Disability Overpayment Recovery for LTD Partners
The Disability Overpayment Recovery product enables employers or Long Term Disability (LTD) plan administrators to eliminate non-recoverable LTD overpayments that occur when an LTD recipient becomes entitled to Social Security Disability Insurance (SSDI) benefits.
Historically, LTD plan administrators have experienced significant financial loss due to non-recoverable LTD overpayments. When plan participants become entitled to SSDI, the LTD payments are offset by the SSDI amount that the employee receives. It can be administratively difficult, if not impossible, to recover an LTD overpayment if an LTD repayment is not made by the participant from his or her retroactive SSDI payment(s).
Some estimates show that 25% of LTD overpayments are eventually written off as non-recoverable. Each non-recoverable overpayment has an estimated value in 2009 of $15,060. When you multiply that by 100 cases, the savings can really add up.
How It Works:
In compliance with Social Security regulations, SSDC will secure authorization from the LTD recipient to initiate transfer of the LTD plan administrator’s calculated overpayment amount from the recipient’s bank account after the first retroactive SSDI payment has been deposited. After notification of an SSDI award and deposit of funds in the recipient’s account, SSDC will secure verbal confirmation from the recipient to proceed with withdrawal from the account. Periodic contacts by SSDC to remind client of obligation to repay LTD overpayment are mandatory.
Contact us today to find out if the Disability Overpayment Recovery product is right for your organization..