*This is a selection from the book titled "Catastrophe Claims: Insurance Coverage for Natural and Man-Made Disasters," Chapter 18A by Dennis J. Wall (©May 2017, Thomson Reuters). This selection is reprinted with permission of Thomson Reuters. Any further reproduction without the consent of the publisher is expressly prohibited.
The group of people who have not yet attempted to receive benefits (have not applied for Social Security), but are eligible right now. A big question for people falling into this group, as distinct from the class of persons who have already begun to receive payments, is whether this group of persons can alleged an "injury in fact." It has been held by a U.S. District Court that with respect to persons who "have not applied for any [Social Security] benefits yet, any injury is at this point hypothetical or speculative, and thus insufficient to establish standing."[1]
In the same case it was held with respect to other persons who had already applied for "monthly Social Security benefits," that "[c]onversely," such persons "have a redressable injury and, thus, standing to pursue this claim."[2]
The Social Security Act itself provides that old-age insurance rights to future payment cannot be transferred or assigned, whether voluntarily or involuntarily. Significantly, the right to receive future payments does not depend on having already received them. It is instead a right of "any person" to receive "any future payment" under the old-age insurance Social Security program and it is protected:
(a) In general
The right of any person to any future payment under this subchapter shall not be transferable or assignable, at law or in equity, and none of the moneys paid or payable or rights existing under this subchapter shall be subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law.[3]
The ban on transfer and assignment will survive until another law expressly refers to this section and expressly changes its provisions:
(b) Amendment of section
No other provision of law, enacted before, on, or after April 20, 1983, may be construed to limit, supersede, or otherwise modify the provisions of this section except to the extent that it does so by express reference to this section.[4]
The group of persons who have not yet applied for old-age insurance benefits, are not eligible yet but are likely to become eligible in the future, and are contributing to the Social Security old-age insurance program now. This group of persons presents an open question. Their expectations and rights are open to development in the case law at this point.
Next: The Conclusion: It's Only a Catastrophe if You Let Them Take it Away.
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[1] Hall v. Sebelius, 689 F. Supp. 2d 10, 18 (D.D.C. 2009).
[2] Hall v. Sebelius, 689 F. Supp. 2d 10, 19 (D.D.C. 2009). The claims all of the plaintiffs, those receiving benefits and those who had not yet applied for Social Security benefits, were based on a change to "Medicare Part A" by the Social Security Administration by which Medicare Part A payments would be deducted from monthly Social Security old-age insurance payments. All of the plaintiffs wanted to "opt out" of the deductions from Medicare and yet receive old-age insurance benefits; in the case of those already receiving Social Security benefits, they alleged further that they wished to continue to receive them without the hindrance of the new regulations.
[3] 42 U.S.C.A. § 407(a), current through P.L. 114-254, and also P.L. 114-256. (Emphasis added.)
[4] 42 U.S.C.A. § 407(b), current through P.L. 114-254, and also P.L. 114-256.
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