The Social Security Administration (SSA) is giving your clients who live in Missouri a new reason to consider buying individual disability insurance: an extra step in the already long, stressful Social Security Disability Insurance (SSDI) claim determination process.
Starting in January, the SSA intends to require an SSDI claimant in Missouri who objects to an initial claim rection to go through a reconsideration process before asking for a face-to-face appeal hearing.
The SSA has been requiring SSDI claimants in most states who want to appeal initial benefits request rejections to seek a determination reconsideration before applying for a face-to-face hearing.
The new change means that Missouri SSDI claimants will face the same kinds of appeal hassles that applicants in most other states face.
The SSA has also been exempting SSDI claimants in Alaska from the reconsideration step. The agency plans to bring the reconsideration step back in Alaska in March.
The agency has brought the reconsideration step back in eight other states since January: Alabama, California, Colorado, Louisiana, Michigan, New Hampshire, New York and Pennsylvania.
Mike Stein, an SSDI specialist at Allsup Inc., a Belleville, Illinois-based company that helps people with the SSDI application process, said in a commentary on the return of the SSDI determination reconsideration step that it could make many people facing serious disabilities wait an additional three months to six months to get through the full SSDI appeals process.
For people who are eligible for the benefits, and really need the benefits, the additional waiting time could be extra painful, because the average amount of time people need to get through the full review process is already about 500 days, Stein said.
The SSDI Disability Redesign Prototype Program
Workers pay for SSDI coverage through payroll taxes.
The program is paying disability benefits to about 8.5 million disabled workers, and to about 1.6 million spouses and children of disabled workers.
The program is of keen interest to insurers that sell disability insurance, and to employers that offer disability benefits, because most group disability plans have benefits that wrap around any SSDI benefits that workers are getting. The plans promise eligible workers will end up with a a certain amount of public and private benefits. Those plans subtract the SSDI monthly benefits payments from the private plan benefits amounts.
Some disability insurance issuers and plan sponsors hire Allsup or other companies to help workers through the SSDI claim determination process, in part because qualifying for SSDI helps workers get Medicare coverage, and in part to minimize the plans’ own net spending on benefits payments.