If you have been disabled due to a workplace injury, you may find yourself looking to two government bureaucracies for disability benefits and wondering whether their rules conflict. The short answer is that North Carolina Workers’ Compensation and the U.S. Social Security Disability (SSD) programs can provide benefits for you. But you’ll need a N.C. Workers’ Compensation attorney who is experienced with SSD to guide you through the claims process.
In most cases, an individual who has experienced a workplace injury is seeking or collecting Workers’ Compensation when he or she learns his or her disability will be permanent. The injured worker is advised to apply for SSD benefits but cautioned that workers’ comp benefits could hurt eligibility for disability benefits.
Sound familiar? If so, you are in good company with many people who wonder what their next step should be. Allow the attorneys at Younce, Vtipil, Baznik & Banks, P.A. to help you.
Can You Receive Social Security Disability And Workers’ Compensation At The Same Time?
Many people who are disabled from a workplace accident and no longer able to work wonder why they can’t just receive benefits from Workers’ Compensation and Social Security Disability at the same time. The answer is that you can receive benefits from both programs if you qualify.
Workers’ Compensation is an insurance program for workers who are employed and become injured on the job or develop a work-related disease. Employers in North Carolina with three or more employees are required to maintain Workers’ Compensation insurance to protect employees. Workers’ comp is no-fault insurance that pays 100% of medical bills and about 66% of lost wages as you recover. There are also payments for permanent disability and certain injuries and disfigurement.
If your claim is approved, you can opt to receive weekly benefit payments, a lump sum settlement or both. There may be reasons to choose either option, depending on the particulars of your case and your needs.
Social Security Disability is a federal insurance program for workers who suffer injury or illness that makes them unable to work for a living. Applicants must meet the Social Security Administration’s strict definition of being disabled and have worked enough years to qualify for disability benefits. It is a more complex program than workers’ comp. For example, to qualify, you have to have worked and paid into the program during five of the 10 years prior to becoming disabled.
If you are approved, the SSD benefit you receive will be partly based on your work history and earnings. Social Security Disability also pays benefits to spouses and disabled children of qualifying individuals who become disabled.
But, as you may have suspected, there is a catch. You can receive Workers’ Compensation and Social Security Disability benefits at the same time. But your SSD benefit may be reduced because of your workers’ compensation benefits. How much will it be reduced? That depends, and that’s why you need to talk to a lawyer about your specific situation.
How Workers’ Compensation Benefits Offset SSD Payments
If you have qualified for Workers’ Compensation and Social Security Disability benefits, the Social Security Administration will likely cut your SSD benefit. The “offset” will reduce your total benefit so that your total monthly payment is 80% of what you earned when fully employed or less.
In other words, 80% of your former income from a job is the most you can make in a combined disability benefit.
To determine that an offset is in order, the Social Security Administration (SSA) identifies what you are allowed to receive as a total monthly combined disability benefit. This is known as the applicable limit.
Your applicable limit is the higher of either:
- 80% of your pre-injury income, known as “average current earnings,” or
- the total amount of SSD benefits received by all members of your family in the first month that you received a workers’ compensation payment. This is known as the “total family benefit.”
In most cases, your average current earnings will be the guiding factor. If your combined SSD and Workers’ Comp benefits in any given month exceed 80% of your average current earnings, the SSA will lower your total benefit to the 80 percent maximum with a smaller SSD payment to offset the excess.
When you apply for SSD, you must report any workers’ comp settlement or other disability payments, such as from private insurance that you have received.
The SSA will keep applying an offset if necessary until you begin collecting Social Security retirement benefits instead of SSD.
How Can I Maximize My Disability Benefits?
Since a combined benefit that equals 80% of your former income represents a loss, you would naturally rather that your Workers’ Comp benefit didn’t have such an impact on your SSD payment. And, with a little planning, there are ways we can help you make that happen.
There are three general approaches, which we would have to make sure really worked for you before we would recommend it:
- Structured lump sum settlement. It seems like a contradiction in terms, but a workers’ compensation lump sum settlement can be negotiated so that the SSA views it as a payment over time. In a workers’ comp claim, a “lump sum” refers to a finite benefit amount. Your settlement can be worded to say payments are to be spread out evenly over the rest of your life, though you receive one payment.
- Claiming deductions. Certain portions of your Workers’ Compensation settlement can be excluded from income calculated in your total disability benefit. This includes medical expenses, attorney’s fees, the cost of rehabilitation and payments to dependents. By tracking these expenses and reporting them to the SSA, we can lower your reported total benefit, which can help you avoid or reduce an offset. This requires documentation, though. Save your receipts.
- Taking retirement benefits. If you have reached age 62, it could beneficial to begin drawing Social Security retirement benefits, because they would not be subject to an offset. We would have to calculate the difference between your retirement benefit, which increases the later you take it, and your SSD benefit and determine whether or when it’s better to put in for Social Security retirement payments.
These strategies may require specific language in your workers’ compensation settlement and must be consistent with what is allowed by the North Carolina Industrial Commission, which administers the workers’ compensation program.
A full review by an experienced North Carolina workers’ compensation attorney who also understands Social Security Disability programs can help you understand whether you are eligible to receive benefits from both programs. The attorneys of Younce, Vtipil, Baznik & Banks, P.A., have the knowledge and experience, and are ready to assist you.
Contact Younce, Vtipil, Baznik & Banks, P.A. in Raleigh, N.C., for a free, no-obligation review of your disability benefit today. We can help if you are in the middle of applying for Workers’ Compensation or SSD or if you need to appeal a denied claim. Call us today.