Workers’ Compensation Offset of Social Security Retirement Benefits – Can it be stopped?

THE HISTORY:  In Washington State the workers’ compensation system has been offsetting a claimant’s receipt of social security retirement benefits since 1986.  Social Security disability benefits have been offset since the 1970s, but it took a while longer to implement an offset to retirement benefits.  All injured workers who were not on Social Security Retirement in July 1986 have had their later entitlement to retirement benefits subject to the potential for offset.

Generally the offset is calculated based on either a worker’s average current earnings (ACE) or their time loss rate.  The average current earnings are calculated based on the highest calendar year earnings of the worker divided by 12 to find an average month.  The offset is then calculated by taking 80% of the ACE.  That figure represents the maximum beyond which the combination of SS retirement and worker’s compensation benefits cannot exceed.  Since a worker’s compensation cannot be reduced because of the offset, if that 80% figure is below the time loss rate, then the time loss rate will be used to calculate the “cap”.  In that latter case all of the retirement benefits are subtracted from the time loss benefit and the worker receives no increase due to the entitlement to retirement benefits.  Where the ACE is higher than the time loss rate, then the workers’ compensation benefits are reduced to the point where the retirement benefits plus the workers’ compensation benefits equal the ACE figure.  In that case the worker receives more money than on workers’ compensation alone, but still at a reduced rate due to the social security offset.  There are periodic cost of living adjustments provided, either yearly for those whose time loss rate is the basis for the offset or every three years if the ACE is the basis for the offset.  [Yes, it is complicated!]

The offset was challenged as being in violation of the Washington State constitution but that was rejected by the Washington Supreme Court in 1993.  A recent challenge to a similar law in Utah was successful as the Utah Supreme Court found it violated the Utah and U.S. Constitutions (exactly the opposite decision from Washington’s court some 16 years earlier).  It is unlikely the Washington Court would be willing to revisit that issue having already considered and ruled on the issue, despite the different outcome in Utah.

CAN THIS BE FIXED?  A bill has been introduced in the Washington Legislature (HB 1211) to repeal the retirement offset.  That bill has yet to gain any real traction despite being introduced again this year.  Representative Steve Kirby (D-Tacoma) is the only sponsor of the bill and remains committed to its passage, but without more support the bill is unlikely to move forward.  The Legislature is out of session for the year and meets in short session next year.  Although economic times are tough for the state, they are also tough for those workers’ on time loss or pension benefits and who are having their hard earned retirement benefits from social security offset against their compensation benefits.

WHAT CAN YOU DO?  All legislators respond to constituents’ needs and demands in one form or another.  One call might receive a polite reply, dozens calls from different constituents might raise an eyebrow (and polite replies), hundreds of calls might reflect a groundswell, thousands of calls might reflect a movement was underway.  If every injured worker called their representative and asked them to contact Representative Kirby to become a co-sponsor on the bill (or at a minimum to otherwise support the bill) and if every injured worker called their state senator and asked them to support the bill when it gets to the Senate the bill can ultimately have a change of passage.

IS THERE HOPE?  Even with a strong groundswell from the injured worker community the bill is not assured of passage.  While it has strong support on equitable grounds (SS retirement is based on a lifetime of work and is intended to replace wages during a worker’s retirement years) and has nothing to do with disability or the disability system (which offsets workers’ compensation and SS disability to make sure a worker has incentive to return to the work force and that life will not be too comfortable – financially – on disability) the bill will have a huge fiscal impact on the Department of Labor and Industries.  On all bills filed which affect the state budgetary process the agency involved files a “fiscal note” with the Legislature advising what the financial impact will be if the legislation is passed.  While workers’ compensation benefits are not funded out of general revenues – rather from employer and worker premiums – if there is a large fiscal impact it could include the need for some premium increases or consideration thereof.  This could spook the Legislature into rejecting the bill despite large popular support from constituents.

FINAL WORD:  The bill will go nowhere despite the good intentions of Rep. Steve Kirby unless support can be generated from other legislators.  The way to start that process is to spread the word among injured workers, friends of injured workers, unions, disabled support groups, retirement groups, etc.  If those groups can get behind this bill, and should a steady groundswell rise up, the Legislature cannot ignore it.  Like all long marches, they must begin with the first step.  Rep. Kirby can be reached at:  Let him know you care.  Let you own Representative know you care.  Step up and make some phone calls, send some emails, spread the word that the time has come to pass HB 1211 and repeal the social security retirement offset from Washington State workers’ compensation benefits.

77 thoughts on “Workers’ Compensation Offset of Social Security Retirement Benefits – Can it be stopped?

