American Bank and Trust Co. v. Community Hospital of Los Gatos-Saratoga Inc‪.‬

[36 Cal3d Page 363] In May 1975, the Governor -- citing serious problems that had arisen throughout the state as a result of a rapid increase in medical malpractice insurance premiums -- convened the Legislature in extraordinary session to consider measures aimed at remedying the situation.1 In response, the Legislature enacted the Medical Injury Compensation Reform Act of 1975 (MICRA) (Stats. 1975, Second Ex. Sess. 1975-1976, chs. 1, 2, pp. 3949-4007), a lengthy statute which attacked the problem on several fronts. In broad outline, the act (1) attempted to reduce the incidence and severity of medical malpractice injuries by strengthening governmental oversight of the education, licensing and discipline of physicians and health care providers, (2) sought to curtail unwarranted insurance premium increases by authorizing alternative insurance coverage programs and by establishing new procedures to review substantial rate increases, and (3) attempted [36 Cal3d Page 364] to reduce the cost and increase the efficiency of medical malpractice litigation by revising a number of legal rules applicable to such litigation.