Work and SSI and SSDI

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					                        How Work Affects
                          SSI and SSDI

                             Linda Landry
                             Disability Law Center

                             SSA Partners Summit
                             March 2008

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                        3 Questions For Today
            How does work affect SSI or SSDI I am
            If I lose my SSI or SSDI, will I lose my
             Medicaid or Medicare?
            What can I do to avoid problems with
             Social Security when I work?

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         How Benefits Help The Transition
                     to Work
            Income from benefits = safety net
               While recovering or gaining skills needed

                for work
               While trying out work

            Benefits come with health care
               Medicaid

               Medicare

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                        What is SSI?
            SSI is a needs based benefit program.
            SSI has strict income and asset limits.
            SSI has strict immigration status rules.
            No work history needed for SSI.
            Most states provide Medicaid w/SSI.

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        SSI and Work – Effect of Wages ?
            Once SSI eligibility has been
             determined, the effect of wages is
             as countable income that reduces
             the SSI benefit, and not as
             Substantial Gainful Activity (SGA)
             that terminates eligibility.

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                        SSI Basics - Income
            Income = “anything you receive in cash or in
             kind that you can use to meet your needs for
             food and shelter.”

            Types of income:
                 Earned = compensation for work.
                 Unearned (e.g., SSDI, unemployment, alimony, gifts).
                 In-kind (e.g., free shelter or food).
                 Deemed from a spouse, parent, or sponsor.

            Income generally counted month of receipt.

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           SSI and Work – Effect of Wages
           For SSI, gross monthly wages count when
            paid/received. 20 CFR 416.1111(a).
           To compute countable monthly wages, deduct $65
            plus ½ of the remainder from gross monthly wages.
            20 CFR 416.1112(c)(5) & (7).
           SSI recipients may also deduct the $20 “general
            income disregard” from wages, if not used on
            “unearned” income. 20 CFR 416.1112(c)(4).

           A good estimate of countable wages is ½ of gross
            monthly wages.

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           SSI and Work – Effect of Wages
                    Example 1
            Carmen receives $637 in SSI disability
             benefits in 2008.

            She takes a job paying $885 in gross
             wages per month.

            What is the effect on her SSI?

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           SSI and Work – Effect of Wages
                    Example 1
            $400 of Carmen’s gross monthly wages
             is countable [$885 – 85 ($65 + $20)
             divided by 2 = $400].

            Carmen’s SSI benefit will be $237.00
             ($637 - $400 = $237).

            Her total monthly income will be $1122.

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             SSI and Work – Effect of Wages
                      Example 2

            Joe receives $520 in SSDI and $137 in SSI
             disability benefits per month in 2008.

            He also takes a job paying $885 per month in
             gross wages.

            These wages make him SSI ineligible.

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             SSI and Work – Effect of Wages
                      Example 2
            $520 SSDI - $20 = $500 countable SSDI
            $885 gross wages - $65 = $820.
             $820 divided by 2 = $410 countable wages.
            $500 + $410 = $910, more than the SSI
             amount ($137) for which Joe is eligible.
            Joe’s totally monthly income is $1405.
            Will Joe remain eligible for Medicaid? (more
             on this later)

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                         SSI Benefits and Work
                        Self Employment Income

            SSA starts with net self employment to
             calculate the amount of SSI the
             individual would otherwise be eligible to
            20 CFR 416.110(b), 416.1111(6).

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                        SSI Benefits and Work
                          IRWE Deductions
            Impairment Related Work Expenses
             (IRWEs) may be deducted to determine
             countable gross monthly wages and
             countable net self-employment income.
            20 CFR 416.1112
            IRWE deductions are in addition other
             permitted earned income deductions

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                        SSI Benefits and Work
                          IRWE Deductions
            IRWEs are:
                  impairment related items and services
                  needed in order to work
                  out of pocket, i.e., paid by the individual
                   and not reimbursed by any source.
                  paid in a month when individual worked.
                  20 CFR 416.976

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                            IRWE Examples
                        Attendant Care Services
            provided at work
            provided on the trip to and from work
            provided at home on work days to
             prepare for work, including cooking and
             bathing after work.

