RPGMemes

Nature is rather fond of its laws and so decides to perturb you right back.

"Your character has started to understand and unlock the secrets of undeath. Do this again and you may need to find a phylactery quick, because each time moves you one step closer to becoming a lich"

It goes off but doesn't heal you because the text specifically says

The touch of your shadow-wreathed hand can siphon life force from others to heal your wounds.

I mean, there's always a way to houserule something to fix the broken rules. Unless you're DMing an AL game.

You're still dealing damage, e.g. it could kill you from the massive damage rule if you dealt enough. Vampiric touch counts how much damage you deal, not how much hp the target loses.

As I've pointed out in other comments there's a specific rule for damage past 0 HP. It's called “Damage at 0 Hit Points.” under the Death Saving Throws section, and it doesn't say anything about it getting cancelled out.

Suggestion: Lich Taint

They haven't become a lich by any means, but they've been touched by the aspect of lichdom. Lich's being rather territorial, they will be noticed by any others with associations to a lich, and that lich will be curious...the player will be investigated. If there is a reason for them to remain curious, expect an interview and serious questions.

Not a problem, I’ll just grab some of the years from the end of my life and just kinda stuff them into the present to get me through.

Good as new without any downsid- why is my hair falling out?

"The contingent spell takes effect only on you, even if it can normally target others"

I don't think the spell being intended to affect others is a problem here.

I don't think there is any issue with a contingency being on knockout. It seems like a perfectly reasonable and intended trigger.

What is more of an issue is that the spell does require an attack roll. There is no RAW mechanic for allowing a hit, so I think to hit yourself you do have to successfully roll to hit. Knocked out means that a player is unaware of its surroundings, can't move, and is incapacitated. I think even though the spell could otherwise trigger, the character doesn't have the ability to compete the requirements needed at "spell engagement", more on this later. Under this reading a DM could still allow it via rule of cool, but keep it mainly grounded with a con save to allow the attack and/or use disadvantage on the attack roll.

There is another way to read this, as contingency that says the spell is cast ahead of time, but doesn't go into affect until the trigger. Above I had to use the words "spell engagement", which I pulled out of my ass to say when the trigger went off. It could be argued that the attack is actually part of the spell casting. If so then the attack roll on themselves would occur before the knockout and that could let it work. Then the only question is does the damage occur up front or at trigger. I'd argue that if damage occured up front it's a little more balanced, however if the trigger was if something like "immediately before I'm knocked out" (which I personally might require a check at casting for that kind of accuracy) I might let them keep the concentration on the spell as they take no damage and were never truly knocked out. If they take damage at trigger instead, then they were definitely knocked out, and if they were knocked before they were healed the spell went into affect when they couldn't hold it up with concentration as they were out, so the spell is just one time healing, if valid at all as they were never able to concentrate.

Either way, this is not really op rule gaming, despite all the chicanery and hoop jumping. Contingency is sixth level and could work with a normal healing spell if they had one. It's also very likely to not be huge in a fight with the best case being that it was prepared by a very high level wizard who long rested previous to battle. The minimal version requires level 11 wizard who is knocked out and comes back with an average of 10 HP (unless upcasting vampiric touch) and it's not even their turn. The most op version for a level 20 wizard using a ninth level upcast of vampiric touch still only averages 31 HP. They stand a good chance to be hit by a second attack and downed again with the CR of creature they are likely fighting at these levels, and this trick is only really decent once a battle.

Vampiric touch counts how much damage you deal, not how much hp the target loses.

It's definitely a flavor fail, but unless you houserule in a cap to damage dealt at 0 hp, (and houserules for how to handle massive damage and the rules for being dealt damage at 0 hp that would be affected,) there's not a limit to how much hp you gain based on the hp of the target.

The failed death save. Kinda. But that's how I would see and rule it.

You trigger after you take damage but before you fall unconscious, like numerous other triggers in the game. I just used the Strength Before Death example because it shows even without magic there's enough time to squeeze a whole ass turn in between those two events.