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While out of work because of your disability, you have to consider how you will get income and health care benefits. This section reviews the basic sources of these benefits for people with HIV who are unemployed. Section VI, which follows, addresses the effect of returning to work once you receive these benefits.
Obtaining income and health care benefits when you are unemployed may be complicated. Deadlines can be crucial and very short, especially when you are leaving a job. If you miss one of these deadlines, you may lose your entitlement to a benefit. We recommend that you call or consult with a benefits counselor or advocate as soon as you become unemployed to be sure this doesn't happen.
INCOME BENEFITS
Income may come from a variety of sources, both private and governmental. Many people use a combination of several sources to sustain themselves while they are not working. All programs that provide income require you to report any money you receive during the period you are out on disability. Therefore it is especially important that you maintain accurate financial records during this time.
Private Income Benefits
1
How can I find out if my employer will continue to pay my salary if I am unable to work?
Check with your human resources department or the person who normally handles personnel and benefit issues. You should ask for a description of the employer-provided benefits. An employee handbook or a Summary Plan Description may answer many of your questions. The law requires employers with disability, pension, or health plans to provide workers with written descriptions and eligibility information. In addition, ask if the employer provides other financial benefits, such as life insurance. You should also ask if the employer will pay your health insurance premiums while you are unable to work.
2
What kinds of employer plans will continue to pay all or part of my salary if I am unable to work?
Generally, two types of plans continue to pay you a salary-based benefit when you are unable to work: sick leave and disability. You will need to find out what your employer's rules are concerning the amount of sick leave that you get each year, the amount that you can carry over from one year to the next, and the amount of sick leave that you currently have accumulated. An employee on sick leave usually receives regular pay with the same benefits.
The other type of plan is a disability plan. Disability plans usually kick in after you have used up all of your sick leave. Some disability plans (called short term disability (STD) plans, supplemental benefit plans, wage benefit or continuation plans) give you benefits for short periods of time, e.g., six months. Long term disability (LTD) plans only start to pay benefits after you have been disabled for a certain period of time. Some employers have designed their benefits so that the combination of sick leave and STD payments cover you until you meet the eligibility of your LTD.
Disability payments may or may not be taxable, depending on how the premiums were paid. Consult your employer as soon as you begin receiving any of these benefits to find out how premiums were paid.
3
I don't think my employer has any type of disability plan that covers me. Doesn't the law require some kind of coverage?
The law only requires that employers provide minimal disability coverage under the California State Disability Insurance Program (see Question 16 below).
4
How much of my salary will I get under my employer-sponsored disability plans?
There is no uniform formula for calculating disability benefits. Each plan has its own level of salary replacement, and some vary levels depending on your seniority. Typically an STD provides a fairly high percentage of salary replacement, e.g., 60% to 80%, while an LTD gives you considerably less, maybe 50% to 60%. But employer plans vary and you need to review the plan descriptions for each one.
5
When am I considered "disabled" for the purposes of my employer's disability plan?
Most employer-provided plans consider you "disabled" if you are unable to perform the duties of your regular job, or any job for which you have the education, training and experience. Some employer-provided plans, however, may define "disability" as the inability to perform any available job. You need to review your plan description to find out what your insurer's definition is.
Regardless of their stated definition, some insurance carriers are harder to convince than others and may routinely deny benefits. If you are told that you cannot receive disability benefits because you are not disabled "enough" or for any other reason, you should contact your local AIDS legal services agency to discuss an appeal.
6
I am currently receiving disability payments from my employer's plan. How long will these payments continue?
It depends. Many plans have provisions that trigger a cessation of benefits at a certain time, such as when you reach retirement age or have received disability for a stated period. Some plans also stop paying if you start a new job and earn above a certain level of income (see the next section to discuss returning to work). Some plans routinely perform a medical re-evaluation. If such a review leads to cutting off your benefits because you are not sufficiently "disabled," you should contact your local AIDS legal services agency to discuss an appeal.
7
I am receiving disability benefits from my employer's plan and am also receiving Social Security benefits. My employer wants to offset part of the benefits paid from its plan with my Social Security benefits. Is this legal?
Yes. If the plan provides for a Social Security offset, your employer can legally reduce the benefit it pays you by the amount of your Social Security check. Some plans also offset benefits received from State Disability Insurance (SDI) or from private disability policies you may have gotten outside of work. Check with a benefits counselor to review your plan if you have questions.
