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Section 2: Calculation of Loss (Compensation)

Date effective
December 26, 2019

By law, the VCF can only compensate for losses caused by eligible conditions related to the events of September 11, 2001.  In addition, the law requires the Special Master, in each case, to take account of the harm to the claimant, the facts of the claims, and the individual circumstances of the claimant.   Our claim analysis therefore always begins with three essential questions: was there a demonstrable loss, can we reasonably conclude the loss was caused by a WTC-related eligible condition, and what makes sense in the context of this claimant and the individual circumstances of this claim?

Three principles guide this inquiry.  First, the VCF strives to be fair to all claimants.  This means that we consider both fairness to the individual claimant as well as fairness to the entire claimant population, with priority given to those who suffer from the most debilitating physical conditions. Second, everything we do must be faithful to the statute that authorizes our work, the Reauthorized Zadroga Act (codified at 49 USC Title IV).  And third, because we are spending public funds, we must ensure that every aspect of the award is adequately justified and documented.

The VCF is committed to transparency about the claim review process.  To that end, the sections below provide detailed information about how we generally evaluate and calculate compensation for non-economic and economic loss.  However, given the volume and variability of claims, and the legal requirement that the Special Master consider individual circumstances in each case, it is not possible to cover every potential situation in this document.  Therefore, this information should be viewed as a general guide to how the VCF implements our fundamental principles: fairness to the claimants, faithfulness to the statute, and accountability to the public, in the service of compensating demonstrable loss caused by an eligible condition.

a. Compensation Review Process 

Once the VCF confirms that you have met the eligibility criteria, we begin initial review of your compensation information.  This includes determining the types of loss being claimed. Claims seeking only non-economic loss are the simplest and fastest to review. Non-economic loss is sometimes called a “pain and suffering” award. This is determined based generally on the nature and severity of your condition and the effect of the condition on activities of daily living and does not take into account economic loss caused by the condition.

If you are claiming economic loss, we obtain information and documentation from various third parties, such as the Social Security Administration (“SSA”), the FDNY, the NYPD, and the New York State Workers’ Compensation Board, regarding your disability, earnings history, and/or pensions if we have not already done so as part of our preliminary eligibility review.

If your claim is missing documentation that we need in order to calculate your award, you will receive a missing information letter.  It is important that you respond to all missing information letters within the timeframe specified in the letter.  If you don’t respond to our missing information request after 30 days, we will render a decision based on the information contained in your file at that time. 

Please be aware that any documents you submit after we have finalized the substantive review of your compensation claim will not be reviewed as that review would delay the issuance of your award determination.  If you submit documents after the VCF finalizes substantive review of your claim, but before your award letter is issued, we will notify you in the award letter that the documents have not been reviewed. The letter will explain the next steps to take on your claim.

b. Substantive Compensation Review and Calculation of Award 

Each award is calculated individually.  As required by the statute, your final award will be calculated using this basic formula: Non-Economic Loss plus Economic Loss, minus Collateral Offsets.  Our review includes: determining non-economic loss based on the severity of physical harm; calculating economic loss, including past and future lost earnings (if claimed); and confirming collateral offsets, including payments received from pension funds, life insurance, SSA, Workers’ Compensation, and settlements from 9/11-related lawsuits.  Claims that have more complex compensation information take more time to review.

To calculate economic loss, the VCF must first determine whether there is in fact a compensable loss. There are three types of economic loss: loss of earnings/benefits, out-of-pocket medical expenses, and replacement services loss. Each of these types of loss is explained in the sections below. 

If we do not receive the documents necessary to calculate economic loss, or if the documents are not submitted in a timely manner, we may issue an award for non-economic loss only.  In certain situations, we may deactivate your claim and stop our review if we are missing critical information.  This includes information about collateral offsets that apply to both economic and non-economic loss, proof of cause of death for a wrongful death claim, or a missing Exhibit 1, which allows us to receive information from SSA in support of your claim.

If you submitted a claim for economic losses, but the VCF issues an award for non-economic loss only because of missing documents, the VCF will only reconsider the economic loss award on amendment.  This means you must submit an amendment and request re-review of your economic loss claim.  Note: In deceased claims, once we have finalized substantive review of your compensation claim, you will not be able to amend your claim to provide any missing information that you did not previously submit. For this reason, if you have not already provided all relevant information to the VCF, we strongly urge you to contact the VCF to request that we hold review of the claim so that you can provide all materials needed to support the claim before we finalize our review.  See Section 5 for additional information about amending your claim.

Once the award is calculated, we send you a letter explaining the breakdown of your award and an option to appeal within 30 days if you believe an error was made in the calculation.  If you do not appeal, we authorize payment within 20 days of the end of the 30-day appeal period.  If you do appeal, payment is authorized once a decision is rendered following your appeal.

As a matter of policy, if the VCF determines that your total award, after calculating economic and non-economic loss and subtracting all applicable offsets, is less than what it would be if we calculated only non-economic loss (to which certain offsets do not apply), then we will convert your claim to one for non-economic loss only, so that you receive the larger award. Your award letter will provide details for both the economic and non-economic loss calculations applied to your claim so that you can understand the VCF’s rationale for awarding only non-economic loss. We urge you (and your attorney, when applicable) to consider the collateral offsets that may be applicable to your claim before submission, and consider submitting a non-economic loss only claim in those cases where your offsets are likely to exceed your economic loss. By doing this analysis before submitting your claim, the VCF will be able to more quickly process your claim because we do not need to take the time to calculate the economic loss in order to determine that a non-economic only award would be greater.

 

2.1  Non-Economic Loss

The Zadroga Act defines non-economic loss as losses for physical and emotional pain, suffering, inconvenience, physical impairment, mental anguish, disfigurement, loss of enjoyment of life, loss of society and companionship, loss of consortium (other than loss of domestic service), hedonic damages, injury to reputation, and all other non-pecuniary losses of any kind or nature.

Each person who was killed or injured in the September 11th attacks suffered grievous harm, and each person experienced the unspeakable events of that day in a unique way.  After extensive fact finding, public outreach, and review of public comments in the original VCF, the Special Master and the Department of Justice concluded that the most rational and just way to approach the difficult task of placing a dollar amount on the pain and emotional suffering experienced by the thousands of individuals killed or injured by the September 11th attacks was to assess the non-economic losses for categories of victims.

 

a.   Valuation of non-economic loss:  

Non-economic loss for death

The regulations set a presumed award for non-economic losses sustained by the victim, and the victim’s spouse[1] and dependents, because of the victim’s death as a result of the September 11th aircraft crashes or subsequent debris removal: $250,000, plus an additional $100,000 for the spouse and each dependent of the decedent. The latter figures – $100,000 for the spouse and each dependent – include a non-economic component of "replacement services loss."

Non-economic loss for injury

The 2015 reauthorization statute established certain caps on non-economic awards for physical injury claims. The maximum non-economic loss for any one type of cancer condition is $250,000, and the maximum non-economic loss for any one type of non- cancer condition is $90,000. If the victim has more than one type of cancer, the Special Master may issue an award that makes an adjustment above $250,000 to account for multiple cancers. Similarly, if the victim has cancer and severe non-cancer conditions, the Special Master may issue an award that makes an adjustment above $250,000 to account for multiple conditions.

The 2015 reauthorization statute also requires that the Special Master prioritize claims with the most debilitating physical conditions. Accordingly, non-economic loss is based generally on the severity of the condition and the effect of the condition on the victim’s ability to maintain normal activities of daily living. Important Note:  The amount of non-economic loss is not tied to the number of certified conditions.  It is possible that an individual victim with many relatively mild conditions would receive a non-economic award that is less than that of a victim who has only one condition that is severe. For example, a victim who has a respiratory condition that significantly restricts the victim’s ability to participate in activities of daily living and recreation, or that is progressive and not effectively treated, may have a higher non-economic award than a victim who has a mild respiratory condition and another mild condition which have not had a significant effect on their activities of daily living.  Please keep this in mind when considering whether to seek certification of additional conditions through the WTC Health Program. 

In general, when an eligible non-cancer condition has a consistent, sustained, and severe impact on a victim’s quality of life, the non-economic award will be in the range of $90,000. As a general rule, under the terms of the Reauthorization Act, the Special Master has identified the following conditions as presumptively severe and debilitating and warranting the highest allowable non-economic loss award for a non-cancer condition, without any further documentation: Emphysema, Interstitial Lung Disease (including Asbestosis), and Sarcoidosis. 

When the victim demonstrates mild or negligible impairment on daily life, or if the eligible conditions have resolved over time or are reasonably well-controlled through over-the- counter medication, the non-economic award may range between $10,000 and $90,000, depending on the severity of the condition as demonstrated by recent medical records (medical records that are dated within three years of the claim submission date). As a general rule, under the terms of the Reauthorization Act, the Special Master has identified the following conditions as presumptively less severe and debilitating and thus warranting lower awards, absent medical documentation of severity, than the highest allowable for a non-cancer condition: Asthma/RADS, Barrett’s Esophagus, Bronchiecstasis, Chronic Airway Obstruction,[2] Chronic Bronchitis, Chronic Cough, Chronic Obstructive Pulmonary Disease, Chronic Rhinitis, Esophagitis, Gastroesophageal Reflux (GERD), Laryngitis, Nasopharyngitis, Obstructive Sleep Apnea, Pharyngitis, Respiratory Conditions due to Fumes or Vapors, Rhinosinusitis, Sinusitis, and  Traumatic Injury or Musculoskeletal Disorder.  While some of these conditions can have severe impacts on individual patients, the VCF will require evidence of such severity, in the form of recent medical records supported by impact statements and/or appeal testimony, before considering an increase in the award.

For eligible cancers, the non-economic award will generally range between $90,000 and $250,000, depending on the type of cancer and the medical evidence provided regarding metastasis, recurrence, and/or permanent complications.  For example, if a victim is certified for two different types of non-melanoma skin cancer – for example, basal cell and squamous cell – or for one non-melanoma skin cancer at multiple sites, the award will generally be in the range of $90,000. 

The Special Master may consider multiple conditions together to determine an aggregate award, which may exceed $250,000.  For example, the victim may suffer from multiple types of cancer or may have a severe non-cancer eligible condition along with an eligible cancer. In such cases, the non-economic award may be greater than $250,000.

Note: If you received a non-economic loss award in VCF1, the VCF will consider the amount previously awarded when determining whether additional compensation is warranted in light of the 2015 reauthorization statute’s prioritization mandate and non-economic loss caps.

While this information is provided for general guidance, it is important to note that these are general benchmarks, and awards may vary within the statutory caps as each claim is evaluated individually on its specific facts and at the discretion of the Special Master.

b.   Special Master authority to award non-economic loss above the statutory cap  

When considering the authority provided by the statute governing the VCF to issue non-economic loss awards above the statutory caps in special circumstances, the Special Master’s intention (consistent with the intent of Congress) is to exercise this authority in very limited and unique circumstances, and only for non-cancer claims.  The $250,000 cap for a single cancer condition will not be exceeded under this authority. 

