Human Resources

Understanding Short Term Disability

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I have sick time; do I need a short-term disability policy?

Everyone’s financial needs vary, so the answer is possibly. Many people will experience a need for a medically necessary leave of absence. Short-term disability (STD) coverage is offered to bridge the gap for individuals that do not have sick time accumulated or do not have enough time accumulated to ensure their paycheck until long-term disability (LTD) eligibility. Most full-time employees fall into the latter category and do not have enough sick/vacation time banked to cover the 6-month LTD elimination period (period before policy pays). The plan covers individuals who are unable to work because of an illness or who sustained an off-the-job injury, regardless of sick/vacation time. That means, even if you have ample sick/vacation time, you can still receive benefits under the STD plan to help with expenses.

What makes this plan different from other Short-term plans?

  • Allows employees to choose amount of coverage
    • Rather than coverage at 60% of your salary, the plan allows you to select a weekly coverage amount up to the max listed on the rate sheet for your salary range.
    • Plan provides flexibility and choice, both with coverage and budget
  • Payment, based on medical necessity, up to employee’s ability to return to work or when long term disability eligible.
    • For medically necessary leave, maximum coverage of 26 weeks
    • Benefit payment is weekly, and the amount is non-taxable
  • 2 plan options to choose from
    • Option 1 has 2-week elimination for illness and injury
    • Option 2 has first day coverage for off-the-job injury and 1 week elimination for illness
  • Pre-existing conditions have minimum allowed amount of 4 weeks of coverage
    • Pre-existing limitation does not apply after 1 year of coverage.
    • If leave is related to pre-existing condition plan still offers pay
      • Option 1: 2 week elimination (period of time before the policy pays)/ 2 weeks’ pay
      • Option 2: 1 week elimination/ 3 weeks’ pay
    • Guaranteed issue during open enrollment means no medical questions to answer to obtain the policy
    • Does not offset other income
      • Benefits paid for covered accident/illness regardless of sick and/or vacation time to supplement your normal income
      • Pay is paid to you on a weekly basis, which means it can be used however you see fit.