EMPLOYMENT: The Great Frontier

1. EMPLOYMENT: The Great Frontier How Work Impacts SSA Disability

2. Two Disability Programs • Social Security Disability Insurance (SSDI) • Supplemental Security Income (SSI)

3. SSDI • Authorized under Title II of the Social Security Act • Pays workers under full retirement age, who are disabled or blind and their dependents • Worker must be insured • Benefit amount based on lifetime average earnings covered by Social Security (FICA) • All benefits paid from the Social Security Trust Fund • Eligible for Medicare after 24 months

4. SSI • Authorized under Title XVI of the Social Security Act • Pays people who are aged, blind or disabled – including minor children with disabilities • Income and resource limits • No benefits paid to dependents • Benefits paid from general tax fund, not the Social Security Trust Fund • Eligible for Medicaid

5. Keep in Mind….. • It is possible to receive benefits under both programs (concurrent claim) • An SSI recipient who works, may one day be insured for SSDI • An individual found disabled prior to age 22 could be eligible for a Childhood Disability Benefit (CDB) on a parent’s record (retired, disabled or deceased)

6. Caution…. • Dependent child benefits end at age 18 (unless still in high school) • If child is receiving on parent’s record and has a disability, he/she should apply for CDB – five months prior to turning 18 • CDB application will keep record from terminating (benefits may be still be suspended at age 18, but not terminated)

7. SSA Definition of Disability • The inability to engage in any substantial gainful activity (SGA) by reason of any medically determinable physical or mental impairment(s) which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.

8. What is SGA?(Substantial Gainful Activity) • Important part of the eligibility process • Earnings guidelines used to evaluate work activity in determining disability • 2006 level is $860/mo for disabilities other than blindness; $1,450/mo for blindness • Work incentives are used to lower earnings below SGA

9. Work Incentives • Special rules for employment support that help preserve benefit eligibility, including health insurance • Serve as a safety net to make the transition from benefits to work • Are available under SSDI and SSI – but are applied differently

10. How Work Affects SSDI

11. SGA as a Factor for SSDI • Used in determining initial disability • Claim is denied at initial application if current SGA is established • Used in determining the date of onset of the disability • A factor in evaluating continuing disability

12. Trial Work Period (TWP) • Test ability to work for nine months (not necessarily consecutive) • Complete within a rolling 60-month period • Full benefits paid each month • Earnings over $620 gross/mo constitutes a trial work month ($620 net or 80 hrs/mo self-employment) for 2006 • No incentives considered – only earnings • Only one TWP

13. Extended Period of Eligibility(EPE) • Starts month after the TWP ends (whether individual is still working or not) • Continues for 36 consecutive months • Full benefits paid for months earnings are below SGA • No benefits paid for months over SGA • Medicare (if active) continues all months • First month of SGA after the EPE results in termination of cash benefits

14. Work Incentives - SSDI • Unsuccessful Work Attempt (UWA) • Impairment-Related Work Expenses (IRWE) • Subsidy and Special Conditions • Unincurred Business Expenses (Self-Employed) • Continuation of Medicare • Recovery during vocational rehabilitation (Section 301) • Expedited Reinstatement (EXR)

15. Unsuccessful Work Attempt(UWA) • Generally any work lasting less than three months andends (or drops below SGA level) due to a disability • Significant break of 30 days between work attempts • Under special situations work up to six months can be unsuccessful • Work over six months is never considered unsuccessful

16. Impairment-Related Work Expenses (IRWE) • Items or services, related to the disability, that are necessary for individual to work • Must be paid for by the individual with no reimbursement expected • Be of reasonable cost • Excluded from earnings when making an SGA determination

17. Examples of IRWE • Medications prescribed to treat the impairment • Attendant care services • Work-related assistance devices • Modifications to vehicle • Service animals • Some transportation costs

18. IRWE and SGA • Donna works and earns $900 per month. She also has several medications prescribed for her impairment. Donna does not have insurance that pays for these medications. She pays $105/mo for her prescriptions. • Donna’s wages are over SGA ($860). However, SSA can exclude the cost of her prescriptions when determining SGA. $900 - $105 = $795 which is below SGA. Donna’s benefits continue.