The exception will be made only in the small number of non-cancer claims where the claimant has an interstitial lung disease (“ILD”) or other pulmonary illness where the effects of the condition are so severe that they are similar in all relevant respects to what a claimant with lung cancer might suffer.  These claimants might require lung transplants (sometimes double lung transplants), or significant mechanical respiratory assistance on a daily basis.  The Special Master interprets the statutory language to allow compensating these limited number of severe non-cancer claimants in the same way that a cancer claimant would be compensated – meaning, $250,000 for a single condition, and a maximum award, under current VCF policy guidelines, of $340,000 for multiple severe conditions.  This is the bar by which the Special Master will measure the appropriateness of an increase above the cap, and it will be done in consideration of all other circumstances of the claim and the totality of the award. If you believe you meet this threshold, you should request “special circumstances” consideration on appeal.  If you have a prior claim that has already been decided and paid, and you believe you should be considered for the exception, please amend the claim to submit the request for review.

c.  Documentation of non-economic loss:   

If the WTC Health Program has certified your condition, no further documentation is necessary to support a claim for non-economic loss; the VCF will award non-economic loss at the lowest end of the range for the applicable condition based solely on the WTC Health Program certification. If, however, the certified condition significantly impairs activities of daily living or if the certification does not reflect the severity of the condition, additional documentation of the types described below can help the VCF evaluate whether an increased non- economic loss award within the appropriate range is warranted.

To help the VCF understand the severity and effect of your condition, you may want to submit supporting documents related to your condition with your claim. The VCF focuses on recent documentation, from within three years of the claim submission date, when evaluating non-economic loss.  For example, if a claim is submitted on January 1, 2020, recent medical records are those dated after January 1, 2017.  Please only submit documents that are related to your 9/11-related eligible physical conditions.  If the medical records submitted with your claim meet the three-year timeframe, you do not need to continue to submit medical records on your claim unless the VCF requests them.  The types of documents listed below can assist the VCF in the evaluation of your claim:

  • Recent medical documents that show the type and frequency of medical treatments you have had for your condition. For example, documents that show hospitalization, surgery, emergency treatment, and/or treatment for side effects of the condition.
  • Recent test results and treatment prescribed that show the severity of your condition. For example, many people with respiratory injuries have pulmonary function tests. If you have had such tests, please submit the test results including the physician’s interpretation of the tests.  Other examples include computed tomography scans, x-rays, endoscopies, esophagogastroduodenoscopies, laryngoscopies, polysomnography or sleep studies, or other diagnostic and treatment procedures.
  • Recent medical records documenting severity and/or effect of the condition on daily life.
  • Recent documentation of the medications required to manage your condition and how often you take those medications. The type of medication prescribed and the frequency of use of the medication can help demonstrate the severity of the condition.
  • Recent medical records or treating physician statements showing use of assistive devices that significantly impair activities of daily living – such as breathing devices that may be used for Obstructive Sleep Apnea.
  • If your condition has limited your activities, please submit any explanation or documentation that explains this effect of your condition. For example, you could submit letters or reports from specialists who treated your eligible conditions.
  • Records of state and federal agency proceedings or private insurance records that address your medical condition.
  • A personal statement discussing the impact of the eligible conditions on your life. Such a statement is most helpful if it provides a timeline and details on the medical treatments you have experienced. Note that in general, the VCF will need medical records substantiating claims of medical procedures (surgery, etc.).

A document from your physician summarizing the medical history of your condition and treatment will often be sufficient to prove the extent of your non-economic loss. If you submit medical records, please highlight the relevant information in the records so the VCF can easily find the pertinent information.

Note:  The non-economic award is not automatically tied to the degree of disability (to the extent there is an occupational disability determination as a result of an eligible 9/11-related physical injury or condition).  A claimant may be partially disabled from performing a certain occupation due to his/her eligible injury or condition but the fact of an occupational disability alone will not warrant a non-economic award higher than the presumptive “base” value.  As noted above, the non-economic award is based generally on the severity of the condition and the effect of the condition on the victim’s ability to maintain normal activities of daily living, as demonstrated by recent medical records, except in those cases treated as presumptively severe (where medical records are not needed in order to qualify for the highest award allowed by the statutory caps). 

 

2.2  Economic Loss: Lost Earnings and Benefits 

If you are physically injured as a result of an eligible condition, you can make a claim for earnings/benefits you lost before you submitted your claim to the VCF, and you can make a claim for earnings/benefits you expect to lose in the future (after submission of your claim) as a result of your eligible condition.

If you are submitting a personal injury claim and you claim a loss of earnings, the VCF must determine whether you are unable to work, or have a reduced ability to work, as a result of an eligible 9/11-related physical condition.  If that is the case, then the VCF must determine the extent of that loss.  The VCF will then compute the amount of past and/or future lost wages in light of these factors (as explained below).  Note: The VCF considers and calculates losses suffered before you submit your claim for lost earnings as “past” losses, and losses suffered after you submit your claim for lost earnings as “future” losses.

If you are filing a deceased claim (i.e. a claim on behalf of a victim who died as a result of an eligible 9/11-related physical condition), you can make a claim for lost earnings/benefits incurred before the victim died as a result of an eligible condition and you can make a claim for the lost future earnings resulting from the death of the victim.  If the Personal Representative of the victim seeks compensation for loss of the victim’s future earnings, the VCF will compute the future lost earnings as of the date of the victim’s death using the procedures explained below. 

This section describes the evidence you must submit to substantiate your claim for lost earnings. In general, you must submit:

  1. Evidence that you are or were unable to work as a result of an eligible condition; and
  2. Information about your earnings and benefits, so that the VCF can determine the amount of loss. Sections 2.2f-i contain information specific to victims who worked for New York City (including FDNY and NYPD) and the Federal government (including military and military reserve).

See Section 2.3 for a detailed explanation of the methodology used to calculate future lost earnings.

a.  Documentation of earnings history:    

The VCF generally will use information obtained from the Social Security Administration (“SSA”) to determine earnings history. You must complete and submit a consent for release of SSA information (Exhibit 1 to the Claim Form) in order for the VCF to obtain this information.

If you did not have SSA earnings (e.g., worked outside the United States or do not have a Social Security number), then you must provide other documents demonstrating earnings – including  tax returns,  statements of profit/loss  from a business  (if self- employed), W2 forms, 1099 forms, pay stubs, or employment offer letters.

If you believe that your SSA earnings history does not fully account for future earnings potential, then you must provide documentation supporting any argument that the VCF should take into consideration other information in determining future earnings. For example, if you received a promotion before becoming disabled and if the earnings history did not reflect that promotion, then you must provide proof of the promotion and any earnings adjustment resulting from the promotion. If you were eligible for bonuses, deferred compensation, stock options, or any other form of compensation that might not be reflected in the SSA earnings report, you must submit proof of such forms of compensation if you want the VCF to consider such forms of compensation or increases in compensation in evaluating your claim.

b.  Establishing discrete past lost earnings  

In order to qualify for discrete past lost earnings (i.e., losses incurred before you filed your VCF claim or losses incurred in the absence of a third-party disability occupational disability determination), you must show that you were unable to work, or unable to work at the same level, as a result of an eligible condition and that you incurred losses as a result. You will need to submit two types of information:

  • First, you need to show that you actually lost compensation. For example, an employer might provide a statement showing your compensation history and time periods where you missed work and were not compensated. If you were compensated fully through sick pay or other compensation, that means you have not “lost” compensation.
  • Second, you need to show that you were unable to work, or unable to work at the same level, because of an eligible physical condition. Examples of such documentation might include a medical report explaining that you had to miss work because of your eligible condition, determinations by an insurance carrier that provided disability coverage and which specify the disabling condition, or Workers’ Compensation records.

The VCF provides a Temporary Past Lost Earnings worksheet to help support your VCF claim.  You can access here, and on the "Forms" tab under “Forms and Resources” on the VCF website.

c.  Establishing loss of future earnings/benefits as a result of permanent disability 

If you are filing on behalf of a deceased victim and you have provided sufficient evidence that the cause of death was related to eligible conditions, the VCF will generally calculate lost earnings and benefits resulting from the victim’s death if it is clear from the information in the claim file that the victim’s death resulted in a compensable loss. 

In some cases, even where the record supports the determination that the victim’s death was related to an eligible condition, it is not clear that the victim’s death resulted in a compensable loss.  For example, if the victim left the workforce more than one year before death without a permanent partial or total occupational disability determination based on an eligible 9/11-related physical health condition, the VCF will consider the reasons the victim originally left the workforce and the likelihood that the victim would have returned to the workforce were it not for the victim’s eligible condition in determining whether the victim actually lost compensation as a result of an eligible condition.  For these claims, it may be necessary to provide additional documentation that explains the relationship between the loss of earnings and the eligible condition.  In many cases, these issues are best addressed in the context of an appeal hearing.  

Likewise, if the victim was 65 years old or older at the time of death, the VCF generally will not award lost earnings and benefits, based on the presumption that the victim had already reached the end of his or her reasonable work-life expectancy.  There are limited circumstances in which the VCF may assume that the victim would have continued working past age 65, such as where the victim was providing financial support to minor children.  In many cases, these circumstances are best addressed in the context of an appeal hearing.  

See the section below about documentation of employment-related benefits.

If you are filing a personal injury claim, in order to qualify for an economic loss award for loss of future earnings/benefits, you must first show that you have a permanent partial or total occupational disability based on an eligible 9/11-related physical condition. In general, the VCF will accept a determination by a governmental agency that you have a disability and will accept the governmental agency’s determination of the cause of the disability. If the governmental agency determines that the cause of disability is a condition that the VCF has found eligible, then the disability determination will provide a basis for a determination of future loss of earnings/benefits. For example, the VCF will accept disability determinations made by the Social Security Administration, the FDNY, the NYPD, NYCERS, the VA, and Workers’ Compensation boards (see the sections below regarding FDNY, NYPD, NYCERS, FERS, and the VA). The VCF may also accept a determination of disability made by a private insurer or a treating physician if they are sufficiently detailed as to the effect of the VCF eligible condition, distinguish those effects from those of ineligible conditions, and provide sufficient information from which the onset and severity of the disabling condition may be determined.

When considering whether the disabling condition identified in the disability determination is the same as your VCF-eligible condition, the VCF will apply the following presumptions:

  • The VCF will treat all conditions in the category of Obstructive Airways Diseases (“OAD”) as equivalent. Obstructive Airways Diseases include asthma, bronchiectasis, chronic airway obstruction, chronic bronchitis, chronic obstructive pulmonary disease (“COPD”), emphysema, reactive airways disease, reactive airways dysfunction, and respiratory conditions due to fumes and vapors. The VCF will consider the SSA diagnoses of Chronic Pulmonary Insufficiency (code 4960), Chronic Respiratory Disorders (code 4960), or Other Disorders of the Respiratory System (code 5190) equivalent to the Obstructive Airways Diseases listed in this paragraph.
  • The VCF will treat all conditions in the category of Interstitial Lung Diseases (“ILD”) as equivalent. Interstitial Lung Diseases include asbestosis, granulomatosis, interstitial pneumonia, pneumonitis, pulmonary fibrosis, and sarcoidosis.
  • The VCF will treat all conditions in the category of Upper Respiratory Diseases (“URD”) as equivalent. Upper Respiratory Diseases are those affecting the nose, sinuses, or throat. These conditions include rhinitis, sinusitis, rhinosinusitis, tracheitis, laryngotracheitis, laryngitis, nasopharyngitis, and pharyngitis.

Thus, in each of the cases identified above, if you have been deemed disabled due to one of the listed conditions, and another condition treated as equivalent has been deemed eligible for compensation by the VCF, your disability determination supports a lost earnings award.

Note that, in all cases, even though the conditions may be treated as equivalent when deciding whether a disabling condition is the same as your eligible conditions, these conditions are NOT equivalent for the purposes of determining the appropriate non-economic loss award amount, as discussed in Section 2.1 above. Disabling conditions that fall in one category will not be deemed equivalent to conditions that fall in another category. Thus, if you are disabled due to an Interstitial Lung Disease and you have been deemed eligible by the VCF only for Obstructive Airways Diseases, the disability determination is not a basis for awarding lost earnings. Likewise, if you are disabled due to an Obstructive Airways Disease and you have been deemed eligible by the VCF only for Interstitial Lung Disease, the disability determination is not a basis for awarding lost earnings. An exception to this general rule may arise in those cases where a claimant is found disabled by the SSA due to Chronic Pulmonary Insufficiency or Chronic Respiratory Disorders and his or her only eligible condition is an Interstitial Lung Disease (e.g., sarcoidosis or pulmonary fibrosis). In such a case, if medical records submitted provide no other discernable basis for the claimant’s SSA disability, then it will be presumed that the eligible Interstitial Lung Disease is the same as the disabling condition.

