What You Should Know About Business Overhead Policies
According to the U.S. Census Bureau, approximately one in five Americans will experience a disability that prevents them from working for at least six months. 30% of workers between the ages of 35 and 65 will suffer a disability for up to 90 days; and one-fifth of that age group will be disabled for five years or more. Given these statistics, it is not surprising that most business owners and professionals with their own practices believe that purchasing a Business Overhead Policy is a necessity. For the most part, they are correct.
Business Overhead Policies pay a monthly benefit to cover expenses if the business ower is unable to work due to disability. These can include rent or mortgage, salaries, office equipment and supplies, malpractice insurance, and utilities, among other expenses. The assumption is that by purchasing a Business Overhead Policy, you will protect your business and will be able to meet your monthly business obligations. That way your business still will be there when you recover; or, if you don’t get better, you still will have something worth selling.
Although policies differ depending upon the coverage you purchase and the insurance company you purchase from, as with other insurance claims, most insurance companies are not anxious to pay out the benefits you’ve paid for, even when your disability is obvious.
Also, keep in mind that Business Overhead Policies were not created to keep your business running without you forever. Rather, they were created to help you meet your monthly expenses during the time of your disability, and/or until you are able to sell your business or practice. Think of a Business Overhead Policy as a temporary safety net and nothing more; a necessity but not a panacea. If you are permanently disabled and cannot run your business or practice, a Business Overhead Policy will not solve all of your problems.
And, just because your have purchased a Business Overhead Policy does not necessarily mean you will receive the maximum allowed by that policy every month. For example, if you purchased a policy that pays up to $20,000 a month, and your expenses for one month are only $15,000, the insurance carrier will only pay you $15,000. On the other hand, if the next month your expenses are $35,000, the insurance company will only pay you the maximum allowed in your policy – $20,000.
For the professional or business owner, Business Overhead Policies are an essential part of life. However, be aware of their limitations, select your policy carefully, and consult with a disability attorney or financial expert before making a final decision or filing a claim.
How The American Recovery & Reinvestment Act of 2009 Can Help Federal Employees
This recession, labeled the worst economy since the Great Depression, unfortunately has affected the entire American workforce. Federal employees, who in previous years may have enjoyed a bit more work security than the private sector, also could be feeling the crunch.
That is because even the Federal Government is cutting back. In fact, it has been reported that if the U.S. Postal Service is forced to cut expenses by eliminating Saturday delivery, postal employees could face layoffs. For postal workers or other federal employees who currently continue to work with a disability, this may be a good time to consider a FERS disability annuity.
Perhaps the most worrisome part of losing your job is the worry over losing your health insurance. To alleviate that major concern during these difficult times, the President and the Congress have included in the American Recovery & Reinvestment Act of 2009 a provision that will guarantee temporary continued health care coverage for federal workers after involuntary termination.
Here’s a quick overview:
1. Federal Employees involuntarily terminated between September 1, 2008 and December 31, 2009, may receive premium assistance from their employers for temporary health care coverage.
2. The premium assistance amounts to 65% of the total health care premiums, and lasts for up to 18 months.
3. This coverage will cease if the employee becomes eligible for other group coverage or for Medicare.
4. Federal employees who are involuntarily terminated because of their “gross misconduct” may not be eligible.
For more information on Temporary Continuation of Health Coverage, visit: www.1OPM.GOV.
Legislative News . . .
Washington, D.C. – Chairman of the House Committee on Veterans’ Affairs, Bob Filner, introduced H.R. 3365 to allow veterans to use their earned Medicare benefits to receive health care and services from the Veterans Health Administration (VHA) at the Department of Veterans’ Affairs. Under current law, the VA has the authority to bill enrolled veterans and their private health care insurers for the treatment of veterans’ non-service-connected conditions. Current law, however, prohibits the billing of Medicare, barring elderly veterans from using their earned Medicre benefits at VA health facilities. H.R. 3365, the Medicare Reimbursement Act of 2009, would require the VA to develop a program that would allow the VA to bill Medicare for services rendered to veterans enrolled in Medicare Part A or B.
“There are veterans who have earned VA health care benefits with their service to our country,” stated Chairman Filner. “They have also earned Medicare benefits by contributing to the Medicare program during their working years. Because the VA cannot bill Medicare, elderly veterans are unable to use their Medicare benefits, even if they may prefer to receive care at a VA facility among their fellow veterans. So for those veterans , they basically forgo the hard-earned dollars that they contributed towards Medicare benefits during their working years. H.R. 3365 is an important bill that would allow elderly veterans to access both VA health care and their Medicare benefits.” Source: House Committee on Veterans’ Affairs, www.veterans.house.gov
Senator Akaka’s VA Advance Funding Bill Passes Senate
This month, the Senate approved the VA Advance Funding Bill, put forth by Senator Daniel Akaka (D) Hawaii, chairman of the Veterans’ Affairs Committee. This important piece of legislation “would provide timely, predictable funding for the veterans’ health care system.”
If passed into law, this bill, The Veterans’ Health Care Budget Reform and Transparency Act of 2009, would secure funding a year ahead of the regular appropriations process, currently secured year-by-year.
The bill also would require public reports as well as GAO audits of the VA’s funding forecasting, allowing more transparency. Presently, the VA’s year-by-year process has delayed funding in 19 of the last 22 years.
Says Senator Akaka, “Congress has worked in recent years to reverse VA’s chronic underfunding, but we still need to address the broken way that we fund the nation’s largest health care system. With advance funding, we will make sure that veterans’ health care receives timely and predictable funding, allowing the VA health care dollars to go further for veterans and taxpayers.
For more information, visit: www.akaka.senate.gov.
Who Is This Great American?
She was born in Brooklyn, NY on March 15, 1933. Recognized early on as an exceptional intellect, she attended Cornell University, and later enrolled in Harvard Law School, ultimately graduating from Columbia University Law School.
In 1972, she was appointed the first female faculty member at Harvard Law School.
She served as a lawyer for the ACLU where she advocated for women’s rights. She successfully argued before the Supreme Court in 1973, her first of six cases.
In 1999, she won the American Bar Association’s prestigious Thurgood Marshall Award for her work in equality and civil rights.
Answer: Ruth Bader Ginsburg