  1. Hello, Dave,

    Very interesting web site. Maybe you can help me. I just starting receiving social security retirement in April 09. I had to have surgery in July which was covered under workman comp.My claims manager says that I would be getting a time loss check. She states that I would have a slight deduction due to the fact that I was receiving social security benefits. Now I had to return my check,she says I am not entitle to compensation, because I am receiving social security and I am doubling dipping….Can you help me? Thank, Ken

    • Sounds like your claims manager believes you are in total offset – not common, but not impossible. You can receive 80% of your ACE (Average Current Earnings) in combined Social Security (disability or retirement) and workers compensation benefits. If the combined benefits are over the 80% cap, L&I will take an offset, reducing your L&I benefit as much as necessary to keep you at that magic 80% number. You can call Social Security and they can tell you what your ACE is, then just add your full SS benefit and your full L&I benefit together and see if you are over your 80% cap. If you have a history of high earnings, your ACE will be higher, allowing you to collect a higher combined monthly benefit. If you have a history of lower earnings, your ACE will be lower, and the amount you can collect in combined SS and L&I will be lower.

      • Hello again…Sorry to bother you but,I am still a little confused….since I have just started collecting Social security benefits…
        Will I be receiving this new ACE amount now? Instead of my Socical security amount? And for how long? I don’t want to have to pay this back again as I had to with the time loss benefit check?
        Did L & I classify me as disability? (as when they looked in their records they saw I had a rating on one of my shoulders)? Also, is their anything else that I would need to know when they rate my other shoulder? Thanks so much for your help…Ken

  2. The maximum you can receive in combined benefits (L&I and SS) is your ACE (average current earnings). Your full combined benefits may be less (resulting in no offset) or you may hit your max with just Social Security (resulting in total offset) Or you may be somewhere in between. Let me give you a very basic example.

    Average current earnings $65,000/yr
    80% cap would be $52,000/yr or $4,333.33/mo
    You can receive this $4,333.33 in combined SS and L&I benefits.
    Lets say your L&I benefits are $2,500/mo and you full SS benefit is $2,500/mo
    Combined you would receive $5,000/mo – this is over your cap of $4,333.33/mo.
    L&I is going to offset, or reduce, your monthly benefit to $1,833.33. ($4,333.33 less the SS benefit of $2,500 = $1,833.33)

    To answer some of your other questions I would need more detail. But keep in mind being disabled for purposes of Social Security does not necessarily mean you are totally disabled for purposes of L&I. They are different systems with different standards and rules.

    • Hello, I am 62 yrs. and still puzzled as to why I get this offset? Will this be separate from my SSI? How long would I get this offset?
      I had my right shoulder done 2008,then was rated as 10%?
      I did volunteer retirement of March 2009. Had to have left shoulder done July 2009.
      A time loss check was sent to me then I had to return it back “as a clerical error”.
      So, I haven’t receive no monies from L & I at all. When I was referred to the socical security offset department she says beginning Oct. 1st. I will be getting $2400. Then all this offset stuff happened. Thanks for explaining the ACE to me. Thanks, I appreciate it. Ken

      • also, update correction my right shoulder was done in 2005 not 2008.
        Also, was I suppose get a time-loss check? after the surgery July? If so should I have to appeal?


  3. You mention that you took “Voluntary Retirement” – this can raise a whole host of issues. If you “retired” because of your industrial injury, then you should continue to be eligible for time loss benefits so long as your injury prevents a return to reasonably continuous gainful employment. However, if you voluntarily retired for reason unrelated to your injury, then you are no longer eligible for time loss benefits. You have enough unanswered questions that it is probably time to talk to an attorney.

  4. I am currently receiving time loss benefits from a self insured company. Have been since 11/08. Have been told I cannot go back at my reg job due to disability. Am eligible to retire, (forced because of injury). and now just had my last I.M.E and waiting to be “classified”. in reading your notes i fear I will be classified as “employable” even tho my dr. and another P.C.E says no. I have two offset reports, one I.M.E and one P.C.E. who determines my classification and where do I go if I do not agree with it? Also I am unable to work at all because of 24/7 pain after surgery and am currently taking narcotics for relief. any help?

    • The assessment of whether you are able to work may come from your attending medical provider, an IME physician and/or a Physical Capacity Evaluation. If the medical providers are all in agreement, then there should not be much controversy. If the medical providers disagree about what you can and can not do, or if the vocational counselor indicates you have transferable job skills that you do not believe you have, then you need to talk to an attorney

  5. I was injured in 1993 the did a scraping omy right knee. The QME at that time stated i would need a full knee replacement .My knee got progressivly worse i notified my company in 2004 they kept saying after the next job well in 2007 they laid me off due to lack of work. So i filed a claim with workmans comp I stated my injury got progressivly worse through the years. It has been over two ad a half years .I have an appointment with my QME in Feb I dont know how it will pan out but my surgery was not a success .I just wantto no what this award will be a ball park figure I was with my company 21 years and was making 125,000 a year June of 2007
    Thanks Bob

    • Without more information I can not tell you what the knee claim is worth. It will be different depending on whether you have a WA L&I or a Longshore claim, and it will depend on your current objective medical findings. There is no “set” value. Sorry I can’t be of more help. If you have additional questions, feel free to give me a call.

  6. It’s interesting to note that the governent allows disabled vets to collect both V.A. and SSA benefits, but not Workers’ Compensation. Jim.

