If you are disabled and unable to work because of a medical condition, you may be eligible for benefits through the Social Security disability program and a long-term disability plan through your employer. You may also purchase a policy from an insurance company offering payments in the event of a long-term disability. It is important to understand the similarities and the differences between SSD, employer-sponsored plans, and disability policies purchased through insurance companies to avoid jeopardizing Social Security benefits.
Short-term and long-term disability plans
If you live in a state that offers a disability program, such as the one offered in New York, its purpose is to provide benefits for short-term disabilities. The program in New York offers benefits for a disability caused by an illness or injury that is not work-related. Workers’ compensation would be the option available to you when hurt or sick due to an accident or conditions at your place of work.
For other injuries and illnesses, including those related to pregnancy, you may receive disability payments over a short duration. You must be unable to work to receive up to 50% of your weekly earnings, up to a maximum of $170 a week, for up to 26 weeks. Either SSD or long-term disability plans may offer payments in the event a disability leaves you unable to work beyond the period covered by a short-term program.
A disability plan sponsored by your employer and benefits payable under a policy of insurance you purchase and pay for on your own is similar in that you must satisfy the requirements of the plan or policy to qualify for payment. The definition of “disabled” under a plan offered by your employer and the definition contained in an insurance policy you purchased on your own through an insurance company may be different. They also may differ from the definition used by Social Security for its SSD program.
Eligibility for Social Security disability
A disability caused by a medical condition must be expected to last for at least a year or be expected to result in death to qualify for SSD. You also must be unable to engage in the same type of work that you did before the onset of the disability and be unable to adjust to other types of work.
Your work history at jobs at which you paid Social Security taxes must be long enough to have earned work credits. The number of work credits you need depends upon your age when you became disabled, but the general rule is that you need 40 credits with half of them earned within 10 years of the disability.
Can private or employer-sponsored disability work with SSD?
The terms of the insurance policy that you purchased to provide payments in case of a long-term disability or the conditions for receiving benefits through the disability plan at your place of employment may not allow you to receive payments from them and SSD. This may be somewhat confusing if your insurance company or employer tells you that you must apply to Social Security for disability benefits.
Most plans and insurance policies reduce the amount they pay you by the payments you receive from SSD. Rather than increasing what you receive each month for being unable to work, the application that you are told to submit for SSD helps the insurance company or your employer by reducing what they must pay. For instance, if you receive $1,500 a month from an employer-sponsored long-term disability plan and get approval from Social Security for $1,200 in monthly disability payments, your total monthly payment from both sources continues to be $1,500. The only difference is that $1,200 comes from SSD and $300 from the employer-sponsored plan.
You should also be aware that it can take quite a while for your application for SSD to be approved. When finally approved for benefits, you may also be entitled to receive retroactive payments back to the date of the SSD application. If this happens, avoid the temptation to spend the money because the plan or insurance company may be entitled to reimbursement for payments you received.
A consultation from a disability lawyer can help
At the Law Office of Daniel Berger, we understand how confusing and complicated long-term disability and SSD can be, so we are here to help you get through it. Arrange for a free consultation by visiting our website or calling us at 718-691-7475 to learn more about how to make long-term disability work with SSD.