Nothing worse than acronyms to add to an already-confusing federal disability income program, right? This week, we’re going to delve into Social Security Disability Insurance and its counterpart, Social Security Income. Despite the similar sounding names, they are very independent of one another are used in very different ways. Here are a few of those important distinctions between SSDI and SSI.
SSDI
Social Security Disability Insurance is administered by the Social Security Administration, or if you’re comfortable with those acronyms, SSA. Qualifying requires a work history since it’s a cash assistance program and the applicant must also be either blind or disabled in some way. In order to be deemed disabled, one must be incapable of physical activity because of either a severe physical or mental impairment. Further, it must have already last for twelve months or it must be reasonably believed it will continue for at least twelve months.
Because it can be subjective in making those determinations, there are federal guidelines that include applicable illnesses and impairments. Even if an applicant doesn’t match exactly to any of the illnesses or impairments, there must be one of similar nature.
If an applicant has the ability to earn at least $1,000 a month in his wages is legally deemed capable of “substantial gainful activity”. This disqualifies the applicant for SSDI.
SSI
Supplemental Security Income (SSI) also falls under the Social Security Administration. It too is a cash assistance program, but it’s made available to those who are over the age of 64, are blind or otherwise disabled. The big difference is that eligibility is based not on one’s work history, but rather, a financial eligibility.
Typically, those who qualify for SSI wouldn’t necessarily qualify for SSDI because of an insufficient work history.
There are also two more very important distinctions. An applicant be prove that he’s both income eligible and resource eligible.
Income eligibility requires the applicant to have less income than the standard of need deemed by the government. The monthly maximum federal amounts for 2014 are $721 for an eligible individual and $1,082 for an eligible individual with an eligible spouse.
Those receiving SSI will most likely not qualify for Medicare coverage, unlike SSDI recipients. This is typically because there’s not been enough paid into the federal system via their wages. That said, most states’ SSI recipients automatically qualify for Medicaid benefits, so it does provide similar coverage from a medical perspective. Note that Vermont is one of those states with this automatic eligibility. In fact, applicants are automatically approved, making enrollment easy.
It’s important to keep in mind this is a brief rundown of those differences; each program is far more complex. The first challenge is knowing the difference and once our clients understand those differences, they’re able to see which program best serves their purposes. If you’d like to know more about SSDI and SSI, we invite you to contact our office. Our team of experienced estate planning attorneys stand ready to put those dynamics in place so that you’re covered.
Ellen LaPlante
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