    • I honestly don’t know much about VA benefits. I suspect it has something to do with the idea of wage replacement. Both Social Security and Workers Compensation benefits include a replacement for wages lost because of injury or disability. So, in very general terms, collecting both benefits creates the possibility of collecting twice for the same lost wage. VA benefits have nothing to do with wage loss, so no potential for double dipping.

      Although your comment does bring up again the question of why L&I offset Social Security Retirement benefits, which are different then Social Security Disability Benefits. This would be a good legislative issue. Not this year, we’re dodging too many business proposals to cut worker’s benefits. But it is an idea to keep in the back of our minds for later.

  7. I just had my last visit to Primary Dr. He rejects the last I.M.E and stated that he believes I will go before a L and I judge because of the controversy. I read you notes on being able to appear before a “human” and chances are better to be able to look the deciding factor in the face. Will I or should I have an attorney present at this meeting, I believe I am totally disabled but as you know that is a really tough call to obtain, Thanks for your reply

    • Whether you are totally disabled or not is partly a medical question and partly a vocational question. It is a good start that you have a supportive medical provider. I would encourage you to talk to an attorney. It costs you nothing except a little time. Then you will have a better understanding of whether you should hire an attorney or not.

      • well then, my next question is are welch and condon taking any new clients? I have their phone number posted on my bulletin board, I will give them a call on monday morning? I can drive to tacoma, should i bring all my paper work? I would like to have things in place even before I get a scheduled appointment, as it could just go to olympia and i would have to have an appeal set up. I was also told that at this time i should prepare my retirement papers because it takes approx three months to start receiving any monies from my pention?

  8. I whole heartedly agree the L&I disability offset to Social Security disability be eliminated. Social Security and Labor & Industries are two separate entities. What’s next if you have a military retirement then you can’t have a civilian retirement? Heaven forbid to couple that with Social Security!

    It’s aggravating when the 1993 Washington Supreme Court rejects the arguement when language is in the Washington State Constitution rejecting the offset to begin with. Now it has to be rechallenged and paraded through a time consuming legistlative bill when disabled people should of enjoyed benefits to begin with.

    What’s wrong with this picture other than politics?

  9. I’ am trying to get my WC case resolved I was rated 64% permanently disabled by te qme will this help or hurt me in trying to receive social security disability

    Thank you


    • Unfortunately, Workers comp and Social Security Disability are two different systems. Being disabled under one system is not proof of disability under the other. While you can collect both benefits, subject to various caps and offsets, there is no short cut way to being awarded benefits after an award in the other system. Give Social Security all the medical records and request reconsideration if you are denied. If your application is denied a second time, get an attorney to help.

  10. I have a question concerning offsets in Washington for receipt of Social Security. My Mother was 66 years of age and working full time when she was injured on the job. She had been receiving her social security since the age of 62. Now the L&I have decided to offset her SSRI. She was receiving this retirement benefit while she was working and now she is loosing most of her time loss benefit because of this. Now she in effect will be getting $1000.00 less per month than she would have had she been able to work. Is there anything that can be done or is she just out the $1000 per month?

    • Unfortunately, the current law does allow L&I to offset Social Security Retirement Benefits, even when the worker was receiving those benefits at the time of the injury. It is a horrible inequity in the law which we have not been able to fix, yet.

  11. I’ve been receiving monthly Washington L & I pension and Social Security disability payments for a work related injury. The other day I received a letter from Social Security saying they were reducing my monthly check by over $1000, because I turned 62 in May. I also am required to pay back over $4,000 for the overage I received since May. I’m in shock over this. I’ve talked to a Social Security representative and one from L & I, but am not getting anywhere. I’ve also found reverse offset information on their websites, but am having trouble understanding it. It seems if Social Security is reducing my benefit, then L & I should pick up the difference. Is there some paperwork I can file? And what happens when I turn 65? Help please!

    • It is confusing. The short answer is yes; When you turn 62 L&I stops taking the offset and the SSA starts taking it. It is not unusual for there to be some lag in this actually happening – which will mean Social Security has overpaid and L&I has underpaid. L&I is well aware of what to do – they will stop taking the offset and make up the benefits which they should have paid since you turned 62. The overpayment assessed by Social Security and the underpayment from L&I should be close to the same number – although because of some oddities they may be off. You can take the underpayment from L&I and send the money to Social Security – which should take care of most if not all of the overpayment being assessed. Talk to the Social Security offset folks at L&I and they will walk you through what will happen. The reverse of all this is going to happen when you turn 65.

      Washington is a reverse offset State. Which means that we have a law which gives the State the benefit of any offset which needs to be assessed. For reasons that I could never explain, there is a weird glitch in the way the law is written, and the State can not take the offset between the ages of 62 and 65. So, the offset is taken by Social Security for those years, and L&I pays your full benefits without offset.

      • L & I is now saying that they will cover about $600 of the $1000 being cut by Social Security. They also said that I should change from Social Security Disability to regular Social Security payments(which would bring me close to the remaining $400) until I turn 65. When I mentioned this to the Social Security rep, he said that if I was to do that, I would be setting myself up for L & I to say that I’m no longer disabled and they could stop paying me altogether and might even demand I pay back everything I’ve received from them in the past. AGH! Who do I believe? By the way, I really appreciate this forum!

