Short Term Disability and Workers Compensation

Short Term Disability and Workers Compensation After a Workplace Accident

After suffering a work injury or receiving the diagnosis of an occupational illness that causes you to miss time, you are probably worried about income and paying the bills. You may have two options: short term disability and workers compensation.

This article explains the difference between short term disability and workers compensation, what kind of benefits you should apply for, whether you can receive short term disability when your workmans comp claim is denied and you’re waiting for a hearing, and the impact receiving short term disability can have on your workers comp case and how much you net in your workers compensation settlement.

Keep reading to learn more. And if you have any questions, or are looking for a top-ranked workers compensation lawyer and disability attorney, contact Corey Pollard for a free consultation: 804-251-1620 or 757-810-5614.

What is Short Term Disability and How is it Different from Workers Compensation?

Short term disability (STD) is an employee benefit often offered by employers as a voluntary benefit. Usually the employee pays for all, or at least part, of the benefit. Short term disability allows employees who who suffer non-work related injuries or illnesses to receive income replacement benefits when out of work for treatment or recovery. STD benefits are paid by the disability insurance company that provides coverage under the company’s employee benefit plan.

Workers compensation benefits are available to employees who suffer an injury by accident arising out of and in the course of their employment. They are also available to employees who contract an illness or disease arising out of their employment. Workers compensation is not a voluntary benefit. All employers with three more or employees must provide workers comp coverage.

There are additional differences between short term disability and workers compensation:

• Short term disability often pays benefits at a lower percentage of your salary or earnings than workers comp. For example, STD benefits are paid at 60% of your pre-disability wage whereas workers comp temporary total disability benefits are paid at 66 2/3, unless you are a high or low wage earner subject to the minimum and maximum comp rates.

• Depending on the plan, short term disability benefits are taxable. Workers comp benefits are not taxable.

• Under short term disability the disabled employee is responsible for out-of-pocket healthcare costs such as deductibles and co-pays. This is not true with workers comp.

• Under workers comp you may receive up to 500 weeks of wage loss benefits. If you qualify for permanent and total disability you may receive more than 500 weeks of wage loss benefits. Most STD policies provide just a few weeks of wage loss payments.

• Workers comp denials are easier to litigate than STD policies. The Workers Compensation Commission has jurisdiction over workplace injury claims and resolves disputes.

When it comes to actual benefits workers comp is the better route to take. It’s not a surprise, therefore, that at least one study found that the average workers comp claims for specific diagnoses cost more than triple the average short term disability claim for the same diagnoses.

Not everyone, however, is entitled to workers comp. And those who are may have to litigate their claim to get the medical treatment, wage loss, and permanent partial disability benefits they deserve.

Can I Receive Both Short Term Disability and Workers Comp?

Usually you cannot receive both short term disability and workers comp benefits. But there are exceptions.

Ask an attorney to review your short term disability policy if you believe you may also qualify for workers comp benefits for the same injury or illness.

Should I Apply for Short Term Disability or Workmans Comp?

You should apply for workers compensation benefits if you got injured at work or contracted an illness that your physician relates to our work environment.

You should apply for short term disability benefits if you were not injured at work but will miss time.

If you got hurt at work but the workers compensation insurance carrier or third-party administrator (TPA) denied your claim then you should file for short term disability benefits. Neither insurance carrier will want to pay. Rather, each carrier will want the other to pay. We recommend contacting an attorney to help you receive income as soon as possible.

What if My Employer Tells Me to File for Short Term Disability When I Know I Should File for Workers Comp?

If you’re going to miss time from work because of an accident, injury, or illness, then you should notify Human Resources or your Safety Manager – whether the injury or illness is related to work or not.

Unfortunately you may receive inaccurate information from your employer about the income replacement benefits you’re entitled to when you’re out.

For example, some employers advise employees to file for short term disability if they are hurt at work. Employers do this for one of two reasons: (1) because they don’t understand the difference between STD and workers comp or (2) because they want to avoid increases in their workers comp premiums by decreasing the number of workers cop claims filed.

Do not count on your employer to provide the right information – no matter how long you’ve worked for it.

Can I Get Short Term Disability Benefits if I’m Hurt at Work But the Insurance Carrier or Workers Comp Commission Denies My Claim?

Usually short term disability insurers will treat a workman comp denial as a finding that your accident or injury is not related to your job. Such a finding means the STD carrier will pay weekly or monthly benefits for as long as you are eligible under that policy.

Each STD policy, however, is different. Make sure to review the policy to see whether you are entitled to short term disability benefits when workers comp denies your case and you are forced to litigate.

What Happens if I Receive Short Term Disability Benefits But Later Get Approved for Workers Comp or Settle My Workers Comp Case?

Many short term disability insurance carriers will require you to sign a contract stating that you agree to pay back some of the STD benefits if you’re later found eligible for workmans comp.

A common example is when an employee is hurt on the job and files a workers comp claim. The insurance carrier may deny the claim pending investigation and raise several defenses. At this point you may elect to receive STD benefits while pursuing your workmans comp claim with an attorney’s help. If you win at the workers comp hearing and receive both retroactive and current wage loss benefits then you will have to pay back the STD company.

Be Aware of this Short Term Disability – Workers Comp Trap

When you’re hurt at work and don’t know where your next pay check will come from, it can be tempting to say that your injury did not happen at work so that you can receive STD benefits right away. This may ease the pain in the short term but will help you in the long run.

As we explained above workers compensation provides better benefits than short term disability. By stating that your injury is not work-related solely for the purpose of obtaining STD benefits right away you may cost yourself tens of thousands of dollars in medical and wage loss benefits in the future. Any statement to a doctor or your employer that you were not hurt at work will hurt your work comp case. The insurance company will use it against you at hearing and in settlement negotiations.

An Attorney to Help You Navigate Short Term Disability and Workers Comp Claims

We have helped hundreds of injured workers across Virginia navigate workmans comp, Social Security Disability, short term disability, and long term disability claims. Our goal is to uncover every possible income source and work to get you those benefits.

Call now for a free consultation. We are ready to help.