Why it’s time to take a fresh look at disability insurance

Register now

Most recruiters will agree that millennials are the “unicorns” of the 21st century job market. Employers want to know what makes young professionals tick. What kind of culture is most attractive to them? What benefits are most appealing? How can they market their organizations as fresh, innovative and forward-thinking? However, when eager new hires are ready to roll up their sleeves, managers will likely rely on their most tenured and knowledgeable workers to show them the ropes.

Employers recognize that experienced employees are arguably their greatest asset. As a result, an underutilized benefit — disability insurance — is getting a fresh look. According to the Council for Disability Awareness, long-term disability claims peak for those aged 50-59, and by 2022, the federal Bureau of Labor Statistics estimates that people 55 and older will account for nearly 26% of the U.S. workforce.

With the right mix of benefits, companies can help keep their most experienced employees in the workforce. Here are a few things that organizations should keep in mind when tailoring products for workers who are more prone to disability, but still want to stay actively engaged in their careers.

First recovery, then back to work

First, it’s important to understand what types of conditions result in claims. According to the Disability Council, the most common causes of long-term disability claims are musculoskeletal system and connective tissue disorders such as rheumatoid arthritis and Lupus. That’s followed by diseases of the nervous system and sense organs like carpal tunnel, circulatory system diseases including atherosclerosis and hypertension, and cancer.

Due to medical advances, even serious conditions may be less debilitating than in the past. People are living longer, healthier lives, and diseases or injuries that once meant the end of a career can now be managed with proper medical care and recuperation. Surgeries and other procedures are less invasive. Hospital stays and treatment plans are shorter. This progress is a game-changer for many Americans who can’t afford to retire, and must find ways to continue making a living. Employer support is the second half of the equation.

Look for comprehensive products and services

In terms of disability coverage, human resources and insurance professionals need to consider a holistic program. They may choose to ground their benefits package with an employer-funded, short-term product, and then add the option to enroll in an employee-funded or “voluntary” long-term benefit, depending on the age of their workforce.

Employers should also consider whether or not the elimination periods associated with different products make sense based on the salary levels of their workforce. The higher the salary, the higher the likelihood that an employee can make ends meet for a longer period of time while waiting for their benefits to kick in. On the flipside, employees with lower salaries will be more comfortable with shorter elimination periods.

Programs designed to reintegrate employees back into the workforce are also essential. These may include rehabilitative assistance and training programs, and employees may receive partial benefits during the transition. Some modifications are temporary, allowing the employee to gradually pick up their prior responsibilities on a part-time, then full-time basis. Others involve changing specific duties, such as eliminating lifting or driving.

Finding the right level of accommodation

In many cases, relatively small accommodations, such as a new chair or workstation, are all that’s needed to successfully reintegrate an employee into the workplace. Some employers, however, provide much more extensive care in conjunction with their insurance carrier. In one case, an employer had a garbage truck driver who severely injured his hip on the job. He was too young for a hip replacement but was very eager to return to work. He happened to mention that he had once worked as a pilot. His employer, who maintained a high level of contact with him, helped him enroll in a flight school to become a flight instructor. The disability he received, along with ongoing services from his employer, helped him turn a disability into a new opportunity.

In another case, a former custodian with bilateral carpal tunnel syndrome worked under the auspices of his employer to retrain in computer science. He was provided with adaptive technology, including voice-activated software and a tablet, to help him make the transition.

Leave-management services that complement state and federal mandates, from the Family and Medical Leave Act to the Americans with Disability Act and state regulations, can also help lessen administrative burdens on employers.

A winning strategy

Understand that employees of any age can become disabled, and that disability insurance is relevant and valuable to your entire employee population. However, as today’s workforce ages, savvy human resources and insurance professionals are working to create an environment where more experienced employees are encouraged to take the time they need to recover from illness or injury, and return to work when they are ready. It is a winning strategy and one that will only become more important over time.

For reprint and licensing requests for this article, click here.
Disability insurance ADA Healthcare delivery Healthcare costs Healthcare benefits