      • You have received incorrect information from Social Security. Switching to SS Retirement instead of SS Disability, in and of itself, will not result in L&I finding you are not eligible for further benefits. I’m sure the person you talked to meant well; and there is a provision in the statute which says you are not entitled to benefits if you are ‘voluntarily retired’. However, that phrase has a very specific meaning. If you are “retired” and unable to work because of your work related injury, it is not considered a ‘voluntary retirement’ which disqualifies you from further benefit. Many injured workers receive SS retirement, and it poses no problem at all for their L&I claims.

      • I am so confused.My husband is permanently partially disabled and receives a small amount of Federal WC every month since 1977 and he also gets SSD. He turns 62 this month and we received a letter yesterday saying he may lose his permanent partial disability.when he turns 62. I thought it was permanent. We live in Florida and he was injured in 1977 in Ohio and we may have to move back there to help his mom. Just saying that in case the laws are different in each State. How can they take that away from him? We need that money to live. When he turns 62 on May 30th, will they add that amount to his Social Security? It is $400 but we really need that as his SSD is only 1157. Thank you for your guidance as I am so stressed over this.

      • The laws in each state are very different, and Federal compensation is very different depending on whether it is FECA or Longshore. So, you really need to talk to an attorney who is familiar with the particular benefit your husband is receiving.

  12. L&I just sent me a notice to find my highest year of earnings. I was hurt in Wa. and several months ago my case was reopened back to Dec. 10, 2009. I cannot work anymore due to my injury so Jan 27, 2010 I accepted my retirement at the age of 62. I recieve that and suppose to recieve L&I benefits. The way I read it is that the only way they can offset my work comp payments is if I am over the cap. Is this true? Thank you Robert

    • In a nutshell – Yes.
      If your combined Social Security and L&I compensation exceed 80% of your highest average earnings, then one of the agencies will take an offset. We have a weird glitch in our offset statute. L&I will take the offset until you turn 62. Between the ages of 62 and 65 the Social Security Administration will take the offset, then the offset reverts back to L&I. You have an obligation to notify the SSA of your worker’s compensation benefits. They will generally contact L&I, or visa versa, to confirm the payment amounts.

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  14. I have a question.

    I am an injured contractor who worked in Iraq and got hurt because of an IED explosion and being thrown around of the armored bus because the buse did not provide seatbelts in the war zone with a lot of passengers inside the bus along with metal falling of you and things hitting you from the explosion in which you was not able to see because the dust was everywhere and you couldn’t see but feel things as it hit you.

    I have not been able to work due to psychological reasons, back and spine problems, eye adjustment problems, shoulder problems, back spasms, short time memory problems, sleep apnea, wearing a CPAP machine at night), high blood pressure, lung and chest pains, burn pit and water contamination victim, shock-like symptoms in brain and neck area under throat, erosive esophagus, lupus, arthritis, neuralgae, tinitus, and speech difficulties at times.

    I am also a disable veteran with prior injuries that were aggravated during the incident mentioned above. I receive disability at 90 percent but have been rated at 100% due to individual unemployability. I get a Navy retired check of $1300, $3205 VA disability, and federal workman’s comp of $1760. All together the amount is $7025 a month. I am not able to substain gainful employment anymore. I also found out that I am having medical problems that stemmed from the contaminated burn pits in Iraq and Afghanistan areas where I worked.

    My total wages when worked overseas in a tax free area was $108,977.00 a year but I only worked from 23 December 2007 to 18 July 2008, which is less that 7 months. So I only made $63,000 dollars for the time period. The company I worked for was SEII Incorporated in the Cayman Islands. Now they have moved to Dubai Saudi, Arabia.

    I am scheduled to go to a social security meeting Friday and wondered if my social security will offset from the funds I already get for the military retirement of $1300 dollars, 100% VA disability of $3205 dollars due to dependents in college, and Federal Defense Base Act Compensation of $1760 a month. Will this hurt me in getting social security benefits and will it completely offset it anyway.

    Please email me as quick as possible on this matter at my email address:

    Thanks for your assistance in this matter.


  15. I am so frustrated beyond words. I was injured in 2008 on the the time I was receiving SSD for an unrelated condition.
    When my time loss started I was getting about 1000.00 every 14 days. I get 665 in SSD benefits. I got an offset and my bi monthly L&I benefits have not been reduced by the 665 I get in SSD they decreased my L&I benefits by 1450 a month because I get 665 in SSD. Now I’m no law student..but BOTH of these are things I’ve paid for via payroll deductions all my working life. I have heard this term ” double dipping” and it makes me sick. I get these for 2 different conditions, the last, after blowing out 3 thoracic discs moving a patient in the operating room. After suffering through the indignity of trying to ” live” on 665 a month I was finally close to what I was making when injured. To be honest it seems I would be almost 1500 a month ahead if I just told SS I no longer want my benefits!! This has to be addressed, why is it they have to help keep the poor “poor?”
    I hope someone still runs this thread because the math doesn’t work here, taking 1490 because I get 665 is so unfair.

