Tag Archives: Social Security

Policy Riders: Social Insurance Substitute Rider

In prior posts we’ve talked about riders and how they can modify the terms of a disability policy.  In this post, we will be looking at a rider we sometimes see in individual disability policies called a Social Insurance Substitute (SIS) rider.

An SIS rider is an optional rider that provides a monthly benefit that works a little differently than a standard base benefit.  Generally speaking, SIS benefits can be reduced if you are eligible for and receiving social insurance benefits (e.g. Social Security retirement or disability benefits, workers’ compensation benefits, etc.).

SIS riders can operate differently, depending on the terms of your policy.  In some instances, the benefit paid by the insurer will be reduced by the amount received from social insurance (usually up to a certain amount).  In other policies, a certain percentage is subtracted from the benefits based on how many different forms of social insurance you are receiving (e.g. if you are receiving Social Security benefits, you might only receive two-thirds of your monthly benefit amount, and your monthly benefits might be further reduced if you started receiving benefits from a second source, like worker’s compensation).

The appeal of the SIS rider is that including it in a policy will typically result in a lower premium.  The logic behind this is that the insurance company shares the risk of payment with the government.  The primary downside to an SIS rider is the fact that your benefits will be reduced in some fashion if you obtain social insurance benefits.

In addition, policies with an SIS rider can also place additional requirements on policyholders by:

  1. Requiring policyholders to apply for social insurance benefits;
  1. Requiring policy holders to reimburse them if a lump sum payment is received from social insurance(s); and
  1. Requiring policyholders to go through the entire appeals process following any social insurance denials and/or re-apply for social insurance benefits periodically.

When choosing a policy, it is important to weigh what you can afford in premiums now with potential future benefits.  If you can afford a higher premium, it is often in your best interest to choose a policy without an SIS rider and with a higher base benefit.  As we have discussed previously, there are also certain riders that you can purchase that will automatically increase your monthly benefit (and premiums) by a certain amount each year and/or allow you to apply to increase your monthly benefit in the future, without undergoing additional medical underwriting.  Whether you are shopping for a policy, or evaluating your existing policy, you should always keep in mind that the cost of the premium is not the only consideration.  There are other factors in play that you must consider when purchasing a policy, and the type of insurance that you purchase can have a significant impact upon your financial position if you should become disabled.

The Devil Is In the Details: Long Term Disability Policies and Benefit Offsets

In a previous post, we discussed a feature of long-term disability insurance policies that is easily overlooked and frequently leaves policyholders feeling cheated and deceived by their insurer:  the benefit offset provision.  When a person signs up for a disability insurance policy, he or she expects to pay a certain premium in exchange for the assurance that the insurance company will provide the agreed-upon monthly benefit listed in the policy, should they ever become disabled.  What many people do not realize is that some disability insurance policies contain language that permits the insurer to reduce the amount of monthly benefits it is required to pay if the policyholder receives other benefits from another source.

Worker’s compensation, supplementary disability insurance policies, state disability benefits, and social security are some of the most common “other sources” from which policyholders may unexpectedly find their disability insurance benefits subject to an offset.  The frequency of offset provisions varies by policy type.  They are more likely to appear in group policies and employer-sponsored ERISA policies, and are rarely found in individual disability insurance policies.

Benefit offset provisions can have significant and often unforeseen financial repercussions, as illustrated by the recent account of a couple from Fremont, Nebraska.  As reported by WOWT Channel 6 News, Mike Rydel and his wife Carla were receiving monthly benefits under Mr. Rydel’s disability insurance policy with Cigna.  Mr. Rydel had suffered a stroke in the fall of 2015 that had left him incapacitated and unable to work.  The Rydels’ financial situation was made even more dire by Mr. Rydel’s need for 24-hour care, which prevented Mrs. Rydel from working as well.

In an effort to supplement his family’s income, Mr. Rydel applied for Social Security disability benefits.  When his claim was approved, the Rydels expected a much needed boost to their monthly income.  Unfortunately, due to an offset provision in Mr. Rydel’s policy, his monthly benefits under the Cigna policy were reduced as a result of the approved Social Security claim, and his family did not realize any increase in income.