It may be necessary to provide additional documentation that explains the relationship between the disability and your eligible condition(s). The VCF cannot award lost earnings for a disability that is not clearly related to an eligible condition.

In some cases, even where the record supports the determination that your disability is related to an eligible condition, it is not clear that your disability resulted in a compensable loss. For example, if you left the workforce more than one year before the onset of your eligible disability, the VCF will consider the reasons you originally left the workforce and the probability that you would have returned to the workforce were it not for your eligible condition in determining the extent of your earnings and benefits loss.  For these claims, it may be necessary to provide additional documentation that explains the relationship between your loss of earnings and benefits and your eligible condition(s). 

d.  Documents required to demonstrate disability  

  • Social Security Administration (“SSA”) – If you have submitted Exhibit 1 of the Claim Form, the VCF will obtain certain disability information directly from the SSA. You should, however, submit any information you have about a favorable disability determination by the SSA, in particular, if your claim was decided on appeal, the narrative decision by the SSA Administrative Law Judge.

Claimants who receive disability benefits under the federal Supplemental Security Income (“SSI”) program: If you receive disability benefits under the federal Supplemental Security Income (“SSI”) program (administered by Social Security) as opposed to under the regular Social Security Disability Income (“SSDI”) program, please indicate that you are receiving SSI benefits when you file the claim and file an Exhibit 1, making sure to select the box requesting release of ”Current monthly Supplemental Security Income payment amount.”  The information the VCF receives from the Social Security Administration will include information about SSI benefits if applicable.  Note:  an SSI disability finding may support a claim of lost earnings.

  • Workers’ Compensation – If you have a Workers’ Compensation determination from the New York State Workers’ Compensation Board (“WCB”), the VCF can obtain that information directly. To do so, the VCF needs the Workers’ Compensation Board number associated with your Workers’ Compensation claim. You should submit documents reflecting your WCB number. If you have a Workers’ Compensation determination from another state, then you must submit the Workers’ Compensation determination documents, including complete documentation of any orders/decisions, any benefits paid, the basis for your disability, and any medical records (including treating physician records and/or independent medical examinations) that are part of your Workers’ Compensation record.
  • Insurer – If you have a disability determination from a private insurer, you must submit documentation from the insurer confirming the disability finding and showing that the basis for the disability was an eligible condition. You must also submit documentation of the amount and duration of benefits received, and a copy of the disability insurance policy.
  • Private physician – To be considered by the VCF, an evaluation from a physician must state how long and how often the doctor has treated you, and explain the examination(s) and testing done by the physician. In particular, the evaluation must include the date of onset of disability; the percentage of disability attributable to eligible conditions and/or whether the eligible conditions are independently disabling, particularly if the claimant suffers from other non-certified conditions, or mental health conditions for which the VCF cannot compensate; and explanations as to why certain test results, limitations, or the effects of the condition itself support a disability finding. These pieces of information are critical to a finding that there is a disability determination that supports a lost earnings award, and disability evaluations that do not contain these pieces of information will be rejected as insufficient.
  • WTC Health Program Disability Evaluation process – The VCF has worked with the WTC Health Program to implement a disability evaluation process (“Process”), which is designed to help provide qualifying claimants with a disability determination for an eligible condition in order to support an economic loss award in a VCF claim. The Process is intended for a limited subset of WTC Health Program members who have been deemed eligible by the VCF for at least one certified physical condition, do not already have a disability determination for an eligible condition from a third-party entity or source (e.g., Social Security Administration, FDNY/NYPD, a state Workers’ Compensation program, or insurance company), and meet other specific criteria for the Process. Individuals who have a disability determination based on an ineligible condition may be candidates for the Process if their eligible condition has become disabling.

If a claimant requests and is approved to enter the Process, a WTC Health Program physician will conduct a one-time disability evaluation of the claimant and prepare a disability evaluation report, which the claimant will submit with his/her claim.  The VCF will consider the WTC Health Program Disability Evaluation report in combination with the facts and circumstances of the claim to determine if a lost earnings award is appropriate.  It is important to note that receiving a WTC Health Program disability evaluation through the Process does not guarantee that you will be awarded lost earnings from the VCF.

See: WTC Health Program Disability Evaluation Process for complete details on the Process. Instructions are also available under “Forms and Resources” on the VCF website.

Pending disability applications: what to do if you are waiting for a disability decision from a government entity or insurer

If you are requesting economic loss but you have a disability application pending, and if your application for disability is based on a condition that is eligible for the VCF, you should wait to submit your claim, but must do so before the VCF closes on October 1, 2090, regardless of your disability status at that time.

If you have already filed your claim requesting economic loss, but you have a disability application pending, you should amend your claim immediately and include a statement notifying the VCF that there is a pending disability application.  We will not process your claim until a determination on your disability application is made. 

If you do not promptly notify the VCF of the pending disability application, and the VCF processes your claim and issues only a non-economic loss award, the claim for economic loss will be reviewed in priority order based on the date of submission of the amendment advising the VCF of the completed disability determination.  If, on the other hand, you promptly amend your claim and notify the VCF of the pending disability application and the VCF defers processing your claim, your claim will be reviewed in a priority order based on the original date of submission of your compensation form once the completed disability application is submitted in a subsequent amendment.

e.  Loss of employment-related benefits  

The VCF award will include the value of lost employment-related benefits. Employment- related benefits include pension programs, retirement contribution programs, and health benefits. You will need to submit documents to show the benefits you received before the eligible injury/death and any claimed losses associated with employer-provided benefits.

Defined benefit plans

In a defined benefit pension plan, the employer or other sponsor promises to pay specific retirement benefits based on the employee's or member’s earnings history, length of service, and age. If you have a defined benefit pension that was or will be reduced because you retired early due to an eligible condition, the VCF may compensate you for that loss. To do this, the VCF needs documents describing the pension plan and how the pension would be calculated.

The VCF has some of the information necessary to calculate pension loss for claimants who worked for New York City or the Federal government. See Section 2: Section 2.2d for FDNY, 2.2e for NYPD, 2.2f for members of the New York City Employees Retirement System, and 2.2g for Federal employees including the military and military reserve.

The VCF also has information about defined benefit pension plans provided by many unions. In order to calculate loss associated with these pensions, you will also be required to submit:

  • Wage cards from 2001 to the present.
  • Information about your work with the union, usually consisting of a work history showing the hours worked in every year of work. This report should include regular hours and overtime hours. If possible, overtime hours should be broken down into “time and a half” and “double time.”
  • Job title, unit, or level within the union.

If you are submitting a claim for loss of future earnings/benefits from a union, please see Required Documents to Support Lost Earnings for Certain Unions and Employers for the complete list of documents you must submit in order for the VCF to calculate your loss.  When calculating loss of benefits from a union, the VCF models typically include loss of pension and loss of annuity benefits.  The VCF may consider loss of other benefits from your union if complete documentation is provided about the employer contribution amount and how the benefit is calculated.

In addition, the VCF has some of the information necessary to calculate pension loss for the following employers:

  • Consolidated Edison
  • Lockheed Martin
  • Metropolitan Transportation Authority Police
  • State of New Jersey, if a members of the Police and Firemen’s Retirement System (“PFRS”)
  • State of New York, if a member of the State and Local Retirement System (“NYSLRS”) or the Teachers Retirement System (“NYSTRS”)
  • Verizon

If you are submitting a claim for loss of future earnings/benefits from any of these employers, please see Required Documents to Support Lost Earnings for Certain Unions and Employers for the documents you must submit in order for the VCF to calculate your loss.

If your employer or union is not listed above or in "Required Documents to Support Lost Earnings for Certain Unions and Employers", you must submit complete documentation about the pension plan and how benefits are calculated, as well as information specific to your pension calculation. Generally, you will need to submit the following information and documents:

  • The pension plan or pension summary plan description (“SPD”) that describes eligibility requirements and how pensions are calculated

  • Membership or start date with the employer or entity

  • Years of qualifying service or number of pension credits

  • Final salary or earnings that are used to calculate pension amount

  • Any other variables or inputs that are used in the pension calculations

  • If you already began receiving a pension (either directly or as a beneficiary of a decedent):

    • The start date of that pension

    • The amount of that pension

    • The type of that pension (e.g., ordinary, service, disability, etc.)

    • If the pension offers different payment options, provide the document the claimant or decedent received outlining those options

    • If you receive a disability pension, documents showing the injuries or conditions that the pension is based upon

Note that the information above and in Appendix G only identifies documents related to loss of pension and other benefits. As with all other claims for lost earnings, claimants must also submit documents establishing a disability and the amount of earnings lost.

If there is an indication that you are receiving, or are entitled to receive, a disability pension (or if the decedent received a disability pension before death), but you do not submit information necessary to calculate that pension or determine the basis of that pension, the VCF will not issue a full award and may issue only a non-economic loss award because, without that information, the VCF cannot determine whether an offset is appropriate and the amount of that offset. If you have a personal injury claim and you later amend your claim and submit the information, the VCF will be able to calculate your economic loss. If you are filing a deceased claim (i.e., a claim seeking wrongful death losses because the victim died as a result of his or her eligible 9/11-related condition), and the victim received or was entitled to receive a disability pension before death, or the victim’s beneficiaries are receiving or are entitled to receive a survivor pension, you must submit that information before the VCF finalizes the substantive review of the compensation claim. 

Defined contribution plans

If your employer provided benefits such as a 401K match or other types of benefits that you would ordinarily receive at the time of retirement, you should submit proof of such benefits in order for the VCF to compute the loss. For example, you may submit a letter from your employer describing the retirement benefit or paystubs that reflect the employer’s contribution to your retirement account.

If benefit information is not provided:

If you do not submit complete information about your benefits, the VCF will apply its standard default values: a 401k employer contribution equal to 4% of base salary and

$2,400 per year for health insurance.  The VCF will also use the standard default values if you did not have benefits or if your benefits were less than the standard default values.

f.  Documentation to support loss of earnings and pension benefits for FDNY claimants  

For each FDNY victim who is claiming loss of future earnings and benefits and has provided the appropriate authorization, the FDNY sends the VCF a printout that is used to calculate the victim’s pension and contains the following information, which the VCF uses to calculate economic loss:

  • Historical earnings:
    • This includes last 5 years’ total earnings prior to retirement, including salary, holiday pay, night shift differential pay, and overtime.
  • 1/60th calculation (for those who served over 20 years)
  • Total annual retirement salary (i.e., pension amount)
    • In general, this is based on the higher of Year 5 earnings or 3-year-average. If Year 5 total earnings exceed 120% of average, the pension basis will be capped at 120%.
    • For those who have been granted a WTC disability or reclassification, the pension value is 75% of the higher value, with the exception noted above.
  • Type of plan (tier)
  • Date of appointment
  • Date of retirement

Generally speaking, a FDNY victim who has been granted a WTC disability pension does not need to submit any additional compensation/pension documentation unless the claimant asserts loss from non-FDNY employment.

Information specific to victims with an FDNY disability

Depending on their circumstances, FDNY victims should submit either two, three, or five documents (depending on their specific situation as explained below) to demonstrate that they have been found disabled as a result of a VCF-eligible condition or injury.

