If you’re nearing the end of the coverage period for your short-term disability insurance—and you still can’t work—you might be expecting a smooth transition from short-term benefits to long-term benefits.
Unfortunately, it doesn’t always work that way—even if both policies are with the same insurance company and provided through your employer. Although your insurance company approved your short-term disability claim, that does not necessarily mean they will approve your long-term disability benefits. Far too often, claimants are blindsided by an unexpected loss of benefits and income after long-term disability coverage is denied.
To avoid a sudden loss of coverage, it’s important to understand the terms of your long-term disability policy and be ready to provide additional evidence if necessary.
In this blog post, we’ll take a closer look at some of the common pitfalls claimants experience when transitioning from short-term to long-term disability insurance. If you need help filing a claim or appealing an unfair denial, contact Bryant Legal Group today at 312-313-6179.
Under normal circumstances, short-term disability coverage is meant to provide income replacement benefits to workers who are temporarily unable to perform their current job due to a medical condition or off-the-job injury. These benefits kick in after a short waiting period – sometimes as little as 5 or 7 days. Workers who contract an illness, are recovering from surgery, or are taking maternity leave might qualify for short-term disability benefits.
Long-term disability coverage is meant to provide income replacement for people who cannot work for an extended period due to illnesses, injuries, or disabilities that are often permanent. Depending on your policy, LTD benefits could be paid for a certain number of years or potentially until you reach retirement age. That said, they also have a much longer elimination period before benefits can begin. You usually need to wait at least 180 days, although some policies may have an even longer window.
If you know you’ll be unable to work for an extended period but are still within the elimination period, short-term disability benefits usually cover the gap. Employers will usually set the maximum short-term disability benefit duration to exactly match the long-term disability elimination period.
However, people run into problems when they assume that approval for short-term disability means that their long-term disability claim will be automatically approved as well. This is usually not the case, even if you have the same insurance company handling both the short and long-term disability claims.
If your STD and LTD policies are with different plan administrators, you’ll need to start completely over with a new claim. However, even if you have the same insurance company handling both your short-term and long-term disability benefits, you will likely still need to file additional paperwork.
This frequently goes beyond simply notifying your insurance company that you intend to file for long-term disability. LTD policies may include objective evidence requirements or other stricter proof of loss requirements for payment of benefits—meaning that the evidence you presented to be approved for STD benefits is no longer considered sufficient.
You may be required to undergo additional medical examinations. It’s also very likely that you’ll be working with a different department or case manager than you were for your short-term benefits.
In some cases, the benefits period for short-term disability runs out before you’ve reached the elimination period for long-term disability. This is most likely to occur if you’ve purchased disability insurance policies from separate companies on your own, rather than through an employer.
Depending on the terms of your policies, your monthly long-term disability benefit might be lower than your short-term disability benefit. For example, it’s not unusual for STD policies to pay up to 80 percent of your pre-injury salary, while most LTD policies average closer to 60 percent.
Depending on the terms of your policy, transitioning from STD to LTD may require you to change healthcare providers or receive additional medical evaluations. This can cause disruptions and anxiety, especially if you’re dealing with ongoing health issues.
Once approved for LTD benefits, claimants may be subject to ongoing evaluations and surveillance by insurance companies. This can be invasive and stressful, as claimants may feel like they need to constantly prove their disability.
Some LTD policies require claimants to participate in vocational rehabilitation programs or demonstrate that they are actively seeking suitable employment. This can be challenging for individuals dealing with chronic or severe disabilities.