The Rydels were understandably shocked when they were informed by Cigna that Mr. Rydel’s monthly disability insurance benefits would be reduced by the amount he was now receiving from Social Security, and that Cigna would be pocketing the difference.  Perversely, the only party that benefited from Mr. Rydel’s SSDI benefits was Cigna, which was off the hook for a portion of Mr. Rydel’s monthly benefits.  In response to an inquiry from WOWT, Cigna simply asserted that “coordination” of private insurance benefits and government benefits was a long-standing practice – an assurance that likely provided no solace to the Rydels.

The Rydels’ story highlights the importance of carefully reviewing every aspect of your disability insurance policy before signing.  Benefit offsets, policy riders, occupational definitions, and appropriate care standards in your policy can significantly impact your ability to collect full benefits if you become disabled.  You should review your policy carefully to determine if it contains any offset provisions that may affect your benefits.  If it does, you will need to take them into account when estimating your monthly benefits.

References:

http://www.wowt.com/content/news/Stroke-Victim-Suffers-Disability-Insurance-Set-Back-385758411.html

Disability Insurer Profiles: Hartford

Hartford is the next disability insurer we will look at that specifically markets its policies to physicians and dentists.

See our profiles of MassMutualMetLifeNorthwestern Mutual, and Guardian.

The Hartford Financial Services Group, Inc. (“Hartford”) was founded over 200 year ago and now has more than 100 offices located throughout the U.S.  In 2013, Hartford’s revenues were approximately $26.2 billion.  However, in 2014, Hartford’s revenues dropped to $18.6 billion.  Given this significant decrease in revenue, Hartford will likely go to great lengths to avoid paying high paying claims submitted by physicians and dentists, and may even attempt to revoke disability benefits that it approved before the company experienced this dramatic drop in profits.

Company: The Hartford Financial Services Group, Inc.

Location: Hartford, Connecticut.

Associated Entities:  Hartford Fire Insurance Company; Hartford Life, Inc.; Hartford Accident and Indemnity Company; Hartford Casualty Insurance Company; Hartford Life and Accident Insurance Company; Hartford Life and Annuity Insurance Company; Hartford Life Insurance Company; Property and Casualty Insurance Company of Hartford.

Assets: $245 billion in 2014.

Notable Policy Features:  Hartford offers policies that define total disability as being unable to perform one of your prior substantial and material duties.  If your policy contains such a definition, it will be much easier for you to demonstrate that you are totally disabled.  In contrast, if your policy does not define total disability in this manner, you may have to prove that you cannot perform any of your prior substantial and material duties in order to receive total disability benefits.

Claims Management Approach:  Hartford only offers group disability policies (as opposed to individual disability policies).  This means that if you have a Hartford policy, it will probably be governed by ERISA.  For many reasons, it will likely be harder for you to obtain your disability benefits if your policy is governed by ERISA.

For example, normally, if you become disabled and you have an individual disability policy, you can collect your disability benefits without filing for Social Security.  However, if you have a Hartford group policy, your policy may require you to apply for Social Security benefits before you can receive your disability benefits.  Hartford requires its policyholders to apply for Social Security because, under ERISA, any Social Security benefits the policyholder receives automatically offset the amount of disability benefits Hartford must pay the policyholder.

Read more about how ERISA claims are treated differently than non-ERISA claims.

These profiles are based on our opinions and experience. Additional source(s): Hartford’s 2014 Annual Report; “The Hartford Fact Sheet (2013),” and “The Hartford Fact Sheet (2014),” available at www.thehartford.com.

Questions to Ask When Choosing a Disability Insurance Attorney

For those looking for help with their disability insurance claims, choosing an attorney is an important step. However, it can often be difficult to determine whether a particular disability insurance lawyer is the right one for you to work with. Here are some general questions to ask to help you evaluate a potential lawyer or law firm.

1. How many cases does the attorney take on each year?

2. What percentage of the attorney’s practice is devoted to disability insurance claims?

3. Does the attorney exclusively work with individual policy claimants, or does he/she handle ERISA and Social Security cases?

4. Has the attorney published any articles or been interviewed about disability insurance topics?

5. What insurance companies has the attorney dealt with?

6. Does the attorney offer comprehensive representation or short term assistance?

7. Does the attorney’s fee structure work for you?

8. What does the attorney expect to accomplish with your claim?

Selecting the right disability insurance attorney to help with your claim is a decision not to take lightly. You should never be afraid to ask questions, and the attorney will be glad to answer them.