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                          IRWE Examples
                        Transportation Costs
            Expense must be required by the
             individual’s disability. E.g., individual
             cannot drive to work and cannot take
             available public transportation due to
            Vehicle modification costs.
            SSA approved mileage allowances

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                        IRWE Examples
            Wheelchair or other mobility device
            Protheses not primarily cosmetic
            Adaptive equipment and software for
             work and use training
            Communication equipment
            Environmental equipment

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                            IRWE Examples
                        Residential Modifications
            Residential modifications , if employed
             outside the home, to exterior of the
             home to permit access
            If self-employed, modifications to
             create an accessible workspace

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                        IRWE Examples
                        Medical Expenses
            Medications and other treatment to
             control or improve a condition to permit
            Doctor visits for conditions related to
            Diagnostic procedures related to
             control, evaluation or treatment.

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                        Other IRWE Examples

            Medical supplies
            Service animal expenses
            Support animal expenses
            Job coach expenses

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                        Rex Could be an IRWE

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             SSI Example – Effect of IRWES
                  on Countable Wages
            Carmen receives $637 in SSI disability
             in 2008.
            She takes a job paying $885 in gross
             wages per month.
            She pays $60 per month for chiropractic
             treatments and co-pays for medications
             she needs in order to function at work.

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             SSI Example – Effect of IRWES
                  on Countable Wages
            $380 of Carmen’s wages are countable:
             $885 – 85 ($65 + $20) = $800
             $800 - $60 (IRWEs) = $740
             $740 divided by 2 = $370 in countable
             earnings .
            Her SSI benefit will be $267 ($637 -
             $370 = $267).

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                        SSI Benefits and Work
                           BWE Deductions

            Blind Work Expense (BWE) deductions
             are available to SSI recipients eligible
             on the basis of blindness.
            BWEs are in addition to other permitted
             earned income deductions.
            20 CFR 416.1112(c)(8).

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                        SSI Benefits and Work
                           BWE Deductions
            Examples of BWEs (POMS SI 00820.555):
               service animal expenses;

               transportation to and from work;

               taxes;

               attendant care services;

               visual aids;

               translation of materials into Braille;

               lunches;

               professional association dues.

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                   Work SSI and SSI Benefits
             Student Earned Income Deduction

            The student earned income
             deduction is for SSI recipients who:
                are under age 22, and
                are regularly attending school.

                20 CFR 416.1112(c)(3).

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                   Work SSI and SSI Benefits
             Student Earned Income Deduction
            Regularly attending school means:
                  For grades 7-12, attending at least 12 hrs
                   per week;
                  For college or vocational program,
                   attending at least 8 hrs per week.
                  20 CFR 416.1861.

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                        SSI Benefits and Work
              Student Earned Income Deduction
            In 2008, the student earned income
             deduction is $1550 per month, up to a
             maximum of $6240 per year.
            This amount is indexed to the yearly
             cost of living increase.
            This deduction is in addition other
             permitted earned income deductions.

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         Federal Educational Assistance
            All student financial assistance received
             under Title IV of the Higher Education
             Act of 1965, or under BIA Student
             Assistance Programs, is excluded
             from income and resources,
             regardless of use. Title IV programs
             include: Pell Grants; federal work study
             programs; Upward Bound, and others
             specified in POMS SI 00830.455.

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             Other Educational Assistance
            any portion of a grant, scholarship, or
             fellowship used for paying tuition, fees, or
             other necessary education expenses is not
             countable income. 20 CFR 416.1124(c)(3).
            any grant scholarship, fellowship, or gift for
             the cost of tuition or fees does not count as a
             resource for nine months. 20 CFR
             416.1210(u), 416.1250.

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                Plan to Achieve Self-Support
            Set aside income and resources to use to
             achieve an occupational goal.
            Occupational goal must be feasible.
            PASS must be in writing and include budget
             (& business plan if self-employment).
            If PASS is approved by SSA & followed,
             income and resources in PASS don’t count for
             SSI. 20 CFR 416.1112(c)(9), 416.1210(f).

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                        SSI and Medicaid

           Medicaid is a needs–based health
            coverage program.
           Most states provide Medicaid to SSI
           Check your state for state specific
            Medicaid rules.

