These are great questions and I will answer them in order below:
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Maybe. This is a complicated answer that would depend a lot on the facts of your situation and the relationship between the LTD plan and your employment. Generally speaking the LTD plan and your employer are separate agreements, so one does not dictate the other. However, if you are being paid out for future LTD benefits, then you can’t turn around and try to go back to that employer right away. With some buyouts they will require you to end your employment as part of the deal because of the relationship between the LTD plan and the employment.
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Yes, in pretty much all cases once you do a buy out you will lose extended health coverage and the ability to continue to contribute to your pension plan. Those two are a given. There is no wiggle room with the pension as that is often clearly set out in the pension plan rule and regulations. There may be some wiggle room on the extended benefits, but that is an issue between you and the employer and really has nothing to do with the LTD insurer. Its just that many employers are allowed to keep you on the group medical plan as long as you are approved and receiving LTD benefits. They may be required to take you off that plan once you are no longer “receiving LTD payments”. You can usually negotiate the option to convert your current life insurance to an individual life insurance.
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You can’t just ignore the discount rate. The COLA will provide an offset, but inflation is generally only 1% or so per year. I can’t advise on how you would do the calculation. You have a complex plan so general advice would not apply.
In a situation like you are describing, I always strongly discourage people from seeking a buyout. If you have a pension, then the pension losses arising from a buyout can be substantial. Buy-outs of an approved claim rarely make sense from a financial sense…only in situations where you have very high credit card debits so you would realize big savings form paying off debt.