  • Victims who retired on a 3/4 Accidental Disability based on VCF-eligible conditions and who did NOT reclassify the disability should submit the following three (3) documents:

1. The FDNY Medical Board Committee Report: This is a report from the Chief Medical Officer of the FDNY on FDNY letterhead regarding the “Result of Medical Committee,” which summarizes the FDNY member’s WTC-related exposure, medical history, diagnosis, and the Medical Board Committee’s recommendation as to the extent of the member’s disability and fitness for firefighting duty.

2. Recommendation of the FDNY Pension Fund re: Accident Disability: This is a recommendation of the 1-B Medical Board on FDNY letterhead regarding whether the individual should be awarded an accident disability retirement.

3. Letter from the Board of Trustees of the Fire Department Pension Fund Regarding Award of Accident Disability Retirement: This is a letter issued to the individual on FDNY letterhead from the Director of the Board of Trustees of the Fire Department Pension Fund regarding whether the Board approved or disapproved the victim’s application for accident disability retirement.

  • Victims who retired on a 3/4 Accidental Disability and later reclassified the disability under the WTC Bill should submit five (5) documents: The three documents noted above from the original disability retirement, PLUS the 1-B Medical Board Recommendation and the Board of Trustees Letter from the reclassification proceedings.
  • Victims who retired on a service pension and later reclassified to a 3/4 Accidental Disability under the WTC Bill should submit two (2) documents: The 1-B Medical Board Recommendation and the Board of Trustees Letter from the reclassification proceedings.

FDNY victims who retired on a non-WTC-related accidental pension, ordinary disability pension, or service pension will not be eligible for lost earnings unless they can provide a disability determination from a third-party entity – such as the Social Security Administration or a treating physician – that identifies a VCF-eligible condition as a basis of the disability determination.

g.  Documentation to support loss of earnings and pension benefits for NYPD Claimants 

For each NYPD victim who is claiming loss of future earnings and benefits and has provided the appropriate authorization, the NYPD sends the VCF a spreadsheet that includes the following information for each NYPD victim, which the VCF uses to calculate economic loss:

  • Historical earnings: this includes last 5-year total earnings and 3-year average of highest 3 of 5 years
  • 1/60th calculation (for those who served over 20 years)
  • Pension amount: In general, this is based on the higher of Year 5 earnings or 3- year average
  • Type of retirement: WTC Accidental or Reclassification, Accidental Disability (not WTC-related), Ordinary Disability (not WTC-related), or Service Retirement
  • Date of appointment
  • Date of retirement and, if reclassified, date of WTC reclassification
  • Basis of disability determination generally: e.g., pulmonary, GERD, cancer, orthopedic

The NYPD also sends the VCF information/documentation regarding the basis of the NYPD victim’s disability, if applicable. Specifically, the NYPD sends the VCF the underlying Medical Board Police Pension Fund Article II Reports that identify the basis of the disability determination for claimants who have retired on a WTC disability. This generally includes the final Medical Board report that identifies the final diagnosis and recommends approval of a WTC disability, as well as any prior Medical Board reports issued that address the claimant’s conditions and recommend approval, disapproval, or deferral on the claimant’s disability application. It may also include documentation that was included in the claimant’s pension file and was reviewed in the course of the disability determination process.

Generally speaking, a NYPD victim who has been granted a WTC disability pension does not need to submit any additional compensation/pension documentation unless the claimant asserts loss from non-NYPD employment.

NYPD victims who retired on a non-WTC-related accidental pension, ordinary disability pension, or service pension will not be eligible for lost earnings unless they can provide a disability determination from a third-party entity – such as the Social Security Administration or a treating physician – that identifies a VCF-eligible condition as a basis of the disability determination.

h.  Documentation to support loss of earnings and pension benefits for members of NYCERS: 

The VCF will calculate pension loss for victims who worked for a New York City agency that is part of the New York City Employees’ Retirement System (“NYCERS”), such as the NYC Department of Sanitation, the NYC Department of Corrections, or EMS personnel employed by FDNY, if complete documentation is provided.  In March 2018, the VCF finalized an arrangement with NYCERS in which NYCERS will provide directly to the VCF the information and documentation needed to evaluate disability, lost earnings, and pension benefits for living members, upon receipt of a completed Exhibit B1.  You should not contact NYCERS directly to obtain this information.  Doing so will unnecessarily tie up limited resources at NYCERS and may delay claims processing. 

Please note: The VCF’s arrangement with NYCERS does not include the provision of information and documentation for deceased members, regardless of whether the VCF claim is filed for personal injury or wrongful death.  For deceased NYCERS members, the authorized Personal Representative must obtain the information and documentation from NYCERS directly and in accordance with NYCERS release of information requirements, and then submit that information and documentation to the VCF.

Personal Representatives must submit the following:

  • Letter from NYCERS informing the victim about the different pension options, including the accompanying data showing how those options were calculated. The data may be in a document called “Retirement Data Sheet” or “Disability Retirement Data Sheet.” It should include the victim’s membership date, years of credited service, and Final Average Salary.
  • The NYCERS pension plan to which the victim belonged (for example, 62/5, 55/25, CC-20, SA20) and the NYCERS membership date (if this information is not provided in the Retirement Data Sheet).
  • Letter from NYCERS stating that the pension has been finalized and showing the total monthly or annual allowance under the selected option.

Personal Representatives for victims who received a disability pension from NYCERS should also submit:

  • NYCERS Medical Board Report
  • Letter from NYCERS stating that the victim was approved for a 3/4 accidental disability
  • Letter from NYCERS showing the annual or monthly benefit amount

i.  Documentation to support loss of earnings and benefits for Federal Employees Including Military Personnel: 

Active Duty Military Personnel

Note that the VCF generally will not compensate for the loss of military earnings and benefits unless you left the service due to an eligible condition.  If you were not medically discharged for an eligible condition, you should provide other evidence and explain how it establishes that the loss of your military earnings and benefits was caused by your eligible condition(s).

Compensation for active duty military service members and uniformed service members is based on the amount of your basic pay (“BPY”), which is the largest component of military pay, plus any additional factors influencing military pay (e.g. longevity raises, overtime, bonuses, differential pay, etc.) as reflected in your taxable income reported to the Social Security Administration.  Any additional factors influencing military pay are assumed to be included in your reported military pay and will not be compensated separately.  In addition, compensation may include other military benefits or allowances if the appropriate documentation of the amount and duration of the benefits is submitted.

Individuals who submit a claim for a loss of future earnings/benefits from the Military or Military Reserve must submit documentation of the following:

  • Date of initial entry to military service (“DIEMS”)
  • Basic Active Service Date (“BASD”)
  • Pay Date (Per Leave and Earnings Statement)
  • Current grade or grade at retirement
  • Type of retirement from the military (e.g. service, disability), if applicable
  • Date of retirement from the military, if applicable
  • Final points statement
  • Most recent pay statement showing various allowances, benefits, and special pay
  • If receiving military retired pay: start date and benefit amount

If you have been found partially or totally disabled by the Military, submit complete documentation of the basis of your medical retirement (e.g. Medical Evaluation Board and/or Physician Evaluation Board report).  

Veterans Administration Disability Determinations

If you have been found partially or totally disabled by the Department of Veterans Affairs (“VA”) because of your military service, notify the VCF.  We will obtain complete documentation of your service-connected disability compensation, including all rating decisions and all changes to the amount of your VA compensation, directly from the VA.  If you are receiving Combat-Related Special Compensation or Concurrent Retirement and Disability Pay, submit a complete history of the amount and duration of benefits received.

FERS and CSRS

Federal employees in the Federal Employees Retirement System (“FERS”) or Civil Service Retirement System (“CSRS”) who are claiming loss of future earnings/benefits must submit the following:

  • Documentation showing the Effective Date and the victim’s final grade, step, and location – the best source of this information is the most recent SF-50 (Notification of Personnel Action) prior to retirement. The victim’s most recent Earning and Leave Statement prior to retirement may have all of this information except the Effective Date, so if that document is submitted in place of the SF-50, the claimant will need to also provide his/her Effective Date.
  • SF-50 (Notification of Personnel Action) from the victim’s retirement.
  • The start date and amount of the victim’s pension.
  • The following information, which is used to calculate the victim’s pension. Note that this information should be in a letter that was sent to the victim at retirement or in a Federal Retirement Benefits printout:
    • Date that victim entered the FERS system (date used to calculate Creditable Service for Retirement)
    • Retirement date
    • Total years and months of credited service
    • “Average High-3 Salary”

Individuals who receive a disability pension from FERS should also submit:

  • Letter from Office of Personnel Management (“OPM”) confirming that the victim’s disability retirement has been approved and stating the conditions forming the basis of the disability
  • Amount of Monthly Disability Pension in first 12 months (already reduced by Social Security benefits)
  • Amount of Disability Pension after 12 months (already reduced by Social Security benefits)
  • Estimate of re-calculated Disability Pension at age 62

2.3  Detailed Explanation of Methodology used to Calculate Future Lost Earnings  

In general, the VCF will use the following procedures and assumptions for determining future lost earnings for both deceased and injured victims:

1. Age, start of loss and compensable income: Establish the victim’s age and compensable income at death or at the time the victim was determined to be unable to work by a governmental entity, or had to reduce work, and suffered a loss of income as a result of eligible conditions. The start of loss date is typically the onset date of disability.  There are some cases, however, where a victim continued to earn income at the same level after s/he was determined to be disabled by a governmental entity.  In those cases, the VCF may use the later date – that is, the date when the victim actually suffered a loss in earnings. 

Income will be determined based on the documents submitted with the claim and on data obtained from SSA earnings reports. Generally, the Special Master will consider the three calendar years of employment history before the decrease in the victim’s earnings capacity as a result of the victim’s disability due to the eligible conditions or the victim’s death, but the Special Master also may consider other factors or other years or combinations of years in evaluating the claim. Where there is a finding of partial disability or if there are multiple disability determinations, some for eligible conditions and some for ineligible conditions, the VCF will compute the percentage of income “lost” based on the percentage of disability attributable to eligible conditions. In some cases, the VCF will apply a computation of future residual earnings for individuals who are disabled from a specific job but who are otherwise able to perform a different occupation.  In general, the standard amount used to calculate future residual earnings capacity is the minimum wage applicable to large employers in New York City ($31,200 in 2018). The VCF will also consider when and how a claimant left the workforce, particularly if the claimant stopped working before the disability onset date identified in the disability determination.

 

2. After-tax income: Determine after-tax compensable income by applying the average effective combined federal, state, and local income tax rate for the victim’s income bracket currently applicable in the state of the victim’s domicile for tax purposes. The Special Master will consider the victim’s tax returns as well as effective income tax rates derived from published Internal Revenue Service (“IRS”) data on selected income and tax items for Individual Income Tax Returns by State.[3] Effective income tax rates derived from IRS data for New York are shown in Table 1 below.

Table of Presumed Future Effective Combined Tax Rates for NY

3. Employer-provided benefits: Add the value of employer-provided benefits (or other benefits received through employment, such as from a union or government pension program). These benefits will be set at actual levels if you provide the necessary data.

If you do not provide sufficient evidence of the benefits you received through employment, the VCF will apply the same assumptions that were used in the original VCF, i.e., the VCF will assume that the employer’s retirement contribution is 4% of base salary and that medical benefits are $2,400 per year in current year dollars and will adjust for applicable inflation.

If, as a benefit of your employment, you are a member of a defined benefit pension plan, and you submit documentation of all information required to calculate a pension benefit under your plan, the VCF generally will calculate your benefits using that data.  See Required Documents to Support Lost Earnings for Certain Unions and Employers.  In some cases, however, the VCF may estimate your benefits using presumptive values. Presumptive defined benefit pension values assume a five-year vesting requirement, normal retirement age of 65, and a benefit factor of 1% of average salary for the final five years of employment.