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            Keeping MassHealth While Working
                      Loss of SSI

            Will I lose Medicaid coverage if I make
             too much money to receive SSI
             benefits, even with all the deductions I
             can take?
            Probably not – you should be eligible
             for “1619b Medicaid” and maybe for
             Medicaid Buy-in program.

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                        SSI Benefits and Work
                           1619b Medicaid
            1619b Medicaid provides continued Medicaid
             for SSI recipients with earnings too high to be
             eligible for an SSI cash payment.
            These individuals can be “deemed” eligible for
             MassHealth - if they continue to meet all
             other SSI eligibility criteria, including the
             asset limit, AND if they meet the “Medicaid

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                        SSI Benefits and Work
                        1619b “Medicaid Test”
            The individual must:
              have been eligible for SSI for at least
               1 prior month;
              remain medically disabled;

              need MassHealth in order to work;
              have insufficient income to replace
               Medicaid and SSI.

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                        SSI Benefits and Work
                           1619b Medicaid

            Individuals can move seamlessly
             between SSI cash eligibility and 1619b
             Medicaid when the ability to work and
             wages fluctuate – as long as they
             continue to meet the disability standard
             and remain assets eligible for SSI.

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                        SSI Benefits and Work
                           1619b Medicaid

            The bad news is having to continue
             to meet the SSI asset test – which
             can be hard while working.
            A state Medicaid buy-in program
             may be an alternative option.

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                        SSI Benefits and Work
                           Medicaid Buy-In

            The Ticket to Work Act, P.L. 106-170
             (1999) allowed states the option of
             expanding Medicaid coverage through a
             buy-in for disabled working individuals.
            A majority of states have established
             Medicaid buy-in programs
            See

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                        SSI Benefits and Work
                           Medicaid Buy-In
            Income and resource eligibility and out
             of pocket costs vary from state to state
             in Medicaid Buy-In programs.
            These programs can be a good
             alternative to 1619b for some.
            But, client must be counseled on the
             effects of cutting ties with the SSI

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             How Do I Avoid Problems with
                  SSI When I Work?
            Be ready:
                 Understand the SSI income counting rules
                  and their likely impact on your SSI benefit
                 Provide SSA with verifications for all
                  income deductions for which you think you
                  are eligible
                 Seek information from WIPA programs

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             How Do I Avoid Problems with
                  SSI When I Work?
            Report
                  Report to SSA anything that might affect
                   your SSI eligibility, e.g., new job, change in
                   pay, bonus, loss of job, etc.
                  Report within 10 days of the end of the
                   month in which the change occurs – ASAP
                   is better.
                  Report in person at your local SSA office if
                   at all possible.

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             How Do I Avoid Problems with
                  SSI When I Work?
            Keep records/copies
                  of everything you provide to SSA
                  of your notices
                  of when, where & to whom you
                   spoke provided records
                  of reports to SSA.

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                        SSDI and Work

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                            What is SSDI
       (Social Security Disability Insurance)?

           SSDI is a Social Security insurance program
            that pays a monthly cash benefit to people
            who are:
                Disabled = same definition of disability as with
                 SSI (for adults), AND
                Insured = worked and earned enough Social
                 Security credits by paying FICA taxes. For most
                 adults, this means working for about 5 of the last
                 10 years before becoming disabled.

           SSDI has no income or asset limits.
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                        Earning Credits to Become
                             Insured for SSDI
            You earn 1 credit for every $1000 earned (in
             2007). $4000 earned = 4 credits.
            You can earn a maximum of 4 credits/year.
             Must pay FICA taxes. No credits for “under
             the table” work.
            Special SSDI Rule for Young Adults:
                 To be insured for SSDI, adults under 24 years old
                  only need to earn 6 credits in the 3 years before
                  they become disabled.

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                        More About SSDI
            The SSDI benefit amount depends on how much you
             earned. Average = $978, but could be much lower
             or higher. Maximum is $2185/month n 2008.

            Certain dependents of the wage earner may be
             eligible for benefits on SSDI recipient’s wage record.
            SSDI recipients receive Medicare after 24 months of
             eligibility (Recipients with ALS do not have to wait 24
             months.) SSDI recipients may also qualify for
             Medicaid, but need to apply for it.

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          How Does Work Affect SSDI ?

