I have received several emails regarding disability insurance coverage from residents and fellows, who are completing their medical training and subsequently pursuing an "academic" career in medicine. Many of these physicians were unaware of the restricted disability insurance coverage limits that is offered to physicians who work for the government after their medical training.
Most insurance companies that provide disability insurance to government physician employees offer much lower coverage limits regardless of income. Typical monthly benefits cap out at $2,000-$2,500/month. That is it!
The fact of the matter is that you as a medical resident making $45,000/year can obtain an own occupation disability insurance policy with a monthly benefit of up to $5,000/month tax free, while your attending working for the government earning $200,000/year is eligible for half of what you are.
Who is effected?
Many attending/faculty physicians working for a federal (i.e. VA Medical Centers), state or local (i.e. County Hospitals) medical facility are classified by the insurance companies as employees of the government. A few exceptions to this rule would be medical residents/fellows, physicians who works for a private group that contracts out with one of these hospitals or independent contractors.
Solution?
You should apply for an individual disability insurance policy with the own occupation benefit while you are still a medical resident or fellow. Insurance companies will offer a starting monthly tax free benefit to you between $3,500 to $5,000/month if you apply during medical training.
These are the general guidelines, however there are exceptions to this rule as noted before. You should always consult with an insurance broker as to how much coverage you may qualify for based on your income and future employment.
