, the 2% indexing takes over. Legal challenges to the new framework have largely petered out; the constitutional questions that surrounded the original MICRA in the 1980s have not resurfaced around AB 35.
For a working playbook on how cap changes get reflected in damages-section analysis, see our guide to structuring demand letters. For broader context on the lien-medicine ecosystem that frames most non-medmal California PI cases, see the Liens & Settlement category.
This article reflects the AB 35 schedule and the 2026 calendar-year cap levels as of publication. Verify current cap figures with primary sources before relying on them for case valuation.