OPM Disability Retirement: The Three Pockets

In discussing Federal Disability Retirement benefits under FERS or CSRS, it is important to keep in mind the conceptual distinction between the three “pockets” of compensatory programs or resources (and, not to confuse the issue further, but these three pockets are separate and apart from the 3-legs of the retirement stool envisioned under FERS — the FERS Retirement annuity, Social Security, and TSP).

The three primary pockets of compensatory programs include:  CSRS & FERS Disability Retirement (and its companion hybrid, the CSRS-Offset)  — all of which get recalculated at age 62 to regular retirement; SSDI (Social Security Disability which, under FERS, one must file for automatically as part of the process of submitting for FERS Disability Retirement benefits, but under CSRS, one does not need to); and finally, Department of Labor, Office of Worker’s Compensation Program.

The former two have direct interaction, inasmuch as one who falls under FERS Disability Retirement must also file for SSDI, and if both are accepted, there is an offset of benefits between the two (100% offset the first year of benefits, 60% offset every year thereafter until age 62).  The last of the three pockets, OWCP benefits, as I have stated on many occasions, is not a retirement system, but one may file for such benefits concurrently with filing for FERS or CSRS Disability Retirement benefits (but one must elect between OWCP benefits on the one hand, and FERS or CSRS benefits on the other hand), have both approved, but cannot collect both concurrently.  There is an exception — and that has to do with a “scheduled award”.

While keeping these various benefits conceptually distinct can be rather confusing, it is important to understand the distinctions when contemplating filing for Federal Disability Retirement benefits under FERS or CSRS.

Sincerely,

Robert R. McGill, Esquire

CSRS & FERS Disability Retirement: Pre and Post

Issues revolving around the initial application stage, during the application stage, and after the approval, are often of equal importance.  This is because the approval of a Federal Disability Retirement application under FERS or CSRS will ensure the financial and economic survival and viability of the Federal or Postal employee.  Thus, in the pre-approval stage of the process, it is often good to engage in some future planning:  How hard will I fight for Social Security Disability?  Will I be getting a part-time job to supplement my income?  Where will I live?  During the process of obtaining disability retirement, there is the long wait, and the ability to remain financially afloat while receiving little or no financial support.  Post-approval, there are issues of the potential for receiving a Medical Questionnaire from the Office of Personnel Management.  Whether the current doctor will continue to be supportive, or will I move and need to find another doctor?  Because getting Federal disability retirement benefits is a life-long process, it is important to get sound legal advice from a competent attorney throughout the process — pre, during, and post process.

Sincerely,

Robert R. McGill, Esquire

CSRS & FERS Disability Retirement: Interaction with OWCP/DOL

I receive calls periodically as to whether it is of greater advantage to remain on Worker’s Comp (Department of Labor, Office of Workers Compensation Program — “OWCP”) as opposed to going out on OPM Disability Retirement.  My answer remains the same:  OWCP is not a retirement system; OPM disability retirement is indeed that — it is a retirement, where one is separated from Federal Service, and you go out and do what you want to with your life.  Every decision has consequences; every act which we engage in has inherent residual effects, and we have to balance such effects and consequences.  Thus, while OWCP benefits pay a higher rate (75% tax free with a dependent; 66 2/3% tax free without a dependent), there are restrictions:  You must comply with any and all requests (or demands) of the Department of Labor; you cannot go out and get another job, or start another career — because you are deemed “disabled” and are being paid for it.  On the other hand, OPM disability retirement pays less (for FERS, 60% the first year, 40% every year thereafter), but you have the freedom of retirement — you may go out and start another career, and make up to 80% of what your former position currently pays, without losing your disability annuity.  These — and many other factors — are some things to consider when weighing the differences between OPM disability retirement, and receiving OWCP/DOL benefits.

Sincerely,

Robert R. McGill, Esquire