8
My former employer just announced that they are planning to drastically reduce the benefits they will offer under their disability plan. Can they do that?
If you left your job due to a qualified disability, the insurer must continue the benefits that were in effect when you stopped working, even if the employer changes or indeed cancels benefits for those still working. Otherwise, while you are still working, the employer has no obligation to offer disability benefits (beyond the minimum State Disability Insurance discussed in Question 16 below) and can change its plan anytime.
9
I am covered by my employer's life insurance plan, and I pay the premiums for the coverage. If I leave my job, will I get any direct cash benefits from the plan?
Usually not. Most employer-sponsored life insurance plans are term life insurance. This means that the premiums pay for the life insurance coverage for a limited period of time, often only until the next paycheck. But you do have the right to convert your group insurance to individual coverage without having to provide the insurance company with "evidence of insurability." Under California law you have 31 days following termination to exercise this conversion right. Because this is such a short time period, you must be careful not to lose this option. Consult a benefits advocate when you leave your job due to disability.
10
What happens to my life insurance if I go on disability and can no longer pay my insurance premiums?
Many insurance policies have something called a "waiver of premiums" provision. This means that if you become disabled, your insurance coverage continues at no cost to you. You should check whether your policy contains this provision, and when it is triggered.
11
Is there any way I can cash in my life insurance policy to help me meet my basic needs?
Yes. Some life insurance carriers will pay you the value of your life insurance or a portion of it if you are extremely ill. Ask the carrier if it offers this "accelerated benefit." You also may be able to "sell" your insurance policy through a transaction known as a "viatical settlement," in which a third party investor offers you a discounted amount for your policy, and it becomes the beneficiary. Be aware, however, that receiving cash for your policy may jeopardize your eligibility for need-based government benefits, such as SSI and Medi-Cal (see below).
If you decide to do a viatical settlement, be sure to work with brokers and buyers that are licensed by the California Department of Insurance (DOI). Only California licensed companies offer protection by the DOI and permit you to receive the funds tax-free.
12
Can I receive benefits from my employer-provided retirement plan if I become disabled?
Your rights to benefits will depend on the specific terms of your employer's plan. Federal law requires employers to provide you with a summary description of the important terms of the plan. Federal law also allows you to examine and copy all of the plan documents related to retirement plans.
Retirement plans generally come in two forms: "defined benefit" plans and "defined contribution" plans. Defined benefit plans (i.e. pension plans) pay a predetermined amount of benefits upon retirement after an employee attains a designated retirement age. Usually a pension plan will not make payments to your estate or to your beneficiaries if you die, although payments may continue after death to a legal spouse. Your plan, however, may have an early retirement age that would allow payments to begin earlier than the usual retirement date. Your plan may also allow you to receive payments if you retire due to disability.
Defined contribution plans (e.g., profit sharing plans, stock bonus plans, 401(k) plans, and 403(b) plans) typically allow easier access to retirement benefits than a defined benefit plan. Some of these defined contribution plans allow you to withdraw your benefits after a certain number of years of participation. For example, a 401(k) plan may allow you to withdraw your contributions upon attaining age 59 1/2, retirement, death, disability or separation from employment. A 401(k) plan may also allow distributions in case of financial hardship caused by threatened foreclosure on a home, eviction, tuition or medical expenses. Early withdrawal may result in penalties. Check the terms of the plan.
Government Income Benefits
If you are unable to work because of an HIV condition, you may qualify for income benefits under a government program.
The federal Social Security Administration administers two separate but related disability benefit programs. The first of these programs, Social Security Disability Insurance (SSDI) or Title II, is an income insurance program available to claimants who are unable to work because of disability and who have paid into Social Security during their working years. The other program, Supplemental Security Income (SSI) or Title XVI, is a need-based program that provides benefits for all disabled people who qualify financially, regardless of whether they have paid Social Security taxes.
In addition to these federal programs, the California Employment Development Department administers the California State Disability Insurance (SDI) program. This program provides a portion of your salary for up to one year if you are unable to perform your regular work due to an accident or illness. It covers most California workers other than government employees.
Social Security
13
How do I qualify for SSDI or SSI?
