Long-term disability and Social Security disability are two different claims against two different institutions, and they are usually handled by two different lawyers.
A long-term disability claim is made against a private insurance company under a policy you hold through work or bought yourself, while a Social Security disability claim is made against a federal agency under a national programme.
That distinction is important because if you are searching for a disability lawyer in Philadelphia, you will usually find Social Security firms, since that is the larger practice area by volume.
If your problem is a denied insurance policy, you may call several offices, be told no by all of them, and conclude that nobody handles cases like this, when the issue was only that the wrong kind of firm was called. What you actually need is a Philadelphia long-term disability lawyer, and Edelstein Martin & Nelson, LLP can fight for your rights and interests.
Two Different Definitions of Disability
The systems do not measure the same thing, which is why one can approve you while the other refuses.
Social Security asks whether you can perform any substantial gainful activity that exists in the national economy, judged against a uniform set of federal criteria. It is a demanding standard that pays no attention to what you used to earn or what your profession was.
A long-term disability policy asks whatever the contract says it asks. Many policies begin with an own occupation standard, meaning the question is whether you can perform the material duties of the job you actually held, and only later switch to a broader occupation test. A surgeon with a hand tremor may satisfy their policy’s own occupation definition without coming close to satisfying the federal standard.
The practical consequence is that an approval on one side is evidence on the other, not an answer. Insurers routinely require claimants to apply for Social Security, then argue that a Social Security denial undermines the insurance claim, when the two decisions were made under different tests.
Two Different Processes
The route a claim travels is as different as the standard it is judged by.
An insurance claim governed by the Employee Retirement Income Security Act (ERISA) runs through the insurer’s own internal process first. You file, the insurer decides, and if the answer is no, you have an internal appeal before any court is involved. Only after that process is exhausted can a lawsuit be filed, and in federal court rather than state court.
The insurer’s own clock has limits too. Under the Department of Labor’s ERISA claims-procedure regulation, a plan administrator deciding a long-term disability claim must generally act within 45 days, with at most two 30-day extensions for reasons beyond its control, capping the decision period at 105 days, under 29 C.F.R. § 2560.503-1(f)(3).
An appeal built on a medical judgment must go to a reviewer who took no part in the original denial and cannot simply defer to it, consistent with ERISA’s guarantee of a full and fair review of a denied claim before any lawsuit is filed, since claimants must exhaust those internal procedures before filing a civil action for benefits.
A Social Security claim runs through a federal agency: the Social Security Administration issues an initial determination, and a claimant who disagrees moves to reconsideration, then to a hearing before an administrative law judge, then to the Appeals Council, and lastly into federal court.
The agency considers individuals to be eligible for Social Security Disability Insurance (SSDI) if they have a disability or blindness, and enough work history, evaluating them using the five-step sequential evaluation set out at 20 C.F.R. § 404.1520:
- First, it analyzes the applicant’s current work activity;
- Next, it considers the medical severity of the impairments;
- The impairment is then contrasted with the Listing of Impairments;
- Past relevant work is also considered;
- As the final step, the agency then assesses the person’s residual functional capacity and their age, education, and work experience to see if they can adjust to other work.
Neither process forgives a missed step. Both are built so that what happens early determines what is possible later.
Social Security Can Reduce Your Insurance Cheque
If you win Social Security, your insurance check could be reduced. This is the part that surprises claimants most, and it is the reason the two claims should be managed together rather than in separate silos.
Most group long-term disability policies contain an offset provision allowing the insurer to reduce the monthly benefit by other income the claimant receives, and Social Security disability benefits are the most common offset.
The insurer is not taking your Social Security award, but paying the difference between your policy benefit and what the government now pays. For that reason, they actively encourage and sometimes require claimants to apply.
The complication is timing. Social Security awards are frequently retroactive, covering months during which the insurer was already paying the full policy benefit. When the lump sum arrives, the insurer will identify the overlap and demand repayment of the amount it would not have paid had the award come through on time.