            The rules for SSDI and work are completely different than
                    for SSI. It’s like being on another planet.

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          SSDI Work Incentive Scheme

9 Month Trial Work Period

                        36 Month Extended Period
                              Of Eligibility

                                                 The Cliff:
                                      Benefit Termination if over SGA

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                        What I Need to Know
            Have I completed my 9-month Trial
             Work Period? When?

            If yes, when does/did my 3-year
             Extended Period of Eligibility end?

            Are my countable earnings above the
             Substantial Gainful Activity level?

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                        Trial Work Period
                        20 CFR 404.1592

            9 service months in any 60-month
            Keep your benefits no matter how
             much you earn as long as you
             remain medically disabled
            1 Trial Work Period per period of

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                         Trial Work Period
            You only use a trial work month if you
             perform “services,” meaning:
                 Earn more than $670 gross wages per month in
                  2008 (this amount changes every year)
                 If self-employed, earn more than $670/month
                  gross or work more than 80 hours/month
                 Not just training or therapy
            No deductions for IRWEs; no averaging
             earnings during TWP

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         Trial Work Period – Example 1
            Victor went back to work for the first time
             after getting on SSDI. His gross earnings
                 $400 in January 2008
                 $680 in February 2008
                 $1000 in May 2008
                 $500 in June 2008
            How many trial work months did he use?
            Should he get his SSDI for these months?

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         Trial Work Period – Example 2
            Maria’s gross earnings went over the trial work month “services”
             limit in the following months:
                  1. June 2001
                  2. January 2002
                  3. February 2002
                  4. March 2002
                  5. April 2002
                  6. May 2002
                  7. June 2002
                  8. August 2007
                  9. September 2007
                  10. October 2007
                  11. November 2007
            What month of her TWP is she in as of November 2007?

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                  Example 2 – The Answer
            TWP 1 - June 2001
            TWP 2 - January 2002
            TWP 3 - February 2002
            TWP 4 - March 2002
            TWP 5 - April 2002
            TWP 6 - May 2002
            TWP 7 - June 2002
            TWP 1 - August 2007 (60-mo. Lookback to Aug. 2002)
            TWP 2 – September 2007
            TWP 3 - October 2007
            TWP 4 - November 2007

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          The Extended Period of Eligibility
              – An All or Nothing Deal
            36 months starting month after the 9th trial
             work month.
            Get SSDI in months where countable
             earnings are the SGA level, as long as remain
             medically disabled.
            Get no SSDI in months earnings are at or
             over SGA level.
            20 CFR 404.1592a.

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             Cessation and Grace Period
            1st month of SGA after the Trial Work
             Period is called the cessation month.

            Despite SGA, SSDI benefits are payable
             for the cessation month and the
             following 2 months.

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                        EPE Example
            The 9th month of Victor’s Trial Work
             Period was December 2005. When
             does his EPE run?

            Answer: January 2006 through
             December 2008.

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                         Is it SGA?
            Work must be substantial and gainful.
            In 2008, work presumed to be SGA if
             gross countable earnings are
             $940/month or higher ($1550/month or
             higher if SSDI for blindness).
            Three additional SGA tests for self-
             employed, based on worth of work.

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                        How to Count Earnings
                              for SSDI
            Earnings count when they are earned, not
             when paycheck is received, unlike SSI.
            Count gross earnings unless self-employed.
            Only pay for work activity counts
               Not pay for sick or vacation time

               Only bonus pay if based on productivity

               Earnings put into pre-tax Cafeteria and
                retirement plans count
               POMS DI 10505.010.

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                 Is It SGA? – Deductions
               Available Throughout the EPE
            IRWEs (slides 14 – 20)
            Subsidies. 20 CFR 404.1574(a)
                  Employer pays more than actual value of services
                   performed ($ amount or % reduction)
            Special Conditions. 20 CFR 404.1573
                  E.g., close and continuous supervision; work done
                   by job coach; frequent rest periods
            Unincurred Business Expenses (self-
             employment only) – e.g., free help. 20 CFR