Out of Contract Demands: When You Can Tell Your Disability Insurer “No”

Every disability insurance policy is a contract. With this contract come certain rights and obligations on the part of the disability insurance company and on the part of the policyholder. The insurer promises to pay you disability benefits and you promise to fulfill certain conditions. One of the most important things to remember about this contractual relationship is that if it’s not in your policy, you don’t have to do it.

Often, disability insurers will ask a person filing for benefits to do certain things or provide certain information in order to qualify for benefits. What every policyholder needs to realize is that the disability insurer cannot force you to do something that is not outlined in your policy. There are many examples of disability insurance companies’ demands that may not be required under the terms of the policy, such as:

• That you see a certain type of doctor

• That you undergo surgery for your disabling condition

• That you get a particular treatment or therapy

• That you provide your Social Security or workers’ compensation claim file

• That you attend a certain type of examination

• That you complete detailed descriptions of your daily activities

• That you allow a private investigator into your home

The bottom line is that a policyholder filing for disability insurance benefits should know what their policy requires and what it doesn’t. The best way to be sure an insurer doesn’t get away with making extra-contractual demands is to have a disability insurance attorney review your policy and advocate with the company for your rights.

Arizona Ranks #3 at Providing Caregiver Support

A new state-by-state scorecard on long-term care recently released shows which states are the best at providing services and support to the elderly and people with disabilities. According to the Commonwealth Fund,

The report’s researchers say it is the first that takes a multidimensional approach in measuring performance in long-term care at the state level. It’s designed to “begin a dialogue among key stakeholders so that lagging states can learn from top performers and all states can target improvements where they are most needed,” says the report.

The scorecard, developed by AARP, The Commonwealth Fund, and The Scan Foundation, ranks Arizona at number 3 for support of family caregivers and number 15 overall, but at 39 for affordability and access. So while Arizona excels at supporting the family members caring for people with disabilities, the state has room for improvement when it comes to controlling costs and helping lower-income individuals gain access to long-term healthcare.

To find out more, check out Arizona’s State Scorecard or review the entire report here: Raising Expectations: A State Scorecard on Long-Term Services and Supports for Older Adults, People with Physical Disabilities, and Family Caregivers.

Making It Through the Holiday Season with a Chronic Disability

The holiday whirl of activity, as well as potential strain on the pocketbook and relationships, can be exhausting to even the healthiest amongst us.  For a person with a debilitating, chronic disability, it is important to communicate to those with whom you’ll be sharing the holidays what you realistically will be able to keep up with and participate in.

Social media blogger Toni Berhard has written an excellent article, available in full here, about some of the ways in which you can try to keep expectations realistic.  Ms. Berhard provides her insights into the myriad ways in which the holidays can be a stressful time for persons with disabilities.

…The holidays can be a recipe for double disaster—the increase in activity exacerbates your physical symptoms, while coping with sadness, frustration, and maybe even guilt about your physical limitations give rise to emotional pain.  No wonder many people with health problems dread the approaching holidays.

Ms. Berhard suggests the following:

  • Share information with friends and family members about your condition.  This can be particularly important if you have a disability that does not make you “look sick.”   Forward a few links or print out select pages and keep your accompanying note on the light side. She suggests, for example, that you could write that “there won’t be a test” in the note accompanying informational materials about your condition.
  • Write a letter.  Avoid being accusatory or whiny and simply express how difficult it has been for you to adjust to the changes your disability has caused in your life and how you wish you could be as active as you used to be.  Briefly describe your day-to-day life, unpredictability of your condition, and how much can realistically be expected from you during the holidays.
  • Enlist a close friend or family member as an ally.  This person can be supportive if you need to excuse yourself in the middle of a holiday gathering, and can also nudge you when they see that you are overdoing it.
  • Ultimately, you may have to accept that not all friends and family members will recognize your limitations.

As this year and holiday season draws near its end, we hope you have enjoyed a wonderful holiday, and we wish you all a very Happy New Year!

