December 15, 2025 | SIBTF.org — The outlook for SIBTF reform remained stalled through 2025, as legislative delays and budget constraints kept the status quo intact. Employers, insurers, and claimants navigated a challenging environment while concerns over the fund’s rising liabilities continued to mount.
Governor Gavin Newsom’s October 2025 veto of Assembly Bill 1329 highlighted the need for a more comprehensive approach to reform. While the bill proposed changes to eligibility and claims processes, the governor determined it did not sufficiently address systemic challenges or long-term sustainability of the SIBTF.
Why 2025 Didn’t Deliver Reform — But 2026 Still Matters
Although AB 1329 introduced measures such as revised Qualified Medical Evaluator processes and potential claim deadlines, the legislation fell short of addressing the growing fiscal pressures and delayed benefits associated with the fund. Governor Newsom emphasized that without a broader plan, SIBTF costs could rise sharply, leaving employers and insurers exposed to increasing assessments.
The governor has now tasked the Division of Workers’ Compensation and the Department of Industrial Relations to develop a comprehensive reform plan for the 2026–27 budget cycle. This directive sets the stage for potential structural changes, including modifications to eligibility standards, claims procedures, and medical evidence requirements.
What to Expect in 2026: Fund Redesign and Policy Priorities
Stakeholders should anticipate that 2026 may bring substantive policy changes, such as:
- Long-term financial sustainability initiatives
- Redesigned claims processing workflows
- Improved timeliness of benefit payments
- Potential revisions to eligibility and medical evidence standards
These anticipated changes could significantly influence how employers, insurers, and claimants manage SIBTF exposure and compliance in the coming year. With the upcoming SIBTF reform expected to introduce updated eligibility standards, revised medical evidence requirements, and redesigned claims workflows, organizations will need to review and adjust internal processes, reporting practices, and risk management strategies.
Insurers should prepare for potential adjustments to assessment formulas and funding allocations, while employers may need to strengthen documentation and tracking of workplace injuries to align with the reformed fund. Claimants will benefit from improved transparency and faster benefit distribution but must remain attentive to any new procedural or evidentiary requirements that could affect their claims.
Overall, the SIBTF reform represents a critical opportunity for all stakeholders to proactively engage with upcoming policy changes, reduce exposure to liability, and support a more efficient, equitable, and financially sustainable fund.
What This Means for Employers and Insurers
For now, the status quo continues through the end of 2025, but the promise of a comprehensive 2026 reform plan creates a critical window for preparation. Employers and carriers should closely monitor upcoming legislative sessions and agency guidance to anticipate changes that could affect liability, assessments, and operational practices.
For more information on SIBTF reforms and updates, readers can refer to: California Division of Workers’ Compensation – SIBTF Overview.
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Read More from SIBTF.org:
- WCAB Rulings Continue to Reshape SIBTF Claim Outcomes in 2025
- Governor Newsom Orders Comprehensive SIBTF Reform Ahead of 2026 Budget
- Rising SIBTF Costs: California Employers Face Financial Pressure in 2025
FAQs: SIBTF Reform 2026
Why didn’t SIBTF reform occur in 2025?
Legislative delays, budget constraints, and the veto of Assembly Bill 1329 prevented comprehensive changes, leaving the fund’s eligibility, claims processes, and financial pressures largely unaddressed.
What is the governor’s plan for the SIBTF reform in 2026?
Governor Newsom has directed the Division of Workers’ Compensation and the Department of Industrial Relations to develop a comprehensive reform plan for the 2026–27 budget cycle, focusing on eligibility, claims procedures, and fund sustainability.
How will the 2026 reforms impact employers and insurers?
Employers and carriers may see adjustments to assessments, operational practices, and compliance requirements. Preparing now for potential policy changes can help mitigate exposure and ensure smoother adaptation.
What changes could injured workers expect?
The reforms aim to improve the timeliness of benefit payments, streamline claims processing, and clarify eligibility and medical evidence standards, ultimately reducing delays and uncertainty for claimants.