New analysis exposes serious methodological flaws and potential bias in RAND’s 7.9 billion dollar estimate, sparking calls for greater accountability in state-funded research
Hartford, CT, Jan. 06, 2026 (GLOBE NEWSWIRE) — A detailed investigative analysis by The Jacobi Journal concludes that the RAND Corporation’s 2024 report on California’s Subsequent Injuries Benefits Trust Fund (SIBTF) dramatically inflated the fund’s future liability by more than $6.75 billion, raising significant concerns about the accuracy and intent of research used to inform potential state policy reforms.
Commissioned by the California Department of Industrial Relations (DIR) in 2022, RAND’s 180-page report projected a total SIBTF liability of $7.9 billion — a number that fueled legislative proposals to overhaul or restrict funding for one of the state’s most critical disability support programs. The Jacobi Journal’s independent review found that this figure was derived from analytical assumptions inconsistent with both historical data and accepted actuarial standards.
Critical Methodological Flaws Identified
The investigation highlights two key missteps in RAND’s methodology:
- Nonrepresentative Case Sampling and Benefit Frequency Assumptions
RAND’s estimate assumed that 91% of all open SIBTF cases would ultimately result in benefit payments. This projection was based on a mere 42 cases examined between 2019 and 2022. Historical DIR data covering more than 27,000 cases (2010–2022) shows that only 24–44% of claims result in benefit payments, depending on adjudication outcomes. - Inflated Valuation of Total Disability Awards
RAND’s modeling placed the average lifetime cost of a 100% disability award at $933,000 per case, exceeding actuarially consistent benchmarks by over $450,000. The inflation resulted from a combination of understated discount rates (3%), elevated cost-of-living adjustments (3.9%), and the omission of reduced life expectancy data for severely disabled beneficiaries — a condition acknowledged even within RAND’s own addendum.
After adjusting these variables to reflect empirical and publicly validated factors — including a 7% discount rate, 2.6% long-term average COLA, and 17% reduced life expectancy — Jacobi Journal recalculated the fund’s projected liability at $1.25 billion, a figure nearly 84% lower than RAND’s original estimate.
Implications for Lawmakers and Public Policy
The findings suggest that RAND’s report, whether by intent or error, may have created a materially distorted fiscal picture of SIBTF’s sustainability. If accepted without scrutiny, the overstatement could have led to restrictive policy changes that undermine benefits for California’s most severely injured workers — individuals already facing compounding disabilities and economic hardship.
Jacobi Journal urges regulators, legislators, and public policy analysts to re-examine the underlying assumptions before moving forward with any proposed reforms to the SIBTF structure or funding model. Decisions based on inaccurate liability data could erode trust in state fiscal oversight and impede equitable support for California’s disabled workforce.
“The evidence indicates RAND’s study did more than miscalculate — it misrepresented the economic reality of the SIBTF,” said Patrick Kelley of The Jacobi Journal’s investigative team. “California lawmakers deserve accurate, transparent, and empirically grounded information before making policy that affects vulnerable constituents and the integrity of the state’s workers’ compensation system.”
The full Jacobi Journal report, including comparative actuarial models, dataset analysis, and corrected projections, is available for public download at JacobiJournal.com/jacobi-journal-sibtf/.
About The Jacobi Journal of Insurance Investigation
The Jacobi Journal is an organization focused on promoting transparency, awareness, and integrity within the insurance industry. We specialize in insurance education and insurance investigation awareness, helping individuals understand how insurance works and why ethical practices are essential to protecting everyone involved.
Press Inquiries
Patrick Kelly
patrick.kelly@jacobijournal.com
860-200-1336
Anna Martin
anna.martin@jacobijournal.com
860-200-1752