  16. I was awarded a life time comp for a perm total disability, i also receive an off set through SSD. My question is at age 60 i am eligible for my husbands Amtrak pension. If i receive comp for life does SS continue to off set for life? This hardly seems fair considering i have paid into that sys and really you get nothing for you injury. And can not sue. Will this off set stop at retirement age? Comp has to pay me forever, my injury was over 10 years ago.

    • Private pensions or retirement funds are not used to calculate an offset for either Social Security or WA L&I. Neither SS or the L&I benefits should be effected by the eligibility for the Amtrak pension.
      It is the Federal Government which dictates the offset when an injured worker receives both workers compensation benefits and SS Disability. This offset would cease with eligibility for SS retirement, expect the State law takes over at that point and continues to offset the benefits. While I agree this may not be fair, at this point there is really very little practical path to removing the offset.

    • Washington State L&I recipients did not get a COLA increase this year. But you raise a good point. These are fixed benefits, be they workers compensation or Social Security. When the fixed income does not keep pace with increases in the costs of food, gas, and basic necessities, then we are truly shredding our safety net.

    • Washington State workers compensation benefits do not stop when you become eligible for Social Security retirement. The benefits are subject to an offset, but you are allowed to collect both benefits.

  17. I am 59 years old and married and was recently injured at work. Took a fall and broke my hip and required emergency surgery. My job was very physically demanding and the doctor says I will be out of work for at least several months and perhaps permanently. Obviously L&I will pay the medical expenses and I am told that I should expect to receive 80% of my regular pay. Would I also be eligible for Social Security Disability concurrent with L&I? If so, would it impact my compensation from L&I? If it would impact my L&I compensation, would I be better off not applying for Social Security Disability?

    • Sorry, this comment was lost in the shuffle and didn’t get a reply right away. You should contact the Social Security Administration and they will walk you through the application process and the guidelines for eligibility. If you do apply for Social Security Disability and are denied, you should request reconsideration. If the same application is denied a second time, you should contact an attorney for assistance. You can collect Social Security and L&I benefits at the same time. The combined benefits are capped at 80% of your highest average current earnings. When considering whether to apply for Social Security you should weigh not only the monthly benefit amount, but also your eligibility for Medicare. If you do not have private medical coverage which will continue while you are off work, then this may tip the scales toward applying.
      Your post says you can collect 80% of your wages on L&I. If you are in Washington State, that’s not accurate. Time loss benefits are paid at 60% of wages at the time of injury, with an additional 5% if you are married at the time of injury, and an additional 2% for each dependent child. (up to a max of 75%) While the time loss rate is easy to calculate, the calculation of a workers monthly wage can be very complicated. If you have questions about your monthly wage you should ask an attorney.
      I will also say, your employer may be able to help you return to work earlier by providing modified work or transferring you to a different permanent position which is not so physical. While it may sound odd coming from an attorney who represents injured workers, many people are better off – financially, physically, and emotionally – when they are able to stay connected to their work environment. I tell my clients to focus on their best outcome, and work toward it.

    • You are likely already receiving time loss benefits under your L&I claim. Social Security (whether disability or retirement) works with L&I pension benefits the same way it works with time loss benefits. You can collect both benefits up to a cap of 80% of your highest average current earnings (or ACE). You can contact the Social Security Administration and ask what your ACE is. Or, take a look at the Social Security Earnings summary you receive periodically from the Social Security Administration. The year of your highest earnings is a good ballpark of your ACE. If you are already receiving both benefits, L&I has probably already calculated and is taking any necessary offset. If you are just now applying for Social Security be sure to notify the department when you are awarded benefits.

      Also, I do have to say, while your physician may say you are going to get a pension, it is as much of a vocational question than it is a medical question. You will need to go through a vocational assessment to determine whether you can return to work, are eligible for retraining, or are not likely to benefit from retraining and are permanently and totally disabled (and therefore entitled to a pension) Your physician will need to continue to be supportive, provide reasonable and objective input on your physical limitations, and review job descriptions. It may well be as you go through the process that options other than a pension will make more sense for you. It can be a rocky road. Please don’t hesitate to get legal help to navigate it.

  18. I have already went though vocational assessment and was said to not be retrainable because when i worked i worked 40 hrs a week and now 2 pce said and my doctor agreed i can only work 3-4 hrs daily my doctor said i would get a pension for life so vocational said wa law is if you work 40hr then retraineing would not work because you can not work get schooling for part time work also when i received my social security i had an ofset but have not had one again what will happen now how do they calulate ;your amount will it be the same as i receive now

    • If the Vocational Assessment concludes you are not able to return to work and are not likely to benefit from retraining, then yes, your file will be reviewed for a pension. It sounds like your physical limitations prevent a return to work in the same full-time work pattern which you worked prior to your injury. Assuming these limitations stem from your industrial injury, than a pension is the most likely outcome. The department will not provide retraining for part-time work.

      You don’t say how old you are, or if you are interested in part-time work. There is a new law which allows for structured settlements of L&I claims. It may be possible to negotiate a structured payment plan which would allow you to work part-time, and receive some payments from L&I. This would be instead of the L&I pension, put places the risk on you to obtain that part-time employment and continue working. There would be no going back to get the pension at a later date. These structured settlements are a new concept, and if you are interested I would strongly recommend you get legal help.

