For many people, returning to work after a serious illness or injury, even on a part-time basis, feels like an important milestone. Your role as a working person or professional is probably an essential part of your identity; getting back into the workforce can help you feel like you’re on the path to recovery.
Some long-term disability (LTD) plans do allow people to attempt a return to work, but you’ll need to review your policy’s terms and conditions carefully. If you’re not careful, returning to the workforce may lead to termination of your benefits. In this article, the disability insurance lawyers at Bryant Legal Group discuss how LTD insurers address part-time and full-time work, and we also explain how you can protect yourself against termination of benefits.
Long-Term Disability Benefits Treat Part-Time Work Differently Than Social Security Does
At Bryant Legal Group, we focus our practice on disability insurance benefits, not Social Security claims. However, when you search “part-time work and disability,” you’ll probably find a lot of confusing information about trial work periods, income limits, and substantial gainful activity. Much of this information doesn’t apply to LTD claims.
When you qualify for Social Security disability benefits, you typically can work as long as your earnings are below a certain financial threshold and you’re working part-time. The Social Security Administration even allows for “trial work periods” that let you work for a time while receiving your Social Security benefits (typically nine months in a rolling 60-month period).
However, this is not how long-term disability insurance carriers operate. Social Security benefits are a government program that focuses on your ability to perform “substantial gainful activity.” Long-term disability benefits involve an insurance policy, which is typically either an employee benefit or self-funded.
LTD policies have detailed contracts that outline their terms and conditions. You can find these terms in both the Plan Document, which is a lengthy, highly technical document, and the Summary Plan Description, which is an easier-to-read outline of the plan’s general rules and requirements.
Before you accept a part-time job, you must review your plan’s specific criteria. That way, you’ll be able to make educated decisions about your return to work based on how it may impact your ongoing disability benefits.
- Related Article: 5 FAQs About Private Disability Insurance Claims
Some LTD Plans Permit a Return to Work, but There Are Usually Limitations
Long-term disability insurance policies vary dramatically from plan to plan. First, most disability insurance lawyers divide LTD plans into two categories: plans with “own occupation” policies and plans with “any occupation” policies. An “any occupation” plan will only pay disability benefits if you are unable to do any type of work. Meanwhile, an “own occupation” plan will pay disability insurance benefits if you cannot do your actual job that you held before the disability.
Generally speaking, it’s easier to work under an “own occupation” plan than an “any occupation” plan. However, even some “any occupation” plans include clauses that allow for partial disability benefits and a return to work.
The first step towards understanding your return-to-work options is to review your Summary Plan Description (SPD) or Plan Document. These documents should contain specific details about residual and partial disability benefits and other incentives. Your disability insurance lawyer can help you decipher your Plan Document’s dense, technical language and apply it to your circumstances.
Return-to-work clauses in long-term disability policies often include the following elements.
Return-to-Work Incentives
The insurance company wants you to return to work, hoping that you’ll become ineligible for ongoing long-term disability benefits. That’s why many insurers include return-to-work incentives in their long-term disability plans.
If your policy has return-to-work incentives, you can rejoin the workforce. However, you cannot make more than 100% of your pre-disability earnings in combined wages and disability benefits. If your LTD benefits and other income exceed your pre-disability earnings, the insurance company will reduce your disability benefits.
The extent of this reduction will depend on your plan’s terms and conditions. For example, some long-term disability policies will reduce your benefits dollar-for-dollar for a period, then provide a smaller reduction after that.
Residual or Partial Disability Benefits
If your plan provides residual disability benefits (sometimes called partial disability benefits), you can return to either part-time or full-time work as long as you earn less than a certain amount. A common residual disability benefit structure looks like this:
- Less than 20% of your pre-disability income: You will continue to receive your long-term disability benefits in full.
- Between 20% and 79% of your pre-disability income: The insurance company will reduce your LTD benefits proportionately based on your earnings. (If you earn 50% of your pre-disability earnings, the insurance company will reduce your long-term disability benefit by 50%.)
- At least 80% of your pre-disability income: You lose your right to long-term disability benefits.
Rehabilitation Incentives
Many people need help finding work after a disabling injury or illness. So, disability insurance carriers offer rehabilitation services and incentives that encourage claimants to look for work and get additional job training.
For example, your LTD carrier may hire a vocational rehabilitation expert to work with you. The expert may help you search for jobs within your restrictions and work with you to identify retraining opportunities. You may even receive a modest increase in your LTD benefits while you work with this vocational expert.
However, rehabilitation incentives are a double-edged sword. If you have an “any occupation” plan, the vocational expert may decide that you’re capable of returning to a full-time position that disqualifies you from additional disability insurance benefits. It’s important to remember that this rehabilitation consultant is paid by the insurance company, so they may spin their reports and findings to support a termination of benefits.
If the disability insurance company notifies you that they’re scheduling you with a vocational consultant, you should call a lawyer who has experience handling ERISA cases and long-term disability claims. Your attorney can guide you through your interactions with the counselor and help you strengthen your claim for benefits.
RELATED: How to Talk to Your Doctor About Disability
Never Return to Work Without Your Doctors’ Permission
We know that many of our clients are anxious to get back to their careers. It’s hard staying home, especially when you’re passionate about your profession and the people you serve. However, you should never return to work before a doctor says it’s okay to do so.
If you think you’re ready to return to the office, check with your doctor. They may suggest specific restrictions or limitations, like part-time only work or weight restrictions, to ensure that you don’t reaggravate your condition or reinjure yourself. These restrictions can also strengthen your long-term disability claim.
If your doctor says you’re capable of returning to work, the insurance company may terminate your benefits. The adjuster for the insurance company will argue that this vague blanket statement from your doctor means you can return to your own occupation or any occupation, making you ineligible for long-term disability benefits. So, if your doctor says you can return to work, make sure they also provide detailed restrictions that outline how long you can stand, sit, concentrate, and perform other essential tasks.
So, rather than telling your doctor, “I’m ready to get back to work,” ask questions. For example, you may tell your doctor or therapist that you’re anxious to return to work, but you want to make sure you do so in a safe manner. Then, ask your doctor if they think you’re ready to try working and whether you should observe specific limitations and restrictions. Your doctor may want to schedule a functional capacity evaluation, which is a test that measures your physical abilities.
If your doctors don’t think you’re ready to go back to work, accept this recommendation. Rather than risk your long-term health and wellness, it’s best to stay focused on your recovery.
RELATED: What Is a Functional Capacity Evaluation?
Bryant Legal Group: Illinois’ Trusted Disability Insurance Law Firm
At Bryant Legal Group, our disability insurance lawyers help disabled people navigate their complex disability claims. If you have questions about your long-term disability plan and whether you can do part-time work, contact our team today. We can help you understand your plan’s terms and conditions and suggest strategies that protect your right to ongoing benefits. And if the insurance company terminates your LTD benefits, our ERISA lawyers can help you fight back.
To schedule your free initial consultation, call us at 312-561-3010 or complete our online contact form.