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If you've recently suffered an injury or illness that has left you unable to perform the work you've done for years, you may have already run through any accumulated sick time and begun collecting short-term disability (STD) payments from a work-based policy. With medical bills mounting and your ability to earn an income compromised, you may be worried about what will happen when your STD benefits expire and you're required to apply for more permanent disability benefits. What should you do to help keep your financial ship afloat? Read on to learn more about the ERISA disability funds that may be available to you and how they will intersect with federal disability benefits. 

What should you do when your STD benefits end?

Many employers offer both an STD policy and a long-term disability (LTD) policy -- commonly deemed ERISA benefits from their coverage under the Employee Retirement Income Security Act. These insurance policies pay a portion of your pre-disability salary for a specified period of time until you're able to return to work or the policy term expires.

If you're currently receiving STD funds, your first step should be to inquire with your employer's HR or benefits department about an LTD policy and any private benefits that may be available. To many employers, filing for LTD benefits indicates an inability to ever return to work, creating a need to fill your position -- so you may find that (unless you're still protected under Family and Medical Leave Act time) your employment is terminated once you submit your LTD application. If you think you may be able to return to work after your STD benefits expire, but not immediately, you may be able to negotiate for an unpaid or partially-paid leave of absence that will allow you to return to work when you're able.

For those who are unlikely to return to work, an LTD policy can provide steady benefits for several years after your disabling event. To receive these benefits, you'll need to submit an application and accompanying medical evidence (usually certified by your doctor) indicating you are too disabled to return to work. The insurer may require you to undergo a physical examination with its own physicians to determine the extent of your condition and how it impacts your quality of life. In exchange, you'll be entitled to receive around 60 percent of your pre-injury salary for an average of 2 and a half years. This payment will be subject to regular income taxes if it was paid by your employer on your behalf, but may be tax-free if paid from post-tax funds (like through a payroll withholding). 

What if your employer doesn't offer an LTD policy?

If you aren't covered by an LTD policy when your STD benefits end, you'll need to file for federal disability benefits -- either Social Security Disability (SSD) or Supplemental Security Income (SSI). SSD benefits are available to those who have been in the workforce for a number of years and have paid Social Security taxes on earned income, while SSI benefits are designed to provide a minimal level of income for those who have been disabled their entire lives or who never spent enough time in the workforce (or paid Social Security taxes) to qualify for SSD. 

Although there isn't often much good news about being eligible for long-term disability insurance benefits, receiving or being approved for these benefits can often bolster your claim with the Social Security Administration. This will improve the odds that your application will be approved on the SSA on the first try, rather than being rejected and requiring you to appeal and provide additional medical information.

For more information, talk to a professional like Horn & Kelley, PC Attorneys at Law.