Settlement Reached in Early-Deposit Case

Empire Justice Center July 31, 2020

Plaintiffs in Ershteyn v. Saul have reached a settlement.  The case, filed in 2018 in the U.S. District Court for the Eastern District of New York, challenged the Social Security Administration’s (SSA’s) improper calculation of resources during months in which it makes an early deposit of Supplemental Security Income (SSI) benefits.


The settlement provides for a technological fix that would allow SSA to properly exclude early-deposited benefits when it determines a recipient’s assets.  Normally, SSA deposits benefits on the first of the month.  Four times per year, when the first of the month falls on a weekend or holiday, SSA deposits benefits on the last business day before the first of the month.  When SSA then checks the recipient’s assets on the first of the month, the agency is not supposed to count those early deposited benefits as assets; rather, those benefits are income for that month.  SSA, however, routinely did count these benefits as assets, and as a result people were terminated from SSI when they were still eligible.  In many cases they were also found to be overpaid for months when they were not actually over-resourced.


Plaintiffs entered a settlement that requires SSA to create a hard-stop that will be triggered whenever its staff does not manually handle cases correctly. Once the hard-stop is triggered, the worker cannot move the case forward through the system until he or she goes back and properly accounts for the early-deposited benefits.  SSA is also providing additional trainings, and making it easier for its workers to find a screen on their computers listing the early deposit months.  This fix will be implemented nationally, and will be done by October 30, 2020.


Congratulations to plaintiffs’ counsel, NYLAG, on this great result!