2016 Budget Proposal Would Require Reporting of Workers’ Compensation Benefits to Social Security Administration

heatherThe Social Security Administration (SSA) has been vocal in the past about its difficulty in obtaining information about workers’ compensation benefits. The primary reason that the SSA has been seeking this information is to reduce social security benefits by way of an SSDI/WC offset. The SSDI/WC offset is a calculation used by the SSA to reduce a beneficiary’s SSDI benefit amount if the person is also receiving workers’ compensation benefits. The SSDI/WC offset is different in every state and applies only when the individual’s combined monthly amounts of SSDI and workers’ compensation are greater than 80% of individual’s pre-disability “average current earnings.”

The SSA currently has to rely on beneficiaries to report to the SSA when they receive workers’ compensation or public disability benefits. President Obama’s 2016 budget proposal includes a provision to establish a new federal requirement that workers’ compensation and public disability benefit information be provided by states, local governments, and private insurers to the SSA.

The budget proposal summary includes the narrative below:

Establish Workers’ Compensation Information Reporting. Current law requires SSA to reduce an individual’s Disability Insurance (DI) benefit if he or she receives workers’ compensation (WC) or public disability benefits (PDB). SSA currently relies upon beneficiaries to report when they receive these benefits. This proposal would improve program integrity by requiring states, local governments, and private insurers that administer WC and PDB to provide this information to SSA. Furthermore, this proposal would provide for the development and implementation of a system to collect such information from states, local governments, and insurers.

The proposal can be found here: http://www.ssa.gov/budget/FY16Files/2016BO.pdf (the workers’ compensation reporting proposal can be found on page 22, section 10 of the document).

In summary, ultimately the proposal’s objective is to have states, local governments and insurers report SSDI beneficiaries to the SSA so that it can use the SSDI offset in more cases and ultimately preserve the fiscal integrity of the Social Security program.

This SSA reporting proposal might be giving payers déjà vu of the ultimate goal of MMSEA Section 111, which is to reduce the shifting of the burden to Medicare and so that Medicare can recoup more conditional payments.

Ultimately, the SSA and Medicare have the same end goal, which is saving money and preserving their respective SSA and Medicare programs. Helios would hope that if this SSA reporting proposal becomes a reality that the SSA and Medicare would solidify these efforts into a single reporting solution/requirement since the SSA and Medicare will often be receiving duplicative data.

Helios will be following this reporting proposal and will keep subscribers apprised of any further progress on this proposal.

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