BASIC (09-08)

Citations:

Social Security Rulings 80-14 , 82-68

After the initial offset is imposed, any change in the WC/PDB payment rate requires refiguring the offset. The new offset computation may result in an increase or a decrease in the total benefit payable to the family. Compute offset as if the new rate were effective in the first possible month of offset.

Not all Social Security disability insurance benefit (DIB) increases are protected from offset. Only protect the following increases through a WC/PDB rate change for months after the first possible month of offset:

• Cost-of-living adjustments (COLAs)

• Primary Insurance Amount (PIA) Recomputations

• Triennial redeterminations

• Combined Family Maximum (CFM) increases applicable after the Offset Effective Date (OED)

Do not protect benefit increases based on a family composition change.

For additional information about protected increases, see DI 52150.055.

A. 1981 Amendment cases

In 1981 Amendment cases, recompute offset effective with the date of the WC/PDB increase or decrease.

B. Pre-1981 Amendment cases

For instructions, see DI 52170.040 – Notice Provisions – Pre-1981 Amendment Cases.

C. Verification of change

Verify any allegation of a WC/PDB rate change. If the NH alleges WC/PDB payment ended, see instructions in DI 52150.025 - Workers’ Compensation/ Public Disability Benefits (WC/PDB) Offset Ending Date.

For verification and documentation instructions, see DI 52145.001 - Obtaining Verification/Proof of Workers’ Compensation/Public Disability Benefit (WC/PDB) Information.

D. Computing the new monthly WC/PDB rate

Compute the new monthly rate as follows:

1. Mid-month change

Prorate the new WC/PDB rate if the rate change is not effective on the first day of a month.

EXAMPLE:

The weekly WC rate increased from $50 to $60 effective 04/20/2007. Compute the monthly WC rate for 04/2007 as follows:

$50 divided by 7 days = $7.14 (daily rate) x 19 days = $135.66

$60 divided by 7 days = $8.57 (daily rate) x 11 days = $ 94.27

Total = $229.93

Round down the final monthly amount in 04/2007 to $229.90. The ICF WC/PDB computation programs are able to compute the new WC/PDB rate.

2. Rounding

Compute the daily rate using three decimal places and round to the nearest penny.

For rounding examples, see DI 52150.035B.

3. WC/PDB begins or ends mid-month

Prorate as in this section at DI 52150.040D.1., using $0 for days the individual is not entitled to the WC/PDB.

4. Monthly equivalent comparison

Exercise caution when manually determining the WC/PDB rate to use in computing offset. The newly derived WC/PDB rate for the adjustment month may sometimes be higher than the monthly equivalent for the higher weekly rate or lower than the monthly equivalent for the lower weekly rate. Where this is true, base the new WC/PDB rate in the month of change on these comparisons:

• Compare the monthly equivalent for the higher weekly rate to the new rate computed for the mid-month adjustment, using whichever rate is lower. The change cannot result in a monthly rate higher than the monthly equivalent for the higher weekly rate. or

• Compare the new rate computed for the mid-month adjustment to the monthly equivalent for the lower weekly rate, using the higher of the two. The change cannot result in a rate less than the monthly equivalent for the lower weekly rate.

NOTE: ICF WC/PDB automatically performs the equivalency comparison.

EXAMPLE 1:

The weekly WC rate increased from $50 to $60 effective 03/04/2008. Compute the monthly WC rate for 03/2008 as follows:

$50 divided by 7 days = $7.14 (daily rate) x 3 days = $ 21.42

$60 divided by 7 days = $8.57 (daily rate) x 28 days = $239.96

                                                                           Total = $261.38

Round down the final monthly amount in 03/2008 to $261.30

02/2008 monthly equivalent: $50 x 13/3 = $216.60

04/2008 monthly equivalent: $60 x 13/3 = $260.00

The monthly WC/PDB rate for offset in 03/2008 is the 04/2008 monthly equivalent for the higher monthly rate of $260.00.

EXAMPLE 2:

The weekly WC rate increased from $50 to $70 effective 02/25/2007. Compute the monthly WC rate for 02/2007 as follows:

$50 divided by 7 days = $ 7.14 (daily rate) x 24 days = $171.36

$70 divided by 7 days = $10.00 (daily rate) x 4 day = $ 40.00

                                                                                Total = $211.36

Round down the final monthly amount in 02/2007 to $211.30.

01/2007 monthly equivalent: $50 x 13/3 = $216.60

03/2007 monthly equivalent: $70 x 13/3 = $303.30

The monthly WC/PDB rate for offset in 02/2007 is the 01/2007 monthly equivalent for the lower monthly rate of $216.60.

E. Computing offset

Compute offset as if the new WC/PDB monthly rate were payable in the first possible month of offset.

NOTE: Where an overpayment to the carrier occurs because of a change in the WC rate, see DI 52150.035A.4. for information on the correct rate at which to offset.

Use the number of auxiliaries who are entitled in the month of the change as if they had been entitled in the first possible month of offset.

Add any protected DIB increases that have accrued since the first possible month of offset up through the month of the rate change.

F. References

• MSOM ICFT2 028.001 - Workers' Compensation/Public Disability Program – Overview

• DI 52150.035 - Determining the Workers’ Compensation/ Public Disability Benefits (WC/PDB) Amount Used to Compute Offset