What Is a Long-Term Disability in Social Security Disability Cases?

Workers injured on the job in Pennsylvania are typically entitled to workers’ compensation benefits. The benefits pay for medical care and wage replacement for on-the-job injuries. However, what happens if your injury or illness is unrelated to your job?

If that happens, you may be eligible for long-term disability (LTD) benefits through your employer. However, the insurance company may advise you that you must file for Social Security disability insurance (SSDI) benefits to continue receiving long-term disability payments

In this blog post, our Harrisburg disability lawyers discuss the difference between LTD and SSDI and how they impact each other in a disability case.

Long-Term Disability Benefits vs. Social Security Disability 

Long-term disability (LTD) is a group insurance policy that your employer may provide. Some employers pay the premium for their employees, but not always. Your employer may require you to pay all or part of the premium for LTD if you want coverage.

LTD insurance provides wage replacement if you become disabled. You typically receive 50 to 70 percent of your earnings before becoming disabled. You may receive LTD benefits until your retirement age, depending on the policy terms.

Social Security disability insurance (SSDI) is a government-funded disability program for disabled workers. The Social Security Administration administers the program. 

You must meet strict requirements to qualify for SSDI benefits. Your impairment or disability must prevent you from performing a substantial gainful activity (i.e., work). The disabling condition must prevent you from working for one year or longer OR result in death. 

The amount you receive in SSDI benefits depends on your previous earnings. However, there is a maximum amount of disability you can receive through SSDI. 

For 2024, the maximum SSDI benefits are $3,822 per month, but few people receive the maximum benefit. The average SSDI benefit in Pennsylvania is approximately $1,494 per month.

You continue to receive SSDI benefits as long as you are disabled or until age 65 years. At 65 years old, your SSDI ends, and retirement benefits begin.

How Do Long-Term Disability Benefits Impact Social Security Disability?

In most cases, you begin receiving LTD benefits before SSDI benefits. Your insurance policy may have an exclusionary period for benefits, but it is often shorter than the time it takes to get approved for SSDI benefits.

However, most LTD policies include clauses that require you to apply for SSDI benefits. Failure to file an SSDI application could cause you to lose your long-term disability payments. 

The insurance company might offer to help you file the claim. However, it could be questionable whether the company is protecting your best interests or looking out for itself. 

Therefore, you may want to consult a Harrisburg disability attorney of your choosing for help. Some insurance policies cover the cost of hiring a private attorney to help with SSDI applications. A disability lawyer will review your LTD policy and advise you of all legal rights under the policy.

Offsetting Long-Term Disability by SSDI Benefits 

The reason the LTD insurance company requires you to file for SSDI is purely to benefit them. LTD insurance policies often contain clauses that allow them to offset your LTD benefits if you are awarded Social Security disability. Therefore, your LTD benefits could decrease by the amount of your SSDI benefits. 

It might take several months to be approved for Social Security disability benefits. Until your SSDI application is approved, the LTD insurance company will generally pay the total amount of your long-term disability benefits. 

Furthermore, the LTD policy probably contains a reimbursement agreement. You must reimburse the LTD company for any offsets that would have been active if you received retroactive SSDI benefits. 

For example, suppose the SSA pays you for six months of back benefits. If the offset for those six months is $3,000, you would need to pay the LTD insurance company that amount. If not, the insurance company may reduce your LTD payments until it recoups the past-due amount. 

Get Help From a Harrisburg Disability Lawyer 

It can be challenging trying to thread your way through the disability bureaucracy, particularly if you’ve never done it before. A disability lawyer can guide you through the thicket so that you end up with the most favorable possible results. Contact a lawyer today to set up a free initial consultation so that a lawyer can evaluate your disability claim.

If you’ve been injured in a social security disability, please contact Marzzacco Niven & Associates at the nearest location to schedule a free consultation today:

Harrisburg Law Office
945 East Park Drive, Suite 103 Harrisburg, PA 17111
(717) 231-1640

York Law Office
2550 Kingston Road, Suite 210A York, PA 17401
(717) 995-8998

Wyomissing Law Office
833 N. Park Road, Suite 103, Room A Wyomissing, PA 19610
(717) 388-2325

Chambersburg Law Office
79 St. Paul Drive, Suite 1 Chambersburg, PA 17201
(717) 388-2378

Carlisle Law Office
354 Alexander Springs Road Carlisle, PA 17015
(717) 995-8732

Carbondale Law Office
30 Lincoln Avenue, Suite 101 Carbondale, PA 18407
(717) 995-8810

Lancaster Law Office
2173 Embassy Drive, Ste 123, Lancaster Pa 17603
(717) 616-2954

Lebanon Law Office
937 Willow Street, Suite D Lebanon, PA 17042-1140
(717) 995-8963