In June 2026, California Governor Gavin Newsom signed landmark legislation into law: Senate Bill 623, formally known as the Fair Medical Billing & Rideshare Safety Act. This historic measure brought a sudden end to what was projected to be a $150 million political battle between Uber Technologies, Inc. and the Consumer Attorneys of California (CAOC). Both organizations had qualified competing, high-stakes ballot measures for the November 2026 statewide election—Uber targeting trial lawyer contingency fees and medical lien practices, while consumer advocates pushed for strict corporate accountability, safety disclosures, and background check mandates for app-based transportation network companies (TNCs).
Rather than waging a bitter, unpredictable ballot fight, key stakeholders negotiated a historic compromise. Codified under SB 623, this new statutory framework reshapes how rideshare accident claims are litigated, valued, and settled across California. For passengers, drivers, and pedestrians injured in an Uber or Lyft crash, understanding how SB 623 impacts medical bills, lien recoveries, and legal representation is essential to protecting their right to fair financial compensation.
1. The Political Backstory: How the 2026 Rideshare Compromise Was Struck
To understand the practical effect of SB 623, it is important to review the high-stakes political standoff that led to its unanimous passage. Ahead of the 2026 election cycle, Uber sponsored a sweeping ballot initiative aimed at fundamentally altering California’s personal injury landscape. Uber’s proposed measure sought to place a 25% cap on attorney contingency fees across all motor vehicle accident claims statewide and strictly limit how plaintiffs could calculate recoverable medical expenses.
In response, the Consumer Attorneys of California (CAOC) sponsored an aggressive counter-initiative focused on rideshare safety, passenger assault prevention, and corporate transparency. Recognizing that a protracted media campaign would drain tens of millions of dollars without guaranteeing a favorable outcome, leaders from both camps—alongside legislative leadership—reached a mediated compromise shortly before the state deadline to withdraw ballot measures.
The result was SB 623: a targeted statutory reform package that addresses specific financial abuses in medical lien practices and strengthens rideshare safety requirements, while preserving full access to justice and un-capped contingency fee legal representation for crash victims.
2. Medical Lien Reforms under SB 623: Benchmarks and Transparency
The core statutory change introduced by SB 623 governs how medical expenses are claimed and recovered in civil lawsuits or arbitrations involving Transportation Network Companies (TNCs) like Uber and Lyft. In California personal injury law, a “medical lien” occurs when an uninsured or underinsured crash victim receives medical treatment from a healthcare provider who agrees to wait for payment until the personal injury claim resolves.
While medical liens provide a vital lifeline for crash victims needing urgent surgeries, specialized care, or diagnostic imaging, the industry faced growing criticism over inflated, arbitrary billing and secretive third-party lien sales. SB 623 introduces three major structural controls on lien-based care in rideshare accident claims:
- FAIR Health Database Capping: Under SB 623, maximum recoverable damages for medical treatment provided on a lien basis in a rideshare accident are capped at the 70th percentile of billed charges listed in the objective FAIR Health database for the same service within that specific geographic area.
- Cap on Sold or Transferred Liens: If a medical provider sells or transfers a patient’s medical lien to a third-party medical finance or factoring company, the maximum recoverable medical damages cannot exceed the actual dollar amount paid by the finance company to acquire that lien. If a factoring firm buys a $40,000 surgeon’s lien for $12,000, the maximum recoverable damage in court for that item is strictly capped at $12,000.
- Mandatory 30-Day Disclosure: SB 623 mandates that any sale, assignment, or transfer of a medical lien must be formally disclosed to all parties in litigation within 30 days, eliminating hidden financial arrangements that previously stalled settlement talks.
3. New Ethical Rules Governing Attorneys and Healthcare Providers
In addition to financial capping mechanisms, SB 623 imposes strict ethical boundaries designed to eliminate conflicts of interest between personal injury attorneys and medical providers. In civil claims arising from an Uber or Lyft accident, the law strictly prohibits the following:
- Self-Dealing and Ownership Referrals: A contingency-fee attorney representing a rideshare accident victim is prohibited from referring clients to any medical provider in which the attorney—or an immediate family member—holds a direct financial or ownership interest.
- Referral Fee Kickbacks: SB 623 explicitly makes it unlawful for personal injury law firms to offer, pay, split, or receive referral compensation or financial bonuses connected to lien-based medical care.
- No Administrative Fee Surcharges: Personal injury lawyers are barred from charging clients additional administrative, management, or success fees for negotiating or reducing medical liens at the conclusion of a case.
4. Heightened Rideshare Safety Mandates and Driver Vetting
Beyond insurance claims and civil litigation mechanics, SB 623 incorporates important safety enhancements advocated by consumer safety groups and personal injury trial lawyers. The legislation establishes strict operational mandates for all app-based transportation network companies operating in California:
- Mandatory Annual Criminal Background Checks: Rideshare platforms are now legally required to perform comprehensive background checks on all drivers prior to account activation, as well as mandatory annual re-screenings thereafter.
- Expanded Disqualifying Offenses: SB 623 broadens the list of criminal convictions and serious traffic violations that automatically disqualify individuals from driving for an app-based platform.
- In-App Safety Innovations: The law provides explicit statutory protections authorizing rideshare companies to implement features such as women-to-women driver and passenger matching preferences to enhance rider security.
5. What Has NOT Changed for Rideshare Accident Victims
For individuals injured in a California rideshare crash, understanding what SB 623 did not change is just as vital as understanding its new provisions. Key protections preserved under the compromise include:
- No Attorney Fee Caps: The proposed 25% cap on personal injury attorney fees was entirely abandoned. Injured victims maintain the freedom to hire experienced trial attorneys under standard contingency fee agreements.
- Scope Restricted to Rideshare Claims: SB 623 applies exclusively to accidents involving app-based rideshare network companies, their subsidiaries, or active drivers. Standard two-vehicle passenger car crashes remain governed under existing California tort law.
- Full Recovery for Pain and Suffering: The law places zero limits on non-economic damages. Accident victims can still seek full compensation for physical pain, emotional distress, lost income, and future disability caused by a negligent rideshare driver.
By bringing transparency to medical billing while reinforcing driver background standards, Senate Bill 623 establishes a balanced legal framework for California rideshare accident claims. Victims who suffer injuries in an Uber crash can still pursue comprehensive legal remedies, confident that their rights to legal representation and full financial recovery remain firmly protected.