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           Is it SGA? – Not if it’s an
       Unsuccessful Work Attempt (UWA
           UWA. 20 CFR 404.1574(c)
                Yes - If work ended or reduced below SGA within
                 3 months due to the impairment or removal of
                 special conditions related to the impairment.
                Maybe – If work ended or went below SGA after 3
                 months and before 6 months. Look at absences,
                 work performance, special conditions, etc.
                No – If work lasted more than 6 months.
           UWA does not apply after first month of SGA
            after end of trial work period (cessation).
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           Is it SGA? – Averaging Earnings

           Average over entire work period unless:
                Significant change in work patterns or
                 earnings, or
                Change in SGA level (e.g., yearly COLA)

           No averaging earnings after first month of
            SGA after end of trial work period (cessation).
           20 CFR 404.1574a, 404.1592a

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                             SGA Example
            Elsa is in her EPE. Her gross earnings in
             January 2008 were $1000.
            In January 2008 she paid for the following
             impairment related work expenses:
                  $25 for prescriptions
                  $75 for therapy
                  $50 for her support dog Max
            Are her countable earnings over SGA for
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                        The Answer

            No. It’s not SGA ($940 or more in
             gross in earnings in 2008).
            IRWEs: $25 + $75 + $50 = $150
            Gross income $1000 – $150 IRWEs
             = $850 countable income

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                        After the EPE – The Cliff
                           20 CFR 404.1592a

            SSDI eligibility ends with the first SGA after
             the end of the EPE.
            IRWEs, subsidies and special conditions
             deductions apply after the EPE.
            Averaging and Unsuccessful Work Attempt do
             not apply after the EPE, if SGA during EPE .
            If SSDI terminated due to SGA after EPE, no
             right to continuing benefits during appeal,
             unlike medical Continuing Disability Review.

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              SGA and SSDI on the Basis of
            Under age 55, SGA applies the same as
             for those eligible on the basis of
            The only difference is that the
             presumed SGA standard is higher -
             $1550 in gross monthly wages in 2008.
            20 CFR 404.1586(a)(3).

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              SGA and SSDI on the Basis of
            At 55 and older, SGA does not result in
             loss of SSDI, unless the work shows the
             ability to use skills and abilities
             comparable to those in gainful activity
             done with some regularity and over a
             substantial period of time prior to age
             55 or becoming blind, whichever is
             later. 20 CFR 404.1586(a)(4).

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              Expedited Reinstatement
             20 CFR 404.1592b, 416.999
            New Application; OR
            Expedited Reinstatement of Benefits (SSDI and SSI)
               If benefits terminated due to earnings;

               Unable to perform SGA in month of application;

               Disabled due to the same or related impairments
                as those for which previously on benefits; and
               Request reinstatement within 60 months from
                date of termination.
               Up to 6 months of “provisional” benefits available
                while eligibility is decided.

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                         Extended Medicare
                        POMS DI 55001.B.2.

            Medicare continues during EPE even if
             not eligible for SSDI cash.
            If SSDI terminates after EPE due to
             SGA, Medicare continues for up to 93
             months after the twp, if individuals
             remains medically eligible.
            Must pay Medicare Part B premiums
             quarterly if no SSDI to deduct from.
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                How To Avoid Problems with
                   SSDI When Working
            Be Ready
                  Understand the Trial Work Period, the EPE, SGA,
                   and how Social Security counts earnings for SSDI.
                  Keep records of the amount earned each month,
                   and of deductions such as IRWEs and subsidies.
                  Know if you’ve finished your trial work period;
                   where you are in your EPE; if your EPE has ended.
                  Seek information from a WIPA program.

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           How Do To Avoid Problems with
                SSDI When Working
            Report. Report. Report.
                  Report to SSA when you go back to work,
                   your earnings, and changes in jobs or
                  Report within 10 days of the end of the
                   month in which the change occurs. The
                   sooner the better.
                  Report in person at your local SSA office if
                   at all possible, and get and keep a receipt.

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           How Do To Avoid Problems with
                SSDI When Working
            Verify and Record
                  Provide SSA with verification of all earnings
                   and all income deductions you think you
                   are eligible for.
                  Keeps copies of everything you give to SSA
                   and a keep a record of when, where & to
                   whom you gave it.

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         Questions About SSDI and Work?
            Consult with WIPA program staff.

            Visit SSA’s website at

            Read Social Security’s Red Book on
             Work Incentives.

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