SSR 72-50: SECTION 224 (42 U.S.C. 424) -- DISABILITY INSURANCE BENEFITS -- REDUCTION OF BENEFITS UPON RECEIPT OF WORKMEN'S COMPENSATION PAYMENTS -- DIFFERENT IMPAIRMENTS

20 CFR 404.408

SSR 72-50

Section 224 of the Social Security Act (42 U.S.C. 424) provides that a

claimant's disability insurance benefit must be reduced in accordance with

the formula set out therein, if he receives periodic workmen's

compensation payments or a lump-sum payment as a substitute for periodic

payments.

In December 1967 an insured individual, R, suffers a knee injury in the

course of his employment. As the result thereof he became entitled to

periodic workmen's compensation payments under State law. After a brief

recovery period R returned to work on a full time basis. His right to the

State payment was unaffected by his employment and, in fact, he continued

to be in receipt of such payments. In June, 1969,, a heart attack forced R

to cease working. Payments for the prior injury continued at the same

rate, with no increase resulting from the heart impairment.

Pursuant to an application for disability insurance benefits, the Social

Security Administration determined that R became disabled within the

meaning of sections 216(i) and 223 of the Social Security Act in June 1969

solely on the basis of his heart disorder, and that he was not disabled,

for social security purposes, prior to that date.

The question raised is whether the reduction of disability insurance

benefits required by section 224 of the Act applies only where the

individual's disability insurance benefits and his workmen's compensation

payments are based on the same injury or whether such reduction also

applies where a disability insurance beneficiary simultaneously receives

workmen's compensation payments which are based on a different

impairment.

uction of disability insurance

benefits required by section 224 of the Act applies only where the

individual's disability insurance benefits and his workmen's compensation

payments are based on the same injury or whether such reduction also

applies where a disability insurance beneficiary simultaneously receives

workmen's compensation payments which are based on a different

impairment.

From the language of the statutory provision, it will be noted that

section 224 simply requires a reduction in title II benefits based on

disability or account of ". . . periodic benefits for a total or partial

disability (whether or not permanent) . . . payable (and actually paid) to

. . . [a title II disability beneficiary] under . . . [a] workmen's

compensation law or plan . . ."

Nothing in the section directs that the workmen's compensation award and

the finding of disability under title II must be based upon the same

impairment for offset to be required. Rather, it seems the Congressional

interest in enacting section 224 was in seeing that disabled workers did

not receive combined title II and workmen's compensation benefits (tax

free) in excess of the amount earned prior to becoming disabled. Cf.,

S.Rep. No. 404, 89th Cong., 1st Sess. 13, 100, 260; Lofty v. Richardson , 440 F.2d 1144 (6th Cir., 1971); cert. denied ,

404 U.S. 985 (1971). This is evidenced by paragraph 224(a)(5) of the Act

which authorizes offset only insofar as the total of title II benefits

based on disability and workmen's compensation benefits "* * * exceeds

that higher of * * * 80 per centum of * * * average earnings' * * *." From

this language it does not appear that Congress intended that the section

224 offset would apply only in instances where the title II disability

benefit and workmen's compensation benefit resulted from the same

impairment.

of title II benefits

based on disability and workmen's compensation benefits "* * * exceeds

that higher of * * * 80 per centum of * * * average earnings' * * *." From

this language it does not appear that Congress intended that the section

224 offset would apply only in instances where the title II disability

benefit and workmen's compensation benefit resulted from the same

impairment.

Furthermore, there exist basic differences between the respective

programs. Generally speaking workmen's compensation is payable for partial

or total incapacity resulting from an injury arising out of and in the

course of employment. E.g., G. L. Mass., Ch. 152, secs 26, 34, 34A, 35.

However, title II disability benefits may be paid whenever an insured

individual, who otherwise qualifies therefor, is unable to engage in

substantial gainful activity by reason of any medically determinable

physical or mental impairment or combination of impairments which can be

expected to result in death or which has lasted or can be expected to last

for a continuous period of not less than 12 months. 42 U.S.C.

423(d)(1)(A); 20 CFR 404.1501(a)(1)(i). The title II program does not

require that the impairment causing the incapacity be incurred in the

course of employment. Consequently, in any particular situation, depending

on the facts involved, the work-related injury may be: (1) the sole basis

for a finding of disability under title II, (2) one of several conditions

which when taken in combination may have resulted in such a finding, or

tle II program does not

require that the impairment causing the incapacity be incurred in the

course of employment. Consequently, in any particular situation, depending

on the facts involved, the work-related injury may be: (1) the sole basis

for a finding of disability under title II, (2) one of several conditions

which when taken in combination may have resulted in such a finding, or

(3) (as here) have had no bearing on the title II determination. It is

unlikely that Congress would have intended to distinguish between the

various situations for section 224 purposes without including language in

section 224 specifically pinpointing these distinctions.

Accordingly, it is held that the section 224 reduction provision

is applicable where the claimant was receiving periodic workmen's

compensation payments while entitled to title II disability insurance

benefits, even though the former were based upon a impairment different

from the latter.