Devastating injury and illness loom increasingly larger in Americans’ lives. Most US households need two incomes to get by. Combined with a Social Security system tottering on the edge of bankruptcy, adequate disability coverage is now more crucial than ever.
Although disability insurance is nothing new, several factors have emerged during recent years that have heavily affected the disability insurance industry. These factors have forced insurers to fill bigger than ever before:
Chronic disease: Modern-day medical advances allow employees with serious illnesses such as multiple sclerosis to rejoin the workforce for satisfying, productive careers. In the face of recent legislation like the Americans with Disabilities Act, employers must make reasonable accommodations for such workers.
Economic recession: Meanwhile, employers must do more with less. Smaller staffs must perform more functions. Consequently, employer-sponsored group coverage dynamics have changed radically. Fewer employees mean higher group coverage costs.
Longer Life spans: More people are delaying retirement, thus creating an older workforce. This demographic shift has forced employers to find the ideal balance between the benefits of older workers’ greater experience and correspondingly higher insurance costs.
Providers of disability group coverage have taken the following steps to accommodate these shifting social and economic trends:
- Chronic disease management programs
- Participation incentives for weight-loss, stress management, and smoking cessation programs
- Employee assistance programs such as crisis or nutritional counseling
- In-person and online health coaching
- Integrated health and disability insurance programs.
This last step cuts insurer costs by streamlining healthcare services delivery and facilitating effective preventive measures.
A CIGNA 2007 study revealed that integrated plan enrollees receiving short-term disability benefits were much more likely to return to work than non-integrated plan enrollees.
Social Security Administration studies conducted in 2004 and 2005 revealed significantly decreased revenues. Increased benefit payments to aging Baby Boomers was cited as the primary causative factor. Projections indicate that this deficit will increase in years to come.
The lesson is clear. Take full advantage of ancillary services of employer-sponsored programs. The self-employed or those without employer-sponsored coverage must maintain adequate coverage through private insurers.