There is a common misconception that disability payments are based on an employees salary, the disability, or even the severity of the disability.
Despite the importance and prevalence of disability payments, many employers are still uncertain as to how these payments work. This is particularly true because payments and what qualifying factors change over time. Here’s what all employers should know about how disability payments are calculated.
How are disability payments calculated?
Contrary to what many employers and employees may believe, disability payments aren’t calculated using a person’s income. The disability of the individual does not matter, nor does the severity of the disability. Rather, a unique payment is created according to each person’s situation. This formula is totaled according to a person’s average lifetime earnings before the disability began. Covered earnings — the amount of income on which a person has paid social security taxes — also plays a role in calculating this number.
What conditions automatically qualify you for disability?
There are many conditions that qualify someone for a disability. These include cancers, neurological disorders, immune disorders, and mental disorders. Conditions related to the skin, digestive tract, kidneys, musculoskeletal systems, and cardiovascular systems also quality. Most of these conditions are listed specifically in the Social Security disability blue book.
If it is deemed that a person is suitable for other types of work, then their claim for social security will be denied regardless of their health condition or illness.
Not everyone has a specific issue that falls into one of these categories, however. In these situations, people can submit a claim that involves equaling a disability listing, where they’ll equate their condition to one of the defined conditions on the list. For example, celiac disease, fibromyalgia and carpal tunnel syndrome all are common conditions that people receive disability for, yet they aren’t listed.
If it is deemed that a person is suitable for other types of work, then their claim for social security will be denied regardless of their health condition or illness. Therefore, people who are truly unable to work in any way are the ones who receive income from disability. Also, receiving disability doesn’t disqualify someone from getting other income, as they may have additional avenues of wealth that don’t involve a job.
What is the Difference Between State and Federal Disability Laws?
By being federally regulated, the Social Security disability (SSDI) is equally distributed across all states. Therefore, there won’t be any discrepancies in how different states deal with this form of disability specifically. On the other hand, however, certain states regulate their own additional security benefits. In California, for example, short-term disability insurance and paid family leave are offered to employees in certain situations who need to take time off of work.
How much is disability per month?
As discussed, there are many factors which determine how much a person makes on disability. However, In 2018, the majority of people receiving SSDI payments are allocated between $700 and $1,700 per month.
How much can one make on disability in 2018? What about 2019?
In 2018, the average monthly disability payment was $1,197. This will change in the coming year, however, and the average payment in January 2019 is slated to reach an average of $1,234 per month. Meanwhile, a beneficiary of this person on disability in 2019 will receive up to $2,861.