Take someone receiving a monthly policy benefit while their Social Security claim is pending. If the federal award is eventually approved with a retroactive start date, the insurer will recalculate every month in that retroactive window as though the offset had applied from the beginning, and the resulting overpayment demand can be substantial.
But none of this is improper or strange: it is written into the policy. However, it can become a problem when nobody plans for it: the demand letter arrives after the lump sum is spent, and many questions arise.
It is important to note that all figures depend entirely on the individual policy and the individual award, and no general number can be given prior to the facts. A disability lawyer in Philadelphia can guide people through these complex procedures.
Will my long-term disability benefit go down if Social Security approves me?
In most group policies, yes. The insurer may reduce the monthly benefit by your Social Security award, and a retroactive award commonly produces an overpayment demand covering the months already paid at the full rate.
Who Actually Decides a Long-Term Disability Claim
A long-term disability claim is decided by an insurance company that will pay the benefit from its own funds, if it approves the claim. Courts recognise that arrangement as a structural conflict and treat it as a factor when reviewing a denial.
Meanwhile, a social Security claim is decided by a federal agency that gains nothing financially from a denial and applies published criteria to every claimant in the country. The problems in that system are volume, delay, and rigidity rather than financial self-interest.
But one can use that difference to drive strategy. Against an insurer, the work is documentary and adversarial: build a record the insurer cannot ignore and preserve every objection for the court that may review it. Before the agency, the work is procedural and evidentiary: satisfy a defined federal test at the correct step, and prepare the claimant for testimony before an administrative law judge.
Two Sets of Deadlines
Both systems run on very different clocks: one gives you 180 days, while the other one just 60.
On an ERISA-governed insurance claim, a claimant must be given at least 180 days after an adverse benefit determination to file an internal appeal. If you miss that window, the claim can be ended, because courts generally require the internal process to be exhausted before suit.
Social Security appeal steps run on much shorter periods. A claimant has 60 days after receiving a notice to request any level of appeal, and the agency presumes the notice was received five days after the date printed on it.
Luckily, the consequence of missing one is usually that the claimant must start over with a new application; they do not lose the right to benefits altogether. However, a new application can cost months of back pay.
A claimant with both claims pending is therefore tracking a long deadline on one side and a series of short ones on the other, with correspondence arriving from two organisations that do not talk to each other.
What Each One Actually Pays
A long-term disability policy pays a monthly benefit defined by the contract, usually a percentage of pre-disability earnings, running until the policy’s end date or until you no longer meet its definition of disability. It is bound by the policy’s own limitations, including any cap on claims treated as mental or nervous conditions.
Social Security pays a benefit calculated from your earnings record under a federal formula, without regard to what any private policy provides. It also carries collateral benefits that private policies do not, including eventual Medicare eligibility.
Because the two are calculated independently and then offset against each other, the combined result is rarely the sum of the parts. Understanding what you will actually hold at the end of both processes usually requires reading the policy’s offset language alongside the award notice.
How to Tell Which One You Have
Most people can answer what kind of policy they have in ten minutes with documents they already possess.
If your money came from an insurance company and you learned about the coverage through your employer’s benefits enrolment, you have a group long-term disability policy, and it is probably governed by ERISA.
The practical test for whether your policy is governed by ERISA depends on who arranged the coverage and who paid for it. Look for a summary plan description or a certificate of coverage, and look for a premium deduction on an old payslip.
If your money came from an insurance company and you bought the policy through an agent, a professional association, or a broker, you have an individual policy governed by Pennsylvania insurance law rather than federal law. The paperwork will be a policy issued to you personally.
If your correspondence comes from the Social Security Administration and refers to disability insurance benefits or Supplemental Security Income, that is the federal claim. Notices arrive on agency letterhead and reference a claim number rather than a policy number.
Many Philadelphia claimants have all three at once: a group policy, a federal claim, and sometimes an individual policy bought years earlier. Those are three separate matters running on three separate tracks, and the interaction between them is where money is usually lost.
