Disability claims related to pregnancy and childbirth increased sharply in 2012—rising by 24 percent—and now account for more than 12 percent of new long-term disability claims for female wage earners, according to a June 2013 report by the nonprofit Council for Disability Awareness. However, by a large margin, diseases of the musculoskeletal system and connective tissue—such as arthritis, spine disorders, back pain, sciatica and osteoporosis—continue to be the leading cause of disability claims overall (representing 30.7 percent of 2012 claims).
The Council's 2013 Long-Term Disability Claims Review also revealed that the number of wage earners protected by private disability income insurance increased by 1 percent in 2012, the first such increase in three years, as the economy continues to improve and unemployment rates decline.
Nineteen CDA member companies, representing more than 75 percent of the individual and group commercial disability insurance market, contributed data for the survey.
Of the 154,000 new disability claimants whom CDA members approved in 2012, more than half (54 percent) were women, a percentage that has slowly increased over time compared with the percentage of male claimants.
"The percentage of claims by women has been rising over the years because the number of women in the workforce has been rising," CDA President Barry Lundquist told SHRM Online. Additionally, because of maternity-related claims, "women, on average, have more disability claims than men, at least up until they reach their 50s, so that factors in as well," he noted.
As for the surge in maternity-related claims, one factor is the effect of an improving economy, along with rising consumer confidence. "To the extent people do plan pregnancies, they are more likely to plan to have a child when they feel their jobs are more secure and they can accept the financial burden associated with having children," Lindquist said.
SSDI Trust Fund Stretched
At the end of 2012 the average Social Security Disability Insurance (SSDI) monthly benefit was $1,130, according to the report. For men, monthly SSDI benefits averaged $1,256 and for women, $993.
In assessing the SSDI program, the report found that the number of workers receiving payments increased to 8.8 million (more than 5 percent of the U.S. workforce) by the end of 2012, its highest level ever. Given the current trends, analysts predict that the SSDI trust fund will be depleted in 2016.
But in terms of relying on SSDI for disability coverage, the program's financial stability isn't the only concern. "No employer should consider SSDI as an adequate source of income replacement for their employees," advised Lundquist. "SSDI is designed to be a basic floor of protection for the most severely disabled employees. It is difficult to qualify for, and the eventual monthly benefits are quite low …and significantly lower for younger employees."
What’s more, "SSDI has almost no resource devoted to returning employees to work; fewer than 1 percent of those who qualify for SSDI ever return to work. And there are no resources devoted to wellness and reducing or avoiding disability in the first place," he said.
Programs that help disabled employees return to work—and, as close as possible, to the life they led before becoming disabled—are "an important benefit beyond the monthly payment that helps the employee, the employer and society as a whole," said Lundquist. "And, of course, preventing disabilities is the best possible course of action, although no matter how healthy a person is, they still have a risk of disability and need to protect their income."
The CDA's website provides tips on how to assess the risk of disability and protect against its impact. Individuals can determine their own risk of becoming disabled by using the CDA's disability calculator.
Stephen Miller, CEBS, is an online editor/manager for SHRM.
Relatd External Article:
Disability Insurance: Are You Protected?, Financial Planning, July 2013
Related SHRM Articles:
‘Disability Divide’ Persists Between Employers and Employees, SHRM Online Benefits, June 2013
An Ounce of Disability Prevention, HR Magazine, June 2013
EU Court Expands Definition of Disability, SHRM Online Legal Issues, June 2013
SHRM Online Benefits page
SHRM Online Health Care Reform Resource Page
SHRM Online Retirement Plans Resource Page
SHRM Online Outsourcing Resource PageSHRM Online Workplace Flexibility Resource Page