Many people who find themselves unable to work due to an injury or long-term illness are unsure what types of benefits they can receive. Can you collect long-term disability and Social Security benefits at the same time?
For most people, the answer is yes. But each case is different. Some of the factors that determine your eligibility for both types of benefits include income, terms of your long-term disability policy, and how Social Security categorizes your disability.
You purchase long-term disability insurance from your employer or from a private insurance company. In the event you are disabled, the insurance company pays your benefit. Conversely, Social Security benefits are paid by the federal Social Security Administration. Under Social Security, there are two types of benefits: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI).
Receiving long-term disability benefits from your employer or private insurance company doesn’t automatically make you ineligible for benefits from Social Security. In fact, many long-term disability policies require you to apply for SSDI benefits after you begin receiving insurance disability benefits.
The reason insurance companies want you to apply for SSDI benefits is that any income you receive from SSDI reduces the amount of the benefit they pay you. For example, if you receive $3,000 a month from your long-term disability insurance and you’re awarded $1,000 from Social Security, the insurance company will reduce the amount they pay from $3,000 to $2,000. This reduction in benefits is called an offset.
Another way SSDI benefits may affect your long-term disability benefits is in the case of back benefits. If you were receiving long-term disability benefits but it took 12 months for Social Security to approve you to receive benefits, you could be eligible to receive retroactive or back benefits.
If you receive back benefits, your long-term insurance company may take 7 months of the benefit to offset the overpayments they made to you. Since there is a 5 month waiting period for SSDI benefits, you would only receive 7 months of back benefits. Read your insurance policy carefully to determine the offsets or back pay terms outlined in your policy.
If you qualify for and are receiving long-term disability, you do not automatically qualify for SSDI benefits. The requirements for long-term disability benefits are different from those for SSDI.
Your condition must qualify for benefits under Social Security’s definition of disability. The SSA uses their own blue book, a list of impairments that must your condition must meet in order to qualify for benefits.
If your disability is not listed in the blue book, the SSA will examine your individual case and make a determination. If your disability is likely to last 12 months or longer, the SSA will consider these factors:
If you cannot do the work from your current job but you could do another type of work, you won’t qualify for SSDI benefits.
There is one other requirement to receive benefits from SSDI and that is whether or not you have worked long enough and paid into Social Security to be eligible for benefits.
Supplemental Security Income or SSI is not the same as SSDI. SSI is for individuals with low income and few financial assets. If your income exceeds the limits to receive SSI, you are not eligible for these benefits.
The income qualifications for SSDI do not include disability benefits which are considered unearned income. SSI considers both earned and unearned income when determining eligibility for benefits therefore, any long-term disability benefits are considered income.
If you qualify for Social Security disability benefits, you do not automatically qualify for long-term disability benefits. It’s important to check your individual policy and understand the insurance company’s requirements for disability benefits and how the policy works in conjunction with Social Security.
Eligibility requirements can be confusing and the assistance of a qualified disability attorney can help you make the right decisions.
Can you collect long-term disability and Social Security benefits at the same? Ask a disability attorney at CJ Henry Law Firm PLLC today. We can help you assess your case and explain your options.