How do I know if my disability policy is governed by ERISA?
If you obtained the coverage through a private employer, it probably is. Coverage you bought yourself is generally not, and government and church plans are frequently exempt from ERISA altogether.
Why the Two Claims Should Be Run Together
Because the systems are separate, claimants often treat them as unrelated, and that is where avoidable damage happens.
The most common problem is inconsistency. A claimant describes their limitations one way on an insurer’s activity questionnaire and another way in an agency function report, months apart, without either document in front of them. Neither account is dishonest. Both become exhibits, and an insurer that finds a discrepancy will use it.
The second problem is evidence duplication. The medical records that support one claim usually support the other, but they need to be framed differently, because one asks about an occupation and the other asks about the national economy. Records gathered once can serve both if they are gathered with both tests in mind.
The third is sequencing. An insurer will often require the federal application, and the timing of that application affects when an offset begins and how large a retroactive overpayment can grow. Deciding when to file, rather than filing whenever the reminder letter arrives, keeps that number smaller.
Comparison: Long Term Disability Insurance and Social Security Disability
| Question | Long-term disability policy | Social Security disability |
| Who decides | A private insurance company | The Social Security Administration |
| Governing law | ERISA if employer-sponsored, otherwise Pennsylvania insurance law | Federal Social Security law |
| Standard applied | Whatever the policy defines, often own occupation first | Inability to perform substantial gainful activity |
| First appeal | Internal appeal to the insurer, at least 180 days on ERISA plans | Reconsideration, then a hearing before an administrative law judge |
| Court route | Federal court after exhaustion, commonly E.D. Pa. | Federal court only after the Appeals Council |
| Jury | Generally unavailable on ERISA claims | Not applicable |
| Benefit | Monthly amount defined by the contract | Amount calculated from your earnings record |
| Effect on the other | Reduced by a Social Security award under most offset clauses | Not reduced by private insurance benefits |
Frequently Asked Questions
Do I need two different lawyers?
Often yes, or one firm that handles both sides. The claims are governed by different bodies of law and are argued in different forums.
Can I receive long-term disability and Social Security at the same time?
Yes, and most people who qualify for both do. The insurer will usually reduce its monthly payment by the Social Security amount.
My insurer told me to apply for Social Security. Do I have to?
Most group policies require it, and the requirement is enforceable as a policy term. Applying also protects your earnings record and future Medicare eligibility.
Does a Social Security denial mean my insurance claim will be denied?
No. The two use different standards, and an insurer that treats a federal denial as decisive is applying the wrong test to its own contract.
How long do I have to appeal a Social Security denial?
60 days after you receive the notice, at each of the four appeal levels. The agency assumes you received it five days after the date on the notice.
Which claim should I file first?
That depends on your policy’s elimination period and its offset language. Both are usually filed within the same period, and the sequencing should be planned rather than improvised.
Does my employer decide any of this?
No. Your employer chose the plan, but the benefit decision is made by the insurer, and the federal claim is decided by the agency.
How Edelstein Martin & Nelson, LLP Handles Disability Claims in Philadelphia
Edelstein Martin & Nelson, LLP works on the insurance side of disability claims, representing claimants whose private or employer-sponsored disability benefits have been denied, terminated, or reduced, and advising on how a Social Security claim interacts with the policy rather than treating the two as unrelated.
Keith L. Martin concentrates on private and group disability policy claims and insurance bad faith matters, and reviews each claim against the policy language that will actually decide it.
If an insurer has already said no, the next step is usually the internal appeal, and appealing denied disability benefits is where the record that a court may later review gets built.
If the coverage was bought privately rather than through work, the analysis shifts to individual disability insurance policies and to state law remedies that federal law would otherwise displace.
Bring both sets of paperwork to one consultation: the insurer’s letter and any notice from the agency, and the two claims can be sorted in a single sitting. That review is free of charge, and there are no fees unless we recover for you. You can contact our Philadelphia office at (215) 731-9900 to arrange an appointment.