You must be "disabled" as defined by the Social Security Administration (SSA). SSA defines disability as a severe physical or mental medical condition that prevents or is expected to prevent you from working for 12 or more months, or will result in death. With the advent of better drug therapies, an AIDS diagnosis no longer automatically qualifies applicants for Social Security benefits. You must show SSA that you have been diagnosed with one of a number of certain opportunistic infections, or show that your condition severely restricts your ability to engage in normal, daily activities. To do so, you will need to work with your doctor, psychologist or other health care provider to thoroughly document your claim for SSDI or SSI.
14
How do I apply for SSDI or SSI?
Call the toll free number, 1-800-772-1213, to make an appointment, or go to any Social Security Administration office and file an SSDI or SSI application. Although you can prepare and file an initial application by yourself, we recommend your working with a benefits counselor from a local AIDS support organization to increase the likelihood of approval.
SSI benefits are retroactive only to the date of application and it usually takes up to three months to process a claim, although you can obtain presumptive benefits in some cases (presumptive benefits begin as soon as you apply and cover you while your claim is processed). SSDI benefits may be given retroactive for up to 12 months before you applied, but claims processing is also lengthy. Moreover, you must wait five months from the onset of disability before your SSDI income benefits begin.
15
How much will I receive?
The SSI level changes often due to state and federal budget cuts. However, a full benefit for an unmarried individual hovers in the low 600's. If you receive other income, live in someone else's home, or do not have a kitchen, your benefit level will be affected.
For SSDI, several factors affect your benefit, including amount of earnings, age at onset of disability, and date of disability. You may ask the Social Security Administration for an estimate of how much your benefit will be.
You can, in some instances, receive both SSDI and SSI. SSI may supplement your SSDI benefits if your SSDI benefit is low and you meet all the income and asset requirements for SSI.
California State Disability Insurance (SDI)
16
How do I qualify for SDI?
SDI provides benefits for up to one year after you are absent from work for more than seven calendar days due to an illness or injury. You must have worked for an employer that paid into the SDI program, or if self-employed, you must have elected to participate in the state program. Assets and other sources of income do not affect SDI eligibility.
In addition, your doctor or health care provider must certify that you are suffering from an illness or injury, either physical or mental, that prevents you from doing your regular or customary work. Note that SDI's definition of disability is less restrictive than the Social Security Administration's definition so you may qualify for SDI even if you do not qualify for SSDI or SSI.
17
How much are SDI benefits?
Depending on your wages and SDI premiums during a 12-month base period, the amount of your weekly benefits payment will range from $50 to $336. The maximum length of time for receiving SDI benefits is 52 weeks or one year. You will receive a check every other week.
You may use accumulated sick pay, vacation pay or the employer's STD to supplement your SDI so that the total amount you receive equals your regular paycheck.
18
How do I apply for SDI?
Mail a completed claim form to a local California Employment Development Department (EDD) office no later than the 49th day after the onset of your disability. You can call the local EDD office in the phone book to request a form be sent to you. A lot of doctors also have claim forms in their offices. Fill out everything on the form except the medical practitioner's section. Your health care provider will need to certify that you are unable to perform your regular job.
Other Government Income Benefits
19
I have no employer-sponsored or individual benefits and I am not eligible for SSDI, SSI, or SDI. Are there other government assistance programs available?
Yes. You may be eligible for General Assistance (GA), Food Stamps, or Temporary Aid to Needy Families (TANF, formerly AFDC) through your county welfare department. Though eligibility requirements may differ from county to county, each welfare department requires that you have limited income and assets, and you reside in the county. U.S. veterans may also be eligible for compensation or pension (as well as additional programs such as vocational rehabilitation, free medical and dental care, and free burial); check with your Bureau of Veterans Affairs Regional Office for details.
HEALTH CARE BENEFITS
Private Benefits - COBRA
20
I'm going out on disability, but I have a great health plan through work. Can I keep it?
Maybe. There is a federal law called COBRA (Consolidated Omnibus Budget Reconciliation Act of 1986) that requires employers with 20 or more workers to offer continued health care coverage to terminated employees and their eligible dependents. Churches and government employers are exempt from this rule. A state law called CAL-COBRA mandates a similar benefit for people who work for small employers (including churches in this case) with 2 to 19 employees. The laws also differ in that COBRA applies to "self-insured" employers (employers that create a fund to pay workers' health benefits, instead of buying a group insurance policy) while CAL-COBRA does not cover self-insured employers. (The following discussion of COBRA benefits, however, applies to CAL-COBRA except where noted.)
COBRA covers all terminated employees, including those who quit, go out on disability, or are fired (unless fired for "gross misconduct" such as criminal behavior).
