California WC Medical Mileage Rate Will Drop to 53.5 Cents/Mile For Travel O/A 1/1/17

The IRS has announced that the standard mileage rate for business miles will decrease from 54 cents per mile to 53.5 cents per mile effective January 1, 2017. As a result, the amount payable to California injured workers for travel related to medical treatment or evaluation of injuries also will decrease to the new rate. Workers’ compensation claims administrators should apply the new rate for travel on or after January 1, 2017, regardless of the date of injury, but should continue to pay the current rate of 54 cents per mile for travel that took place in 2016.

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.

The IRS announcement released today notes that the average rates were updated following an independent, annual study of the costs of operating an automobile. That study factors in gasoline prices as well as other fixed and variable costs, including depreciation.

The Institute will issue a Bulletin and a news release on the new rate, which will be posted on our website (http://www.cwci.org/). We have advised the DWC, and requested that they issue a Newsline on the 2016 rate, which they are likely to do after the DPA issues a Personnel Management Liaison memo announcing the change to state agencies and departments. DWC Newslines are posted at http://www.dir.ca.gov/dwc/dwc_newsline.html.

Because the mileage rate has changed multiple times over the past decade, the Division has posted downloadable mileage-expense forms that show applicable rates by travel date under Claim and Court Forms on the Forms page of its website, at www.dir.ca.gov/dwc/forms.html. The DWC is expected to post an updated form with the 2017 rate soon, but given the upcoming holidays and the time required to update systems, you may want to give a heads up to your claims staff and system programmers that the mileage rate for travel on or after 1/1/17 is decreasing to 53.5 cents per mile.

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