AzMedicine publishes “Can Your Disability Insurer Dictate the Terms of Your Care?” article by Ed Comitz and Michael Vincent

Disability insurance attorney Edward O. Comitz and Michael Vincent, Summer Associate at Comitz | Beethe, had their article “Can Your Disability Insurer Dictate the Terms of Your Care?” published in the Winter edition of AzMedicine, the publication of the Arizona Medical Association.  The article is excerpted below.

Can Your Disability Insurer Dictate the Terms of Your Care?

By Edward O. Comitz, Esq. and Michael Vincent

           Imagine that you are a surgeon who has submitted a disability insurance claim after failed cataract surgery left you with halos, starbursts, and even temporary blindness under bright lighting. While you are dedicated to your profession, you realize that continuing to operate on patients puts them in danger.  Your disability insurance company, however, will not pay your claim.  It insists that you can keep performing surgeries, alleviating any occupational hazards by wearing sunglasses and using matte-finish instruments in the operating room.  This scenario may sound absurd, but it is an actual example of some of the difficulties faced by many doctors seeking legitimate policy benefits.  Fortunately, the surgeon in question had the common sense to cease performing surgeries rather than follow her insurer’s suggestions.  Her decision did affect her financially, as benefits were denied for almost two years, and only paid after litigation ensued.

Insurance company treatment mandates are commonplace and based on their interpretation of the terms of your policy.  In some cases, the insurance company goes so far as to demand surgery, invading your privacy and leaving you with the choice of either undergoing an operation involuntarily, bearing all of the medical risks and financial costs yourself, or waiving your right to collect disability insurance benefits.  The decision can be difficult, but understanding your rights and obligations beforehand can help alleviate much of the worry.

Whether or not insurers can legally condition payment of your disability insurance benefits upon you following their suggested treatments depends on the specific terms in your policy.  The various policy types fall into three general categories: “regular care” policies, “appropriate care” policies, and “most appropriate care” policies.

The oldest policies typically contain provisions conditioning benefits on being “under the regular care and attendance of a physician.”  These “regular care” policies provide the most protection for insureds, as courts have repeatedly found that these provisions only create a duty for the insured to undergo regular monitoring by a physician to determine if the disability persists.  Even if a proposed surgery is usually successful and very low risk, an insurance company cannot force it upon you.  Under a policy requiring only regular care, courts will not enforce any particular course of treatment, no matter how vehemently an insurance company objects. Continue reading AzMedicine publishes “Can Your Disability Insurer Dictate the Terms of Your Care?” article by Ed Comitz and Michael Vincent

Dealing with a New Disability

A recent article by Pamela Poole in the Huffington Post offers a sensitive look at the challenges faced when a person becomes disabled.  The adjustments to be made, both by the person with the disability and by his or her friends and family, extend beyond the physical.   Ms. Poole summarizes the first ten months of her own sudden disability thusly:

denial denial indignation fear anger anger denial

anger depression depression medication

Poole chronicles not only her own struggle to accept the changes her disability made in her life, but the obstacles she faced in making her friends and family understand the new limitations on her abilities and endurance.  Ms. Poole’s article and references to books and articles she found helpful are available at this link.

The physical and emotional impacts of a disability are difficult enough.  If your disability insurance company is giving you the runaround, it can be helpful to have an experienced disability insurance attorney advocating on your behalf and guiding you through the claim process.


Oregon Voters with Disabilities Test Out iPad Voting in November Election

Federal law requires election officials to make voting equipment available to ensure that people with disabilities have access to participation in the voting process.  In the State of Oregon, where voting is done only by postal voting and ballots dropped into electoral boxes, voting can present special challenges to residents who have difficulty voting through the traditional mail-in voting method.  Therefore, Apple donated five iPad tablets for use in a special trial, in conjunction with software developed by the State of Oregon, to test a new voting method using a “sip and puff” device attached to an iPad via Bluetooth.  The “sip and puff” device is most commonly used by persons without use of their hands to control electric wheelchairs by inhaling or exhaling through a tube or wand.  In the trial conducted in the Oregon special election, participants were able to navigate the electoral forms, scroll through screens, adjust font size and color, and choose candidates, all hands-free.  The iPad then reads back the choices to them for verification.

Oregon state officials will conduct further trials of the system, and, if successful, the new system may be used nationally in future elections to enhance the accessibility and privacy of all voters, including those with disabilities.