Federal government employees are entitled to continued health benefits under a similar statute. Employees of state and local governments may be eligible for continuation coverage through other programs. Speak with your plan administrator to find out what these programs cover and if you qualify.
21
What coverage do I get under COBRA?
You receive the same health plan coverage as before you left work. In addition many companies allow you to switch health insurers once a year during "open enrollment." While you are on COBRA you can do this too, as if you were an active employee. But any changes your former employer or a successor company makes to its health benefits plans, good or bad, apply to you as well. For example, if your former employer drops its group health plan completely, it is under no legal obligation to continue your coverage under COBRA. But if the employer switches to any other group health insurance, then the new plan must allow you to join.
COBRA coverage lasts for 18 months for terminated employees, but you are responsible for paying the premiums, at the rate of 102% (110% for CAL-COBRA) of what your employer pays its insurer. This is usually a good deal, because group rates offered employers are often lower than individual rates. In addition, if you were disabled (based on Social Security standards) at the time you became eligible for COBRA, or within 60 days of that date, you may extend the coverage for 11 additional months, although at the higher rate of 150% of the employer's premium. (This additional coverage for people with disabilities is known as OBRA.) In either case, if you do not pay your premiums, you will lose the coverage.
22
Is COBRA the only way to continue my health coverage?
No. California law requires that group health insurance policies contain a conversion option. This option allows you to "convert" your participation in the employer's plan into your own individual policy. You are entitled to a conversion policy regardless of your medical condition. Unfortunately, premiums on converted policies are quite high and the policies may not pay many expenses, such as prescriptions.
If your employer cancels its group insurance and you are disabled at the time the plan terminates, you may be entitled to an extension of benefits providing you with up to 12 months of coverage at no cost. If this extension of benefits provision is in your policy, it probably covers the disabling condition only. Consequently, this insurance protection covers all HIV-related claims if that is the reason for your disability, but not claims for unrelated illnesses or injuries. Check your policy for this provision.
Be aware that if your employer is self-insured, it is not required to offer either conversion or extension of benefits. Employers that are self-insured create a fund to pay for employees' health benefits, instead of buying a group insurance policy. Since self-insured employers often hire an insurance company to administer the self-insured plan, it can be difficult to tell whether your employer is self-insured. Be sure to ask about this if you have questions about continuing your health coverage.
23
If my disability leave is only temporary, do I need to go on COBRA to keep my health benefits?
Not necessarily. Under the federal Family Medical Leave Act (FMLA), an employee who qualifies may take a temporary leave for up to 12 weeks during any 12 month period. The FMLA applies to those with serious health conditions who cannot work, and requires the employer to give you your job back when you return.
Although the employer does not have to pay your salary during your leave, it must continue to pay for your group health benefits on the same terms as for active employees. If you decide not to go back to work after the 12 week period, the employer may require you to reimburse it for the health care premiums it paid. It cannot require you to repay those premiums, however, if the reason you do not return is beyond your control, such as your continued poor health. COBRA coverage would begin when your disability leave was determined to be permanent and your health benefits would otherwise be terminated.
Government Benefits
The government provides Medicare and Medi-Cal benefits for some people who are disabled from working. Medicare is provided for those who have been on SSDI at least 24 months plus the five month waiting period. Medi-Cal, however, covers everyone as soon as they begin to receive SSI benefits. If you are not quite within the SSI income guidelines, you may still qualify for Medi-Cal by paying a share of cost. Contact your Social Security office to apply.
These programs can interact with private benefits. If you are receiving health benefits under COBRA, these benefits end as soon as you become entitled to Medicare coverage. Some employers continue to provide health care coverage to people on temporary or permanent disability as part of their disability package. These plans may also end when you become entitled to Medicare. If your insurance does not terminate, you should next determine if your health insurance coverage will be the "primary" health insurance plan, that pays first for any covered health care services you receive. In most cases, your employer-sponsored health plan will be the primary plan. Medicare then becomes the secondary plan that pays some of the expenses your employer plan does not pay. You should look at your Summary Plan Description to see how your private plan interacts with Medicare, and which medical costs it covers.
Medi-Cal also interacts with private benefits. If you are on Medi-Cal, you may qualify to have your COBRA and other private insurance premiums paid for you. (Medi-Cal would much rather pay your premiums than cover all your medical costs if you lose your coverage.) Call 1-800-952-5294 to see if you qualify.