If you receive Social Security benefits or expect to in the future be sure to read this and know your rights.
Many times after a person is injured at work, they apply for Social Security benefits. Most of the time the injured worker applies for disability insurance benefits (DIB) based on the disability resulting from the very accident for which they are receiving workers’ compensation benefits. There is nothing wrong with this, but it does create a potential trap for the unwary.
In a nutshell, you cannot receive more than 80% of what the Social Security Administration calls your pre-injury “Average Current Earnings” through a receipt of social security disability benefits and workers’ compensation indemnity benefits.
If you do (and assuming SSA and/or the work comp insurance company realize it), the Social Security Administration will reduce your monthly social security benefit to an amount, that when added to your weekly workers’ compensation benefit, results in you getting an amount no greater than 80% of your average current earnings. This is called an “offset.”
In some cases, if you are found to be totally and permanently disabled, the insurance company can take what is called a “reverse offset.” Many states, including Louisiana, opted into a federal loophole allowing workers’ compensation insurers to take this reverse offset. This allows the workers’ comp insurance company to reduce the amount of your weekly checks and requires the Social Security Administration to increase your monthly benefits, so that the total of the two do not exceed 80% of your average current earnings. This essentially shifts the offset right from the Social Security Administration to the work comp insurer, hence the term reverse offset.
These offsets and relationships between workers’ compensation and Social Security benefits become extremely important if you intend to settle your work comp case. It is very important to have competent legal representation from a skilled Baton Rouge workers’ compensation lawyers when dealing with the Social Security Administration.
If you are not very careful, settlement of your workers’ compensation case can lead to suspension, reduction or even elimination of your social security disability benefits, not to mention entitlement to Medicare.
Choose your Baton Rouge workers’ compensation attorney carefully. Ask us about the impact of workers’ compensation settlement on your social security benefits and what strategies we have to minimize the potential negative repercussions of settlement.
Fill out our firm’s case consultation form and we will contact you at your convenience. You can also contact the office of J. David Smith, Attorney at Law at (225) 387-0293 to schedule a free consultation.