Presentation Transcript

1. Long Term Disability (LTD)

   Overview of coverage 1
2. What is LTD? LTD is a form of income protection. Under the plan, a disabled employee is able to receive money from the LTD carrier if: Employee has been medically unable to work for at least 90 days Employee will receive either 50% or 60% of pre-disability base earnings (max benefit of $15,000/month) The income will (or will not) be taxable to the employee
3. Who pays the LTD premium? CMH buys you coverage for 50% base salary You may purchase add’l10% base salary Total amount available 60% base salary Note: Physicians, under a separate LTD plan, are provided 60% coverage by CMH with no opportunity to increase by 10%.
4. How do taxes work on LTD benefits? The federal government states employees must be taxed on either LTD premiums or LTD benefit checks For the majority of employees, CMH “gives” the employee the premium on each check, then takes the premium out after tax. This action results in LTD checks being issued tax-free. A few employees have requested their premiums NOT be taxed, meaning their LTD checks would be treated as taxable income and subject to federal, state, FICA and Medicare tax withholding.
5. How long could I collect LTD? After the 90 day waiting period, LTD benefits will continue until one of the following: You recover You reach age 65 You pass away
6. What is an LTD offset? The LTD checks would be reduced (dollar for dollar) if you receive either of the following: Social Security Disability income Pension payments from the CMH Plan Note: Salary continuation (Choice Time and/or ESB hours) are not used to offset LTD benefit checks.