      • Hello I am 54 years old and i do not think i can even work part time any more because of the back pain .

      • What matters most in your situation is what the medical providers and vocational experts conclude about your ability to work. If your work pattern at the time of injury was full-time, and the consensus is you are currently limited to part-time – then you are likely headed for a pension review. The new structured settlement provisions are limited to those injured workers who are at least 55 years old, so you are not currently eligible to even consider this as an option.

  19. I hurt my back in 1995 and had the claim closed out in 2005. I had a minimum wage job and at the time minimum wage was 5.15. Since then the minimum wage has gone up to 9.01. I am re-opening my claim since my fusion didnt take and was wondering will my time-loss be 5.15 or 9.01?

    • Time loss (in WA) is based on wages at the time of injury. But there would have been COLAs in the meantime, which would increase the compensation rate paid if your claim is reopened.

  20. my husband rec ssd and L&I for a disability work related and had a hip surgery and is still in so much pain. because ime said nothing wrong and this went on for 4 yrs befor first surgery that other areas of back and hip are involved now ssd says they overpaid and L&I says they over paid for the offset both cant take back can they? his injury was a labreum tear and went undiagnosed due to L&I Ime not letting him see an ortho surgen the surgery took 45 min and now there is still more problems it took over 4 yrs to get done. also if he was over paid then the attourney that took 30% of anything he got on L&I was also overpaid right shouldent he have to pay back also

    • It sounds like your husband already has an attorney representing him on his L&I claim. I strongly encourage him to make an appointment to talk to his attorney. Take a list of questions so you are organized and can easily pinpoint what is confusing to you. The attorney should be willing to take the time to address any concerns and make sure all your questions are answered. Offset calculations between L&I and Social Security can be complex and difficult to understand. But your attorney is in the best position to explain what is going on and why.

  21. also wondering if any attourney is brave enough to take on a law suit to the IME’S that tell us there is nothing wrong with you and state its all in your head and the dr was so old that he said no tear in the hip could be fixed I googled the dr info and found he last worked in a hospital in 1972 these guys are paid by L&I and for L&I by L&I what a bunch of quacks and rent a doctor thay should not be practicing medicin. they tell you to bring xrays and mri but wont look at them and state that they are of no use to them

  22. Are these nightmares only going on in Washington State?? My husband (62yrs old) has a similar story. He is in constant pain, has had 4 spinal surgeries since his construction accident in 2002. 8 months ago L&I cut him off saying he could do “sedentary work”. SSD reported an L&I offset of over $6,000 for December on which we now have to pay over $600.00 income tax. We were left with no income. He does have an attorney who is working on this but we may lose our house in the mean time. Do these people at L&I have no idea they are destroying people’s lives? I totally agree with Janet about the IME’s.

    • I don’t practice in other states, but our (Washington State) system is somewhat unique with respect to the offset issues (there may be a handful of other states who are allowed the offset before age 62, lose it between 62-65 and then get it back at age 65, but I’ve not done the research to verify that). You mention L&I and in my posting I meant L&I to refer to the Washington State Department of Labor and Industries, the state agency which administers the workers’ compensation and pays benefits to all employers but those who were working for self-insured employers. What you refer to is another issue relating to the offset of workers’ compensation benefits by SSA in that it pretends it paid the benefits (which it did not as they were paid by the workers’ compensation carrier) but it reports them as having been paid thus making them potentially taxable (that depends on the entire tax status of the injured worker and whether there is sufficient other household income to make these benefits taxable). This turns otherwise nontaxable (workers’ compensation benefits are not taxable) benefits into potentially taxable benefits (social security benefits can be taxable if sufficient other income to pass the threshold). Clearly unfair to a disable worker, but entirely consistent with the current tax code and the socisal security laws relating to offset of workers’ compensation benefits. Your problem likely occurs in all states where there are offsets. The problem I tried to address in the posting was something quite different dealing with the reverse offset and the application of the “average current earnings” resulting in a reduction of benefits during the age 62-65 time period due to rather than using the adjusted “ACE” using the historical “ACE” during that time frame.
      As you point out there are several other “nightmares” that the system can throw at injured workers who are all but helpless in the face of the combined bureaucracies of federal and state governments hard strapped for cash and unwilling to listen to any proposal that might reduce government income or increase payments to beneficiaries.

