Public Benefits for the Disabled
Two types of monthly income and medical coverage benefits may available to disabled individuals. Entitlement benefits are available to those who have sufficient quarterly credits paid into the Social Security system. Welfare benefits are provided to those disabled individuals who have a financial need. Complicated rules and similarities in the names of the programs cause a good deal of confusion. Many individuals who receive the benefits are unaware of which type they receive. Some individuals may receive both types of benefits.
|Income||Social Security Disability
| Supplemental Security
Social Security Disability Insurance (SSDI)
To qualify for SSDI a person must meet Social Security’s definition of “disabled” meaning he must be unable to do “substantial work”, or must be unable to earn more than $940 per month and have a sufficient past work record to have paid sufficient credits into the Social Security system. Family benefits may be available to the dependents of the SSDI recipient. A child with a disability who has never paid into the system may be eligible for SSDI based on his parent’s work record provided the disability began before the age of 22 and the parent is dead, disabled or retired.
The amount of the SSDI benefit is based on the worker’s earnings record, the time of the workers benefit claim and the number of dependents the worker has. If the family includes more than one dependent, the “family benefit amount” (up to 180% of the worker’s benefit) would be divided among all the dependents of the worker who are entitled. When the worker reaches retirement age, he will qualify for retirement benefits through Social Security and his SSDI will stop.
After being qualified for SSDI for 24 months, the disabled individual qualifies for Medicare. This is the same medical insurance benefits available to retired people. Premiums for the insurance are deducted from the Social Security check. Part A pays for in-patient care in a hospital, skilled nursing facility or hospice. Part B pays for out-patient care such as doctor visits and other medical services and supplies. Part D pays for prescription drug coverage. Medicare generally pays for 80% of the Medicare approved amount of the bill.
Supplemental Security Income (SSI)
Those who meet Social Security’s definition of disabled and are financially needy may qualify for SSI. Financial need is based on both assets and monthly income. To qualify, the individual must own no more than $2,000 in countable assets. Certain assets such as a home, car, prepaid funeral, burial plot, furniture or personal property are considered “exempt” not countable assets. To qualify for SSI, the disabled individual’s monthly income must not exceed the qualifying amount ($637 in 2008). The qualified individual will receive SSI to supplement the monthly income. Receiving direct or “in kind” income (such as cash gifts or free room and board from relatives) can reduce the amount of the monthly benefit.
Children under the age of 18 may be eligible for SSI if they meet Social Security’s definition of “disability for children”, but many, do not qualify because the parents’ income is too high. After the age of 18, however, the benefit is based on the child’s own income and resources.
Medicaid is available to pay the medical bills of disabled individuals with a financial need. Although Medicaid qualifications, in most states, mirror SSI requirements, in Ohio, Medicaid recipients can have no more than $1,500 in countable assets. The monthly income requirements are the same. Some people who have more income than Medicaid and SSI limits can qualify for Medicaid by “spending down” a portion of their income each month on medical bills or by a direct payment into the system. This “spend down” will offset their income enough to qualify them for Medicaid benefits.
It is important to distinguish entitlement benefits, which are provided because the worker has paid into the Social Security system from welfare benefits, which are based on a financial need. A person may receive SSDI and Medicare regardless of now many assets he owns or what other income he may have. A person receiving SSI or Medicaid may lose those benefits if he receives a financial windfall such as an inheritance or settlement of a lawsuit or if his income increases above the qualifying level.
An attorney can assist the families of disabled individuals with their estate and financial planning to assure that important public benefits are preserved.
By Marta Williger, CELA | Williger Legal Group, LLC | Munroe Falls, Ohio | www.willigerlegalgroup.com/
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This article is for informational purposes only and is not intended to be advertising, solicitation, or legal advice. This article may not reflect the most recent legal changes. Individual circumstances vary, and laws differ from state to state. If you have a question about your specific situation, we recommend that you find a certified elder law attorney in your area.