Senate Bill 1127, signed and approved by Governor Gavin Newsom on September 29, 2022, went into effect beginning January 1, 2023. The new law reduces the claim investigation period from 90 to 75 days for certain injuries. SB 1127 states,

For certain injuries or illnesses, including hernia, heart trouble, pneumonia, or tuberculosis, among others, sustained in the course of employment of a specified member of law enforcement or a specified first responder, this bill would reduce those time periods to 75 days. The bill would make other conforming changes.

Additionally, the law imposes up to $50,000 in penalties for “unreasonably delayed benefits,” for claims outlined above, leaving the Workers’ Compensation Appeals Board to determine whether the denial of liability is reasonable. SB 1127 further states, “The bill would apply this provision to all injuries, without regard to whether the injury occurs before, on, or after the operative date of the bill.”

The language of the bill is vague and does not clearly define the criteria for law enforcement or first responders that the new law applies to. It further leaves room for additional injuries or illnesses to be included as a qualifying condition. SB 1127 also does not provide any guidance for assessing whether a denial of benefits is unreasonable.

The provisions of SB 1127 will alter how claims are investigated and will require a more prompt and diligent investigation within the first 75 days of a claim. Considering the bill’s minimal guidance, it is imperative now more than ever to ensure that claims are investigated and decisions are issued timely. Additionally, the basis for denying a claim is now even more crucial, as denials are surely to be challenged more frequently for potential penalties.

SB 1127 also includes additional regulations related to temporary disability benefits and presumptions. Ensuring claims administrators and employers are aware of the new requirements can avoid potential delays and additional exposure.