19. Unincurred Business Expenses • For self-employed only • Contributions made by others to the business • Item or services that IRS would normally allow as a business expense: • Computer • Office space • Paid help • Paid for by someone other than individual receiving benefits

20. Subsidy/Special Considerations • Forms of support received on the job • Job coach • Extra assistance from co-workers • Extended or more frequent breaks • Support results in individual receiving more pay than the actual value of his/her work • Only the actual value of the work is counted when determining SGA

21. Subsidy and SGA • Bob works 30 hrs a week at $7.50/hr. He is doing well with work, but still needs extra help. He has a job coach five hours a week. • 30 hrs/wk at $7.50/hr Bob earns $900/mo (over SGA.) However, he has a job coach 5 hrs/wk. SSA will disregard the time Bob is working with his job coach. 5 hrs at $7.50 =$37.50 x 4 wks = $150/mo. • $900 - $150 = $750 which is under SGA.

22. Continuation of Medicare • Two parts to Medicare *: • Part A hospitalization – free • Part B supplemental – premium • In general, coverage will continue at least93 months following the TWP • After extension expires, both Part A and Part B may be purchased • Individual must remain disabled by SSA rules

23. Recovery During Vocational Rehabilitation (301 cases) • Individual is having a medical review (CDR) and • Is active in an approved vocational rehabilitation program - indicates possible 301 case • If found no longer disabled by SSA rules, benefits can continue until program is completed – if it is reasonable to expect individual will be self-sufficient at the end of the program

24. Expedited Reinstatement(EXR) • If benefits terminate due to work, not medical recovery and • Work ends due to the disability (or drops below SGA) and • Disability is the same as or related to the original impairment allowing benefits • Provisional payments and Medicare reinstated for up to six months while SSA reviews the disability • Request within 60 months of termination

26. How Work Affects SSI

27. SGA as a Factor for SSI • Used in determining initial disability • Same level as SSDI • Claim is denied at initial application if current SGA is established • Exception: SGA is never a factor for those who are blind • After SSI benefits are started, SGA is not a consideration

28. Federal Benefit Rate(FBR) • Maximum monthly SSI cash benefit payable • For 2006 • Individual - $603 • Couple - $904 • FBR is national amount – same in all states • States have option to supplement the federal amount • Income can lower the amount payable

29. Countable Income • Amount used to determine SSI benefit check amount • Earned income (wages, self-employment) counts $1 for every $2 earned (one-half) • Unearned income (e.g. SSDI, alimony) counts dollar for dollar • Work incentives are used to lower countable income

30. Work IncentivesSSI • Earned Income Exclusion/General Exclusion • Impairment-Related Work Expenses (IRWE) • Continuation of Medicaid (1619b) • Plan for Achieving Self-Support (PASS) • Student Earned Income Exclusion (SEIE) • Property Essential to Self-Support (PESS) • Blind Work Expenses (BWE) • Recovery during vocational rehabilitation (301 cases) • Expedited Reinstatement (EXR)

31. Earned Income Exclusion/General Exclusion • $65 of gross earnings automatically excluded – count one-half of remainder • If there is unearned income, SSA will exclude $20 – count all remainder • If no unearned income, the $20 is excluded from the earnings for a total of $85

32. Example I– Countable Income • John receives $603 (full FBR for 2006) in SSI benefits. He started a job earning $400/mo. From his $400 SSA excludes $65 and then because he has no unearned income, $20 (general exclusion) = $315. Divide $315 by 2 = $157.50 ($1 for $2). This is John’s countable income. • $603 - $157.50 = $445.50. John’s SSI check will be reduced to $445.50

33. Example II - Countable Income • Joyce receives SSI plus a small pension of $100/mo. She also works earning $300/mo. SSA will exclude $20 from her pension. Her countable unearned income = $80. • From earnings she has the $65 exclusion = $235. Divided by 2 = $117.50. Total countableincome: $117.50 + $80 = $197.50. • $603 - $197.50 = $405.50. This is Joyce’s SSI check amount.

