Benefit Duration and Return to Work Outcomes in Short Term Disability Insurance Programs: Evidence from Rhode Island's Temporary Disability Insurance Program

Purpose

The Workforce Innovation and Opportunity Act strengthens the vocational rehabilitation program’s focus on providing early intervention services to keep workers with disabilities in the workforce. At the same time, some have suggested that short-term disability insurance (STDI) programs may hold promise as an early intervention service, helping people with disabilities stay in the labor force and avoid needing longer-term benefits. Rhode Island is one of five states with a mandatory STDI program. We examine the extent to which Rhode Island STDI claimant characteristics are correlated with partial return-to-work (PRTW) benefit receipt and certain STDI benefit receipt duration measures.

Methods

Our study used administrative data from 2011 to 2014 to explore Rhode Island’s STDI program—called the Temporary Disability Insurance program—and regression analysis to estimate the correlations of interest.

Results

Regression adjusted estimates revealed that claimants opting to receive PRTW benefits earned more and received benefits for fewer weeks than claimants opting to not receive PRTW benefits. We also observed significant correlations between duration of benefit receipt and claimant characteristics such as diagnosis and treating healthcare provider specialty.

Conclusions

Findings suggest that STDI claimants with certain characteristics are more likely to receive benefits for a long duration or not receive PRTW benefits, signaling that they might benefit from early Vocational Rehabilitation supports and services that would allow them to remain productive members of the workforce and avoid long term benefit receipt.