Millions of Americans collect Social Security benefits due to retirement or disability. Millions of Americans also suffer accidental injuries every year. If you belong in both categories, you may have wondered how filing a lawsuit could affect your benefits. In this article, Philadelphia nursing home abuse lawyer Brent Wieand explains how SSI (Supplemental Security Income) and SSDI (Social Security Disability Insurance) can be impacted by a personal injury settlement or award.
According to the Social Security Administration (SSA), over 65 million Americans are Social Security beneficiaries as of March 2016. Nearly three quarters of them are seniors and retirees (about 44.5 million people), while the remaining 21 million beneficiaries are disabled, early retirees, young survivors, or belong in other groups.
The vast majority of beneficiaries receive Social Security Disability Insurance (SSDI), which is available to people who have earned enough “work credits” through employment, while others receive Supplemental Security Income (SSI), which is intended to help provide financial support for low-income individuals who cannot work due to severe long-term disability. A very small number of people qualify for both, which is called “concurrent benefits.”
According to the SSA, the average monthly SSI payment in 2016 is about $540, while the average monthly SSDI payment is closer to $1,160. But how might these payments be affected by a car accident settlement or the award resulting from a successful lawsuit?
Negligence is the failure to take adequate safety precautions against foreseeable accidents – for instance, failing to change a nursing home resident’s sheets often enough to prevent bedsores, or failing to pay attention to the road while driving, leading to a car accident in Philadelphia. When a person is injured due to another person’s negligence, the injury victim may be able to get compensated by the negligent party. This is typically accomplished through out-of-court negotiations, though in rare instances where negotiations are unsuccessful, the injury victim may wish to file a lawsuit and go to trial. The compensation that comes from negotiating outside of court is called a settlement, while compensation resulting from a trial for a lawsuit is called an award.
If you’re an SSDI beneficiary, there’s good news: an award or settlement should not affect your SSDI benefits, even if the amount is quite large. This is because SSDI is contingent upon your employment history, not your current financial circumstances. The work credits you earned to become eligible for SSDI will not disappear or be erased simply because you were injured in an accident.
Unfortunately, the same cannot be said of SSI benefits. Unlike SSDI, SSI is based on the recipient’s degree of financial need, as the purpose of SSI is to provide additional income for disabled individuals who are unable to work. For this reason, a person cannot qualify for SSI if the SSA determines he or she earns too much countable monthly income (more than $733 per month, which is the Federal Benefit Rate or FBR as of 2016). If an SSI recipient sees an influx of income due to a personal injury settlement or award, he or she may see a reduction in SSI benefits or even lose SSI eligibility altogether, because there is no longer financial hardship.
However, there may be a way to avoid losing your SSI benefits: setting up a Special Needs Trust. The trust may be used to pay for various items that are necessary to the beneficiary, with the exceptions of food, housing, and clothing. Creating a Special Needs Trust is a complicated process, so it’s very important that you consult an experienced attorney for assistance.
Other than receiving additional income, other factors that could lead to a reduction or termination of your SSI benefits include:
Lawsuits and settlements aren’t the only forms of injury compensation which can impact your Social Security benefits. If you get hurt in a workplace accident and subsequently receive workers’ compensation for your injuries, your benefits could be reduced accordingly.
However, as Social Security Handbook 504.2 explains, your benefits should only be reduced if your combined Social Security benefits and workers’ compensation benefits are greater than 80% of your average current earnings, or greater than your family’s total pre-reduction Social Security benefits – whichever number is larger. This reduction, which is called an “offset,” can be made during any month before the month you turn either 62 or 65 years old. The offset can continue until you turn 62 or 65 years old, depending on:
If you or one of your loved ones was injured in an accident caused by negligence, you may be entitled to compensation for your medical bills, pain and suffering, and other hardships. You should speak to a knowledgeable personal injury attorney about your claim and how your benefits could be affected. Call Philadelphia workplace injury lawyer Brent Wieand at (888) 789-3161 for a free and confidential legal consultation. Brent handles Pennsylvania and New Jersey auto accidents, slip and fall accidents, nursing home neglect and abuse, and many other types of injury claims.
***Disclaimer: This article is for informational purposes. It is not legal advice and should not be used as legal advice.***
