There are programs that exist for the protection of those with disabling medical conditions. For example, the Social Security Administration (SSA) oversees two different benefits programs for those with health challenges that affect their daily lives.
However, Social Security benefits often do not offer adequate protection from financial devastation. Especially if someone is the primary or sole wage earner for their family or they work in a well-compensated career, state disability benefits may not cover all of someone’s expenses.
Private disability insurance is therefore very important for the preservation of someone’s economic stability when they face some kind of medical emergency. Employers often offer long-term disability insurance as one of the benefits of accepting a job with their companies. Federal law helps protect the rights of those with short-term and long-term disability insurance coverage provided by employers.
The rules are different for worker policies
Some people purchase their own disability insurance through private insurance brokerages. Others receive coverage as a part of their employment. Long-term and short-term disability insurance coverage provided by employers is subject to federal regulations.
Specifically, these policies must comply with the standards established by the Employee Retirement Income Security Act of 1974 (ERISA). Contrary to what the name implies, ERISA does not just govern retirement benefits and pensions. Disability insurance policies provided as part of a compensation package are also subject to the rules of ERISA.
The protections extended under ERISA are actually quite valuable for workers struggling with health challenges. The insurance company has a fiduciary duty to act in the best interests of the policyholder, not the employer or the insurance company. That different perspective focused on what the worker needs might lead to fewer conflicts related to benefit claims.
ERISA also protects the right to an appeal. If the insurance company refuses a worker coverage, ERISA ensures their right to file an internal appeal request. Appeals often require significant evidence. Even if the appeal is not successful, the evidence the claimant and their lawyer presented during the insurance appeal could help them prepare for litigation against the insurance provider.
It is sometimes possible to take denied disability insurance claims to court when ERISA applies. Those who have the right advice and support during the claims and appeals process may be more likely to obtain the coverage they require when dealing with disabling medical issues.
Learning about ERISA and other laws that apply to long-term disability benefits may be useful for those adjusting to life with a disabling medical condition. Workers shouldn’t have to worry about financial hardship when they have disability insurance to help them when they’re dealing with medical challenges.