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Overpayments And Off-Set Issues

Stethoscope on money

Our New Jersey ERISA and disability attorneys may be able to provide assistance if you are dealing with overpayments and off-set issues. If you have received back benefits from Social Security for disability, a claim may be brought against you by your disability carrier if your policy lists Social Security disability benefits as an offset against their disability payments. In such cases, you are required to repay the back benefit award or face a potential lawsuit. A counter-claim may occur on the same basis if you have filed a lawsuit against your carrier for a denied administrative appeal. Even if you file for bankruptcy while receiving benefits and discharge your obligation to repay an overpayment of back benefits, your plan may still withhold a portion of future payments to cover the overpayment.

What Is a Set-Off?

A set-off refers to the amount that can be deducted from your current or future benefits according to policy. Set-offs may come from social security disability, dependent social security, severance pay, workers’ compensation payments, or personal injury settlements. It is important to disclose payments from any of these sources to your disability insurance company upon receipt. Carriers reserve the right to reduce benefits if any of these set-offs are not reimbursed. The set-offs that qualify for reimbursement according to your policy should be provided by your carrier before enrolling in a plan. The policy itself will describe what constitutes an offset, and what does not.

Social Security Back-Benefits For Dependents And Disability Insurance

Whether Social Security disability payments made to your dependent children are reimbursable to your carrier depends on your individual policy. While the reimbursement of such payments is a controversial matter since such payments actually belong to the dependents rather than the parent, most courts have upheld the right of carriers to demand reimbursement for benefits paid to minor children through the Social Security disability system. It all depends on what the LTD policy says.

ERISA And Disability Benefits By State

State disability benefits are typically paid in place of short-term disability payments. Some carriers offer plans which allow you to receive both types of payments with short-term disability payments supplementing state disability benefits. State disability is always considered an off-set payment, which means that it can be adjusted according to short- and long-term benefits you may be receiving at the same time. Our knowledgeable and experienced New Jersey disability attorneys may be able to help you determine how your state-issued disability payments interact with ERISA benefits. Legal representation is critical may be helpful when it comes to ensuring that you are not reimbursing funds you are entitled to keep.

Contact Our New Jersey Disability Attorneys

If you fail to repay overpayments to your disability insurance company, your regular disability benefits may be reduced until you repay the excess amount. Immediate repayment is the best way to ensure that your payments are not reduced. Your carrier has the right to withhold payments for months or even years if necessary until the amount of overpayment is reimbursed. The veteran disability attorneys at Uscher, Quiat, Uscher & Russo, P.C., in New York and New Jersey will help you sort out the complicated process of disability off-sets and overpayments, so call today at 201-781-5645 for your consultation.