California WC Medical Mileage Rate to Increase to 72.5 Cents/Mile For Travel o/a 1/1/26

This morning the IRS issued a news release announcing that the standard mileage rate for business miles will increase from 70.0 cents per mile to 72.5 cents per mile effective January 1, 2026. As a result, the amount payable to California injured workers for travel related to medical treatment or evaluation of injuries also will increase to the new rate.  Workers’ compensation claims administrators should apply the new rate for travel on or after January 1, 2026, regardless of the date of injury, but should continue to pay the current rate of 70.0 cents per mile for travel that occurred during calendar year 2025.    

California workers’ comp medical mileage requirements [LC §4600(e)(2)] work in conjunction with Govt Code §19820 and Department of Personnel Administration (DPA) regulations.  Claims administrators are required to reimburse mileage at the rate adopted by the DPA Director for non-represented (excluded) state employees, which is tied to the IRS published mileage rate.

Annual adjustments to standard mileage rate for business use typically take place at the beginning of each calendar year and are based on an annual study of the fixed and variable costs of operating an automobile, which include the cost of gasoline and depreciation.  Despite recent reductions in gasoline prices in California and the U.S., apparently those reductions either did not occur prior to the calculation of the latest increase or failed to offset the increases that occurred earlier this year.  

To alert the community, the Institute has also issued a Bulletin and a news release on the new rate. The DWC is aware of the increase and is expected to issue a Newsline, which will be posted at www.dir.ca.gov/dwc/dwc_newsline.html. The mileage rate has been adjusted multiple times over the past decade, so the DWC also has posted downloadable mileage-expense forms in English and Spanish that show applicable rates by travel date under “Medical Forms” on its Forms page (click here). 

Given the short lead time and the upcoming New Year’s holiday, the Institute recommends you alert your claims staff and system programmers immediately that the mileage rate for medical travel on or after January 1, 2026 will be increasing to 72.5 cents per mile. 

BY/