Colorado’s Heath Care Availability Act (“HCAA”) generally imposes a $1 million limit on medical malpractice damages awards. § 13-64-302, C.R.S. (2024). But the HCAA also provides an exception: in cases where good cause is shown, courts may find that applying the cap would be unfair and award economic damages beyond the $1 million cap. The HCAA further provides that prefiling interest is deemed part of the damages awarded in the action.
The Colorado Supreme Court held in its September 8, 2025 Opinion that prefling interest accruing on economic damages is part of the economic damages award and thus falls within the good cause exception to the HCAA’s general $1 million cap.
In Colorado, prefiling interest accrues 9% annually between the time the cause of action arises and the time of filing and, hence, is calculated only on the original principal. Post-filing interest compounds 9% annually between the time of filing and the court’s judgment and is, therefore, calculated on both the principal and the accumulated interest from previous periods. § 13-21-101(1), C.R.S. (2024); see also § 13-64-302(2).
The HCAA’s Liability Limitations and Good Cause Exception
The HCAA generally limits healthcare providers’ tort liability to $1 million in an effort to contain the costs of medical malpractice insurance and thereby the growing costs of healthcare more generally. § 13-64-102, C.R.S. (2024); § 13-64-302. Section 13-64-302 of the HCAA details the Act’s liability limitations.
Subsection (1)(b) caps liability at $1 million, of which a maximum of $300,000 may compensate for noneconomic losses.6 § 13-64-302(1)(b)–(c). However, the statute provides an exception: “[I]f, upon good cause shown,” the court finds that applying the $1 million cap “would be unfair, the court may award in excess of the limitation . . . additional past and future economic damages only.” § 13-64-302(1)(b).
Subsection (2) provides that prefiling interest is “deemed to be a part of the damages awarded in the action . . . and is included within each of the limitations on liability” established by subsection (1). § 13-64-302(2).
The question before the Colorado Supreme Court was whether prefiling interest on economic damages may fall within the good cause exception. The birth injury medical malpractice defendant argued that prefiling interest is not included within the good cause exception, and therefore courts may only award prefiling interest on economic damages up to and until the total award reaches $1 million, even upon a finding of good cause. The Colorado Supreme Court responded to the defendant’s argument: “interpreting subsection (1)(b) as creating two categories of damages, economic and noneconomic, flows logically into subsection (2), which states that prefiling interest is “deemed to be a part of the damages awarded in the action.” § 13-64-302(2) (emphases added). That is, subsection (2) dictates that where damages result from noneconomic injuries, the associated prefiling interest is part of the noneconomic damages award; if damages result from economic injuries, then the associated prefiling interest is a part of the economic damages award. Therefore, we conclude that prefiling interest is not a separate category of damages.”
“Thus, prefiling interest on noneconomic damages awards is included within the $300,000 hard cap, while prefiling interest on overall awards is included within the general $1 million cap. We further conclude that the General Assembly included prefiling interest “within” the $1 million general cap with full knowledge that the cap is subject to the good cause exception for economic damages … Hence, because the exception applies to “economic damages only,” prefiling interest on economic damages may fall within subsection (1)(b)’s good cause exception. § 13-64-302(1)(b). Accordingly, we hold that prefiling interest accruing on economic damages is part of the economic damages award and thus falls within the good cause exception to the HCAA’s general $1 million cap.”
Source Bianco v. Rudnicki, 2025 CO 49.
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