I’m thinking about having the penalties start at level 2 instead of level 4. So Grazed would start at hp 75% or lower with -2 penalties. The second penalty, Wounded at 50% would kick in at level 4 (-4 penalty), and the third, Critical, would kick in at level six (with -6 penalty).

This is harder on spellcasters though, because a -2 penalty to attack at level 2 is going to reduce their BAB to -1, and their effective caster level to 0, so they can only cast cantrips once their health drops below 75%. Of course a spellcaster is likely to die in two to three hits anyway at level 2, so they’re going to be trying to stay out of combat already.

At that rate, I may as well just have the first penalty start at level 1, since level 2 with less than 75% health is arguably worse than level 1 with no chance of penalty. So maybe I should just say the penalties kick in at 1, 3, and 5. This would also mean that full BAB characters could have a -1 BAB at level 1, level 3, and level 5 if they have the maximum penalty I grant at that level.

Still, better than just starting at with all penalties at level 1, since one hit can put a character under 25% health pretty easy at level 1.

Making them wait until level 4 to start seeing penalties seems a long time to go without. I’d like to introduce it earlier, but I don’t want to do so in a way that seems too punishing at the low levels when every +1 is very significant. I’ll have to think about it some more.

Instead of gaining +1 ability point, could just gain +0.5 modifier, with fractions rounding down on rolls. That would require that people spend two of them in the same ability to see a mechanical benefit though.