Your attorney should have explained all that to you at the time of settlement. They will probably deduct 24.00 per month from your benefits based upon the formula. I sincerely doubt that your attorney put you under duress; you ALWAYS have the option to go to Trial and flip the All or Nothing coin.
Usually the Hartman formula is used to reduce any offsets that can be claimed by the Social Security Administration. While Social Security may be able to deduct $23.84 per month from your benefits, there is a very good chance they will be able to deduct nothing. As long as your Social Security check plus $23.84 per month does not exceed eighty percent of your earnings at the time of injury, there will be no deduction.
While Social Security will require and offset of benefits dollar for dollar from your work comp claim settlement, the amount is very low and really is not much of an issue for you.
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1. Take some responsibility for your decision. No one forced you to settle your workers' compensation claim. To be sure, the vast majority of cases settle prior to trial and only a very small percentage of cases proceed to trial. Of those that proceed to trial, oftentimes a settlement is reached before the trial concludes. Your attorney probably recommended the settlement because a solid chance exists that a trial would result in a decision in which you would receive nothing.
2. That said, there is a coordination of benefits between workers' compensation and Social Security benefits to prevent what the Social Security Administration considers unjust enrichment or double recovery by claimants. Your situation falls into this area in which workers' compensation claimants are often unhappy with the options.
3. The Hartman formula has been around for about twenty years and only a few careful and excellent practitioner put the effort into making the calculations and adding such as an addendum to the settlement document, a Compromise & Release in California. I am impressed that your attorney expended the extra effort which protects, not hurts, your ability to receive Social Security benefits without interruption.
4. Your settlement is on the small side, $7,000 net to you, such that the chances are high that Social Security will not trifle with your settlement and offset your benefits. The chances of Social Security changing your monthly benefit amount is much higher when the claimant receives a large net lump sum settlement.
5. If the Social Security Administration does not alter your monthly benefit amount, you should rejoice in that the workers' compensation settlement is a windfall to you.