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Does a Personal Injury Settlement Affect SSDI?

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Categorized as Personal Injury, Social Security Disability

Have you recently been awarded a personal injury settlement? If you receive Social Security disability benefits, they might be negatively affected. This depends on the type of aid you receive and the nature of the settlement.

The Social Security administration offers two kinds of disability programs:

Supplemental Security Income (SSI)

Social Security Disability Insurance (SSDI)

The SSI program is needs based and depends on your financial situation. SSDI is only granted if you have worked and paid into the Social Security system through payroll taxes for a specified length of time.

If you have been receiving SSI benefits, such as Medicaid, a personal injury settlement may have serious consequences for your ability to continue your benefits. However, if you are receiving SSDI benefits or Medicare, your personal injury settlement should not be impacted.

Considering Impact on Your Expenses

While a personal injury settlement may cover your immediate medical expenses, the amount you receive might not be enough for you to cover health related costs like prescriptions and doctor visits for your lifetime. If you receive SSI, the settlement amount will be counted as income and may disqualify you from Medicaid health coverage.

Special Needs Trust

If you need to continue to receive SSI benefits after receiving a personal injury settlement, you should look into setting up a special needs trust with an experienced attorney. This trust may permit you to continue to receive your SSI benefits and you could also have funds from the settlement to cover services that are not covered by the SSI programs like transportation, nursing care and therapies.

Any questions you have regarding a personal injury settlement should be discussed with an experienced Kansas City personal injury attorney. Contact Peterson & Associates, P.C.™, and we will work to protect your benefits.