Everything you need to know about getting disability benefits when planning surgery.
If you’re considering an elective surgery, you may have questions about how you’ll pay your bills while you’re recovering and if a disability insurance policy makes sense. Or maybe you already have a disability insurance policy and are wondering if you can get benefits while you’re recovering from surgery.
Whether disability insurance can help you depends on the nature of your surgery and the nature of your disability insurance plan.
Short-term disability insurance (STD) pays you a percentage of your salary — usually 80% of your gross income — if you’re unable to work because of disability, such as an illness, accident, or recovery from necessary medical procedure, for a short period of time.
The benefit period, which is the max amount of time that you can receive benefits, can be from three months up to one year, depending on your policy. (For longer coverage periods, long-term disability insurance can be an essential way to protect your income and your family after a catastrophic illness or accident. Learn about how long-term disability insurance compares to short-term disability insurance, and get a free quote from Policygenius.)
The elimination period, which is the time you have to wait between your diagnosis or injury and receiving benefits, is usually from 1 to 14 days.
There are three major ways to have short-term disability insurance: if you’re an employee of a company who offers a group plan, if you buy private short-term disability insurance yourself, or if you live in a state that has its own plan.
Employer-provided group short-term disability insurance Many companies offer group short-term disability insurance to their employees. Qualifications are determined by your employer and plan, as are costs — your employer may pay the premiums or you may pay them.
State-run short-term disability programs California, Hawaii, New Jersey and Rhode Island all have state-run short-term disability programs that employees pay into through their employers. New York doesn’t have a state-run program of its own, but does require employers to provide short-term disability benefits to employees.
Private short-term disability You can purchase a short-term disability insurance policy on your own (see below).
Though short-term disability insurance is available to be purchased privately, many financial advisors don’t recommend it. The premiums are high for what ends up being a low potential payout (80% of your salary, for a set period that may be up to three months or one year). For many people, self-insuring (that is, putting money in an emergency fund) is often a better way to prepare for short-term illnesses and disabilities, like recovering from surgery.
Additionally, many privately purchased short-term disability insurance plans include limitations and exclusions for pre-existing conditions. In many cases, this means that if you’ve been treated for an injury or illness in the past year, claims relating to that illness, including surgeries to treat it, wouldn’t be covered.
When you make a short-term disability insurance, you’ll need information from your healthcare provider stating that due to a disability, you are unable to work. Many plans will want this letter to also provide an estimate of how long you will be out of work.
If you are an employee under an employer-provided plan, talk to you employer about how to file a claim. Many employers have policies about how to use short-term disability in conjunction and in addition to paid time off (PTO) and, if applicable, unpaid time off through the Family Medical Leave Act (FMLA).
If you live in a state with its own disability insurance program, check your state’s guidelines for filing for claims.
You can qualify to receive benefits from short-term disability insurance after an accident or illness or to recover from surgeries that are medically necessary.
Each policy will have its own language detailing what “medically necessary” means, but generally, a qualifying procedure is both prescribed by your doctor as required treatment for an injury or illness and appropriate according to generally accepted standards of medicine.
Each policy will also have its own list of exclusions and limitations.
These may include pre-existing conditions (generally defined as illnesses or injuries you’ve been treated for in the past year), self-inflicted injuries (including suicide attempts), injuries or illnesses incurred due to the illegal use of drugs or alcohol (including injuries from drunk driving accidents), and more, depending on your policy.
Short-term disability insurance companies differentiate between reconstructive surgery and cosmetic surgery when evaluating whether to pay benefits. Many policies have language that the procedure must be to restore physical function in order to qualify.
Cosmetic surgeries including breast augmentation, face lifts, and angioplasties, are not generally covered as they are not seen as medically necessary. But there are circumstances – like after treatment from breast cancer or to alleviate chronic back pain – where breast augmentation, reduction and reconstruction surgeries may be covered.
Reconstructive surgeries, such as craniofacial reconstruction after an accident, are generally deemed medically necessary and are also covered.
Many carriers will approve short-term disability claims for weight-loss surgeries, including gastric bypass, bariatric, and lap band surgeries, if the procedures are considered medically necessary to alleviate a physical symptom.
For example, a gastric bypass to address a physical symptom like respiratory issues would likely be covered. The same procedure to improve physical appearance would not be covered.
Abdominoplasty, more commonly called a “tummy tuck,” are more rarely covered and medical necessity must be proven. Generally the stomach must hang below the pubic bone or there must be skin irritation.
Recovery from dental surgeries may or may not be recovered, depending on your plan. Some policies exclude dental surgeries, such as the removal of a wisdom tooth or wisdom teeth, from coverage by short-term disability insurance.
However, if a surgery is required after an injury or accident, it will likely be covered.
Surgeries to alleviate pain in the hips, knees, feet, ankles, shoulders, elbows, hands, and spine are often medically necessary, and therefore qualify for benefits under your short-term disability policy. For example, knee replacements, hip replacements and rotator cuff surgeries are commonly medically necessary orthopedic surgeries.
It’s important to note, however, that surgeries to treat injuries sustained while working are not covered by short-term disability. At-work injuries are covered by workers compensation.
Some Americans choose to travel to foreign countries for medical procedures and surgeries because costs may be lower.
However, many short-term disability policies won’t pay benefits if you’re receiving medical treatment outside of the U.S. If you’re planning to get surgery abroad, check your policy’s limitations and exclusions.
While it’s not a surgery, going to rehab for drug or alcohol addiction is another elective event that many people wonder about. Whether or not your short-term disability insurance plan will pay your rehabilitation facility benefits depends on your policy.
Some policies specifically exclude disabilities that are the result of the illegal use of drugs or alcohol (injuries sustained while driving drunk, for example, are often excluded), and some policies specifically exclude rehab.
Treatment for addiction to prescription drugs, as long as you have a prescription, may be covered.
Delivering a child, whether vaginally or by planned-or-emergency c-section, is a covered event for short-term disability insurance.
However, pregnancy will be considered a pre-existing condition and most insurers will exclude childbirth-related claims within nine months of your policy becoming effective. If you’re planning on having a child and want to ensure that you’re covered by short-term disability insurance, it’s important to apply before you are pregnant.
If you have coverage through a group-sponsored or state-mandated plan, childbirth may be covered even if you are enrolled in the plan after you are pregnant; talk to your employer.
Many people wonder about the benefits of short-term disability insurance compared to the Family Medical Leave Act (FMLA). The FMLA mandates that employees who have worked at least 1,250 hours and 12 months at a company with over 50 employees be granted 12 weeks unpaid time off to deal with qualifying family medical events, which include the birth or adoption of a new child, taking care of a sick family member or dealing with a personal health issue.
FMLA leave is not insurance and provides no benefit payment. It does grant that, at the end of the leave period, you can return to your job. Many employers require that FMLA leave and short-term disability be used concurrently for childbirth. Again, check with your employer.
Logan Sachon is the co-founder of The Billfold, a groundbreaking personal finance site for millennials that was named one of Time's 25 Best Blogs of 2012. Her work has been published in New York Magazine, Glamour, The Guardian, BuzzFeed and more.