California WC Medical Mileage Rate To Increase to 62.5 Cents/Mile For Travel o/a 7/1/22
This morning the IRS issued a news release announcing a rare, mid-year increase in the standard mileage rate for business miles. According to the IRS, the rate will increase from 58.5 cents per mile to 62.5 cents per mile effective July 1, 2022. 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 July 1, 2022, regardless of the date of injury, but should continue to pay the current rate of 58.5 cents per mile for travel that took place between January 1, 2022 and June 30, 2022.
California workers’ compensation medical mileage requirements [LC §4600(e)(2)] work in conjunction with Government 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. However, today’s IRS news release (posted here) notes that the decision to opt for a special adjustment for the final months of 2022 was made in recognition of recent gasoline price increases. Nationwide, the average price of a gallon of gasoline is fast approaching $6 per gallon, and in California it is already well over that level.
To alert the community, the Institute will also be issuing a Bulletin and a news release on the new rate. We also have advised the DWC of the increase and the Division is expected to issue a Newsline on the new rate once it receives confirmation from the DPA. DWC Newslines are 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 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). The DWC is expected to post a new form with the revised rate soon, but given the time required to update systems, you may want to give a heads up to your claims staff and system programmers as soon as possible that the mileage rate for medical travel on or after July 1, 2022 will be increasing to 62.5 cents per mile.
BY/