How many disability programs can I be on?

There are lots of disability programs. Here at Burnett & Driskill we help individuals receive disability benefits through:

• Social Security
• Veterans’ Administration
• Railroad Retirement Board
• ERISA policies held by individual employers
• Federal and governmental plans not covered by ERISA
• Private insurance policies

Let’s look at a veteran who worked as a shipping and receiving manager for a major corporation. Through work, he has a retirement/disability plan. Two months ago, this individual was shelfing an item and injured his back. He filed a workman’s comp claim and has surgery scheduled next month. His own doctor has told him he cannot return to work and will probably never be able to go back to his job.

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Does this mean the man can get workman’s’ compensation, disability through his employers, VA and Social Security benefits? Not necessarily.

All of the programs have different rules and standards. Many of the programs offset each other.

Ways the programs offset:

Workman’s comp is based on an injury that was caused during the course of work. Similarly VA disability benefits are also based on injuries caused/aggravated during military service. If our individual receives both workman’s’ comp and VA benefits, it is likely that it will not be for the same reason or if it is both related to his back the workman’s’ comp settlement is likely to reduce the amount of benefits based on the pre-existing injury.

Let’s say our individual receives payments through his employer. Then a year later, Social Security decides his case and finds he is disabled. Many employer-based plans say that if an individual receives other disability payments, they get to be reimbursed. So our individual wins Social Security benefits and his employment based insurer is going to claim most if not all of the back benefit. They are also going to reduce future benefits from the employer-based program.

VA and SSA: This is the only exception to the offset. If our individual receives service-connected VA benefits and Social Security Disability Insurance benefits, he can receive both. But if the VA benefits are retirement benefits or if the Social Security benefits are through Supplemental Security Income then there will be an offset.

If all the programs work against each other, why apply for more than one?

Because they have different standards.

I am not a workman’s’ comp specialist, so I will focus on the disability standards.

Disability through the employers: the standard for disability through an employment plan is different for each company. The plans tend to be similar because insurance companies prefer certain standards, but the honest answer is to read the contract/plan documents. Generally, a disability plan through an employer will contain 2-3 stages. Stage one is usually whether an individual can return to the work they were doing or make a percentage of the same income. (Can our individual go back to shipping and receiving or do another job with similar wages?) Stage two tends to be a higher standard of whether an individual can do any work. Stage two is typically 12-24 months after stage one. Stage three tends to be limits on benefits. Many plans will pay no more than 24 months of benefits for mental health impairments.

Social Security disability: Social Security has only one standard. Can an individual sustain substantial gainful activity? If our individual cannot go back to shipping and receiving but could be a call out man at an auction house, he will not be disabled under Social Security even though he is disabled under stage one of the employer plan.

VA disability: VA requires any disability to begin/be aggravated by military service. Unless our individual can prove that his back injury began in the service, then there is no VA benefits for this situation. If there is a service-connection for the back injury, VA will payout by percentage even if the individual goes back to his exact same job as shipping and receiving manager.

Because they have different timelines:

Social Security takes 3-6 months for an initial decision. Initial decisions are denied 60-70% of the time. In some states there is a reconsideration that takes another 3-6 months on average. Approval at reconsideration tends to be even less than at the initial. So most Social Security applicants have to wait for a hearing. The wait for the hearing to be scheduled is 18-24 months. Once its scheduled, it takes 3-6 months to get the hearing decision and another 2 months to get money after the hearing is scheduled. Even at hearing, the chance of winning is statistically around 40%. That means it is not unusual for a Social Security applicant to have waited 3 years for a favorable decision. That is a long time to wait.

Employer plans require the individual to wait an elimination period, usually 90 days. Then an application for disability must be made within a certain amount of time. Once the application is made, the plan administrator is supposed to make a decision within 90 days with some exceptions. So in 6 months there may be an initial decision. If appealed, the administrator again has roughly 90 days to complete the next decision. The big delay in employer plans is how long it takes to do the appeal, but once an appeal is filed, the administrator is supposed to make a decision in 90 days each time. It is possible to have three denials on an employer-based plan before the reconsideration denial at the Social Security level. If the employer-plan pays benefits, that is money to survive on while Social Security makes its decision even if later the insurance company will demand repayment.

VA has even longer timelines than Social Security. They are implementing new programs to speed the initial decision process, but appealing a VA case means looking at years between responses.

Because of the different timelines and different standards, it is often in the worker’s best interest to file for all possible programs and be aware and ready for the offsets to occur.