One of the more confusing topics we see revolves around short-term disability through Social Security. Temporary medical conditions are far more common than those lasting one year or longer, so much more people are affected and in need of direct answers.
Understand the differences between short-term disability insurance and Social Security and find answers to several common questions.
Buy a policy before needing one.
- Does Social Security cover medical conditions?
- Does short-term disability affect Social Security?
- Can I collect both at the same time?
Short-Term Disability Insurance
You should understand how short-term disability insurance works. There are government-mandated programs in five states and private policies in all fifty. You must purchase the private policies prior to getting sick or injured in order to qualify for claims payments.
Once again, the key features for this discussion revolve around the projected length of medical conditions and occupation definitions.
Own Occupation Definition
Most short-term disability policies contain a more valuable occupation definition. The definition is more valuable because the policies are far more likely to pay claims.
The policies make claims payments when you are unable to perform your “own occupation.” This means that if your medical condition prevents you from performing the duties of your primary full-time job, you will meet the eligibility requirements.
Your medical condition may allow you to work in another job role with the same employer, or move to another industry. It does not matter. The own occupation definition means what it says. Claim payments are made even if you can still work at any job.
Temporary Medical Conditions
Individual short-term disability covers temporary medical conditions. Policies have claims payment-duration options of three months, six months, twelve months, on up to two or three years. Most policyholders chose duration periods of twelve months or less to keep premium costs more affordable.
Short-term disability rarely affects Social Security. Most temporary medical conditions resolve themselves. The state programs stop making claims payments before SSDI kicks in. In addition, most people fail to purchase a private temporary policy before getting sick or injured.
Social Security is a federal government program administered through states. It provides income support through two separate programs. Social Security Disability Insurance (SSDI) provides income support to people who worked and paid into the system. People pay into the system through payroll taxes. Supplemental Security Income (SSI) provides payment support for aged, blind, and impaired people who have no income support.
The two most important SSDI features are the medical condition and occupation definitions.
Permanent Medical Conditions
SSDI has a very strict definition of disability. It covers longer permanent medical conditions only. You must be unable to do the work you did before. You cannot adjust to any other work because of your medical condition. Your condition is expected to last a year or more or result in death.
Most people find that they are able to return to work well before the minimum 12-month time period. SSDI will not pay claims for this much larger segment.
Any Occupation Definition
SSDI also has a very strict definition for occupations. It does not pay benefits if you are able to adjust to any other work. Your medical condition may make it impossible to perform the duties of your primary occupation. However, you may still be able to perform other tasks in the same industry that pay far less. In addition, your medical condition may allow you to work in other industries that also pay far less.
If either of these is the case, SSDI will not cover your medical condition. Social Security does not provide for temporary medical conditions.
You cannot purchase a policy or apply for short-term disability through Social Security. As described above, there are distinct differences between the two program types. However, you may be able to apply for and expect to collect benefits from both at the same times.
Understand where to go to apply for benefits, and how integration rules may come into play when collecting from both at the same time.
Applying for Benefits
Applying for short-term disability requires that you complete a claim form, and submit it to the company that issued the policy. Both your doctor and employer may need to sign the form. If you are applying through a state program, you should visit the state website for instructions.
Applying for Social Security benefits is often more involved because the medical condition definition is stricter. The first step is to locate the correct office in the state where you live. Most people applying are denied on the first try. You may need to consult with an attorney experienced in helping people apply for Social Security.
Short-term disability does not integrate with Social Security. Your SSDI benefits are not affected by having a policy. If you qualify for SSDI, the claims payments from your private policy remain the same.
The period of time when overlap may occur is very small. Most private policies have a twelve-month payment period. A smaller percentage last for twenty-four months and an even smaller percentage last for thirty-six months.