March 26, 2025 | SIBTF.org – SIBTF reform is at the heart of new legislation introduced by Assembly member Liz Ortega, who has amended Assembly Bill 1329 to significantly alter California’s Subsequent Injuries Benefits Trust Fund (SIBTF), proposing its renaming to the Second-Chance Employer’s Risk Reduction Trust Fund.
The bill aims to reform the program that provides supplemental benefits to workers with pre-existing disabilities who suffer a subsequent work-related injury, resulting in a combined permanent disability rating of at least 70%.
Proposed SIBTF Reform: Key Changes in AB 1329
- Stricter Proof of Pre-Existing Disability: For injuries occurring on or after January 1, 2026, claimants under the SIBTF reform must provide “substantial evidence” of a pre-existing permanent partial disability, supported by prior medical records, testimony, and other evidence predating the subsequent injury.
- Qualified Medical Evaluator Database: As part of the proposed SIBTF reform, the Division of Workers’ Compensation will establish a centralized database of qualified medical evaluators with expertise in SIBTF claims.
- Standardized Medical-Legal Evidence: The SIBTF reform will align medical-legal evidence protocols with standard workers’ compensation procedures, with reimbursements limited to the Medical-Legal Fee Schedule.
- State Direct Payment: The Department of Industrial Relations (DIR) will assume responsibility for direct benefit payments under the restructured SIBTF system, replacing the State Compensation Insurance Fund.
- Clarification of Permanent Disability Definitions: The bill formalizes how permanent disability is calculated for claims before and after January 1, 2013, clarifying the use of whole-person impairment and the statutory diminished future earning capacity modifier—key elements in the SIBTF reform strategy.
- Fund Name Change: The “Subsequent Injuries Benefits Trust Fund” would be renamed the “Second-Chance Employer’s Risk Reduction Trust Fund” under the comprehensive SIBTF reform.
The SIBTF, created to encourage the hiring of World War II veterans, has seen a substantial increase in assessments. This surge, rising from $14 million in 2015 to $848 million in 2025, stems from several factors. Like changes in apportionment rules and permanent disability rating calculations, as highlighted in a 2024 Rand Corp. report.
Rand’s analysis also revealed significant growth in benefit payments, from $13.6 million in 2010 to $232 million in 2022. With a substantial portion going towards medical-legal expenses. The report suggested that changes in workers’ compensation law, including those in Senate Bill 863, and the Todd v. SIBTF decision, have contributed to increased SIBTF claims and liabilities.
Assembly Bill 1329, has been referred to the Assembly Insurance Committee but has not yet been scheduled for a hearing.
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Read More from SIBTF.org:
- Doctor Pleads Guilty to Writing SIBTF Reports After Suspension
- California Employers Face Mounting SIBTF Liabilities
- Summary and Background of SIBTF
- California’s Subsequent Injuries Benefits Trust Fund
FAQs: Purpose of California’s AB 1329 in Reforming SIBTF
What is the purpose of California’s AB 1329 in reforming SIBTF?
AB 1329 aims to reform California’s SIBTF program by tightening eligibility standards, improving medical-legal procedures, and renaming the fund to better reflect its modern goals. The bill responds to concerns about ballooning costs and seeks to ensure only valid claims are paid.
How will AB 1329 affect injured workers applying for SIBTF benefits?
If passed, AB 1329 would require injured workers to provide substantial pre-injury medical evidence to qualify for SIBTF benefits. It also centralizes benefit payments through DIR and standardizes medical evaluations to reduce litigation and fraud.
Why has California’s SIBTF liability grown so dramatically since 2015?
California’s SIBTF costs have surged due to evolving apportionment rules, legal decisions like Todd v. SIBTF, and changes in disability rating methodology. According to the LAO and RAND, these factors combined with SB 863 reforms significantly increased the volume and value of claims.
What is SIBTF?
The Subsequent Injuries Benefits Trust Fund (SIBTF) helps California workers who suffer a new workplace injury and already had a prior disability. It offers supplemental compensation when combined impairments severely limit earning capacity.