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FERS Disability Retirement Benefits for Government Physicians May Not Fully Protect

Author: Financial Balance Group

Published: 2011-09-08

Synopsis and Key Points:

Review of FERS disability retirement program for physicians employed by the Federal government shows their income may not be effectively protected in event of illness or injury.

Main Digest

FERS Disability Retirement Benefits for Federal Government Physicians May Not Fully Protect Against Loss of Income.

Many physicians employed by the Federal government believe that their income is effectively protected in the event that an illness or injury prevents them from working. However, based on a review of the FERS disability retirement program by Thomas Lloyd of Financial Balance Group, LLC, this may not be the case.

In an effort to empower Federal government physicians to better understand their disability income benefits, Financial Balance Group, LLC and MR Insurance Consultants, the owners of and respectively, have partnered to illustrate how the Federal Employees Retirement System (FERS) works in providing disability benefits, and why the benefits provided may be inadequate.

According to a recent study conducted in 2011, the U.S. Bureau of Labor Statistics reports that nearly 21,000 physicians and surgeons are employed by the Federal government in a full-time or part-time capacity. With an average salary of more than $100,000 for most general practice and specialists, this places government physicians at the top-tier of salary levels for government employees.

The partnered efforts will include the launching of new web pages on each site, that are specific to the options available to Federal government physicians. The team has already started the release of an article series related to the issue and will continue throughout the month of September.

Summary of FERS Disability Benefits for Physicians: When a government physician suffers a total disability and meets the eligibility requirements set forth by FERS, that individual may be eligible to receive a taxable benefit equal to 60% income replacement during the first 12-months of disability and 40% for all subsequent years (until early retirement age).

"After calculating the benefits on an after tax basis, a government physician may end up taking home as low as 30% of his/her pre-disability income throughout a long-term disability, which is just not sufficient," says Thomas Lloyd, a disability insurance specialist in the Washington DC area. Couple the loss of income with the additional expenses that inevitably occur from suffering a long term disability and the impact could be disastrous.

In order to more adequately protect themselves and their families, Federal government physicians subject to FERS can obtain supplemental disability insurance policies from a number of private insurance carriers throughout the nation. "Many physicians purchase an individual disability insurance policy to help supplement their coverage with the Federal government. It's generally inexpensive and provides them the right level of income protection," says Thomas Lloyd.

Thomas Lloyd is a disability insurance specialist with the Financial Balance Group, in Rockville, MD. He works with physicians and dentists to secure disability insurance quotes online and manage their policies.

Thomas Lloyd is a Registered Representative of Park Avenue Securities LLC (PAS), 1355 Piccard Drive, Suite 380 Rockville, MD 20850, (240) 683-9700. Securities products/services and advisory services are offered through PAS, a registered broker-dealer and investment adviser, 240-683-9700.

Financial Representative, The Guardian Life Insurance Company of America (Guardian), New York, NY. PAS is an indirect, wholly owned subsidiary of Guardian. Financial Balance Group, LLC is not an affiliate or subsidiary of PAS or Guardian. PAS is a member FINRA, SIPC.

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