Many individuals who become unable to work due to a serious medical condition wonder whether they can receive both Social Security Disability Insurance (SSDI) benefits and Long-Term Disability (LTD) benefits at the same time. The short answer is yes-in many cases, it is possible to collect both benefits simultaneously. However, there are important rules and offsets that can affect the amount you ultimately receive.
SSDI is a federal benefit administered by the Social Security Administration (SSA). It is available to individuals who have worked and paid Social Security taxes and who are unable to engage in substantial gainful activity because of a disabling medical condition expected to last at least 12 months or result in death.
Long-Term Disability benefits, on the other hand, are typically provided through a private insurance policy or an employer-sponsored disability plan. LTD benefits are designed to replace a portion of a worker’s income when a medical condition prevents them from performing their job duties.
Because SSDI and LTD benefits come from different sources, receiving one does not automatically prevent you from receiving the other. In fact, many LTD insurance carriers require claimants to apply for SSDI benefits. This is because most LTD policies contain provisions that allow the insurer to reduce, or offset, LTD payments by the amount of SSDI benefits received.
For example, if an LTD policy promises a monthly benefit of $3,000 and the claimant begins receiving $1,200 per month in SSDI benefits, the insurance company may reduce the LTD payment to $1,800. The combined monthly income would still total $3,000, but a portion would now come from Social Security.
Obtaining SSDI benefits can provide additional advantages beyond monthly income. Individuals who qualify for SSDI may become eligible for Medicare coverage after the applicable waiting period. SSDI approval can also strengthen an LTD claim by providing independent evidence that a federal agency has determined the claimant is disabled.
Applicants should also be aware that if they receive a retroactive SSDI award, the LTD carrier may seek reimbursement for any overpayments that occurred while the SSDI claim was pending. Understanding these potential repayment obligations is important when planning finances.
While it is generally possible to receive both SSDI and Long-Term Disability benefits, the interaction between the two programs can be complex. Reviewing the terms of your disability policy and seeking guidance when necessary can help ensure you maximize the benefits available to you while avoiding unexpected offsets or repayment demands.
