What to Do If Your Disability Benefits Are Denied

Disability and Healthcare Planning | by Jules Buxbaum | Monday, January 27, 2025

Disability benefits appeal can be overwhelming when you first see the denial letter. Yet nearly 65% of initial claims face rejection, so you’re far from alone in confronting this setback.

Before losing hope, remember that multiple appeal stages exist to help you pursue benefits. If you’re unsure about your next steps, it might help to learn about distinctions like short-term vs. long-term disability so you can pinpoint the best path forward.

Why Are Disability Benefits Often Denied?

Many applicants receive denials because their medical documents are incomplete or do not meet official disability criteria. In other cases, procedural errors—such as filing incorrect forms—cause the problem.

Technical reasons also appear often. For instance, individuals may exceed Substantial Gainful Activity (SGA) thresholds or lack adequate work credits. If the denial letter cites a technical detail, you can potentially fix that issue during the first appeal stage.

Primary Stages of a Disability Benefits Appeal

Once you receive a denial notice, you generally have 60 days to respond. Missing that deadline might close your case unless you show “good cause” for filing late. Below are the main steps in most Social Security out-of-work appeals.

1. Reconsideration

Reconsideration is a fresh review by a different evaluator than the one who handled your initial application. You can submit new or stronger medical evidence, such as updated treatment records or additional physician statements.

This review can take several months. Historically, only about 10–15% of people gain approval here. Still, thorough new evidence may turn things around, especially if you address every detail from your denial letter.

2. Administrative Law Judge Hearing

If reconsideration fails, you can request a hearing before an Administrative Law Judge (ALJ). This step offers a face-to-face meeting—sometimes conducted through video—giving you a chance to explain your situation personally.

You may wait 12–18 months for a hearing date due to backlogs. Despite that wait, data from 2020 shows a roughly 50–60% approval rate at this stage. Presenting persuasive proof of your condition and limitations is key to a positive outcome.

3. Appeals Council

When an ALJ rules against you, you have the option to seek another review by the Appeals Council. The Council examines whether correct procedures were followed and whether the evidence was appropriately considered.

The Appeals Council might return your case to an ALJ for further review, decide on its own, or decline to re-evaluate. This path can take a year or more, and approval rates hover below 5%—though your specific circumstances could differ.

4. Federal Court Review

This final level involves filing a civil action in Federal district court. It’s the most legally complex stage, and a significant portion of claimants seek legal representation here. If you continue, a judge will review the SSA’s decisions for errors of fact or procedure.

Because of tight court deadlines and formal procedures, many rely on an attorney who focuses on disability cases. Though federal reviews are challenging, a victory can open the door to benefits or trigger another ALJ hearing.

Key Considerations for Timely Filing

You typically have 60 days from the date on your denial letter to appeal. The SSA generally assumes the letter reached you five days after mailing, so that effectively becomes 65 days unless you prove otherwise.

Filing online is often faster. You can also track your case through the SSA’s electronic system. Missing your window can require you to start from scratch or show a valid excuse, so respond quickly to every notice.

Common Reasons for Denials—And How to Address Them

Incomplete medical records and missing timelines are frequent obstacles. Address these by collecting doctor reports, lab results, or physical therapy notes. Many find that updated records can demonstrate a chronic condition’s progression.

Insufficient proof of severity is another concern. Detailed physician statements highlighting how symptoms restrict daily tasks provide clarity. Do you face limitations standing for an extended shift? That testimony can show the judge why full-time work isn’t possible.

Crucial Steps to Strengthen Your Appeal

Gather every bit of new medical data you can. Pinpoint any test results, treatment changes, or additional diagnoses that weren’t available when you applied the first time. Such updates can play a big role in your appeal.

Also consider whether pre-existing conditions affect disability insurance for your situation. Sometimes showing multiple conditions—like a heart issue plus severe knee pain—underscores how combined impairments reduce your work capacity.

Legal or professional representation is valuable too. According to one SSA Inspector General report, claimants with professional representation were nearly three times more likely to succeed at the ALJ level. Experts can help present your medical data and challenge unfavorable opinions effectively.

How Disability Appeals Impact Retirement Planning

Prolonged waiting for benefits may cause unscheduled withdrawals from retirement funds. This approach can undermine your financial stability down the road. It might also shift your tax obligations if you tap accounts early.

Some people reevaluate their retirement timelines when disability applications take longer than expected. If you need to save more aggressively, you may want to examine whether disability income affects retirement goals. Strategizing around potential partial work income or partial benefits can safeguard your future balances.

Seeking a Bigger Financial Picture?

While focusing on your disability claim is important, you might also need an integrated plan that factors in contingencies, possible risk adjustments, and your overall savings approach. That’s where a specialized tool can assist.

If you’re ready to plan beyond the immediate appeal, the Two Pi Financial Planner can guide you. It evaluates your data and shows how factors like retirement age, risk tolerance, and savings rates change the odds of sustaining your future budget.

Filing in Different States or Reapplying?

Specific state rules—like partial tax breaks or resource limits—might influence your decision to stay the course or file anew. If you move or if your household changes, these details can shape your case specifics.

Those who live in regions like New York or Florida often have different thresholds around acceptable monthly earnings. Investigating how to apply for disability benefits in different states may reveal local programs or supplemental income options worth exploring.

What Happens If the Appeal Fails?

An unfavorable outcome at one stage doesn’t always mean the end. You can progress through each level of this system, but keep an eye on deadlines and gather every relevant piece of evidence.

In extreme cases, a new claim might be your next move. However, repeating the process should not be your first choice if you can still push your appeal further. It might be beneficial to consult an attorney or a trusted advocate before starting a fresh application.

Bottom Line

Being denied disability benefits is frustrating. Yet the multi-tiered system provides a second—and sometimes third—chance to prove that you qualify for financial support.

To boost your odds of success, submit fresh records, follow each deadline, and seek guidance if needed. You can learn more about appealing a denied claim if you want additional insights on forms, hearings, and legal strategies.

References

1. Social Security Advisory Board. (2020). “Improving the Social Security Disability Process.” Available at: https://www.ssab.gov/(https://www.ssab.gov/)

2. Government Accountability Office. (2020). “Average Wait Times for ALJ Hearings.” Available at: https://www.gao.gov/(https://www.gao.gov/)

3. HDSA. “Understanding the Social Security Appeal Process.” Available at: https://hdsa.org/(https://hdsa.org/)

4. SSA Office of the Inspector General. (2019). “Representation in Disability Hearings.” Available at: https://oig.ssa.gov/(https://oig.ssa.gov/)

5. SOAR Works. “The SSA Appeals Process: Information for Applicants.” Available at: https://soarworks.samhsa.gov/(https://soarworks.samhsa.gov/)