When taking damage allow -1 HP per character levelThere's a case to be made that this is just Gary's "Characters are only unconscious at 0 HPs. For each level a character may have a minus HP total equal to the level, so a 1st level PC is dead at -2, a 2nd level at -3, etc." house rule restated in another form.
But how about taking it as read?
Characters deduct 1hp/level from all damage sustained. This rule would effectively give all characters 3E-style damage reduction, allowing them to laugh off nicks and scratches as they grow in level.
OK, it might harm verisimilitude that the Orcs of the Lowly Beatstick tribe can no longer mob and gang pound Lord Slashstab when he reaches a certain level, but it appears to be in keeping with the source material for D&D. Fafhrd and the Grey Mouser, Elric, Kane, [your preferred S&S hero here] are hardly ever in any real danger from single unnamed lowbies getting in a lucky blow; it takes memorable and major threats to concentrate the minds of such bad-asses.
I might have to give this a try IMG...