Nearly all long term disability policies include a “Rehabilitation Plan” provision. A “Rehabilitation Plan” is a written agreement between the claimant and the disability insurer in which the disability insurer agrees to provide, arrange or authorize vocational or physical rehabilitation services.
The disability insurer promises to undertake a physical or vocational evaluation of a claimant to see if he or she is a suitable candidate to participate in a Rehabilitation Plan. The terms and conditions of the “Rehabilitation Plan” must be mutually agreed upon by the disability claimant and the disability insurer.
The disability insurer will promise to work with the claimant, the claimant’s employer and the claimant’s physician, and others, as appropriate, in developing a Rehabilitation Plan. If the claimant refuses to participate in the rehabilitation efforts, disability benefits will not be payable.
The Rehabilitation Plan may, at the disability insurer’s, discretion, allow for payment of medical expense, education expense, moving expense, accommodation expense or family care expense for a claimant while he or she participates in the program.
Now, does this really happen??? OF COURSE NOT!!!!
Do you really think that the disability insurer is going to underwrite all the expense of retraining a disability claimant for other work while paying benefits during the interim period. Even better, will any greedy insurer also assume the additional expenses for rehabilitation, medical, moving, family care, and accommodations???? If you believe this, then there is this bridge in Brooklyn I would like to sell you.
The purpose of this clause is primarily for selling the group policy to the employer. It looks and sounds soooooooo verrrry nice. The only problem is that the disability insurer would only invoke it if it believes it could “rehabilitate” a claimant at a low cost and quickly. To this day, I have never seen the clause invoked successfully and witnessed a claimant return to work successfully, The truth is that I have seen a couple feeble attempts at most which failed quickly.
What usually happens is that is far cheaper for the disability insurers to determine that the claimant is not disabled and ready to return to work with no need for any rehabilitation or accommodations. See, wasn’t that so much easier??? No messy “plan” to create or expenses to underwrite. Just cut the person off from benefits. Wow. It even results in an overall savings.
So, next time you try to read a long term disability policy, you just might want to save some time and skip over this rather self-serving and useless section.
Scott Elkind is an attorney in Silver Spring, MD whose practice focuses on disability issues. He can reached at 301-495-6665.