The 2024 study of California's Subsequent Injuries Benefits Trust Fund is facing renewed scrutiny following findings published by The Jacobi Journal of Insuranceinvestigation. The Journal's independent review suggests the 2024 study may have overstated SIBTF's unfunded liability by roughly $6.75 billion, or more than six-fold compared with the Journal's recalculated estimate. The state-commissioned report had concluded that the SIBTF faced $7.9 billion in unfunded obligations, a figure cited throughout 2025 legislative discussions that led to proposals adjusting eligibility and benefits for severely disabled workers. The SIBTF provides supplemental benefits to workers with significant pre-existing disabilities who incur additional workplace injuries, with the program funded through California's workers' compensation system to help prevent long-term reliance on general public assistance.
According to The Jacobi Journal, the large difference in liability estimates stems from assumptions embedded in the report's model. Key variables include the proportion of open claims expected to result in payments and the method used to calculate the present value of lifetime disability awards. The report projected that 91% of open SIBTF cases would ultimately result in benefit payments, while the Journal's review, based on historical closure data, suggests a likely payout rate closer to 24–44%. The report's model implied an average present value of about $933,000 per 100% disability case. The Journal's analysis, using more typical actuarial inputs—a 7% discount rate, a 2.6% cost-of-living adjustment, and a shorter life expectancy assumption—produced a lower value of roughly $418,000. The Journal notes that the combination of a low discount rate (3%) and a high COLA (3.9%) in the report's calculations substantially inflated the long-term liability projection.
When modeled with alternative parameters, the Journal's total estimate of $1.25 billion reframes the SIBTF's fiscal position as a significant but manageable obligation. This variance in estimates could have important policy consequences, as lawmakers relied in part on the report's $7.9 billion figure when drafting legislation, including Senate Bill 1329 (2025), aimed at modifying SIBTF benefits. If the Journal's lower estimate proves more accurate, stakeholders argue the urgency for deep benefit reductions may require reassessment. A recalibrated understanding of the fund's obligations also affects California's broader fiscal planning. Reducing SIBTF support could shift financial responsibility from a specialized, employer-funded system toward taxpayer-funded safety-net programs such as Medi-Cal and Supplemental Security Income (SSI), potentially raising general fund expenditures. Mark Hyman of MedLegalNews.com stated that this case illustrates how financial modeling assumptions can substantially influence policy outcomes, emphasizing that accurate actuarial data is vital to ensure that reforms strike the right balance between fiscal responsibility and worker protection.
