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Unum. SSA Public-Private Disability Partnership: Options and Opportunities February 21, 2007 Kenneth Mitchell, Ph.D. VP Health & Productivity Development Chattanooga, TN. Managing the Politics of Incapacity. Competing Self Interests Stockholder vs. Taxpayer vs. Consumer Value - PowerPoint PPT Presentation
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Unum
SSA Public-Private Disability Partnership: Options and Opportunities
February 21, 2007
Kenneth Mitchell, Ph.D.VP Health & Productivity Development
Chattanooga, TN
2Unum
Managing the Politics of Incapacity
• Competing Self Interests
– Stockholder vs. Taxpayer vs. Consumer Value
– Organizational efficiency & accountability
– Meeting the needs of a changing, diverse work force, i.e. aging work force
– Maintaining a safe, healthy work force & work place
– Protecting productivity & independence
– Creating balance between benefit costs and social safety net
– Dealing with competing definitions of disability and related legislation
– Incentives and disincentives to change
3Unum
Important Features and Provisions in Private Disability Plans & Contracts
The Basic Elements of a Group/Private Disability Plan
• Industry & Managing Risk (What is the nature of the employees’ work?)
– Major industry and specific line of business are important in managing risk (claims experience, trends, other factors)
• Eligibility (Which employees are covered?)
– Usually defined based on occupation or employment criteria such as job title, location, years of employment or exempt status.
– Often an employer will define more than one eligible group, in order to vary coverage levels or eligibility requirements for different groups of employees.
• Definition of disability (How is “disability” defined in the plan?)
– Typically defined in terms of (1) ability to perform the material and substantial duties of one’s regular occupation; and (2) associated income loss
4Unum
Private/Public Partnership Options
• Option #1 Improve SSDI Claims Adjudication Speed & Efficiency
– Share medical information by treating physician
– Document definitive medical evidence
– Support timely IME’s & FCE’s
• Option #2 Fee for Service – Early Intervention and RTW Services
– Early evaluation of medical /functional status of new SSDI applicant
– Develop RTW Plan
– Provide ongoing RTW management – Manage Work Support Track
– Periodic reviews and reassessment
– Fraud investigations
• Option #3 Private Administration of Public Disability Income
– Reimburse private administration of public disability benefit
– Support RTW and work transitions
– Claimant selects disability benefit manager
5Unum
Create Productivity Transitions
Stay at Work(preserve productivity)
Return to Work(restore productivity)
Transitional Work Transitional Work
Absencefrom Work
Full work Capacity
Stay at Work(preserve productivity)
Return to Work(restore productivity)
Transitional Work Transitional Work
Absencefrom Work
Full work Capacity
Stay at Work(preserve productivity)
Return to Work(restore productivity)
Transitional Work Transitional Work
Absencefrom Work
Full work Capacity
6Unum
Selected Health & Work Incentives
• Medical Care: Guarantee Medicare coverage for a person’s work life if currently qualified for SSDI and return to work.
– A public private corollary would be the development of a partnership between Medicare and private healthcare insurance programs that distributes the healthcare cost risks between the employer, the employee, the government and the private insurer.
– Such a partnership could create an incremental or a “transitional work healthcare benefit” (TWHB). By its nature we are looking at a period of transition between full employment or some appropriate increment of work.
– Defined work capacity and employment would be the primary threshold of eligibility.
• Support Productive Aging: Allow RTW earnings and status count towards retirement benefit calculation, but there is a guarantee that the ultimate retirement benefit would never be LESS than the level one would receive if they had stayed on SSDI to retirement age.
• Practical Off Sets: Create proportional (or 50%) offset from SSDI benefit of RTW earnings from indexed pre-disability eligible wage base to age 66 or SSDI Normal retirement age.
• Timely Application: Make the RTW support function available up to 3 months before SSDI benefit eligible for early planning and maintaining connection with employer.
7Unum
Dedicated RTW Services
• Require/Expect a WorkRx, Work Prescription, as part of the initial and ongoing SSDI medical review.
• Develop a dedicated team with accountability (public, private or some combination)
– Providing accessible age and career development specific programs preparing individuals with significant impairments to enter or continue in a competitive work environment.
• Easy, Accessible & Consistent Regionalized Service
– Employee can request work support or be referred to it.
– The claimant/applicant can print off a ticket to work voucher or receive one from the SSDI web site and work with certified rehab specialists.
– Rehab services payments in 2 installments, (both negotiated flat fee), 50% for support (up to 3 months of support), 50% after 6 months of active employment (over 20 hours per week).
– Alternative option; staff vocational services as a SSDI/SSA case management function.
8Unum
Claims Closure Patterns: Opportunities
Reasons forDI payments
ending
Other
No longer disabled
Death
Reach retirement
age
Differences driven by:
• Different definitions of disability
• Lack of SSDI active claims management
*
**
SSDI*** UP LTD****
* Claim resolutions from Other, RTW and No Longer Disabled are roughly 5 times that of SSA ** Claim resolutions from Reaching Retirement and Death are roughly 1/2 of SSA. *** 2004 Results-- Journal of Economic Perspectives . Vol. 20 No. 3, Summer 2006**** YTD 9/30/06 from BAS
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