34. Impairment-Related Work Expenses (IRWE) • Under SSI, SGA is not an issue after initial eligibility is established • IRWE are used to reduce the countable income • IRWE criteria is the same as for SSDI: • Be related to the disability • Necessary to work • Paid by individual with no reimbursement expected • Be of reasonable cost

35. Example – Countable Income with IRWE • Jill receives $603 in SSI benefits. She started a job earning $400/mo. She has IRWE of $200/mo. From her $400 SSA excludes $65 and then $20 = $315. SSA then excludes $200 in IRWE = $115. Divided by 2 = $57.50. This is Jill’s countable income. • $603 - $57.50 = $545.50. Jill’s SSI check will be reduced to $545.50. ($100 more than John’s.)

36. Continuation of Medicaid1619b • Earnings too high for monthly benefit check (break-even point) • To qualify: • Eligible for benefit check for at least one month • Remain disabled • Meet all non-medical eligibility rules • Need Medicaid in order to work • Earn under the Medicaid threshold amount ($29,207 for SD in 2006) • Medicaid eligibility continues

37. Plan for Achieving Self-Support (PASS) • Set aside income (other than SSI) and/or resources, for use in reaching a specific work goal • Plan must be in writing, listing each step to reach goal and required expenses • Must be approved by SSA (including any changes to original plan) • Monitored for progress • Denver PASS cadre handles all plans for SD

38. Who Can Apply for a PASS? • A person who: • Receives SSI or could be eligible for SSI if PASS approved and • Has a disability by SSA rules • Has income other than SSI • Agrees to perform the employment goal • Uses excluded income/resources only for approved plan expenses

39. Student Earned Income Exclusion • Definition of student: • Under age 22 • Attending school regularly • SSA will exclude up to $1,460/mo (for 2006) in student’s earnings when figuring countable income • Yearly maximum of $5,810 (for 2006) • Exclusion taken before earned and general exclusions *Prior to April 2005 could not be married or head of household

40. Property Essential to Self-Support • Excluded from countable resources: • Items used in a trade or business • Inventory • Equipment • Items owned and used as an employee • Tools • In special cases some equity in non-business property or rental property

41. Blind Work Expenses (BWE) • Extensive • Need not be related to blindness: • Professional dues, union dues • State, federal and local taxes • Social Security taxes • Meals at work • Transportation • Excluded after one-half reduction of earnings

42. Recovery During Vocational Rehabilitation (301 Cases) • Same criteria as SSDI: • Medical review (CDR) • Found to no longer be disabled, but; • Active in approved vocational rehabilitation program • Benefits can continue until program is completed – if it is reasonable to expect individual will be self-sufficient at end of program

43. Expedited Reinstatement (EXR) • Benefits terminated because of earnings, not medical recovery • Stopped work (or reduced to below SGA) due to disability which is the same or related to original impairment • Requested within 60 months of termination • Provisional payments/Medicaid up to six months while disability is reviewed • Meet all other eligibility requirements

44. Just a note…… • Unincurred business expenses • Used ONLY at initial claim to determine SGA • NOT used to reduce countable income • Subsidy/Special consideration • Used ONLY at initial claim to determine SGA • NOT used to reduce countable income

46. More Information • SSA pamphlets: • What You Need To Know When You Get Social Security Disability Benefits • What You Need to Know When You Get Supplemental Security Income • How You Earn Credits • Working While Disabled-How We Can Help • Working While Disabled-A Guide To Plans For Achieving Self-Support • SSA publication: • Red Book on Employment Support

47. Resources • SSA toll-free: 1-800-772-1213 • www.socialsecurity.gov • SSA, PASS Cadre Denver Federal Center P.O. Box 25447 Denver, CO 80225-0447 1-800-551-1034 Toll-free: 1-800-772-1213 • Mickie Douglas, Public Affairs Specialist SSA, Rapid City 605-342-0242 ex. 219 mickie.douglas@ssa.gov

49. THE END