Because Florida workers’ compensation permanent total disability (PTD) benefits are paid at the rate of 66-2/3% of an injured worker’s average weekly wage (AWW), an employee qualifying for both PTD and Social Security Disability (SSD) benefits may be in line to receive combined payments in excess of his or her AWW. Is this allowed under Florida law? The answer is, it depends.
Florida Statute 440.15(9)(a) and 42 U.S.C. s. 424(a) address the issue. The federal law allows the combined payments to equal 80% of a person’s average current earnings (ACE). ACE is a calculation, based on one of three formulas, used by the United States Social Security Administration to determine monthly SSD payments. Payments in excess of the 80% are subject to an offset.
Who gets the offset, the federal government, against SSD, or the workers’ compensation insurance companies? Unless a state has laws allowing workers’ compensation carriers to take the offset, the offset belongs to the Social Security Administration. The SSA will reduce SSD payments to bring the combined benefits down to the 80% mark.
Florida Statute 440.15(9)(a) authorizes workers’ compensation carriers to take the offset. Combined benefits under Florida’s system are capped at 80% of AWW or 80% of ACE, whichever is greater. Importantly, the maximum offset carriers can take is the amount of the federal benefit. This is true even if it results in the injured worker collecting more than the original AWW.
Because AWW and ACE are derived from different calculations, the two numbers may not be the same. (Link to determining AWW — Florida Statute 440.14,) To be in compliance with federal and state laws, the higher of the two numbers must be used. Conceivably, 80% of the ACE can exceed 100% of the AWW, hence, the reason for the answer to the question posed in the first paragraph of this blog.
- Offset does not include cost of living increases. See Great Atlantic & Pacific Tea Co. V. Wood, 380 So.2d 558 (Fla. 1st DCA 1980). In other words, COLI are not added against the 80% cap.
- The offset ends at age 65, when SSD benefits are converted to Social Security Retirement benefits
- Offset does not include 440.15(1)(f)1 supplemental benefits. Supplemental benefits are not added against the 80% cap
- Make sure SSA isn’t taking the offset
- Request SSA information with form DWC-14
POLITICAL STATEMENT: Since SSD is taxpayer-funded, taxpayers should be getting the offset rather than private insurance companies.
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