Prohibits insurers from reducing disability benefits due to the actual or anticipated receipt of social security disability benefits unless certain conditions…

Showing the cosponsors who are on Agora, A to Z. The official record may list more.

• Democratic5

Shown in neutral colors by design; Agora is non-partisan.

◆ The sponsor's argument

Why Jamaal Bailey says this is needed

Social Security Disability Insurance is a federal benefit which provides benefits to individuals who have worked jobs covered by Social Security and have an inability to do any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months. As a matter of sound public policy, it is critical that New York encour- age its residents to take full advantage of the federal benefits they are entitled to, including Social Security Disability Insurance ("SSDI"). The benefits of SSDI are numerous and New York residents should not go without the many advantages this federal program provides. All too often New Yorkers are on the losing side of the equation when it comes to resources provided from Washington. Providing clear require- ments as to when insurers are permitted to deduct estimated SSDI benefit payments from long-term disability ("LTD") insurance payments will encourage more policyholders to take advantage of their substantial federal benefits. There are numerous benefits, beyond the financial benefit itself, that individuals and their families entitled to SSDI receive under the SSDI program. As eligible workers have earned this benefit by contributing 6.2 (on top of 6.2% from the employer) of their earnings through the Federal Insurance Contributions Act("FICA") to fund Social Security, including disability insurance, it is only right that they are encouraged to take advantage of all the program's benefit. The following are benefits received under Social Security Disability Insurance: *SSDI freezes the individual's Social Security earnings records, which means that the amount of eventual retirement benefit may be substantial- ly higher (depending on when someone is disabled). The normal Social Security Retirement 35-year average earnings is adjusted for years on disability, which for the average SSDI beneficiary could lead to a substantially higher retirement benefit. The impact of having zero earnings considered for a given year can be dramatic. If an SSDI-eligi- ble claimant remains solely on an LTD plan, the 35-year average earnings will be significantly lower due to the disability period, leading to a reduce retirement benefit. *SSDI provides spousal and child benefits to those eligible. On average, the SSDI benefit amounts to $415 for spouses and $390 for children that would not be available to private long-term disability only claimants. *Individuals entitled to SSDI are eligible for Medicare coverage after 24 months, allowing for medical services at reduced health insurance premiums. Some disabling conditions waive the 24-month waiting period and grant immediate Medicare coverage. SSDI eligibility also increases extension of employer sponsored medical coverage under COBRA (bridges COBRA to Medicare). *Individuals taking advantage of the SSDI program may be entitled to significant tax savings (SSDI benefit vs a taxable long-term disability benefit). *There is the potential for a closed period award (a closed period exists when a claimant for Social Security disability benefits or SSI is found to be ineligible for ongoing benefits, but is eligible to receive benefits for a period of time in the past). *SSDI provides the ability to participate in a work trial period (9 months without losing SSDI and potential retraining through the SSA's "Ticket to Work program"). *Cost-of-living adjustments made to the SSDI benefits would not be deducted from the private long-term disability benefit payments, and therefore, would go directly to the disabled resident. This is one of the most significant benefits which can lead to substantial increases in income overtime. In addition to missing out on the many benefits that an individual disa- bled claimant may be entitled to, the prohibition that insurers are no longer permitted to deduct LTD disability insurance benef

This is the sponsor's own case for the bill, quoted from their memorandum. It is not Agora's description of what the bill does.