COVID-19 and Social Security Claiming – Some Considerations

by | Published on Mar 15, 2021 | Social Security Disability

The COVID-19 pandemic has wreaked havoc throughout the world and has been especially overwhelming for people of retirement age and workers. According to the U.S. Centers for Disease Control and Prevention, figures in mid-February show that those 65 and over accounted for 81% of the pandemic’s deaths in the United States. More than 373,000 older adults succumbed to the virus. An important question in the present context is whether the pandemic could put more pressure on Social Security and Medicare, the two financially challenged federal programs that provide disability and retirement benefits to disabled and older Americans. Workers contribute payroll taxes towards these programs and draw benefits later on. As a medical record review company assisting disability attorneys and workers’ compensation attorneys, we understand that many older workers are hesitant to return to work in this COVID situation; some others are unable to find employment. Consequently, they are likely to claim their social security benefits early.

Mixed Reactions Regarding Disability Claims

According to an article in The Philadelphia Inquirer, Social Security actuaries had predicted in November last year that disability incidence would increase for the next 3 years and then come back to baseline. Doctors and attorneys working with COVID-19 survivors said they don’t see much interest among people to apply for disability, but it was too early to predict. Since COVID-19 is a new disease, doctors are not very clear about how much patients can improve after months of symptoms. According to an Ardmore disability attorney Mike Silver, some people may have delayed applying for disability because of enhanced unemployment benefits and stimulus payments. However, some lawyers said they are hearing from a small number of COVID-19 survivors who are considering applying for disability. Andrew Hamelsky, a lawyer who represents disability insurers, said some private insurance claims have been filed associated with disabling fear of returning to work.

Since vaccination is available, it is not clear how courts will handle such claims. A senior policy analyst with the Center on Budget and Policy Priorities, Kathleen Romig, said there is strong suggestive evidence that some COVID-19 survivors will meet standards for disability, though their numbers will possibly be small compared to those disabled with other serious conditions.

COVID-19 and How It Could Affect Claim Filing Behavior

Given the continuing prevalence of the virus, many people are concerned about when to file for benefits. highlights some ways in which the novel coronavirus could affect the age people should begin claiming benefits.

  • Delaying Claiming Could be a Good Strategy in the Face of Reduced Payroll Taxes: The pandemic has led to millions of people becoming unemployed and no longer paying payroll taxes. Benefits could be reduced in the near future, which makes it sensible to wait a little longer to begin claiming. The longer a person waits to file for benefits, up to age 70, the more will he/she receive each month. When claim filing is delayed, it could help protect one against future cuts.
  • Claiming Early Could be the Right Strategy if you Lose your Job: During this pandemic, more than 45 million Americans have filed for unemployment benefits. If the pandemic persists, there could be a lot more layoffs. If you lose your job later in life, it could be difficult to find another one before you retire. Social security benefits can be claimed when a person has turned 62 years of age. A person finding it challenging to find a job can opt to file for benefits as soon as possible so that some extra cash is brought in. You may claim benefits before the proper retirement age but find a new suitable job one or two years later. Then, you can take the job but will find that your social security checks are temporarily reduced based on how much your earnings are. Once you reach full retirement age, the benefit amount will be adjusted to account for any money that was withheld.
  • A Person Could Either Claim Early or Delay Benefits if their Savings are Affected: Market downturns could negatively impact retirement investments people have made. In some instances, claiming early could be a good strategy because it allows the person to withdraw less from his/her retirement account. Withdrawing one’s savings during a market downturn could be risky because you are selling when the stock prices are lower. If a person is retiring early and needs income, social security benefits could help keep as much money as possible in the retirement fund.Conversely, if a market downturn annihilates one’s savings, delaying claiming is the wise strategy because it can permanently boost one’s monthly income. Delaying filing for social security until age 70 can provide one with hundreds of dollars more each month compared to if one claimed earlier. The bigger monthly checks will prove beneficial if you are not able to rely much on your savings.

COVID-19 is an unprecedented health crisis that is still not completely within control. The fear of future waves and new strains of the virus has created an unpredictable situation, forcing older workers to reconsider retirement plans and claiming social security. It is important, however, that one works out a good strategy that will help one advance into his/her senior or retirement years well prepared.

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