Brief Overview of Social Security Disability Benefits

1. Brief Overview of Social Security Disability Benefits Title II and Title XVI

2. Title II – SSDI/SSDAC Social Security Disability Insurance Social Security for Disabled Adult Children How Do You Qualify? You have worked and earned enough credits to gain insured status OR Your parent/spouse has earned insured status and is retired, deceased or disabled. AND You have a disability. Title XVI – SSI Supplemental Security Income How Do You Qualify? You must have a limited income, resources less then $2000.00, and have a disability. Social Security has two disability benefit programs:

3. Title II – SSDI/SSDAC The cash benefit varies depending on the insured worker’s FICA payroll deductions. MEDICARE is the medical benefit associated with Title II. Title XVI – SSI The FBR (Federal Benefit Rate) for 2007 is $623.00. This is the maximum amount of cash benefit you can receive How much is actually paid depends on amount of income and living situation. MEDICAID is the medical benefit associated with Title XVI. How Much is the Benefit?

4. Title II – SSDI/SSDAC Only earned income/wages have the potential to impact this benefit. Unearned income is not considered because Title II is not needs based. The 2007 SGA (Substantial Gainful Activity) threshold is $900.00. Therefore, if your earnings average over $900.00 per month, you may not receive a check for Title II benefits. Think of this as the “ALL or NOTHING” benefit. It is not adjusted. Title XVI – SSI Unlike SSDI/SSDAC both earned and unearned income impact the amount of the payment. There is a formula that is applied to calculate that amount of adjustment. The amount of the adjustment depends on whether in the other income is considered earned or unearned. Think of this as the “flexible” benefit. It is adjusted. What Happens if You Get Other Income?

5. Title II – SSDI/SSDAC SSDI and SSDAC do not have resource restrictions; however, if you also receive CNP Medicaid*, you must have less than $2,000 in resources. Title XVI – SSI SSI and Medicaid have a $2,000 resource limit. Resource Restrictions

6. Exceptions to the Resource Limit • Your own home; • A car; • Money sheltered in a Special Needs Trust*; • Money sheltered in a PASS*; • Money and equity in a self-owned business*; • Burial funds, up to a certain amount; • Retroactive SSA payments for a certain period.

7. Special Needs Trust • A special needs trust preserves assets that would otherwise disqualify someone from SSI and Medicaid. • One available trust is the Developmental Disabilities Life Opportunity Trust.

8. Healthcare for Workers with Disabilities (HWD) If you need Medicaid and you have more than $2,000 in resources, you should also consider Healthcare for Workers with Disabilities. To become eligible, you must have a disability, be working, and meet certain income restrictions. Once eligible, you purchase Medicaid. • There is no resource restriction to Medicaid when purchased through HWD. • The Medicaid you purchase through HWD is CNP Medicaid. • The cost of Medicaid through HWD will be based on your earned and unearned income. The most it can be is 7.5% of your total income.

9. Social Security Work Incentives 1619 (b), PASS, IRWE, Subsidy, and SEIE

10. Continuing Medicaid Eligibility – 1619(b)You can work and keep your Medicaid! Section 1619(b) on the Social Security legislation provides for continued Medicaid eligibility for individuals whose incomes are too high to qualify for SSI cash payments, but not high enough to offset the loss of Medicaid. Essentially, this means that if someone has drawn an SSI cash benefit and loses their eligibility for their cash benefit due to wages, they can continue to receive free Medicaid up to the annual income threshold for 2007 of $26.530.00.

11. Plan for Achieving Self-Support (PASS) A PASS allows a person with a disability to set aside income and/or resources for a specific period of time to pay for expenses associated with a vocational/work goal. Having a PASS may assist an individual in qualifying for or increasing their SSI payment.

12. How PASS Works A person with an approved PASS plan sets a portion of his/her own income aside monthly in a separate bank account to pay for the items listed. Social Security responds by reimbursing the person that set-aside amount with his / her SSI check.

13. Impairment Related Work Expense (IRWE) An Impairment Related Work Expense (IRWE) is an expense that a person pays for out of pocket that is DIRECTLY related to their disability AND to their work.

14. IRWE Examples Examples of IRWEs include: • Supported Employment Services; • Attendant Care Services if performed at work, or in the process of helping someone prepare for work or return from work; • Certain transportation costs, including mileage for approved vehicles; • Routine drugs and medical services; • Work-related equipment.

15. Title II – SSDI/SSDAC If you are a Title II beneficiary, the amount of your IRWE will be subtracted from your gross wages before your wages are considered against the $900 income threshold. Title XVI – SSI If you are a recipient of SSI, and you have an approved IRWE, you can be reimbursed up to 50% of the IRWE amount on your SSI check. IRWEs impact Title II and Title XVI differently.

16. Subsidy and Special Conditions A subsidy is the support an individual receives on the job. A subsidy indicates the wages an individual receives from their job may be more than the actual “value” of their services. Subsidies and Special Conditions are only used for determining SGA, which is only associated with Title II benefits.

17. What Could Be Considered a Subsidy? • A Carved Job – special duties, special hours • Natural supports – support provided by co-workers, peers, employer, etc… • Extra breaks • Reduced productivity • Job coaching – monthly hours of coaching x the individual’s hourly wage

18. S u b s i d i e s Subsidies are an excellent tool to eliminate or reduce overpayments.

19. Student Earned Income Exclusion (SEIE) A Student under the age of 22 can earn up to $1,510.00 per month up to $6,100.00 per year in total wages before Social Security will reduce their SSI check because of wages.

20. Property Essential for Self-Support (PESS) PESS allows certain business-related resources be excluded against the SSI Medicaid $2,000 resource limit. Examples of PESS include: • Business equipment; • Property related to the business venture; • Unlimited case resources in a business account that are used in the operation of a small business.

21. Managing Your Benefits andAvoiding Overpayment

22. Title XVI/SSI • Report earned income/wages to Social Security every month by sending in original pay stubs • Keep all pay stubs, income tax records, letters from Social Security and DSHS (do not throw them away) • Keep receipts/track room-and-board or rent payments • Develop and maintain a recording keeping system • Familiarize yourself with the formulas used by Social Security to determine SSI payment amount when wages are reported • Avoid exceeding the $2,000 resource limit

23. Title II/SSDI/SSDAC • Understand terms like Substantial Gainful Activity (SGA), Trial Work Period (TWP), Extended Period of Eligibility (EPE) • Report work activity to Social Security – for example start of new job, pay raise, increase in hours, change of employer • Track gross monthly wages and compare to Trial Work Period and Substantial Gainful Activity thresholds

24. Both SSI and SSDI/SSDAC If you draw both SSI and SSDI/SSDAC it is important be aware of how work impacts both benefits. You will need to • Report wages on a monthly basis • Pay attention to earnings over SGA • Understand the SSI and SSDI/SSDAC claims representatives do not necessarily share information

25. Questions?