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Social Secuirty Disability Benefits and Long Term Disability Insurance

Applying for LTD and SSA disability benefits can be confusing on what is required, how they work together, and what choices to make.  A discussion with an attorney experienced in the interplay between the two can be extremely beneficial and help you to maximize your chances at successfully achieving your maximum benefits.

First, most LTD policies require you to apply for SSA disability benefits or obtaining an attorney’s opinion that an application would be never be successful.  The type of claims that will never succeed generally fall into a couple of categories.   You may have a  condition that will not not prevent you from working for at least 12 months, such as pregnancy.  The other most prevalent type occurs most often with claimants who have returned to work after being unemployed for a significant length of time.  A claimant who has re-entered the workforce, may no longer have quarters of coverage, but has other income or assets in their household making them ineligible for SSI.  The last group includes those that are self-employed and did not pay FICA taxes, thus not gaining quarters of coverage.  even if you believe you fall into one of these categories, it is still important to discuss your case with a knowledgeable representative, who can examine your specific facts to determine what options you have.

The next question many claimants face when dealing with Social Security Benefits and an LTD claim is whether or not to take the full LTD claim or to apply the Social Security offset prior to obtaining Social Security benefits.   If you choose to receive your full LTD claim while awaiting a decision on your SSA claim, then your offset will be due from any back pay received from Social Security.  Taking the full LTD claim and paying any offset from your back pay can be in the claimant’s favor.  The claimant continues to receive their full LTD amount each month until they receive Social Security benefits and any offset is based solely on the time frame of the back pay, not the entire LTD claim.  Most policies will also exclude any fee paid to your representative.  It is important to have a copy of your LTD policy to present to your attorney.  LTD benefits usually have a minimum monthly payment they must pay you.  This may range from as low as $25-50 per month to several hundred.  Many people will find that their SSA benefit offset completely eliminates their LTD benefit amount ,except for the minimum monthly payment.  This generally also means that a majority of your back pay will be owed back to your LTD carrier.  But in the long run, choosing to accept your full LTD amount and paying any offset from your SSA back pay will mean that you receive your full LTD benefit each month during, what can sometimes be, a very long wait for SSA benefits.  It may be the difference between receiving $25 a month now and keeping any back pay that you receive months or years later, or receiving a substantial amount now and only owing  anything back when you receive your back pay from SSA.  By taking your full LTD benefit, the risk is moved from you to the LTD carrier on the outcome of the Social Security claim.

Probably the most raised question from claimants applying for social Security benefits and are receiving LTD is why isn’t the fact that they have already been found disabled not sufficient for SSA.  While each policy varies, most LTD policy’s use two definitions of disability.  for the first 24 months, the LTD policy looks to see if you can do the job you were in at the time you became disabled, or a job similar to it.  If you cannot perform that job, then benefits are granted.  This finding is only helpful in your Social Security claim to eliminate your most recent work.  After 24 months, most policy claims change their definition of disability in order to continue your benefits.  The carrier will look to see if you whether or not there is any work you can do.  If they find you can perform any job, even one that pays way below your previous employment, they can end your LTD benefits.  This can result in getting opposing decisions from your LTD carrier and SSA.  for example, if your under 50 and limited to a sedentary position, you may be granted LTD benefits for 24 months, but lose you LTD benefits after 24 months and lose your SSA case because there is other work you can do.  But if your 55 and limited to sedentary work, but had always had light work previously, you may lose your LTD benefits after 24 months, but your SSA claim is successful.  These conflicting results are not uncommon, especially in claimants over the age of 50.

On a final note, your LTD carrier can be a great resource for your representative to obtain documentation of your condition for Social Security.  Your LTD carrier may require frequent reports from your doctor, outlining your disability.  These documents can be extremely helpful in proving your case.  If you are receiving STD/LTD benefits, let your representative know and do not forget to grant permission for your representative to obtain this information from your carrier. This documentation may reduce your costs for medical records and help you receive SSA benefits faster.