1 SHORT-TERM DISABILITY (STD) Presented by: Miles Gibson (213) 351-6409 Chief Executive Office Risk Management Branch Short-Term/Long-Term Disability County

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SHORT-TERM DISABILITYSHORT-TERM DISABILITY (STD)(STD)

Presented by:

Miles Gibson(213) 351-6409

Chief Executive Office

Risk Management Branch

Short-Term/Long-Term Disability

County of Los Angeles “To Enrich Lives Through

Effective and Caring Service”

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STD Eligibility, Purpose & Authority STD Eligibility, Purpose & Authority

• Only MegaFlex Cafeteria Plan Participants are eligible to receive STD benefits.

• It provides disability income replacement benefits for up to 182 calendar days (minus a waiting period) from the first day of a disability.

• It is governed by Chapter 5.27, County of Los Angeles Flexible Benefit Plan, and Chapter 5.28, County of Los Angeles Nonpensionable Flexible Benefit Plan of the County Code.

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STD BenefitsSTD Benefits

• The STD Plan offers two benefit options for MegaFlex participants to select from during Annual Enrollment.

– Core benefit: a continuous 14-day waiting period followed by 70% income replacement; or

– Additional benefit: a continuous 7-day waiting period followed by 21 calendar days of 100% income replacement, then 80% income replacement for the remainder of the approved STD period.

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Application Process for STDApplication Process for STD

• To initiate an STD claim, the employee and their health care practitioner must contact the County’s third-party administrator (TPA); Sedgwick CMS (Sedgwick), at 1-800-786-8600 or via the web site at:

www.sedgwickcms.com/calabasas

• Both contacts must be made before the end of the waiting period, or a penalty may apply (no benefit for each day the contact is late).

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STD Approval ProcessSTD Approval Process• Once Sedgwick has received all the

necessary information, the claim will be processed within 48 hours. Sedgwick will mail a notice of approved STD dates to the employee, and email the approved STD dates to the their department.

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STD PaymentsSTD Payments

• The employee will be paid STD Benefits through their payroll on regular paydays.

• The employee will receive their monthly County Contribution.

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STD Payments / TaxSTD Payments / Tax

• STD benefits are taxed as ordinary income in the year they are received, so state and federal withholdings will be taken on these amounts.

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STD Denial / Appeal ProcessSTD Denial / Appeal Process

• If the claim or an extension is denied, Sedgwick will mail the employee a notice with an explanation for the denial, and information regarding their right to an appeal.

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Duration of STD BenefitsDuration of STD Benefits• STD benefits stop when the

employee reaches the “maximum duration guideline” (unless an extension is filed and granted) or after 182 days from the first date of disability, whichever occurs first. (Under no circumstance will benefits continue beyond 182 days!)

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Duration of STD Benefits –Duration of STD Benefits –Part-Time DisabilityPart-Time Disability

• If the employee can return to work on a part-time basis, they MUST. The employee’s department will be asked to provide Sedgwick with the minimum hours that the department can temporarily accommodate.

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Use of Time During STD Use of Time During STD

• Any scheduled part-time work hours not worked must be coded as “AWOP” or accrued time. STD time may not be used.

• Holidays that occur during a part-time STD period are paid in the same proportion as the other STD benefit days.

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Use of Time During STD Use of Time During STD • The employee may not use their accrued time to

supplement STD benefits.

• However, the employee may “turn on” the substitution of accrued time during their disability, but only one time. It can be for any length of time, but only in whole day increments. Then they may “turn it off” and return to the STD Benefits (if any are left). Use of accrued time will not extend the 182-STD period for the disability in question. The employee is SUBSTITUTING accrued time for STD Benefits.

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Coordination of BenefitsCoordination of Benefits

• STD benefits are reduced on a dollar-for-dollar basis by the amount the employee receives from other benefits for the same disability. Note: personally acquired benefits (such as Aflac) are excluded!

• “Mega I/A” (A MegaFlex participant with an approved Industrial Accident claim) is the most common “other benefit” that reduces an employee’s STD Benefit.

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Mega I/A & STD BenefitsMega I/A & STD Benefits

• The employee must file separate claims for Mega I/A and STD benefits.

• The employee does NOT receive 70% salary continuation. They are paid the state mandated Temporary Total Disability (TTD) rate.

