Uh Oh! Dangers in Your Disability Policy

Debra A. Shute

Disclosures

July 24, 2019

Christopher Yerington, MD, was forced to end his career in clinical anesthesiology due to progressive degenerative peripheral neuropathy diagnosed at age 40.

As if that event weren't bad enough, Yerington discovered that his disability insurance policy did not cover him like he thought it would.

"Multiple EMG [electromyography] exams were performed to verify the findings," said Yerington. "My clinical career ended that day with awful proof showing chronic permanent damage to the nerves to my left arm and hand. The neurologist and I spoke softly about the probability of using a wheelchair later in life."

Yerington is not alone. Many physicians, through illness or accident, have their lives changed and may be unable to work, either completely or partially. Most assume their insurance disability policy will save them. In some cases, they're right. But not always.

Unless a physician is very financially independent, disability insurance is crucial. "Your entire financial life generally revolves around your ability to get up and work, do what you do every day, and generate an income," says Lawrence Keller, CFP, CLU, ChFC, an insurance agent specializing in term life and disability insurance for physicians and other professionals.

"The bottom line is—for a physician or anybody else—if they're working because they need the money, they need disability insurance to protect that income," he says.

Statistically speaking, a 32-year-old is 6.5 times more likely to become disabled during their working years than to die, notes Cory S. Fawcett, MD, a personal finance coach and author.[1] "For that reason, disability insurance is even more important than life insurance for a practicing physician." he says.

However, the culture of medicine, beginning in residency, instills in physicians such extraordinarily high expectations that they don't envision themselves ever becoming disabled, says Yerington.

Yerington wrote about his life-changing disability onset in a guest post on Fawcett's physician-finance blog:

The neurologist repeated my exam six times and used two different machines. He looked up at me. I knew, he knew. Silence. I finally said, "I will never practice clinical anesthesiology again." The EMG showed chronic permanent damage of my left median nerve. Full neurological exams and multiple EMGs eventually showed deficits in the left lower leg and foot as well. I was told that I might need the use of a wheelchair later in life. ... My last day of clinical practice was October 15, 2009. I went on disability in January 2010.

"Trust me, I never wanted to become an expert in disability insurance," Yerington says. His disability insurance policy did not cover him like he thought it would—and the emotional turmoil that ensued—so Yerington now educates physicians about disability insurance and what he calls "preventive financial medicine."

Your Employer Group Policy Is Probably Not Enough

Many healthcare organizations offer their physicians disability insurance at little or no cost to the physician as an employee benefit. Physicians also do not have to submit any medical information or answer any underwriting questions about dangerous avocations such as scuba diving or rock climbing. "If you're not healthy, not having to provide medical information can be a saving grace," says Keller.

However, experts warn against relying on group policies alone. "Group disability insurance is really designed to take care of a catastrophic event—blindness, brain injury, lost limbs, or other lifelong loss of function," says Yerington.

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