CREDITS AND OFFSETS:
- CREDITS FOR NET PAYMENTS MADE ON ACCOUNT FOR PRE-EXISTING DISABILITY PER LABOR CODE SECTION 4753: Generally SIBTF will reserve jurisdiction for credit issues on the MSC Statement, as “credit” will not be determined until a final overall PD level is set. SIBTF can only take “credit” for the disability benefits. Retirement pensions and Social Security Retirement are not a basis for credit, while disability pensions and Social Security Disability can be basis for “credit.” See Ybarra v. SIF 67 CCC 1282.
The Theory is that if someone is on Social Security Disability they are 100% disabled, SIF only takes credit for the percentage of pre- existing disability as SIF already took a credit for the subsequent industrial disability. No offset for Social Security Retirement so that at the retirement age (see attached), the Social Security Disability offsets stop accruing.
- Prior Awards: There is net credit for pre-existing disability payments. The credit is for the net permanent disability recovery to applicant after legal fee. There is no credit for the medical portion of prior C&R. However, if not broken down in the C&R by a stamen, the disability portion, SIF will claim credit for the whole C&R.
- Disability Pension: SIF is entitled to will claim credit similar to SSDI Social Security Disability as a percentage of SSDI that is related to the pre-existing PD. The formula is (Overall disability % (combined pre-existed PD and Subsequent injury PD) Less Industrial % of disability = Offset % Multiplies Social Security Disability Monthly Amount = Offset Amount. (Combined % – WC PD = % x SSDI benefits = offset). The SSDI credit will end once the worker reaches retirement age and the SSDI benefit converts to retirement benefits. Calculating the Social Security credit can be rather complex. To properly assess the credit four things need to be known:
- The date of entitlement to SSDI benefits and the beginning date of these benefits;
- Dates and amount of changes in monthly SSDI benefits after deductions;
- If SSDI benefits have been terminated, the date reason for the termination must be known; and
- The date of entitlement of Retirement. This information should be obtained from the Social Security Administration.
EXAMPLE: Social Security Monthly Amount = $900 monthly. Overall combined Disability 100% less WC 65% = 35%. 35% X 900 = $315 monthly SIF credit.
Note: No “credit” is given to SIF for Social Security Retirement)
- Third Party Recovery: The credit is for the net recovery to the applicant from the third party recovery. Sometimes it is the best to leave the pre-existing disability resulting from the personal injury case off the SIBTF application because of a large prior personal injury recovery. In this case the claim would not include disability resulting from the personal injury case, but there would also be no credit from that recovery.
- VA disability: SIF is not entitled to Credit for Veteran’s Benefits//Service Connected Disabilities. No offset for military disability through the armed forces of the U.S per Labor Code Section 4753. In Webineer v. WCAB (SIF) (1975) 40 CCC 774, the Subsequent Injuries Fund was entitled to a credit for payments made to an injured employee under a Veterans Administration pension and as Social Security disability benefits only to the extent to which these payments were for a non-service connected disability which pre-existed the industrial injury. [According to Hanna, California Law of Employee Injuries and Workmen’s Compensation, Vol. 1, § 9.05[a].]
TIMING OF CREDITS AND OFFSETS:
The timing of the credits and offsets is based on the initial PD start date of the subsequent industrial injury. The PD start date is not always the same as the P&S date especially for the cases after SB 899 with a two year TD cap. Reference the benefit printout. An earliest start date will mean SIF benefits accrue earlier, and credits and SIF credits will be deducted sooner.
Contact Rawa Law Group APC for more information at the following number 866-200-1212 or visit us at the following website https://www.zrawa.com, to setup a time to discuss your case. We can help you.