Can You Receive Workers’ Comp and Disability Benefits at the Same Time?
You need to know your options when you have been seriously injured or fallen ill on the job and cannot work. There are many benefits available, but you may only qualify for some. Knowing whether you can receive workers’ compensation, disability benefits, or both can be challenging for many individuals.
At Work Injury Advisor, we have compiled this blog to help answer the question: “Can you recover workers’ comp and disability benefits at the same time?”
What Does Workers’ Compensation Cover?
In all states, workers’ compensation benefits provide financial and medical benefits to employees who suffer work-related injuries or illnesses. Medical expenses, rehabilitation costs, and a portion of lost wages during the recovery period are all covered.
However, these compensation benefits are temporary. They are designed to support employees until they recover and return to work. If there is a case of a permanently disabling condition, workers’ compensation may offer long-term benefits, such as permanent partial disability or permanent total disability benefits.
In some cases, disabled workers could qualify for additional benefits. For example, Social Security Disability Insurance (SSDI) is a federal benefit available to individuals who are unable to work due to a severe, long-term disability. Unlike workers’ compensation, which covers work-related injuries, anyone who is disabled can apply for and receive SSDI benefits. It is not exclusive to those injured on the job.
To receive these benefits, an individual must have a medical condition that meets the Social Security Administration’s definition of disability. Many times, a person will have a condition that is expected to last at least one year or result in death. Additionally, the qualified applicant must have accumulated sufficient work credits by paying into the Social Security system through payroll taxes.
Receiving Both Workers’ Compensation and Disability Benefits
Under certain conditions, a person can receive both workers’ compensation and SSDI benefits at the same time. There are a few caveats per the Social Security Administration, though. The total amount of benefits you receive from both programs may be subject to limitations. In many cases, the “workers’ compensation offset” will reduce SSDI benefits when workers’ compensation exceeds a certain level.
How Does Workers’ Comp Offset Affect Other Benefits?
With the workers’ compensation offset rule, workers cannot receive more money in disability benefits than they were earning while working. Under this rule, workers’ compensation and SSDI cannot exceed 80% of a person’s average current earnings before they become disabled.
For example, if those average current earnings were $5,000 per month before an injury, the combined workers’ compensation and SSDI benefits cannot exceed $4,000. In cases where the amount exceeds that threshold, the SSDI benefits will be reduced.
The Social Security Administration will calculate the offset and adjust the SSDI payments in many situations. However, the calculation can vary depending on state laws and workers’ compensation settlement type. Sometimes, workers’ compensation settlements might be structured to minimize the offset. For example, a lump-sum workers’ compensation settlement can be prorated to reduce the impact on SSDI benefits.
Also, remember that other income sources are considered in the workers’ compensation offset. For example, any private disability insurance or pension benefits will also affect your SSDI. The Social Security Administration must know about all forms of income when calculating the workers’ compensation offset.
State Variations
Keep in mind that these rules can vary widely depending on the state in which you reside. Each state has its own workers’ compensation system, with separate rules regarding eligibility, benefit amounts, and the duration of payments. These variations can affect how much you receive in workers’ comp. In turn, that can impact how much SSDI benefits you’re eligible to receive.
While the workers’ compensation offset reduces SSDI after reaching a certain threshold, some states have a “reverse offset.” As a result, the compensation will be reduced instead of SSDI benefits.
Also, some states may have caps on the duration or total amount of workers’ compensation benefits you can receive, once again affecting your SSDI benefits.
While it is possible to receive both workers’ compensation and disability benefits at the same time, the amount you receive from SSDI may be reduced due to the workers’ compensation offset. You may want to work with an attorney to understand the types of financial support for which you may qualify.
Whether dealing with a temporary or permanent disability, knowing your rights and options can help during this difficult time.