SSR 69-5: SECTIONS 202(k)(4) AND 202(q)(2). -- SIMULTANEOUS ENTITLEMENT TO REDUCED OLD-AGE INSURANCE BENEFITS AND REDUCED DISABILITY INSURANCE BENEFITS
SSR 69-5
- Effective March 1968, a worker under age 65 became entitled to a reduced old-age insurance benefit of $105.30 a month. Effective September 1968 he became entitled to disability insurance benefits, which after reduction under the provisions of section 202(q)(2) of the Act, amounted to $118.20 a mont. Held,under the provisions of section 202(k)(4) of the Act, the worker is entitled beginning with September 1968, only to the larger of the two benefits (the disability insurance benefit of $118.20), unless he elects to receive the smaller benefit.
A worker, D, who attained age 62 in April 1967 was steadily employed until February 21, 1968, when he was hospitalized after suffering congestive heart failure and a stroke. On March 8, 1968, D filed an application for a period of disability and for disability insurance benefits, alleging that he was no longer able to work because of his heart condition.
Under the provisions of section 223(a)(1) and (c)(2) of the Social Security Act as pertinent here, a disabled worker can become entitled to disability insurance benefits (provided that all other requirements are met) no earlier than the first month after a "waiting period" of 6 consecutive calendar months throughout which he has been under a "disability," as that term is defined in section 223(d)(1) of the Act. Therefore, assuming that D was under a disability as so defined beginning with February 21, 1968, he could not become entitled to disability insurance benefits for any month before September 1968 even though he was no longer working and, beginning with March 1968, had no earnings.
Under the Act, a worker who becomes entitled to old-age insurance benefits before age 65 may subsequently, until he reaches age 65, become entitled to a period of disability and to disability insurance benefits. Since D wished to receive social security benefits as soon as possible, he also filed an application for old-age insurance benefits on March 8, 1968, electing to receive such benefits reduced for age beginning with March 1968.
Under section 202(q)(1) of the Act, where a man becomes entitled to old-age insurance benefits for months before the month in which he attains age 65, his benefit amount must be reduced by 5/9/ of 1 percent multiplied by the number of months he is under age 65 in the first month for which he is entitled to benefits. Section 202(q)(8) of the Act provides that where the amount of a reduction computed under section 202(q)(1) is not a multiple of 10 cents, it must be changed to the next lower multiple of 10 cents.
In April 1968, D was awarded old-age insurance benefits effective with March 1968. Based on his earnings record, D's primary insurance amount was $111.40; his old-age insurance benefit would be equal to this amount if D's entitlement began at age 65. However, since D would not attain age 65 until April 1970 and his first month of entitlement was March 1968 (25 months before April 1970), his benefit amount of $111.40 was reduced in accordance with the provisions of section 202(q)(1) by 25 times 5/9 of 1 percent or $15.47, which after rounding to the next lower multiple of 10 cents, resulted in a reduction of $15.40. Thus, D's old-age insurance benefit, beginning with March 1968, was $96 a month. D received this amount until August 1968.
On August 21, 1968, it was determined that D, due to his inability to engage in substantial gainful activity by reason of severe physical impairments, was under a disability within the meaning of sections 216(i)(1) and 223(d)(1) of the Act. A period of disability was established for D beginning on February 21, 1968, and he was found entitled to disability insurance benefits beginning with September 1968, the first month after the 6-month "waiting period" prescribed by section 223(a)(1) of the Act.
Section 202(k)(4) of the Act provides that:
- (4) Any individual who, under this section and section 223, is entitled for any month to both an old- age insurance benefit and a disability insurance benefit under this title shall be entitled to only the larger of such benefits for such month, except that, if such individual so elects, he shall instead be entitled to only the smaller of such benefits for such month.
Since D was entitled to both an old-age insurance benefit and a disability insurance benefit for September 1968, the question presented here is which of the two benefits is payable to D beginning with that month. This depends on which benefit is the larger.
To compute the benefit amounts, it is first necessary to recalculate D's primary insurance amount in accordance with the computation provisions of section 215 of the Act to give effect to the period of disability which had been established for him. By excluding the years in his period of disability, this recalculation in effect computed D's primary insurance amount as if he had attained age 65 in 1968 (the year in which his period of disability began) rather than in 1970, resulting in a primary insurance amount of $122.20. The increase in D's primary insurance amount was effective retroactively beginning with March 1968, the first month of his entitlement to old-age insurance benefits. Just as D's original benefit amount of $111.40 was reduced for age, the increased amount of $122.20 was also reduced for age under the provisions of section 202(q)(1) of the Act by 25 times 5/9 of 1 percent, resulting in a recalculated old-age insurance benefit of $105.30 effective with March 1968.
Section 202(q)(2) of the Act provides as pertinent here that:
- (2) If an individual is entitled to a disability insurance benefit for a month after a month for which such individual was entitled to an old-age insurance benefit, such disability insurance benefit for each month shall be reduced by the amount such old-age insurance benefit would be reduced under [section 202(q)(1)] * * * for such month had such individual attained age 65 in the first month for which he most recently became entitled to a disability insurance benefit.
Thus, to determine the amount of the disability insurance benefit to which D is entitled beginning with September 1968, it is necessary to determine the amount by which D's old-age insurance benefit would have been reduced under section 202(q)(1) of the Act if D had attained age 65 in September 1968. Except as provided in section 202(q) of the Act, a disabled worker's disability insurance benefit is equal to his primary insurance amount. Therefore, the amount of D's disability insurance benefit is equal to his primary insurance amount less the above described reduction.
D was first entitled to disability insurance benefits for September 1968. Had he attained age 65 in September 1968, than he would have been entitled to an old-age insurance benefit for only 6 months before attainment of age 65 (March 1968 through August 1968). Accordingly, in figuring the amount of his old-age insurance benefit, his primary insurance amount $122.20 would have been reduced under section 202(q)1) by 6 times 5/9 of 1 percent or $4.00. Thus, the amount of D's disability insurance benefit, reduced under section 202(q)(2) of the Act, is equal to his primary insurance amount of $122.20 less $4.00, or $118.20 a month.
Since D's old-age insurance benefit for August 1968 is only $105.30, and he did not elect to receive the smaller of the two benefits, then in accordance with section 202(k)(4) of the Act only his disability insurance benefit of $118.20 is payable to him beginning with September 1968.
Accordingly, it is held that D is entitled to a disability insurance benefit, reduced under the provisions of section 202(q)(2) of the Act, in the amount of $118.20 a month beginning with September 1968; and that his old-age insurance benefit of $105.30 a month is not payable for any month after August 1968 for which he is also entitled to the disability insurance benefit.