Disability Insurance

SANTA ANA, Calif. -- Having built a successful dental practice in the mountain community of Wrightwood, Calif., Mary Samida decided to protect her investment six years ago by taking out a disability-insurance policy.It was a good thing, because last December, increasing pain in her back caused by ruptured discs forced Ms. Samida out of her profession of 15 years."It was kind of a jolt," she said. "I'm having to sell my practice and immediately quit dentistry."The shock of ending her career so suddenly has been greatly eased by a disability-insurance policy that will pay Ms. Samida the equivalent of her monthly take-home pay every month for the rest of her life.

Readers reacted with sympathy, empathy, mild outrage and charity (checks and cash) to the story (TJI, Nov. 15) of Michael Younger, the Eastern Shore contractor who broke his back in a fall last spring and whose family has been struggling to get by, with only meager support from the government. The story demonstrated how America's vaunted safety net has big holes.At a time when politicians, Democratic and Republican, brag about the effectiveness of welfare reform, government policy gives limited support to Americans trying to move up from poverty.

SHARON YOUNGER has a question about the frozen turkey. It sits, white and pink, on its back in a roasting pan on the kitchen counter of the Younger house in a middle-class development in Stevensville, Queen Anne's County, on the Eastern Shore. Before its present state, the turkey had been wrapped and stored in a freezer for several months. It came from an emergency food pantry. Younger wants to know if I think the turkey is still good. I suggest she give it the smell test."I did that already," she says.

I'M WATCHING a video, recorded in February 1997 for training purposes by Aetna U.S. Healthcare, one of the nation's largest health insurance companies. It should scare everyone who has company-paid health or disability insurance. You're at more risk than you think of not getting the care you need.Under current law, most patients in most states cannot sue their company plans for damages. Too bad if you die because your plan delayed or denied treatment. Too bad if you're refused disability benefits you should have had. The plan isn't liable.

WASHINGTON -- Every month, the federal government mails more than $3.6 billion in checks to 5.3 million working-age disabled Americans.Most will get the checks for the rest of their lives even though, according to a national report, hundreds of thousands would like to work again.Vatrice Rivera is one of them. A 30-year-old registered nurse, Rivera had to quit her job three years ago because of thyroid problems and complications from a debilitating infection in her spinal cord.Rivera, of Fort Lauderdale, Fla., dreams of working again, perhaps at a desk auditing medical bills, as she did before.

THE INSURANCE companies that sell disability policies are finally discovering America.In the past, they sold principally to high-earning professionals such as doctors and lawyers. Now they're noticing everyone else: midlevel professionals, small business owners and employees, business executives and managers, technicians, skilled clerical and white-collar workers, "gray-collar" workers in high-tech manufacturing plants."Real opportunities exist in the middle market," says Timothy Gardner, a manager at Conning & Co. in Hartford, Conn.

The life insurance industry and privacy advocates clashed yesterday before a General Assembly committee over the uses and potential abuses of genetic information -- a topic one witness described as "the issue of the new millennium."The House Environmental Matters Committee heard calls from the sponsors of legislation to restrict the use of genetic information about individuals to "get out front" on an issue that is drawing increasing interest in state legislatures nationwide.But Roberta B. Meyer, senior counsel of the American Council of Life Insurance, testified that the legislation would interfere with the industry's essential function of determining risk.

WASHINGTON -- Heightening the prospects that the government's burgeoning disability programs will be scaled back, President Clinton has proposed changes that would slow their growth and reduce the rolls by hundreds of thousands of people.The federal government could save up to $15 billion over five years under proposals Mr. Clinton has made and under Republican proposals that he is considered likely to accept.If adopted, the proposals would bring about the sharpest cuts in the history of the two disability programs run by the Woodlawn-based Social Security Administration.

WASHINGTON - The Clinton administration plans to ask Congress this week for special funding to sharply increase the review of disability check recipients to determine whether they can return to work, officials said yesterday.In a move that could save the government hundreds of millions of dollars, 1.4 million cases over the next two years would be reviewed 600,000 more cases than had been planned.Beyond that, the Clinton administration proposes to increase the reviews to more than 1 million annually by 2002, said Phil Gambino, a spokesman for the Social Security Administration, which conducts the reviews.

WASHINGTON -- Congress was urged yesterday to increase aid to the disabled by billions of dollars even though the Republican majority has been moving to scale back disability programs run by the Social Security Administration.The call for more assistance came from a panel of the National Academy of Social Insurance, a think tank headed by former Social Security Commissioner Robert M. Ball. The new or expanded benefits would cost more than $17 billion over five years.Aimed at encouraging the disabled to work, the proposals include a new tax credit for the disabled working poor, vouchers so recipients can purchase vocational rehabilitation services from private vendors, and a 44 percent increase -- from $500 to $720 a month -- in the amount some recipients can earn without losing benefits.

