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what are the chances...actually needing to cash out on disability insurance

Discussion in 'PM&R' started by jonnylingo, Apr 19, 2012.

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  1. jonnylingo

    jonnylingo Junior Member Gold Donor

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    I was sufficiently scared into buying a policy a year ago, now I'm sinking ~250/mo into yet another safeguard.

    Do you ever feel over-insured? Between the usual home/car and now the malpractice, umbrella, health, and dental, and disability, I'm overwhelmed.

    What are the chances of needing this? I know this is the million dollar question (literally), but really is it worth it?

    Do you and/or your partners carry private disability? Do you know anybody who has actually needed it?

    It was a nightmare going through the paperwork and finally get insured, but now I'm considering dropping it.

    Any thoughts are appreciated.
  2. RUOkie

    RUOkie

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    Not personally, but I have a colleague who's husband was in a bike wreck and is now a mid thoracic paraplegic. He is a radiation oncologist. He used his long term disability for 18 months before he went back to work.

    I know PM&R docs with TBI's. who had to stop working. I just saw a 52y/o anesthesiologist who we ultimately diagnosed with Alzheimers.

    Figure out how much you need to live, and buy that much disability insurance. IMO, it is more important than Life insurance. Although right now, Whole Life insurance is a great investment (the cash value is wonderful since the annuities are paying 7-8%)

    If you are just starting out, a converable Term life policy is cheaper, and then convert it to whole life when you can afford the higher premiums (but then you have cash value).

    Also, it is FAR cheaper to lock in your disablity insurance rates when you are young. If I didn't have my policy for the past 15 yrs, it would cost triple what I pay right now. And I have increased my limits 4 times.
  3. SSdoc33

    SSdoc33

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    i can sympathize. my wife wants us to get pet health insurance. and dont forget travel insurance when you go away.

    but ruokie is right. drop your life insurance before you drop disability, although youshould have both. and 250/month is a steal. either you got a great deal, or you are underinsured (or have some coverage from your employer).

    there are some good threads on this in the pain medicine forum
  4. Jitter Bug

    Jitter Bug

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    Honestly I probably wouldn't do it if I had chosen another field, but I'm PM&R. I spent years taking care of the catastrophically injured, and watching their families do things like meat raffles and bake sales to raise 10K for their 150K medical bills. And then I watched them sell everything, file for bankruptcy, move back in with their elderly parents and go on medicare to cover the prescriptions and PT/OT/SLP.

    I pay my disability insurance every month. Just in case.
  5. Louisville04

    Louisville04 Junior Member

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    Wouldn't your health insurance pay for your medical bills while disability pays for your loss of income?

    If you are permanently disabled, would it pay for in perpetuity or is there a time limit?
  6. RUOkie

    RUOkie

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    I have mine to pay me $6500/month (TAX FREE) until I hit 65 and then it is prorated down to what SSI pays (6500-SSI=payment). It keeps paying me until 75 (if I remember correctly)
  7. PMR 4 MSK

    PMR 4 MSK Large Member SDN Advisor

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    :laugh:

    Insurance will pay SOME of the medical bills. Unless you have really good insurance, in the case of a catastrophic injury or illness, you often get left with a lot of money to pay.

    Let's say you're in an MVA. Broken legs and pelvis, T6 para. You are 200 miles from home. Multiple surgeries, long hospital and rehab stay. Unfortunately, all the doctors who treated you are out of network. You owe 30 - 50% of their bills, and they are not contractually reduced to "usual and customary."

    You also have things the hospital did, but your insurance won't pay for. Not that you were given a choice. Some of the labs will be denied. Some of the procedures will be deemed "experimental." Others will be denied "just because."

    Then you will have outpt therapies 3-5x/week for months @ $25 co-pay per visit. And your meds - many will be Tier 2 or 3 = higher co-pays.

    And who is going to remodel your home to make it wheelchair accessible - ramps, wider doorways, rebuild the bathroom so you can use it, etc?

    You will easily build up $30 - 50K in Medical bills in a year. But you'll be glad you had insurance to cover the other $700,000.
  8. Jitter Bug

    Jitter Bug

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    Exactly! Think catastrophe, not back pain. I can buy my own flexeril.
  9. RUOkie

    RUOkie

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    The average lifetime medical expenditures for a Mid Thoracic paraplegic is >$1,000,000.

    For a High Quad, it is $1,000,000 IN THE FIRST YEAR. and over $10M lifetime.
  10. Louisville04

    Louisville04 Junior Member

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    Disability insurance will pay enough to cover $700k in bills? RUOkie said his policy pays $6500/month tax free.

    Don't just about all SCI patients end up on SSDI/medicare/medicaid?
  11. Louisville04

    Louisville04 Junior Member

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    Would you be able to get disability for non-catastrophic injuries such has CTS or hand OA that has failed treatment?
  12. Jitter Bug

    Jitter Bug

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    The money is awfully tight on SSDI/Medicare/medicaid. I don't want to downgrade to a small apt. And the options for clinics, meds, DME are limited on medicare/medicaid. I'd rather be partially or fully disabled making near or full doctor salary, and have better health care choices.
  13. PMR 4 MSK

    PMR 4 MSK Large Member SDN Advisor

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    Medical/Health insurance will cover the $700K, not disability.

    Most SCIs do end up on SSI, and many on Medicaid. But if you start out with insurance and/or assets, you have to lose everything to get on Medicaid.
  14. RUOkie

    RUOkie

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    No they don't. I know many SCI people who work full time jobs. The point is that a Disability policy is a safety net. And a very important one. And please do not plan on relying on SSI/SSD. After 15 yrs as a physician, my monthly benefit is $1200 if I become disabled. And not to get all political on you, but even that won't be there in 10 yrs since our government is going broke.
  15. Gauss

    Gauss Damnit Jim!

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    SSDI latest forecast will be it runs out of money in 2016 unless they reallocate it. Personally, I think you would be foolish to not have a longterm disability plan. get it while you're young, in school, lock it in and max it out.
  16. MDEssentials

    MDEssentials

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    Accordingto the Social Security Basic Facts 2011, over 1 in 4 of 20 year olds willbecome disabled before reaching age 67. As a physician, it is important notonly to have disability coverage to pay for basic necessities, but to replacethe income that you have trained so long to earn.

    Agood individual disability policy should replace about 60% of your income(disability policies paid for with after tax dollars pay benefits tax free),and should pay if you can't preform the duties of your occupation, not just ifyou are unable to work at all. Some other issues to pay attention to are thecost of living adjustment amounts, and residual benefit options. A gooddisability policy is non-cancellable, meaning the insurance company can'tchange rates or benefits for the duration of the contract.

    Apolicy as outlined above should cost between 1 and 2% of annual income, butprovides the income protection to allow you to continue your lifestyle shouldyou become disabled. There are many good disability insurance companies thatprovide this kind of coverage, just be sure that the policy you choose fitsyour needs as a physician.

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