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Mega I/A & STD BenefitsMega I/A & STD Benefits• The state mandated TTD rate is 2/3 (66 2/3%). • of the average weekly wage (up to a maximum

amount).

• The employee will receive the TTD payment, and the difference between the TTD and STD payment amounts.

• The total payment for the two benefits will not be more than the 70% STD benefit, regardless of which STD income replacement was selected, however the waiting period will be the one the employee elected.

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Mega I/A & STD BenefitsMega I/A & STD Benefits

• Mega I/A benefits are not taxed.

• STD benefits are taxed as ordinary income in the year they are received.

• These benefits are paid by the payroll unit of the employee’s Department for the first six months, then they are paid by the Workers’ Compensation and LTD TPA’s.

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Long Term Disability Benefits (LTD) Long Term Disability Benefits (LTD)

• If a claim is approved for LTD after 182 days of STD, a “Mega I/A” becomes straight TTD, and is paid by the Workers’ Compensation TPA. The employee will no longer receive the monthly County Contribution.

• Sedgwick will review the TTD benefit, and deduct the TTD payment before sending the LTD benefit.

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STD ScenariosSTD Scenarios• Bob is hurt on the job (in a car accident). His

monthly salary is $6,000. He’s awarded $3,360 per month for his Mega I/A benefit. He also files an STD claim for his 100/80% income replacement with a 7-day waiting period. However, since this is a Mega I/A claim, his STD income replacement will be processed by payroll at 70% (not the 100/80% he purchased), which equals $840 [($6000 x 0.70) - $3,360 = $840].

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Duration of STD Benefits –Duration of STD Benefits –Recurrent DisabilityRecurrent Disability

• If the employee returns to active service for 29 days or less and they file an extension to be off work again for the same disability, the employee would resume benefits where they left off. There would be a resumption of the original 182-day STD period, if not already exhausted. No new waiting period would be required.

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STD ScenariosSTD Scenarios

• If Bob had shoulder surgery related to the car accident that took him off work, but he had only been back for 29 days, he would resume his original 182-day STD period with no new waiting period. There would be no extension of the STD period to reflect the fact that Bob had returned to work for 29 days.

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• If, after an STD period, the employee returns to full-time service for 30 calendar days or more, and then they need to be off work again for the same or different disability, they are entitled to a new 182-day STD period. The employee must complete a new waiting period.

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STD ScenariosSTD Scenarios• Bob returns to work after his car accident.

After 33 days, his shoulder (which was strained during the car accident) needs surgery. He is forced to go off work again. Although it is clearly a consequence of his initial claim (the car accident), it occurs more than 29 days after his return to work, and is therefore deemed a new STD claim. Bob would need to complete a new waiting period.

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• Any return to active service from a previous disability, followed by a separate and unrelated disability will always be cause for a new claim.

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• Bob recovers from the car accident and returns to work. On his first day back he slips in the lunch room and breaks his wrist. Since the injury to his wrist is separate and unrelated, this would be a new STD claim requiring a new waiting period.

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• If there is not a return to active service, STD benefits have been received, and a new disability is incurred from a separate and unrelated cause, there is a continuation of the original 182-day STD period.

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• After recovering from his car accident, Bob does not return to work, but continues his absence by using accrued time. During the absence he breaks his wrist. Even though the injury to his wrist is separate and unrelated, this would be a continuation of his original 182-day STD period with no new waiting period.

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STD RemindersSTD RemindersThe employee must…

• File an STD claim timely (even if it is a Mega I/A).• File for an STD extension in timely manner.• Accept an offer of County employment which is

consistent with work restrictions.• Provide satisfactory evidence of disability.• Cooperate with the Chief Executive Office or the

STD administrator.

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Other ResourcesOther Resources

An STD Pamphlet and Booklet are available on the County Medical Panel Network website at:

- http://ceo.lacounty.gov/rtw/rtw_default.htm

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Contact InformationContact InformationThe status of an STD claim may be obtained from:

- Sedgwick’s STD Specialist:

Mirna Ramos @ (818) 222-3044FAX # 818-591-7644

email: [email protected]

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QUESTIONS?QUESTIONS?

Documents

1 SHORT-TERM DISABILITY (STD) Presented by: Miles Gibson (213) 351-6409 Chief Executive Office Risk Management Branch Short-Term/Long-Term Disability County