Injured employees often have questions about their eligibility for Social Security Disability Benefits (SSDI) if they are receiving workers’ compensation. Fortunately, you are allowed to apply for Social Security Disability Insurance, even if you are already receiving or in the process of being approved for workers’ comp.
Please note that if you are approved for Social Security Disability benefits while you receive payments from WC, the amount received from SSDI may be less than what you would normally be entitled to. This is due to the fact that the total amount in benefits from both of these plans cannot exceed 80% of your average earnings (before the accident tor diagnosis of injury). This requirement is established by the Social Security Administration – the agency that’s in charge of figuring out your monthly benefit rate.
What Is SSDI?
Social Security is a monetary benefit system funded by social security taxes and administered by the federal government. SSDI, or Social Security Disability Insurance, is a system that provides people with monthly payments if they are unable to work due to an illness or injury. This is a benefit that’s completely separate form workers’ compensation, which is managed by each state and is strictly for work-related health issues. To qualify for SSDI, one simply has to show that their ability to work is restricted due to a medically proven disability.
In order to be eligible for SSDI payments, you must have a terminal condition, or you must be injured or ill to the point where you are unable to work for at least 1 year. Please note that you must be unable to work in any capacity, and not just in the role or position you had prior to your work-related injury or illness.
You must also have enough “work credits” to qualify for Social Security Disability benefits, which you accumulate for each year or work. The number of credits is based on your yearly wages, and how many credits you need to be approved for SSDI is based on your age and when you became disabled to the point where you were unable to work.
Dual SSDI and Workers’ Comp Benefits Offset
If you are approved for Social Security disability and workers’ comp benefits at the same time, there may be an “offset” that’s deducted from SSDI payments you are owed. The offset occurs if the total amount you are receiving in benefits is more than 80% of your average earnings. Regardless of whether you apply for workers’ comp or SSDI first, you have a legal obligation to report any WC earnings as soon as you begin to receive them.
Some claimants have what is referred to as a “reverse offset.” In this situation, you receive the full value of your SSD benefits, while having an offset taken out of your workers’ compensation funds. To learn which of these option is the most suitable based on your personal circumstances, talk to a lawyer that’s experienced in dual claims for SSDI and workers’ compensation.
Calculating an Offset for WC and SSD Benefits
The first step to calculating an offset is to add how much you are getting in WC benefits with the amount of your monthly payment from SSDI. If there are family members who are also eligible for SSDI, you will need to factor them into the equation as well.
If the total value of combined benefits is greater than 80% of your earnings right before the accident or diagnosis (average current earnings), the excess amount will be taken out of your SSD benefits. Here is an example of how an offset is calculated:
Prior to a disabling work injury, you were making an average monthly income of $4,000 per month. You receive $2,000 from workers’ compensation, and your family is eligible for $2,200 a month in Social Security benefits.
Here, the total amount you receive from the combination of these benefits is $4,200. In addition, $3,200 is 80% of your monthly earnings. That means the benefits you are eligible to receive is $1,000 more than your current earnings. As a result, your SSDI payment would be reduced by $1,000.
Don’t worry if any of this confusing to you. A workplace injury lawyer at our office can walk you through the calculation of a dual benefits claim offset and ensure that you understand the impact it has on your income.
Does a Workers’ Comp Settlement Paid as a Lump Sum Affect my SSDI Benefits?
At the conclusion of workers’ compensation claim, you may have negotiated a settlement with your employer that was paid to you as a lump sum, meaning it was paid all at once. This can have an effect on your SSD income and lead to an offset until your disability benefits from Social Security transition into retirement benefits.
It’s essential that you talk over any settlement agreements with an attorney before you sign the contract. Your attorney will explain the impact a lump sum can have on SSD payments you are currently receiving or qualify to receive.
What about State Disability Insurance?
You may be eligible to receive disability benefits through the State Disability Insurance program, which is administered by the State of California and not the federal government. This is a program that provides disabled California workers with partial wage replacement funds when they are unable to work due to pregnancy or an injury / illness that is not work related.
California State Disability is only paid for a short time, unlike Social Security Disability, which some people receive for the rest of their lives. However, the approval period tends to be longer with SSD, meaning you are likely to start receiving State Disability before your monthly payments start with Social Security. If there are any questions or concerns you have about either of these programs, don’t hesitate to give us a call.
Do I Need a Lawyer to Apply for Workers’ Compensation of Social Security Disability?
No, you can apply for these benefits on your own, though having an attorney does have advantages when you are trying to manage dual claims for a disability that prevents you from working. Workers’ comp cases are more complex than most people realize, particularly when you have a potential offset because you qualify for Social Security benefits, or the worker was already receiving SSD.
Having a disability insurance lawyer who can walk you through the process will make the claims process go much smoother and eliminate potential errors and delays. Here at California Labor Law Employment Attorneys Group, we have a dedicated team of work injury lawyers, who are ready to assist you with any aspect of an SSDI or worker’s comp claim.
Contact Our Law Firm
Ensuring compliance with the law and obtaining all the benefits you are entitled to can be challenging when you are eligible for multiple state and federal programs. But rest assured that the attorneys of CLLEAG are with you every step of the way. Please contact us today and schedule a free consultation to learn about your rights and legal options.