When I hear my fellow baby boomers gleefully talk about their elaborate plans to retire ASAP, head for the Tuscan hills, or otherwise continue their lifelong quest for "self-actualization," I have to bite my tongue. It's not that I'm all work and no play. But there's just something - make that lots of things - wrong, in general, with retiring at 55, 62 or even 65. I would go so far as to call it profoundly selfish and unpatriotic. Dropping out of the work force while still in one's prime means ending one's contributions to America's strength, mortgaging our children's and grandchildren's future and leeching trillions of taxpayer dollars from the economy.

I read that this is the last year when proceeds from an IRA can be donated directly to a charity. But is this a good idea? Apparently no tax is owed on the money that goes to the charity, but you don't get a charitable deduction for the money you are giving to the charity. Which is preferable? No tax or a deduction? - Elaine Hopkins, Peoria, Ill. No tax is better for several reasons, said James Lange, a Pittsburgh attorney and accountant. The reader is referring to a provision available for tax years 2006 and 2007 that lets individual retirement account owners age 70 1/2 and older transfer up to $100,000 tax-free from their IRAs to eligible charities.

Think about college tuition, health care and especially your electric bill, and it's easy to assume that prices only move in two directions: up and waaay up. But if you haven't been paying close attention, you might not have noticed that one important financial product is significantly cheaper these days: term life insurance. Industry experts estimate that term premiums have fallen 40 percent or more in the past decade alone. "This is great news," says Gary Schatsky, a financial planner in New York.

Once the children are out of the house and you wind down your full-time working years, your insurance needs shift. You'll need more of some kinds of insurance and less of others. And you'll need some patience and diligence. At no other time in life does insurance get more complicated than retirement, when you're considering the baffling ins and outs of Medicare, long-term care insurance and annuities. Here are tips for empty-nesters and seniors: Life As you approach retirement, and especially during retirement, your need for life insurance diminishes rapidly.

Not all families are the same when it comes to insurance needs. Established families with middle-age parents and older children need more of some kinds and less of others. "As the value of your home changes, as your assets increase, as your children approach college age and your financial situation changes, quite likely your insurance needs are going to change at the same time," said Roger Sevigny, insurance commissioner of New Hampshire. Here are some tips for evaluating insurance needs for an established family: Life Now is a great time for established families to re-examine their life insurance, for a couple of reasons.

ARTHUR E. HESS, 89, died at his home in Charlottesville, VA on Tuesday, November 15, 2005. Known as a trailblazer in implementing both disability insurance and Medicare, Hess paved the way for the successful mid-century expansion of the Social Security Administration into the fields of disability insurance and medical care. He was Deputy Commissioner, then Acting Commissioner, of the Social Security Administration at the time of his retirement in 1974. The chief architect and first Director of the Medicare program officially enacted in 1965, Hess was widely acclaimed for achieving unprecedented cooperation and partnerships with private sector players, including hospitals, state agencies, health departments, and private insurance carriers.

UNTIL a few years ago, Debra Potter made sure that her family could cruise the Caribbean, watch the NFL on a big-screen TV and keep her elderly mother and in-laws at home in comfort. She did so by earning $250,000 a year selling more insurance than almost anybody else in Virginia, virtually all of it disability and health policies that she thought put a safety net under middle-class and affluent families such as her own. Potter so believed in the protection she was providing that she made sure she was covered under a policy her employer, Southeastern financial services giant BB&T, had with UnumProvident Corp.

No work, no money: Without a job, most of us would be in the poorhouse. Consider what would happen if an illness or accident prevented you from working permanently. How would you survive a lifetime without income? In the prime of youth, it's tough to think about disability insurance, which essentially replaces your wages if you become incapable of working. But at age 25, there's a 40 percent chance you'll become disabled before turning 65, according to the National Association of Insurance Commissioners.

Q. I collect a pension and Social Security, but I also work part time. I recently was injured off the job and have been out of work since February. Can I apply for disability, or am I disqualified because of my retirement benefits? A. Receiving a pension doesn't automatically disqualify you from disability benefits. Instead, your eligibility could depend on whether you signed up for the benefit. You waive your right to disability benefits if you decided against paying the average 60 cents a week that employees contribute toward disability insurance, said Jon Sullivan, a New York Workers' Compensation Board spokesman.

SOCIAL SECURITY -- formally Old Age, Survivors and Disability Insurance -- is the single largest federal program. It provides about $500 billion to about 50 million American retirees, widows, widowers, disabled workers and children and sends surpluses in excess of $100 million a year to the Treasury. For 70 years, it's been America's security net -- not an uncertain pension, but earned insurance. At the outset of President Bush's second term, he's peddling two big untruths about Social Security: One, it faces a crisis.