 

4. Work-life expectancy: Determine a measure of the victim’s expected remaining years of workforce participation using the tabulated work-life expectancies for the victim’s age at the time of death or at the time the victim was unable to work, or had to reduce work, as a result of eligible conditions contained in the publication, “Worklife in a Markov Model with Full-time and Part-time Activity” by Kurt V. Krueger, Gary R. Skoog, and James E. Ciecka in the Journal of Forensic Economics, 19 (1) 2006, pp. 61-82. These are generally accepted tables of work- life expectancy regarding the general population.

Work-life expectancies are based on actual experiences and behavior of the general population and measure the estimated time in years an individual of a given age will remain in the labor force (either employed or actively seeking work), allowing for age-specific mortality risks and rates of workforce transitions. The Special Master will use the expected work-life for active males, with a full-time beginning labor force state, to compute expected remaining years of workforce participation for both male and female victims. The work-life expectancies are shown in Table 2 below. Because published estimated work-life expectancies by gender are lower for women than men, this specification increases the duration of estimated foregone earnings, and thus presumed economic losses, for female victims and was implemented by the Special Master to accommodate for potential increases in labor force participation rates of women.

Expected Remaining Years of Workforce Participation

As a matter of general policy, the VCF will not award lost earnings if the victim was 65 years old or older at the time of disability or death based upon the presumption that the victim had reached his or her reasonable work-life expectancy.  Exceptions may be considered if the victim (or his or her authorized representative) submits evidence to support the assumption of additional years of workforce participation after age 65, such as the victim’s need to support minor children.  In many cases, these issues are best addressed in the context of an appeal hearing.   

 

5. Growth rates: Project compensable income and benefits through the victim’s expected work- life using growth rates that incorporate an annual inflationary or cost-of-living component, an annual real overall productivity or scale adjustment in excess of inflation, and an annual real life-cycle or age-specific increase derived using data on average full-time year-round earnings by age bracket from the 2010 Current Population Survey (“CPS”), a monthly survey of households conducted by the Bureau of the Census for the Bureau of Labor Statistics. This survey is widely recognized as a primary source of data on employment status and workforce characteristics of the civilian non-institutional population ages 16 years and older. Because age-specific observed life-cycle increases for all males were higher than observed life-cycle increases for both men and women combined, the Special Master elected to incorporate the life-cycle increases for males into earnings growth for all victims, both male and female.

Independent of life-cycle increases, inflation and real overall productivity increases of 2% and 1%, respectively, are applied each year. These rates of increase are consistent with the long- term relationship between economy-wide wage growth and risk-free interest rates, which currently reflect lowered inflationary expectations. A schedule containing age-specific earnings growth rates reflecting the combined inflation, overall productivity, and life-cycle increases is shown in Table 3 below. The Special Master has determined that individual age-specific growth rates, rather than growth independent of a particular age bracket at death, better reflects the expected pattern of earnings over one’s career[4] and results in more equitable and consistent projections for victims close to each other in age with otherwise similar family and employment characteristics.

Presumed Age-Specific Earnings Growth Rates

6. Risk of unemployment: To better reflect contingencies that the victims would have faced, all projected earnings and fringe benefits (assumed to be received during projected employment and until work-life expectancy) amounts will be adjusted for a factor to account for the risk of unemployment as lifetime jobs are not representative of the modern economy. This adjustment is made because work-life expectancies are based on years of expected workforce participation, which, as defined by the Bureau of Labor Statistics, include periods an individual is either working or seeking work. Historical unemployment rates were examined and a reduction factor of 6% is applied to presumed earnings and fringe benefits to account for this risk[5].

 

7. Personal consumption adjustment for decedents: For claims for deceased victims whose death was related to an eligible condition, subtract from annual projected compensable income and benefits the decedent’s share of household expenditures or consumption as a percentage of income, using expenditure data by income level obtained from “Table 2. Income before taxes: Average annual expenditures and characteristics, Consumer Expenditure Survey, 2009,” published by the Bureau of Labor Statistics (“BLS”). This subtraction is a standard adjustment in evaluating loss of earnings in wrongful death claims because some amount of the income the decedent would have contributed to the household would have been consumed personally by the decedent and not available to other household members. A decedent’s expenditures were calculated as a share, based on household size, of certain expenditure categories. For married or single individuals with dependents,[6] these expenditure categories include Food, Apparel & Services, Transportation, Entertainment, Personal Care Products and Services, and Miscellaneous. For single individuals without dependents, Housing, Education and Health are also included.[7] For lower income categories where total expenditures exceed income, expenditures were scaled to income, so as not to reduce income for expenses potentially met by other forms of support. This approach was intended to avoid a penalty to the victim. Table 4 below shows calculated consumption rates by income bracket and for various household sizes.

Decedent's Personal Expenditures or Consumption as Percent of Income

In determining household size for claims for decedents, the Special Master will assume that children will remain in the household through age 23. Consumption rates calculated using alternative techniques were considered but found to produce higher personal consumption rates and were not ultimately used to determine the decedent’s household consumption adjustment.[8] Although the consumption rates determined from BLS data actually represent household expenditures as a percent of before-tax household income, the actual consumption reduction used to determine the decedent’s personal expenditures was calculated as a percent of lower after-tax income, which significantly lowers the resulting adjustment. In addition, the victim’s consumption is determined as a share of the victim’s own earnings only, rather than the standard share of total household earnings. This further lessens the resulting subtraction, compared to personal consumption rates typically applied in litigation, if there are other earners in the household.

 

8. Application of statutory limitation on annual gross income: In accordance with the updates to the statute that were enacted as part of the December 18, 2015, reauthorization of the VCF, for each year of loss, the methodology limits the annual loss of earnings and other benefits related to employment that fall under the definition of gross income in section 61 of the Internal Revenue Code of 1986 to $200,000. The methodology computes the loss in each year (including pensions) and caps the loss at $200,000 in each year. The methodology applies adjustments for taxation, risk of unemployment, employee contributions, and personal consumption for deceased claims before applying the annual limit.  The methodology accounts for the loss of employer-provided health plans after application of the limit because such costs are exempted from gross income.

 

9. Present value: Calculate the present value of projected earnings and fringe benefits using discount rates based on a weighted average of historical yields on mid- to long-term U.S. Treasury securities, adjusted for income taxes using a mid-range effective tax rate.[9] Because the period of presumed economic losses is either longer or shorter, depending on the victim’s age, the present value calculations are performed using yields on a blend of securities with longer or shorter times to maturity. For computational efficiency, three blended after-tax discount rates were used, depending on the victim’s age as of date of death or time the victim was unable to work, or had to reduce work, as a result of eligible conditions, and assumed to apply for all years forward. These rates are shown in Table 5 below.[10]  The present value adjustments will be based on the period of presumed economic loss (which is in turn based on the age of the victim).

Assumed Before-Tax and After-Tax Discount Rates

10. Assumptions: The computation methodology adopts a number of assumptions implemented to facilitate analysis on a large scale. When viewed in total, these assumptions are designed to benefit the victim and are more favorable than the standard assumptions typically applied in litigation. For example, the Special Master considered that over the course of their projected careers, younger victims could expect to cross into higher income brackets, and be subject to corresponding higher income tax rates, on account of experience-based real lifetime earnings growth in excess of economy-wide national wage increases. To calculate economic losses, however, whatever income tax rate corresponded to the victim’s determined compensable income bracket as of the date of death, or time the victim was unable to work or had to reduce work as a result of eligible conditions, was assumed to apply for the remainder of the victim’s career, without increase. Likewise, the calculations of economic losses also assume that the personal consumption percentage corresponding to the victim’s determined compensable income bracket as of the date of death, or time the victim was unable to work or had to reduce work as a result of eligible conditions, applies for the remainder of the victim’s career, without decrease. It was determined that the net effect of these and other facilitating assumptions was to increase the potential amount of presumed economic loss to the benefit of the victim.

 

2.3.1 Compensation for VCF1 Claimants Who Were Paid in VCF1

If you received an award in VCF1, you can amend your claim and qualify for additional compensation if:

a. Your VCF1-eligible injury or condition has substantially worsened;

OR

b. You have a new physical injury or condition that you had not suffered at the time of the VCF1 claim filing or that was not compensable at the time of VCF1;

        AND

c. You have not already been fully compensated for your losses. 

When evaluating whether additional compensation should be awarded, the VCF considers the types of conditions compensated, the type, nature, and amount of compensation awarded, and the basis and timing of any lost earnings awarded in VCF1.  A claimant will be considered to have been fully compensated if the compensation s/he received in VCF1 exceeds the amount of compensation s/he is eligible to receive in VCF2 based on his/her eligible conditions and the circumstances of the claim.  For that reason, even if a claimant’s eligible condition has worsened since VCF1, s/he may not qualify for additional losses.  Moreover, the VCF will not reconsider or recalculate any component of the VCF1 award or change any assumptions made in the VCF1 calculation.  Below are some illustrative examples of how VCF1 awards are considered:

  • If you received $125,000 of non-economic loss in VCF1 for asthma, and you amend in VCF2 for additional non-economic loss for newly certified interstitial lung disease and emphysema that have progressively worsened, the VCF will consider you to be fully compensated for your eligible conditions and will not award additional non-economic loss.  The VCF is required to consider your non-economic loss in the context of the current statutory caps.  Because your VCF1 non-economic loss exceeds the maximum amount allowed by law for those conditions ($90,000), no additional losses will be awarded.  
  • If you were found to be partially disabled due to an eligible condition in VCF1 based on an FDNY disability determination, and the Social Security Administration subsequently determined that you became fully disabled due to the same condition after your VCF1 award was issued, you may be eligible for additional compensation.  The VCF considers the fact that you became more (fully) disabled after your VCF1 award was issued as evidence that your same, eligible condition has worsened and that you suffered losses that were not previously fully  compensated.  Note that proof of exacerbation is required to support an additional award for economic loss in VCF2 if economic loss was awarded in VCF1.  Thus, a determination by SSA that you were already fully disabled at the time that the VCF1 award was issued will not support additional loss, even if the SSA does not make that determination until after your VCF1 award was issued, and even if the VCF1 did not consider you to be fully disabled, because that new determination does not establish that your disability has actually worsened since the time VCF1 considered your conditions. 

 

2.4 Other Types of Economic Loss  

a.  Past out-of-pocket medical expenses   

As part of the economic loss component of your claim, you can request reimbursement for past out-of-pocket medical expenses you have paid as a result of your eligible condition(s).

Because claims for reimbursement of out-of-pocket medical expenses require the submission and review of significant documentation establishing both that the claimed medical expense was related to your eligible condition and that you personally paid for the expense out of pocket, processing these claims takes time and can delay your award. As a result, it is VCF policy that claims for reimbursement of past out-of- pocket medical expenses will only be considered if the following criteria are met:

  • The claim for medical expenses must be submitted as a compensation amendment to your claim and only after you have received your initial award determination. This allows the VCF to issue your initial award determination more quickly, since we are not spending time during our initial review to verify each claimed medical expense.
  • If you amend your claim to seek reimbursement for medical expenses, the VCF will only review the amendment if the total amount of the claimed medical expenses incurred due to eligible conditions exceeds $5,000.
  • The amendment must be submitted with the required documentation as explained below, and in the required format, in order to be considered for reimbursement.

The Special Master may exercise discretion to waive one or more of these requirements as appropriate based on individual claimant circumstances. If you wish to seek a waiver, please contact the VCF Helpline.