  23. Hi my name is Bill and on July 5, 2000 i was in a bad logging accident and lost my right leg and part of my left. I was on L&I and in 2003 i was told to sign up for ssi and was excepted from 2003 until 2008 i was reciving both L&I and SSI. L&I gave me a permant partial dissability settlement of 99,728.96. SSI knew i was receicving L&I and yet no one told me i had to claim the Permant partial disability as earnings. In 2011 i recieve an overpayment from SSI of 25,789.00 I filed a waver and they knocked of 11,952.00 for lawyers fees and medical and other expenses but i since i did not know i had to claim the permant partial disability money and no one in either the L&I or SSI told me i had to claim the money am i still responsible for the overpayment. We feel it will bankrupt us. Do you have any suggestions for us

    • That’s a sticky one. The Social Security Administration claims Washington State’s Permanent Partial Disability awards are payments for lost wages, and must be offset just like time loss benefits. There is an argument to be made that our state’s particular PPD system is not wage replacement but is instead payment for bodily impairment – which would not be subject to offset. Unfortunately, the Courts have not been particularly receptive to the argument. I know there were some attorneys who were pushing the issue for a while, but I don’t believe it ever resulted in changing the status quo.
      That said, what the Social Security Administration should do is take the PPD payment and extrapolate it as payment for loss of earnings over your lifetime – thereby reducing the monthly payment for lost wages subject to offset. The monthly amount subject to offset should not be the same as your time loss rate, because you are allegedly (according to L&I) able to work in some capacity. So, for example, if you are currently 45, argue you have a 20 year (240 months) work life expectancy. Divide the $90,000 PPD by 240 months, and you have a wage replacement of $375 per month which would be subject to offset (if that amount combined with your SS benefit exceeded your 80% cap) Using this type of argument may reduce or eliminate the overpayment. Although, I’m not sure of the timing in your particular circumstance, it may be too late to challenge the overpayment calculations.

  24. My husband was a 62 year old retired ironworker and worked in the steel industry for over 40 years. He has been on L&I since 2006 and has had back surgery and both knees replaced due to ‘over time wear and tear on his body’. His is currently in schooling and when it is completed in February 2013, his claim will be closed and he will receive a settlement. He has been told that the maximum lump sum payment L&I can pay is $24K. The remainder of the settlement can be calculated over the rest of his life, or he can opt to get the maximum monthly payment of $6K until the settlement is completely paid. Our question is about how these options will affect his Social Security Disability. Will it be tax exempt like all of this L&I monthly payments have been? Will it be counted as income?

    • I’m not a tax attorney, but, benefits paid by L&I are not considered taxable income. Social Security can offset benefits received under your workers compensation claim, they are probably doing so already. (Or, the State is because we are a reverse offset State) PPD can be offset just like time loss benefits. You should carefully consider before agreeing to a structured settlement. Taking a structured settlement means you can never again receive benefits under the claim, other than medical treatment. If instead, you take your PPD payments and the claim is closed, you can file an application to reopen the claim if your condition worsens within 7 years for full benefits. You have to weigh the amount of the structure versus the possibility of getting future benefits. Structured settlements are new in this state, and you should tread cautiously

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  26. Are there any changes going into effect in 2013 that will change how offset of L&I loss time payments for Social Security retirement?


  27. Unfortunately there were no changes made by the Washingtron Legislature in 2012 which might become effective in 2013 to help the problem. At this point I don’t expect any given the monetary crisis affecting our state, both relating to the general budget as well as workers’ compensation. The Bill to reverse this is now known as HB1317 and unfortunately came back with a huge Fiscal Note (see: Those kinds of non-appropriated (i.e. unfunded) increases are going to make it very had to get this bill passed, especially in hard economic times. Perhaps when the economy improves….
    Dave Condon

  28. I’m confused. I fell at work 13 months ago and have been off work on L&I time loss since that time. This past Friday,I was informed that my SSDI claim had been approved. L&I was supposed to close my claim this week,now they are not going to until I go through VR assessment, and will keep paying TL until then. I’m guessing I won’t see a penny of SSDI,since L&I is 3200 a month and SSDI 1645. I will be 62 on 1 Dec. How long is the offset likely to last (until I am 66???????????).

    • You are allowed to collect both L&I and Social Security benefits at the same time. If your combined benefits are over your cap, then there will be an offset. There is an offset for as long as you receive both benefits, although which agency takes the offset may change. Everyone’s cap is different. You can call SSA and ask for your ACE (Average Current Earnings). You are allowed to receive 80% of your ACE in combined benefits.
      Hope that helps!

  29. I am 51 yrs old and have had C-5, C-6 and C-7 fused, also L-5,S-1 fusion as well as Rotator cuff repair Am I to young to be considered for retirement. I am currently on Land I for these repairs

    • The short answer – Age is not a factor.

      But let me rephrase your question, and see if a change in perspective changes your own answer to the question. You asked if you were too young to be considered for ‘retirement’?. I would ask, are you too young to be considered ‘permanently and totally disabled’? Are you never going to work again? Are you ready to live on a fixed income? An L&I pension is an award of permanent and total disability benefits. It is a recognition that you are so disabled that you cannot obtain and maintain reasonable continuous gainful employment. Are you too young for that?

      The focus will be on your functional abilities and limitations, transferable work skills, and potential to benefit from vocational services – regardless of your age. Keep in mind, when we talk about employment and ability to work it is not just the specific job or type of work you were doing when you were injured. You may not be able to return to that line of work. But the workforce is a broader and bigger universe than your previous field.

      So, now ask yourself the question. . .

