By Tatyana Bellamy – Walker, Special to Workers World Today
A staggering 10.2 million people are on Social Security Disability (SSD), according to a recent report by the U.S. Office of Retirement and Disability Policy (ORDP). The report states that musculoskeletal system and connective tissue issues such as carpal tunnel syndrome, fibromyalgia, and bone fractures, are driving disabled workers and disabled widowers to receive benefits.
Starting in the late 1950s, SSD benefits were added to the ORDP. SSD often aids low-income families that are at or below the poverty line. Those with SSD benefits receive free or reduced medical care, prescriptions, and other services.
If you receive a personal injury settlement your SSD benefits will not be affected. Even the wealthiest people in America, Jeff Bezos, the CEO of Amazon, and social media mogul, Mark Zuckerberg, would not lose SSD benefits (if they become disabled and are unable to work) with a settlement. This is because SSD impacts people who have worked and have paid into Social Security through Federal Insurance Contribution Act (FICA) taxes.
However, if you receive Supplemental Security Income (SSI), the barriers can become murky. SSI is a needs-based rather than earnings-based program. To be eligible for Social Security benefits you must have under $2,000 in assets if you are single. In addition, it is important to seek legal counsel to make sure that the terms and conditions of the settlement do not terminate existing benefits. For those who have been on Social Security for years, according to CNN, almost 56 million were on SSI in 2012, losing the extra income may provoke anxiety.
Even with the financial help of a settlement, ongoing medical issues can be costly. According to Genworth’s 2017 Annual Cost of Care Survey, the cost of long-term care services has increased by 4.5 percent since the study began in 2004. For example, home health aide services are up by 6.17 percent or $21.50 per hour, adult day health care services are up by 2.94 percent or $70 per day, assisted living facilities are up by 3.36 percent or $3,750 per month and semi-private room nursing home care are up by 4.44 percent or $7,148 per month.
While these numbers are high for individuals facing long-term treatment, it is important to consider ways to manage settlement income. To keep Social Security benefits some lawyers recommend spending down (paying off bills, car debts, and home improvements) or investing the money in a special needs trust, which is kept by a third party who oversees the spending. This money is not considered income by the ORDP; thus, you will not face infractions.
Since you’re required to report settlement income to your SSI caseworker within 10 days, this may impact or reduce Medicaid coverage. However, settlement income will not impact Medicare coverage because that is based on work history, not financial resources. Ultimately, if you have any questions regarding Social Security and personal injury settlement, it is best to contact a lawyer to avoid the financial strain of a lack of benefits.
Workers’ World Today is a free publication that empowers all workers, regardless of social or political affiliations. Distributed throughout New York City, our paper has a mission to educate workers and provide them with relevant information pertinent to the workforce such as workers’ compensation, discrimination on the job, workers’ rights, and more.