I.  When to File a Medical Expenses Claim 

A. By Amendment: Claims for medical expenses will only be processed by the VCF when filed as an amendment once your initial award determination is received. You may also amend your claim to seek reimbursement for medical expenses after receiving a revised award decision. Instructions for how to amend your claim can be found under “Forms and Resources” on the VCF website.

The amendment may be filed at any time following receipt of your initial award determination, but no later than October 1, 2090.

The VCF will only consider reimbursement for medical expenses incurred as of the date the amendment is submitted. This means if you amend your claim to seek reimbursement for medical expenses, you must have paid the expenses prior to the date you submit the amendment. By statute, the VCF does not compensate for potential or anticipated future medical expenses.

B.  Pending Claims and Amendments: If you have already filed a claim for medical expenses as part of your claim form submission, effective immediately, the VCF will not review the expenses as part of our initial review of your claim.

Once you receive your award determination, you will need to determine if your out-of- pocket medical expenses meet the $5,000 minimum threshold for filing an amendment to seek reimbursement. You are not required to amend your claim if you decide you no longer want to seek reimbursement for medical expenses. If your paid medical expenses meet the $5,000 threshold and you want to seek reimbursement of the expenses, you must submit an amendment to reactivate your request. You do not need to resubmit documents in support of your medical expenses claim if you already submitted them with your claim form, although you may submit additional documentation if you paid expenses between the date you submitted your claim and the date you file your amendment. You must be certain any documentation you provide meets the criteria outlined below.

If you have already filed an amendment to seek medical expenses reimbursement, the VCF will review the expenses as part of our review of your amendment, provided the expenses meet the $5,000 minimum threshold.  You do not need to resubmit documents you have already submitted in support of your amendment, but you must be certain the documentation you provided meets the criteria outlined below.

C.  Claim Form for New Claims: If you are filing a new claim and you plan to seek reimbursement for medical expenses by filing an amendment after you receive your initial award determination, please select “Medical Expenses” in the “Type of Loss” section of the claim form. This will allow the VCF to monitor the number of anticipated future amendments for medical expense claims.

Selecting the medical expenses option is strictly for VCF informational purposes and your request will not be reviewed as part of your claim. You therefore do not need to submit any documentation in support of the medical expenses when you submit your claim form; you only need to submit that information if you decide to amend your claim after receiving your initial award.

Failing to affirmatively indicate an intent to file a later claim for medical expenses when filing your claim form will not prevent you from filing an amendment seeking such reimbursement later.

II.  Acceptable Medical Expenses Claims

A. Types of Expenses Covered: By statute, the VCF does not compensate for potential or anticipated future medical expenses.

Compensable expenses include costs you have paid out-of-pocket for prescription medication, prescribed medical equipment, doctor visits, diagnostic tests, surgeries, or other medical procedures relating to your eligible conditions. The VCF will not compensate for any travel expenses you incurred while seeking medical treatment, including the cost of gas, public transportation, hotels, and meals, except in extraordinary circumstances.

Only expenses that you have paid out-of-pocket will be reimbursed. Compensable expenses do not include any costs for which you have been, or will be, reimbursed by your insurance company, a secondary payer (like Medicaid, Medicare, or a second insurance provider), or any other collateral source.

  • If you have insurance, the VCF will not compensate for any expenses that have not yet been evaluated by your insurance company or any applicable secondary payer.
  • If the service or medication is provided to you by the WTC Health Program, it is not eligible for reimbursement from the VCF and you should not include it with your claim.
  • Treatment expenses covered by private health insurance, Workers’ Compensation, or other programs will not be reimbursed. If you receive a benefit intended to cover medical expenses from Workers’ Compensation or any other collateral source, please include information regarding that payment, so that it can be appropriately offset from your medical expenses award.
  • Treatment expenses billed to you as a co-payment, after denial of insurance coverage, or that you pay because they fall within your insurance deductible, may be reimbursed if appropriate documentation is submitted.

B.  The Minimum Monetary Threshold. The VCF will consider claims for medical expenses only if the total amount legitimately claimed in your amendment exceeds $5,000. The “total amount legitimately claimed” means that the claimed expenses are reasonably related to your eligible conditions (as identified in your most recent eligibility determination letter) and that you have documentation demonstrating that you paid the expense out-of-pocket.

If your medical expenses claim does not meet the documentation requirements described in the next section, the VCF reserves the right to deny the amendment.

III.  Documentation Required to Support a Medical Expenses Claim 

For the VCF to consider your amendment for medical expenses, you must submit the following documents in support of your amendment:

A. VCF Medical Expense Worksheet (available on the "Forms" tab under “Forms and Resources” on the VCF website); and

B. A Medical Expense Supporting Documentation Packet that verifies: (a) the relationship of each claimed expense to one of your eligible conditions; and (b) the amount of each claimed expense that you have paid out-of-pocket.

The requirements for each of these items are described in greater detail below.

 

The Medical Expense Worksheet

The Medical Expense Worksheet is used to identify each discrete medical expense for which you are seeking reimbursement. The worksheet must be completed following the instructions below (the instructions are also included in the worksheet). The VCF will not review your amendment if the worksheet is not properly completed.  If you are unable to complete the worksheet in Excel format, please contact the VCF Helpline for assistance.

Instructions for Completing the Worksheet. The numbers below correspond to the numbers for each field or column in the worksheet.

  1. Claim Number: enter your 7-digit VCF claim number including any leading zeros.
  2. Victim Name: enter your full name (or the victim’s name if you are not the victim).
  3. Medical Insurance (Primary and Secondary if applicable): Enter the name of your insurance carrier (if you had one) at the time the expense was incurred and the name of any applicable secondary payer, such as Medicaid, Medicare, or a second insurance provider.

Each expense you are claiming must be entered in a separate row in the Worksheet following the guidelines below. Do not group expenses together each unique expense must be entered as a separate line item. You should sort the Worksheet chronologically by column A, the date of service.

  1. Date of Service: Enter the date that you received the medical service. The field will automatically format the date to MM/DD/YYYY. For doctor visits, diagnostic tests, surgeries, or other procedures, this is the date you went to the doctor or had the test or procedure performed. For prescriptions or equipment, this is the date you filled the prescription or purchased the equipment. It is very helpful if you list the dates in chronological order (starting with the oldest date of service and ending with the most recent date of service).
  2. Name of Doctor, Facility, or Pharmacy: Enter the name of the doctor, facility, or pharmacy as shown on the invoice, receipt, or medical records.
  3. Short description of Procedure, Treatment, or related Expense: Enter a brief description of the treatment, procedure, or test. Some examples are: office visit; surgery; prescription - [name of prescription drug]; MRI; blood test.
  4. Related Eligible Condition: Enter the name of the eligible condition to which the specific expense relates. The condition name MUST match the name of one of the conditions listed on your most recent eligibility determination letter.
  5. Amount Paid by Victim/Claimant: Enter the amount you paid out-of-pocket for the medical service or treatment. This is the amount for which you are personally responsible; it should not include any portion covered by insurance or any other source. Do not include any amounts that have not yet been evaluated by your insurance company or any applicable secondary payer. The field will automatically format the entry in $0.00 format.
  6. Page within Supporting Documentation Packet that shows relationship to Eligible Condition: Unless the expense claimed is on the list of Presumptively Compensable Expenses (see Table 1 on page 6), enter the page number (or numbers) from the Supporting Documentation Packet that shows that the expense is related to one of your eligible conditions.

If the expense claimed is on the list of Presumptively Compensable Expenses, this cell may be left blank.

  1. Specific Page within Supporting Documentation Packet that shows Proof of Payment: Enter the page number (or numbers) from the Supporting Documentation Packet that show that you personally paid for the claimed expense. Note that there must be specific documentation supporting the payment of the claimed expense. A credit card statement or cancelled check will not be sufficient if it identifies only that an amount was paid to a pharmacy such as CVS or Duane Reade, but is not accompanied by a receipt that demonstrates that the amount paid was for the specific claimed prescription cost.

Submitting the Worksheet: You must upload the Worksheet to your claim in Excel format. If you do not upload the Worksheet, or if you upload the file in any format other than Excel, the VCF reserves the right to deny your medical expenses claim.

When uploading the Worksheet to your online claim, select “Medical Expense Worksheet” as the document type.

 

Medical Expense Supporting Documentation Packet 

For each discrete medical expense entered on the Medical Expense Worksheet, the Supporting Documentation Packet must include:

  1. A document that demonstrates that the expense is related to one of your eligible conditions, unless the expense is on the list of Presumptively Compensable Expenses (see Table 6 below); and
  2. A document that demonstrates the amount of the expense that you have paid out- of-pocket.

When uploading the Supporting Documentation Packet to your claim, select the document type “Medical Expense Supporting Documentation Packet.”  If you fail to include the required supporting documentation, your amendment will be denied.

1. Demonstrating the Relationship between the Claimed Expense and your Eligible Condition.

- Presumptively Compensable Expenses: If your eligible conditions falls within one of the categories in Table 6, the VCF will presume that any expense for the medications and procedures listed in Table 1 is related to your eligible condition and you do not need to provide any further proof of the relationship. You still must complete the Medical Expense Worksheet to list the specific expense, but you may leave Column F blank for the specific entry.

Please note that this list is subject to change. Please be sure to check the most recent version of the list (available on the VCF website) when completing your Medical Expense Worksheet.

- Non-Presumptively Compensable Expenses: If your eligible condition or your medical expense is not listed in Table 1, then you must submit medical records that demonstrate the relationship between each claimed expense and one (or more) of your eligible conditions. The medical records must include your name, date of birth or other identifying information, and date of service, and must state the condition for which you were treated. If medical records are not available, you may instead submit a letter from your doctor explaining how the expense is related to your eligible condition.

2. Demonstrating the Amount of the Expense you Paid. For all claimed medical expenses (without regard to whether they are Presumptively Compensable Expenses), you must submit documentation showing the amount you were billed, the date of service, the service provider, and proof that you paid the expense. The documentation must also include your name or other identifying information.

Documents that are sufficient to demonstrate the amount of the expense you paid include receipts from providers or pharmacies, provider billing statements, cancelled checks or credit card statements if they contain the necessary detail, pharmacy prescription histories, or an explanation of benefits statements from your insurance provider if you do not have a secondary payer.

If you have insurance or a secondary payer, do not submit any bill or invoice for expenses that have not yet been evaluated by your insurance company, or an explanation of benefits statement that does not reflect the contribution of the secondary payer.

3. General Organization of Supporting Documentation Packet. It is extremely helpful to the VCF, and will minimize delay in processing your amendment once it is in substantive review, if you organize the Supporting Documentation Packet in the following way:

1. Label all submitted documentation with the line number from the Medical Expense Worksheet that corresponds to the specific expense. This helps the VCF to easily match the documentation to the associated entry on the worksheet.

2. Sort the submitted documentation chronologically by the date of service. This should match the “Date of Service” as entered on the worksheet for the specific item.

3. Organize the documents in the packet so that the documentation demonstrating that the expense is related to an eligible condition (when required) is immediately followed by the documentation demonstrating the amount of the expense and your proof of payment.

If the VCF, with reasonable effort, cannot clearly identify the required documentation necessary to support each claimed medical expense, the VCF reserves the right to deny your medical expenses claim.

 

Table 6: Presumptively Compensable Expenses

This chart may change over time.  Please be sure to refer to the most recent chart posted to the VCF website prior to filing your amendment for medical expenses.

