Can I Get Disability After a Workers’ Comp Settlement in Oklahoma?

If you’ve already received a workers’ comp settlement or are thinking about one, you might be wondering what comes next. Specifically: Can you still get disability benefits?

The short answer is yes, you may still qualify for Social Security Disability Insurance (SSDI). First, you will need to file an application for SSDI benefits and get approved by the Social Security Administration. Second, how much you get in monthly SSDI benefits may depend on how your workers’ comp was structured.

The truth is that these systems don’t make it easy. But you don’t have to figure it out alone. A lawyer who knows both Social Security and Oklahoma workers’ comp can help protect what you’re owed.

RELATED: 10 Best Tips for Applying for Disability

What’s the Difference Between Workers’ Compensation Settlements and Workers’ Compensation Benefits?

In Oklahoma, workers’ compensation is a state-run program that helps cover medical bills and lost wages if you get hurt on the job.

You might receive:

• Ongoing benefits, such as weekly wage replacement, or
• A lump sum settlement, which is a one-time payment that typically closes your case.

Both types can affect your SSDI, but in different ways. Here’s how it works.

How a Workers’ Compensation Claim Can Reduce Your SSDI

SSDI is a federal program that helps people who can’t work due to a serious disability. Workers’ compensation is run by the State of Oklahoma and replaces wages when you’re injured on the job.

Both programs are designed to help you replace lost income. But that also means the government doesn’t want you to “double dip” by collecting full benefits from both. So, Social Security puts a cap on how much you can receive in total.

This reduction in benefits is called the workers’ comp offset.

Step-by-Step: How the Offset Works

1. SSA Figures Out Your Average Monthly Income

Once your SSDI benefits are approved, SSA will look at your work history to determine how much money you used to earn. This is called your Average Current Earnings (ACE).

Your ACE is usually based on your average earnings from the five years right before your disability.

2. They Cap Your Combined Benefits at 80%

SSA limits your combined monthly benefits (SSDI + workers’ comp) to 80% of your ACE.

3. They Add Up Your Monthly Workers’ Comp and SSDI

SSA adds your current monthly workers’ comp and SSDI checks together.

4. If You’re Over the 80% Limit, They Reduce Your SSDI

If your combined checks are more than 80% of your ACE, SSA reduces your SSDI payment by the extra amount.

Example: Miguel’s Monthly Offset

Miguel suffered a serious back injury while working construction and was approved for both Social Security disability and Oklahoma workers’ compensation benefits. Before his injury, he earned $3,500 per month on average.

He’s now receiving $1,800 per month in workers’ compensation and has been approved for $2,000 per month in SSDI.

Social Security calculates 80% of Miguel’s pre-disability income:
80% of $3,500 = $2,800.

His combined monthly benefits total $3,800, which is $1,000 over the allowed amount.

So, SSA reduces his SSDI by $1,000. Instead of $2,000, Miguel will receive $1,000 in SSDI each month until his workers’ comp benefits change.

How a Workers’ Compensation Lump Sum Payout Can Reduce Your SSDI

If you receive a lump sum workers’ compensation settlement, the way it affects your SSDI benefits is often based on the language within that settlement. Most often, the total payment is divided into monthly amounts. That amount is used to determine the offset.

Example: Jan Settles Her Workers’ Comp Case on Her Own

Jan negotiated a $22,000 one-time payment from a workers’ comp claim. She did not hire a workers’ compensation attorney.

Jan applies for Social Security disability benefits and is awarded $1,375 per month, but the SSA sees that she already received a workers’ compensation payment to replace her lost wages. The SSA calculates that her lump sum will cover 16 months of disability benefits ($22,000 divided by $1,375 equals 16), so her SSDI payments are suspended for 16 months.

Example: Mark and His Lawyer Structure His Monthly Offset

Mark is a 30-year-old truck driver who suffered a life-changing traumatic brain injury in a wreck. His lawyer negotiates a $100,000 settlement with his employers’ workers’ comp insurance company. At the same time, the lawyer helps Mark successfully apply for SSDI benefits.

In the workers’ compensation settlement agreement, Mark’s lawyer adds very specific language that says his settlement is meant to cover monthly expenses up until Mark reaches age 65.

Since Mark is 30, that is 420 months. $100,000 divided by 420 = $238.10

Social Security will treat Mark’s settlement like he was getting a monthly payment of $238.10. This minimizes the offset. In fact, Mark may still receive his full disability benefits from the SSA.

RELATED: What Conditions Qualify for Disability in Oklahoma?

Other Disability Programs

SSI

Some injured workers who pursue workers’ compensation and SSDI may also look into Supplemental Security Income (SSI) benefits. SSI is for people with limited income and assets. Most workers’ comp recipients won’t qualify, since a lump sum or ongoing payments may push them over SSI’s limits.

If you have questions about SSI, consult with an experienced disability attorney.

Private and Group Disability Benefits

If you have private or employer-sponsored disability insurance, it can provide additional financial assistance if you become disabled. Just like federal disability benefits, if you are receiving workers’ compensation, most private disability insurance policies have a clause that your long-term disability insurance will be offset by the amount that you already receive.

How to Minimize the Social Security Offset

The best way to maximize the amount of money you receive from workers’ compensation and from SSDI is to hire a lawyer who is extremely knowledgeable about both.

An experienced lawyer can help you understand if you qualify for SSDI and structure your workers’ compensation settlement to maximize what you receive in disability benefits.

Here are some other ways to minimize the social security offset:

• Make sure your agreement excludes legal fees and medical expenses from the lump sum amount, so that only the amount you actually receive gets offset by social security.
• Clearly state how the lump sum payment is meant to be used so that the SSA uses the right monthly number for offset purposes (in legal terms, ideally, you’d want to spread your payment over your life expectancy).
• Maintain accurate and complete records so you can show what you’ve spent on medical bills or lawyer’s fees.
• Make sure to update the SSA if there are any changes to your workers’ comp payments. If your payments are reduced, you should be able to reduce your offset as well.

These types of claims can be complicated, and there’s no easy way to simplify them. An experienced lawyer is the best way to navigate the paperwork and bureaucracy in a way that gives you the best financial assistance you need.

Call The Wolf Pack™ to Help You Maximize Your Benefits

Whether your workers’ compensation claim is still in process or has already been settled, The Wolf Pack™ at Colbert Cooper Hill is here to help you get the maximum benefits you deserve. Our team is experienced in compassionate care for those suffering from physical or mental impairment after a work accident, when you may not have the bandwidth to tackle complicated legal matters. We’ll aggressively fight for your rights and better financial security.

Get started with a free consultation, where our team can tell you what to expect from the SSDI application process and how your benefits may be affected by your workers compensation settlement. Just contact us here or call us at (405) 218-9200 and we’ll get started on the best strategy to move forward with your case.

The content provided here is for informational purposes only and should not be construed as legal advice on any subject.