For certain individuals who are unable to work, there is assistance available. If you are eligible for workers' compensation benefits, you may also be able to receive Social Security Disability Insurance (SSDI).
Some people may have the false notion that utilizing both benefits will result in "double-dipping." However, the benefits generally are separate from each other, and those individuals who receive both may do so in most instances.
Caution is needed if a worker with a disability from a workplace accident is considering an application for SSDI benefits. The timing of the SSDI application is critical when there is a pending workers' compensation claim. Consultation with an experienced workers' compensation attorney is encouraged--and needed.
Workers' compensation and SSDI are similar in that they both assist individuals who have impairments on their fully ability to work by providing financial compensation. For this reason, people tend to think they are related. However, the benefits service two different groups of people. It just so happens that at times, individuals may fall into both categories.
Employees technically become "eligible" for workers' compensation after their first day of work for a covered employer, and they receive work comp benefits if they suffer a workplace traumatic injury or occupational exposure that results in the need for medical care or missed work time. The injured worker's employer is the main contributor to this program by having workers' compensation insurance. In turn, the work comp insurance company pays the medical bills and provides the compensation benefits on a temporary or permanent basis, depending on the severity of the employee's condition.
On the other hand, employees earn and contribute to their SSDI. Significantly, SSDI is available to individuals with impairments regardless of causation. This means an individual can apply for SSDI benefits whether the impairment is work-related or not (like a personal health condition) . SSDI is paid out after a five-month waiting period, once the Social Security Administration receives confirmation that the injury, illness, or impairment is expected to last for at least a year or lead to death.
Offset on Work Comp Benefits
If an individual receives both SSDI and work comp benefits for the same period of time, the law puts a "cap" on the total benefits--meaning one of the benefits will be offset. The Social Security Administration provides a full definition of reverse offset and acceptable programs. Wisconsin is a reverse offset state, which means when employees receive both benefits, the workers' compensation benefits may be decreased if the combination of work comp payment and the SSDI benefit exceeds 80 percent of the individual's working income. (There is a formula for this calculation).
The good news is that if an injured worker is receiving SSDI benefits, a workers' compensation settlement will NOT reduce the SSDI benefits. On the flip side, those SSDI benefits could reduce someone's work comp benefits (but generally not wipe them away).
An injured worker also must be aware of the potential for shifting the future costs of medical treatment to Medicare (and exposing themselves to monetary penalties). If an injured worker becomes SSDI eligible, generally they are eligible for Medicare enrollment within 24 months of SSDI eligibility date. Federal law prohibits Medicare from paying for work-related medical treatment expenses. Therefore, if an injured worker tries to settle the work comp claim completely, they could inappropriately shift the burden for future medical treatment expenses to Medicare, which in turn, may pursue penalties against the worker.
Accordingly, talking to an experienced Wisconsin workers' compensation attorney before considering an SSDI application is recommended.
As you can see, workers' comp and SSDI benefits are separate entities with a few similarities. For more information on how you may benefit from them, take the time to do your research and speak with a knowledgeable workers' compensation attorney.