Condition Category

Includes

Presumptively Compensable Medications

(generic name is listed first, followed by brand name)

Presumptively Compensable Procedures
Obstructive Airway Disease
  • Asthma
  • Bronchiectasis
  • Chronic airway obstruction
  • Chronic bronchitis
  • Chronic obstructive pulmonary disease (COPD)
  • Emphysema
  • Reactive airways disease
  • Reactive airways dysfunction
  • Respiratory conditions due to fumes and vapors
  • Albuterol (ProAir, Proventil, Ventolin)
  • Atrovent (ipratropium)
  • Beclomethasone (Qvar)
  • Benzonatate (Tessalon Perles)
  • Budesonide (Pulmicort, Symbicort)
  • Ciclesonide (Alvesco)
  • Fluticasone propionate (Advair, Flovent)
  • Formoterol (Dulera, Foradil, Symbicort)
  • Ipratropium (Atrovent)
  • Levalbuterol (Xopenex)
  • Metaproterenol (Alupent)
  • Mometasone (Asmanex, Dulera)
  • Montelukast (Singulair)
  • N-acetylcysteine (Mucomyst
  • Oxygen
  • Pirbuterol (Maxair)
  • Salmeterol (Advair, Serevent)
  • Terbutaline (Brethine)
  • Tiotropium (Spiriva)
  • Zafirlukast (Accolate)
  • Zileuton (Zyflo)
  • Bronchoscopy
  • CAT Scan Chest/Thorax (CT)(CT Scan)
  • Chest X-ray (CXR)
  • MRI Chest
  • Pathology – lung specimens
  • Sputum Cultures
  • Thoracoscopy/ Thoracotomy
  • Video-Assisted Thoracotomy (VAT)
  • Wedge resection of the lung
Interstitial Lung Disease
  • Asbestosis
  • Granulomatosis
  • Interstitial pneumonia
  • Pneumonitis
  • Pulmonary fibrosis
  • Sarcoidosis
  • Bronchoscopy
  • CAT Scan Chest/Thorax (CT)(CT Scan)
  • Chest X-ray (CXR)
  • MRI Chest
  • Pathology – lung specimens
  • Sputum Cultures
  • Thoracoscopy/ Thoracotomy
  • Video-Assisted Thoracotomy (VAT)
  • Wedge resection of the lung
Gastroesophageal Reflux  
  • Esomeprazole (Nexium)
  • Famotidine (Pepcid)
  • Lansoprazole (Prevacid)
  • Omeprazole (Prilosec)
  • Pantoprazole (Protonix)
  • Ranitidine (Zantac)
  • Barium Swallow
  • Esophagogastroduodenosc opy (EGD)
  • Laryngopharyngeal Endoscopy
  • Pathology – Esophagus, gastric, duodenum specimens
  • Upper GI Series

Upper Respiratory Disease

  • Rhinitis
  • Sinusitis
  • Rhinosinusitis
  • Tracheitis
  • Laryngotracheitis
  • Laryngitis
  • Nasopharyngitis
  • Pharyngitis
  • Azelastine (Astelin, Astepro)
  • Budesonide (Rhinocort)
  • Fluticasone propionate (Flonase)
  • Ipratropium bromide (Atrovent)
  • Mometasone (Nasonex, Asmanex)
  • Oxymetazoline (Afrin)
  • CAT Scan Head/Sinuses
  • Endoscopy of Nasal and Sinus Cavities
  • Laryngopharyngeal Endoscopy
  • Pathology – Nasal and Sinus specimens
  • Septoplasty
  • Sputum Cultures
Prostate Cancer  
  • Sildenafil (Viagra)
  • Tamsulosin (Flomax)
  • Prostate Biopsy
  • Radical Prostatectomy
  • Radiation Seed Implants

 

b.  Replacement Services Loss: 

If you regularly performed general household-related tasks, and if you cannot perform those tasks as a result of an eligible condition, then the VCF may provide compensation for the value of those “services.” This component of economic loss is called “replacement services loss” and is typically considered to be a component of loss in deceased claims, or in claims where the claimant did not have prior earned income or worked only part-time outside the home. Replacement services loss awards are not precluded in other circumstances, but they are variable according to the individualized needs and circumstances of the claimant and subject to the discretion of the Special Master. Examples of the types of tasks that are considered for “replacement services” compensation are services that you provided to the family or to yourself, such as cleaning, cooking, child care, home maintenance and repairs, and financial services. Replacement services loss is intended to replace something that was lost – that is, something you used to do and now cannot do because of your eligible condition. In order to be compensated for replacement services, you must demonstrate that you performed the service before the onset of the eligible condition (or that the victim performed the service prior to his or her death from the eligible condition). In a personal injury claim, you must also demonstrate that the eligible condition now prevents the performance of such services.

To make a claim for replacement services loss, you should provide a statement describing the types of services you provided before your eligible condition, the amount of time spent on those services (per week or month), and the amount of time you are able to spend on those services now (i.e., with the eligible condition). You should also submit medical records that show that the reason you cannot perform the services is because of the eligible condition. You must complete and submit a Social Security Administration Consent Form (Exhibit 1 of the Claim Form) even if Replacement Services is the only type of loss you are claiming.  This allows the VCF to obtain information from the Social Security Administration to determine earnings history.  If the victim is deceased, you should provide a clear statement of the services provided before the onset of the eligible condition and/or death from the eligible condition.

If the victim is deceased, you should provide a clear statement of the services provided before the onset of the eligible condition and/or death from the eligible condition. If services are no longer relevant, they will not be compensated (for example, child care services will not be compensated after the child reaches age 18).

 

b.  Burial or memorial service expenses:   

The VCF will compensate for documented out-of-pocket burial or memorial expenses for victims who died as a result of an eligible 9/11-related physical injury. The VCF will calculate such loss on a case-by-case basis using documentation submitted by the Personal Representative. If any part of these expenses was covered by life insurance or another source, you must provide documentation of that coverage. The VCF will not reimburse expenses that were covered by another entity.

 

c.  Other out-of-pocket expenses:   

The VCF generally does not compensate other out-of-pocket expenses absent evidence that they are medically necessary as a result of an eligible condition. Expenses for travel for medical treatment generally are not compensated, but extraordinary circumstances will be considered on a case by case basis.

 

 

2.5  Collateral Source Offsets  

The VCF is required by statute to offset (that is, subtract) from the calculated loss the amount of compensation that you have received, or are entitled to receive, from certain collateral sources as a result of the injury that is eligible for compensation.  This includes compensation paid to your dependents or to the beneficiaries of a deceased victim as a result of the eligible injury, such as benefits that the Social Security Administration pays to dependents of a disabled or deceased wage earner.  Collateral sources may include life insurance, pension funds, death benefit programs, settlement payments from September 11th-related lawsuits, and payments by federal, state, or local governments related to the terrorist-related aircraft crashes of September 11, 2001, or debris removal in the immediate aftermath. For example, the VCF will deduct from the award the amount that an FDNY victim receives under a WTC disability pension provided that the disability pension is for an eligible condition.

The Special Master will exercise discretion in valuing the appropriate deductions for collateral offsets by determining the following:

  • Whether the particular offsets fall within the definition of collateral sources;
  • Whether particular offsets should apply to all or some categories of loss (for example, certain disability benefits are offset only against lost earnings; see Table 7: Which Offsets Apply to Which Types of Loss);
  • Whether the collateral source compensation is certain or can be computed with sufficient certainty to enable its offset while ensuring that beneficiaries receive the full amount of compensation that is appropriate; and
  • The appropriate amount of the compensation that should be offset, taking into account the time value of money and contributions made by the injured victim or decedent in the nature of investment or savings.

While it is not possible to define in advance every possible collateral source deduction, the following general illustrations should provide guidance:

  • The Special Master has the discretion to exclude from consideration life insurance proceeds that are distributed to persons other than the beneficiaries of the VCF award.
  • The Special Master has the discretion to adjust the amount of offsets to exclude premiums or assets that were accumulated by the victim through self-contributions paid into a life insurance program to build up a tax-deferred cash value.
  • The Special Master may reduce the amount of the offset for a pension to take account of self-contributions to that plan over the injured victim’s or decedent’s lifetime.
  • The collateral source offsets will not include monies or other investments in the injured victim’s or decedent’s 401(k) accounts.
  • The Special Master is required under the statute to offset Social Security survivor and dependent benefits as compensation paid to the surviving spouse or dependents of a disabled or deceased wage earner because of the eligible injury.  For this reason, if any spouse or dependent (e.g., a minor or disabled child or an elderly parent) of the deceased victim is receiving these benefits, you must submit a separate Social Security Administration Consent Form (Exhibit 1 of the Claim Form) for the surviving spouse and/or dependents when submitting the claim.  Please do not submit another copy of the Exhibit 1 for the victim.  The VCF will then obtain information regarding the benefits directly from the SSA.

Moreover, the final regulations provide that tax benefits received from the Federal Government as a result of the enactment of the Victims of Terrorism Tax Relief Act of 2001 (Pub. Law No. 107-134) will not be treated as collateral source compensation.

The following are NOT considered collateral offsets:

  • Charitable gifts - the final regulations clarify that benefits from charities (privately-funded charitable entities) disbursing private donations will not be treated as collateral source compensation, even if such charities were created or managed by governmental entities.
  • Payments made by the various State Victim of Crime Boards funded with federal funds.
  • The cost NIOSH incurs in reimbursing treatment under the WTC Health Program.
  • Deferred or vested compensation from employment. Compensation that would have been payable upon retirement or death regardless of when or why the victim retired or died is not payable “as a result of the terrorist-related aircraft crashes of September 11, 2001,” and therefore is not collateral source compensation.  Thus, if you retired on a disability pension due to an eligible condition, the VCF will only offset that pension to the extent it is greater than the amount you were entitled to receive as a service pension. Likewise, in a wrongful death claim, the VCF will only offset a survivor pension to the extent it is greater than the pension the victim was otherwise entitled to receive.  

 

Table 7: Which Offsets Apply to Which Losses

The Special Master has discretion to determine which offsets should be applied to which losses. It is not possible to define and categorize in advance every possible collateral source deduction.

Collateral sources

Offsets Applied to
Personal Injury Losses

(including losses before death when the victim is deceased)

Offsets Applied to
Wrongful Death Losses

Offsets Applied to the Total Award

(PI and WD)

Non-economic Loss

 

Medical Expenses

Replacement Services

Lost Earnings

Non-economic Loss

Burial Expenses

Replacement Services

Lost Earnings

Lawsuit Settlements

X

X

X

X

X

X

X

X

X

PSOB Awards

(for Death or Disability)

X

X

X

X

X

X

X

X

X

Payment on prior PI claim

X

X

X

X

X

X

X

X

X

Disability Benefits

  • SSA
  • Workers’ Comp
  • Disability pension
  • Private long- or short-term disability insurance
  • Dependent benefits for Claimant’s disability

 

 

 

X

 

 

 

 

 

Life insurance

 

 

 

 

X

X

X

X

 

SSA death benefit of $255

 

 

 

 

X

X

X

X

 

SSA survivor benefits for dependents

 

 

 

 

 

 

 

X

 

Workers’ Compensation death benefits

 

 

 

 

 

 

 

X

 

Survivor Pension

 

 

 

 

 

 

 

X

 

 

a.  Collateral offsets that are paid periodically:   

The Special Master will only offset the present value of collateral source compensation. This has the effect of decreasing offsets and, thus, increasing the amount of VCF awards. As an example, in the case of Social Security children’s benefits, the Special Master will determine the monthly benefit to the child, multiply that benefit by the number of months remaining until the child reaches age 18 (taking into account possible limits such as maximum family benefits available), include — if consistent with Social Security guidelines — a factor for inflation, and then discount the total to present value to determine the amount of the offset.

