Chaos in Workers' Compensation - Raising Medicare's Eligibility Age to 67

A new issue for workers' compensation programs is  emerging as  the Republicans push forward on their legislative agenda to reform Medicare. Uncertainty over the impact of raising the eligibility age for Medicare from 65 to 67 may seriously and adversely impact the nation's network of fragile workers' compensation schemes. Furthermore, looming in the background is also the elimination of The Affordable Care Act and the consequence of a large pool of uninsured again seniors.

The workers' compensation system has been challenged by an aging universe of working seniors who bring to the table pre-existing and co-existing medical conditions that impact theories of occupational causal relationships and state workers' compensation law reforms involving prior functional loss. 

The Medicare Secondary Payer (MSP) Act may have a lightened load to one side of the scale. On the other side will be the elimination of a strong safety-net resulting in a major increase in the litigation of medical benefits and the end of cost-shifting by employers and their insurance companies onto the nations taxpayers.

A recently published study brings the issue out into the open and discuss the adverse consequences of raising the Medicare eligibility age from 65 to 67.

"Raising Medicare’s eligibility age to 67—featured in Speaker of the House Paul Ryan’s plan, “A Better Way: Health Care”—has gained renewed support in the current political environment.[ Research conducted by the Actuarial Research Corporation (ARC) for the National Committee to Preserve Social Security and Medicare Foundation provides compelling evidence that suggests this would not be a “better way,” either for the health of Americans aged 65 and 66 or for the financial health of the institutions that provide care for them."

Click here to read the entire article.

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Jon L. Gelman of Wayne NJ is the author of NJ Workers’ Compensation Law (West-Thomson-Reuters) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thomson-Reuters). 

For over 4 decades the Law Offices of Jon L Gelman  1.973.696.7900  jon@gelmans.com  has been representing injured workers and their families who have suffered occupational accidents and illnesses.

Declining Earnings Capacity - A Retrogressive Penalty for Ill Workers

The decline of the earning capacity of ill workers prior to stopping work has an impact on both workers' compensation benefits as well as Social Security disability benefits. It is  a retrogressive penalty for chronically ill workers.

The Social Security Administration in a recent report objectively reports this phenomena.


"Data from the 2014 Disability Research File show that the earnings of individuals who apply for Social Security Disability Insurance benefits decline rapidly in the years prior to application. This article presents statistics on the average “decline period”—the time from the year of maximum earnings to the year of application—by general and specific primary diagnosis, sex, and age, for individuals who filed applications during 2004–2013. On average, denied-claim applicants experience a longer decline period than do allowed-claim applicants, and those with mental impairments experience a shorter decline period than do those with physical impairments. Differences across general diagnosis groups are typically small; differences between certain specific diagnosis subgroups are greater. Men experienced longer decline periods than did women, and older applicants experienced longer decline periods than did younger ones."

Even though no reported data has been published for workers' compensation claims, it would appear to be logical that the data would mirror the Social Security Administration report. The impact on workers' compensation claims results in a reduction of hourly wages with that reflects a reduction in the payable rate for total disability compensation benefits.

Aging workers,  especially those with latent occupational disability claims, would appear to be most impacted by this result. When workers compensation was crafted in 1911 social security claims did not exist and most occupational disease claims were not deemed to be compensable. If the remedial intent of Workers' Compensation Act is to be observed this will be another area to consider when reforming been the benefit structure.

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Jon L. Gelman of Wayne NJ is the author of NJ Workers’ Compensation Law (West-Thomson-Reuters) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thomson-Reuters). 

For over 4 decades the Law Offices of Jon L Gelman  1.973.696.7900  jon@gelmans.com  has been representing injured workers and their families who have suffered occupational accidents and illnesses.

The Social Security Financial Report: An Insight Into the Future

Change is coming to the Social Security Disability program based upon the The 2016 Trustees Report that was published this week. It projects that the future finances of the Social Security Disability Trust Fund will require additional funding to remain solvent.

As of January 2016, 60 million Americans, or more that one in six, receive Social Security benefits. About one American family in four receive Social Security Benefits.  Approximately 8.9 million disabled workers receive benefits.

The annual report to Congress reflects both short and long term projections. While disabled works paid into Social Security for an average 22 years before becoming disabled, the system is projected to require legislative revision by 2013 to avert a shortfall.

Going forward it will be interesting to see what efforts will be made to subsume state workers' compensation disability indemnification programs into a single payer, Social Security Disability Insurance (SSDI).  Integration would eliminate the disparities between "reverse offset" and "non-reverse offset" states, as well as the tri-annual adjustment jurisdictions. Another import savings in adoption of the SSDI program universally is that administrative costs amount to less than 1 percent of the program's expenditures.

If Congress fails to act by 2023, the SSDI reserve fund will be only able to pay 89 percent of benefits. Congress has  never permitted this hardship to occur for these very vulnerable individuals and their families.

Needless to say that based upon the upheaval presently happening to Workers' Compensation programs throughout the United States,  the Trustees Report of 2016 surely provides an open door for radical Congressional action.