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Understanding Social Security Disability

Understanding Social Security Disability. Two Different Programs. Title 2 SSDI Requires work: 5 years out of last 10 5 month waiting period 24 month M edicare waiting period 12 months retro May pay family benefits. Title 16 SSIDI No work required Income: < $710/$1066

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Understanding Social Security Disability

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  1. Understanding Social Security Disability

  2. Two Different Programs Title 2 SSDI • Requires work: 5 years out of last 10 • 5 month waiting period • 24 month Medicare waiting period • 12 months retro • May pay family benefits Title 16 SSIDI • No work required • Income: < $710/$1066 • Resources: < $2K/$3K • Living arrangements • 1 month waiting period • No retroactivity • Medicaid • No family benefits

  3. Definition Of Disability • Inability to engage in Substantial Gainful Activity (work) (2013 - $1,040 month) by reason of a physical or mental impairment that has lasted or is expected to last at a severe level for a period of at least 12 continuous months.

  4. Substantial Gainful Activity • 2013 – Generally SGA if over $1040 month • Impairment related work expenses (Rx co-pays, doctor co-pays, special equipment, transportation, etc.) can reduce earnings • Subsidy/special considerations can reduce earnings

  5. Office Processes Local SSA Office • Paperwork processing center • Application/appeal intake • Determination of non-medical factors Disability Unit • Located in Raleigh • Never sees the client • Obtains medical records • Makes medical decision

  6. Work Requirements – T2 • Credits earned by working • 2013 - $1,160 per credit up to 4 • 10 years minimum work (40 credits) • 5 of the years (20 credits) must be within the 10 years prior to onset of disability (current connection)

  7. Onset Date • Not always equivalent to diagnosis date • 2 different factors: 1. Not engaging in SGA (2013 - $1,040 month) 2. Have a severe condition (12 months duration)

  8. Onset/Entitlement Example • Diagnosis date: 03/15/2012 • Stop work date: 09/30/2012 • Correct onset date would be 09/30/2012 • Waiting period: 10/12 – 02/13 • Entitlement date: 03/2013 • First payment: 04/2013 • Medicare: 03/2015

  9. Onset/Entitlement Example 2 • Diagnosis date: 03/15/2012 • Stop work date: 03/15/2012 • Correct onset date would be 03/15/2012 • Waiting period: 04/12-08/12 • Entitlement date: 09/12 • First payment date 10/12 • Medicare: 09/2014 • Retroactivity: dependent on application

  10. Onset vsEntitlement • Under T2 SSDI, can delay as long as 17 months from onset to file application with no loss in benefits • Allows up to 12 months retro benefits from date of application (subject to onset/waiting period restrictions) • Onset 10/15/2011, Waiting Period Nov., Dec., Jan., Feb., Mar • Application Date 04/15/13 = Potential Retro benefits to 04/2012

  11. Offset 1 • Workers Compensation – WC + SSA cannot exceed 80% of monthly average current earnings. Excess is offset against SSA benefit. • Example, average earnings = $3,000 month, ACE = $2400 • Workers Comp = $500 week, or $2,165 month • SSA = $2000 • Total of $4,165 in benefits, $1,765 offset • Net SSA = $235.00

  12. Offset 1 (cont) • WC lump sum payments are also offset • Lump sum pro-rated based on weekly wage will result in offset • Lump sum pro-rated on life expectancy will usually avoid offset • WC offset is removed at age 65

  13. Offset 2 • Employer long term disability is usually offset by Social Security (even if paid for by employee) • LTD: $2500 per month • T2 SSDI: $2000 per month • Insurance offsets the $2000, paying only $500 per month under the LTD • Varies from policy to policy

  14. Application Process • Can apply through local office appointment (telephone) or via internet • Application takes about 1 ½ hours • See green worksheet • Client can have consultant or representative if desired • Decision takes from 3-5 months

  15. Appeals • Reconsideration (SSA-561) 2-3 months Paper review, DDS in Raleigh • Hearing (HA-501) 18-24 months Administrative Law Judge in Greensboro Need representative • Appeals Council Review 6-12 months Council is in Arlington VA

  16. Benefit Rates • T2 benefits are based on average earnings over an “elapsed period” from age 22 to date of disability onset, less 5 drop out years • Example: Disabled at age 45. From age 22, there are 23 “elapsed years”, less 5 drop out years = 18 used in the computation • Disability rate is equivalent to age 66 retirement rate

  17. Benefit Rates • Family benefits are payable, usually 50% of the worker’s primary rate. • Worker’s benefit $1500, family = $750.00 • Divided pro-rata share for multiple children in family

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