 

b.  Benefits that may be subject to liens:  

Some Workers’ Compensation laws, both domestic and foreign, contain provisions that would allow the insurance carrier to assert a lien against an award issued from the VCF. For those who receive Workers’ Compensation benefits from New York State, New York amended its Workers’ Compensation statute in 2002 to prohibit insurance carriers from asserting liens against awards from the VCF. Specifically, the NY Workers’ Compensation law, Section 29(1-b) provides as follows:

“1-b. Notwithstanding any other provision of this chapter to the contrary, the state insurance fund, if compensation and/or medical benefits be payable therefrom, or otherwise the person, association, corporation, insurance carrier or statutory fund liable for the payment of such compensation and/or medical benefits: (a) shall not have a lien on the proceeds of any award from the September eleventh victim compensation fund of two thousand one established pursuant to title IV of the federal air transportation safety and system stabilization act, public law 107-42, as amended; and (b) shall not terminate or reduce such compensation and/or medical benefits based upon the submission of a claim for an award from such federal fund, and/or the waiver or compromise of any cause of action resulting from such submission.”

As a result of this amendment, if a victim or family member of a decedent has received, or is entitled to receive, payments from the New York State Workers’ Compensation Board related to an eligible condition, in general, the VCF will offset those payments.

Other state Workers’ Compensation programs have not enacted similar legislation. Thus, there is a possibility in those states that payments to a victim or family member of a decedent might ultimately be subject to repayment from the VCF award. The VCF will review these benefits on a case-by-case basis. If you know that payments or benefits you have received are subject to a lien, you must notify the VCF. If you do not notify the VCF, we will assume that there are no liens.

Similarly, payments from other government or private entities that are subject to liens may not be offset from the VCF award if sufficient evidence of the lien is submitted. The VCF will evaluate these types of payments on a case-by-case basis.

 

c.   Survivor benefits subject to adjustment or termination:  

Some survivors may be eligible for benefits or payments from certain programs that provide periodic payments subject to adjustment or termination depending on potential future events. Such payments will be assumed to continue and will be offset unless evidence is submitted that the benefits or payments in fact terminated.

Thus, for example, the Special Master has determined that Workers’ Compensation benefits that are payable only if the spouse does not remarry will be offset throughout the period of compensated loss unless evidence is submitted that the spouse in fact remarried and the benefits in fact terminated. Likewise, Social Security and similar benefits payable to a surviving spouse only if the spouse does not remarry or does not earn income above a certain threshold will be offset absent evidence that they have terminated. 

Where survivor benefits being paid to a disabled child may continue after age 18 but are subject to evaluation for continuing disability, the Special Master has discretion not to deduct them to extent they cannot be determined with reasonable certainty.

Any changes in entitlement to survivor benefits, such as a determination of continuing disability at age 18, should be reported on the “Collateral Offset Update Form” found under “Forms and Resources” on the VCF website.

 

d.  Public Safety Officers' Benefits ("PSOB"):   

Congress amended the Public Safety Officers’ Benefits Act (42 U.S.C. § 3796) to provide that the benefits paid under the Act “shall be in addition to any other benefit that may be due from any other source, except . . . payments under the September 11th Victim Compensation Fund of 2001 . . .” Therefore, if PSOB has paid a benefit to the eligible victim, then the VCF will offset this amount.  As shown in Table 7 on page 55, PSOB benefits are offset against the total award, including non-economic loss, whether they were awarded for death or disability.

If you have applied or plan to apply to PSOB Programs for a September 11th-related injury, you should note the PSOB application in the Collateral Offsets section of the claim form.

The VCF has an arrangement with the PSOB program to exchange information regarding the status of any claim, the amount of any award determination and payment, and the basis of the award determination. It may facilitate the processing of your claim, however, if you submit to the VCF any determination you have received from the PSOB program, or documentation of a payment from the PSOB program, when you submit your claim.

 

e.   WTC Volunteer Fund administered by the New York State Workers' Compensation Board:  

If an individual is eligible for VCF compensation and is also receiving payments from the WTC Volunteer Fund, the VCF will offset certain payments made by the WTC Volunteer Fund.

While unpaid volunteers are normally ineligible for Workers' Compensation benefits, the New York Workers' Compensation Law was amended to provide a unique exception for certain volunteers who assisted with World Trade Center rescue, recovery, and clean-up efforts. WTC volunteers are eligible to receive benefits through the WTC Volunteer Fund, which is administered by the Workers' Compensation Board. The WTC Volunteer Fund provides medical and indemnity (cash) payments for volunteers who are disabled as a result of their efforts.

The Federal government originally provided funding for this program, but the $50 million congressional appropriation ($25 million in 2002, increased to $50 million in 2005) was exhausted in early 2016. An additional $9 million was provided by the State of New York in 2016. In the event these funds are also exhausted, the NY Workers’ Compensation Law now provides that WTC volunteers may receive benefits directly from the Uninsured Employers Fund, which is funded by fines paid by employers who do not comply with insurance coverage requirements.

Before these legal alterations were made in the program, it was the VCF’s policy to offset only those WTC Volunteer Fund payments that a claimant had received as of the date his/her claim was filed because any future payments were considered to be uncertain and contingent on an additional infusion of funds and on the identification of a continuing funding mechanism. Given the recent additional $9 million in funding, however, and the statutorily designated backstop through the Uninsured Employers Fund, future funding for the WTC Volunteer Fund is now sufficiently certain. As a result, and consistent with the statute and regulations governing the VCF, the VCF has revised its policy and will offset any indemnity benefits a VCF claimant receives, or is entitled to receive in the future, from the WTC Volunteer Fund for an eligible condition. Claimants receiving benefits through the Workers’ Compensation WTC Volunteer Fund should provide the VCF with their Workers’ Compensation file number.  The VCF may obtain information directly from the WTC Volunteer Fund regarding VCF claimants with WTC Volunteer Fund claims, which will allow the VCF to investigate the basis of any disability benefits, the amount of such benefits, and any other information that may be relevant to the VCF’s computation of loss.

 

f.  Obligation to notify the VCF of additional offsets:   

If you receive, or become entitled to receive, any additional payment that constitutes a collateral offset at any time after you submit your claim – including after any award has been determined and paid – until the VCF closes on October 1, 2090, you are required to notify the VCF in writing within 90 days by completing and submitting the “Collateral Offset Update Form” found under “Forms and Resources” on the VCF website.  A significant increase (more than a cost of living adjustment) in the amount of a previously reported collateral offset may constitute an additional payment that should be reported. Do not use this form if you have had a decrease in a collateral source payment and would like to request that the VCF review your award. To request a review in the case of a decrease in a collateral source payment when the higher payment was used in the calculation of your award, you must file an amendment.

When determining when to notify the VCF, keep in mind the following general guidelines:

  • If you notify the VCF within 90 days of the date you learned that you were entitled to receive a new or revised collateral source payment, your determined or paid award will not be adjusted to reflect the new or revised entitlement or payment.
  • If you notify the VCF more than 90 days after the date you learned that you were entitled to receive a new or revised collateral source payment, the VCF may adjust your determined or paid award to reflect the new or revised entitlement or payment as an offset, which may result in a lower award.

The obligation to report collateral source payments is ongoing. If you become entitled to receive additional collateral source payments after an initial notification to the VCF, you will need to submit a new form to advise the VCF of this update.

 

2.6  Withdrawing an Economic Loss Claim   

If you filed a claim for economic loss and have since decided that you do not want the VCF to review your economic loss claim, you may withdraw that portion of your claim at any time by filing an amendment.  Follow the instructions on "How to File an Amendment" to amend your claim.  The instructions are also available on the "Forms" tab found under “Forms and Resources” on the www.vcf.gov website.

When filing your amendment, you must identify the specific type(s) of economic loss claim(s) you are withdrawing: past lost earnings, future lost earnings, replacement services, and/or medical expenses.  If you filed a claim for more than one type of economic loss, you may choose to withdraw some or all of your economic loss claims.  If you withdraw all of your economic loss claims, the VCF will then review your claim for non-economic loss only.

 

 

 

 

[1] The regulations provide that the Special Master will identify the spouse of a victim by looking to the victim’s Federal tax return.  Prior to June 26, 2013, same-sex married couples were prohibited from identifying themselves as married on their Federal tax returns because Section 3 of the Defense of Marriage Act (“DOMA”) prohibited the Federal Government from recognizing same-sex marriages.  Following the decision of the Supreme Court in United States v. Windsor, 133 S. Ct. 2675 (2013) (finding Section 3 of DOMA unconstitutional) and pursuant to Department of Justice policy, all lawful same-sex marriages will be recognized if they were valid in the place where the marriage was celebrated. The Special Master will therefore recognize all same-sex marriages valid in the place where the marriage was celebrated notwithstanding that a victim’s Federal tax return filed before June 26, 2013, could not identify a same-sex spouse.


[2] When evaluating whether an individual should be certified for Chronic Obstructive Pulmonary Disease (COPD), the WTC Health Program follows the diagnostic criteria set forth by the American Thoracic Society in the Global Initiative for Chronic Obstructive Lung Disease (known as the GOLD standard).  See https://goldcopd.org/wp-content/uploads/2018/11/GOLD-2019-v1.7-FINAL-14Nov2018-WMS.pdf.  For purposes of evaluating non-economic loss, the VCF does not treat a certification for Chronic Airway Obstruction as equivalent to COPD unless the individual meets the GOLD diagnostic criteria for COPD, and will not consider an increase to the award unless there is medical documentation of ongoing severity and impact on daily life.


[3] Average combined effective income tax rates by earnings bracket were calculated based on an analysis of IRS data for the most recent tax years available: 2007, 2008, and 2009.


[4] Real life-cycle increases are typically higher in the earlier stages of one’s career, one reason being unrealized opportunities for advancement and promotion that individuals in later stages of their careers have already experienced. During the course of an individual’s career, the rate of annual real life-cycle growth tends to gradually decline until a peak real earnings level is attained. Although CPS and other data used to study lifetime earnings profiles indicate that peak real earnings typically decline at some point, in calculating life-cycle earnings growth in excess of inflation and overall productivity adjustments for victims, the Special Master has assumed that peak earnings are maintained.


[5] Application of individualized unemployment rates by age or occupation was infeasible and determined to be unnecessary.


[6] For purposes of determining consumption rate and household size, the term “dependent” refers to an individual who was financially supported by the decedent and may include individuals who are not considered when calculating the wrongful death non-economic loss award, as the definition of “dependent” for purposes of awarding additional non-economic loss is more stringent. 


[7] Other standard expenditure categories sometimes included in litigation, namely Reading, Cash Contributions, Alcoholic Beverages, and Tobacco Products, were excluded.


[8] These alternative techniques included an analysis of BLS data on household expenditures reported by household size, with expenditure categories allocated equally among household members or allocated according to the methodology suggested by authors Robert Patton & David Nelson in their 1991 Journal of Forensic Economics article, “Estimating Personal Consumption Costs in Wrongful Death Cases.”


[9] The tax rate used to determine after-tax interest rates is the computed combined Federal, State and local income tax rate of 15.1% for New York for the $70,000 earnings bracket. Although it is recognized that a different after-tax interest rate could theoretically be calculated for each age, income, and state combination, such a computation was impracticable for the large-scale valuations to be undertaken here. It was determined that the benefit to the claimants of calculating the decedent’s personal consumption offset as a percent of after-tax individual earnings more than outweighed the potential effect of discounting future amounts by income-specific after-tax discount rates. Moreover, computation of the after-tax discount rate using a relatively high combined New York income tax rate, compared to other states, results in a lower after-tax discount rate. The lower the after-tax discount rate, the higher the present value of presumed economic loss.


[10] The blended discount rates, before tax adjustment, shown in Table 5 imply real interest rates in excess of inflation of 2.1%. 1.8%, and 1.2%, depending on the average time to maturity consistent with the average duration of presumed losses.