      • That was a lot of help. But being that all I have done is heavy construction, I don’t know anything else. With 3 fused vertibrea in my neck and 2 in my lower back and rotator repair.what kind of disability am I looking at. Who in their right mind is going to hire a 51 yr old guy with all of these repairs

      • It is really scary to face the loss of the only work you’ve ever known. It doesn’t help that the workers compensation system is confusing, full of acronyms and initials, and shy on answers and direction. There will be two main questions in any claim. Are you employable and what is your disability rating. Unfortunately, “employable” means employable at anything for even minimum wage. So, you will have some choices and decisions to make. That can be daunting, and getting some help might be a good idea.

      • if I get a 30% disability rating, Will I get a pension or just the ppd 1 time payment. It is scary to thank that after 33 years of working my but off, getting hurt on a job, and now I could end up only being able to get minimum wage. Can a lawyer help with that. I am not to the point of getting rated or vocation yet, But I bet it will be coming soon. Thanks

      • A pension, or permanent total disability, does not depend on your impairment rating. It depends entirely on whether you are employable. Employable can mean doing anything, for minimum wage or above. So, you could have a very low impairment rating, but have physical restrictions or other barriers to employment which prevent a return to work. In the alternative, you could have a larger impairment rating but be able to obtain and perform full-time sedentary work. If you are employable, but have a permanent impairment you will receive that PPD (permanent partial disability) award when your claim is closed. An attorney may be able to help – particularly if you have questions about what benefits you are entitled to receive.

  30. I have been on l &I permenant disability since 2004 it is now 2016 .I have have not applied for ssi or ssdi will I be penalized when I turn 62 or older by docial security? Ahd if so will it be retro active?

    • In Washington state the offset is applied whether you receive Social Security Disability or Social Security Retirement. You can collect up to 80% of your highest Average Current Earnings (ACE) when Social Security and L&I benefits are combined. The offset is applied to any period of time you are paid both benefits. If you did not receive both benefits the offset is not applied retroactively. But, if you are paid a period of back due benefits by Social Security, then the period of time covered by the retroactively paid benefits would be subject to offset. Hope this helps.

  31. Short and sweet fiance got hurt on the job..been on L&I for almost 4yrs now. Have a lawyer but nothing has been done. He needs surgery on his back and his doctor and a surgeon we see bolth agreed he did need surgery. He recently had to go to an I ME when he already down alot of them, and his doc put in for pain management along time ago and it was denied. But now that he went to the I ME he juse found out they approved it, but waiting for I ME results to come back because of course he wants the surgery and his doctors agree 5hat pain management won’t help. I jut think 5hey don’t want to pay for the surgery and he is in pain 24 seven and not even on pain meds because the doc won’t prescribe because he put in for pain management. I am so frustrated and hate seeing him like this. If they deny the surgery should we just give up and do the pain management I just don’t want him to just have to quit after all we have been thru and barley able to survive on L&I. Do you think they will give into surgery cause at the I ME he told them that’s what he needs but those docs never agree with his…wich is a crock because why do other docs say he does. We are at our last straw and if they say no to surgery he is going to have to deal with the pain all of his life and that is not except able to me. And disability he applied for once or twice and denied that he has been out of work 4yrs could he get disability now if he tried we are struggling so badly and have lost alot. And seeing him this way is horrible and he cannot work and has not in almost 4yrs

    • If you already have an attorney, I would follow the advice you are being given. For my two cents, I will say that participation in a multi-discipline pain clinic program is required prior to some surgeries being authorized – specifically, certain lumbar fusions. I know this sounds odd, but the research tells us the increase in functioning following these types of surgeries is in the same general ballpark as increases in functioning after participation in a Pain Clinic program. Go figure. . .Turns out sometimes surgery does not solve pain. Pain is its own world, which sometimes requires its own type of treatment. It is frustrating for a patient when some physicians recommend surgery and others oppose it. If the department ultimately denies authorization you will be faced with the unenviable choice of paying litigation costs to fight the denial, or going another route with treatment. This is where talking to your attorney will help you make informed choices.

  32. I live in WA.I keep reading about offset. I went to ssa and they said since im 62 and drawing retirement not disabilty they would not impose a offset. I spoke with L and I and they said they will impose offset. Is it to my advantage to put off drawing retirement till im 66 ? Also if ssa says they wont impose offset why can L and I impose offset

    • Whether or not you take early retirement at 62 or wait to full retirement age 66 (or higher based on your birth date) varies case to case. Federal law does not allow SSA to offset early retirement against workers’ compensation benefits. However, Washington State law does allow L&I to offset both federal disability and federal retirement benefits. The best way to move forward is to get the details of what your early retirement rate would be, contact L&I and find out now that would be offset (if at all based on your Average Current Earnings “ACE”). Then compare that with the age 62-65(6+) retirement scenario. Also compare your post full retirement age benefits under each scenario and how LNI might offset after you reach full retirement age going forward.
      It sounds complicated but usually once you have the figures laid out in front of you the path becomes obvious. However, it does also involve some guess work as to how long you might live and if you’ve taken a reduced retirement rate, to avoid offset, at what point does that even out.
      Good luck.
      Dave Condon

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