The ramifications of the current economic crisis in the United States are profound. Everyone ranging from top executives in “Corporate America” to the average blue collar worker on “Main Street” has felt the far-reaching effects of the sharp economic downturn caused by the mortgage meltdown and the significant losses in the stock market. The ripple effect has led to many losing their homes, retirement savings, and their jobs. Faced with these grim prospects, many people are at a loss as to how to cope with their current loss of income or job.
According to the Department of Labor and Training, the number of unemployed in Rhode Island is among the highest in the nation. There are thousands struggling to find employment. Unfortunately, the playing field is not even for everyone. Those individuals who are young and healthy with a strong educational background usually stand a better chance in finding employment than those individuals who are older, with limited education, suffering from chronic medical issues which limit their ability to find and perform work. What options exist for these individuals who seem to be at a disadvantage because of age, health, and educational background?
This article is designed to provide a brief overview of some basic programs that are offered through the federal government’s Social Security Administration (SSA) that may offer assistance to individuals who have recently lost their jobs or have been unable to maintain employment. Many of the recently unemployed suffer from chronic medical conditions which now hinder them in securing employment. Although these individuals may not be old enough to retire, they have been rendered effectively unemployable due to the combination of medical ailments, limited work experience, and limited educational background. This article will explore some options available through the SSA that may be of some value and assistance to such individuals.
For those individuals who have worked and contributed to Social Security and Medicare by paying taxes out of their paychecks for a period of forty (40) quarters or approximately ten (10) years, Title II of the Social Security Act affords those individuals monthly social security income (more commonly known as Social Security Disability or “SSDI”) payable through retirement age. However, the individual must satisfy a medical requirement in that he or she must not be able to physically engage in any substantial gainful employment. This inability to work must last or be expected to last greater than one (1) year. There is a five (5) month wait period before the individual can realize his or her first monthly social security disability check. The monthly benefit will be calculated based on the insured individual’s work record. Thus, not every individual collecting SSDI will receive the same monthly benefit.
After benefits commence in the sixth month, an individual may qualify for “Medicare”, a medical insurance program that runs with Title II benefits, after an individual has received twenty-four (24) months of disability compensation or reaches the age of sixty-five (65), whichever comes first. Every year, the SSA calculates an adjustment for inflation and implements a cost of living adjustment (COLA) which is added to the individual’s monthly disability payment.
Finally, once an individual receiving Title II benefits reaches retirement age, the SSA will automatically convert the individual’s monthly benefit rate to that which would yield the higher monthly payment under the continued disability or retirement program. It is important to note that this program not only provides monthly income benefits to disabled workers, but affords coverage to the blind, widow(er)s, and adults disabled since childhood.
For those individuals who for one reason or another lack the forty (40) quarters of contributions made to Social Security and to Medicare, Title XVI of the Social Security Act affords benefits to those individual adults or children who are disabled or blind under a program more commonly known as Social Security Supplementary Income or “SSI”. Like the SSDI program, SSI requires an individual to meet the same medical eligibility guidelines in finding one disabled from all substantial gainful employment for at least one year or more. However, unlike SSDI, SSI mandates an individual to meet certain financial criteria before becoming eligible for the assistance.
The individual must have limited income, resources, and meet living arrangement requirements. For a single individual, SSI allows a person to have no more than two thousand dollars ($2,000.00) per month in available countable financial resources. For a married couple, the resource limit rises to three thousand ($3,000.00) per month. The SSA counts certain assets as financial resources. These include but are not limited to cash, real estate, personal belongings, bank accounts, stocks/bonds, life insurance with cash value, rental income and other assets that one may use for his or her support.
However, not all of an individual’s resources count toward the SSI resource limit. For example, the home you live in and the land it rests on do not count. Personal effects, household goods, and burial plots for you and your family also do not count. Your car and life insurance policies with limited cash values may or may not count. Calculating an applicant’s financial eligibility for the SSI program is a complex process and should not be taken lightly. There are stiff criminal and civil penalties if an individual is not truthful when applying for this program or any other program offered through the SSA.
If an individual meets the medical and financial criteria for the SSI program, the monthly payment varies up to the maximum federal benefit rate, which may increase with supplements paid by the State or decrease due to the availability of the applicant’s countable income and resources.
Unlike SSDI, SSI has no wait period. An individual’s monthly benefit commences on the first month of his application for the SSI program. Further, there is no wait period to qualify for SSI’s medical insurance program called “Medicaid”. Like Medicare, Medicaid runs through SSA’s Title XVI of the SSI program.
Although SSI payments may fluctuate or even terminate due to and individual’s income or increased resources, payments can be made to individuals who are age sixty-five (65) or older who have limited income and resources. Further, children under age 18 who are disabled may qualify for SSI if the child does not perform “substantial work” and has a physical or mental condition (or a combination of conditions) which results in “severe or marked” functional limitations, as determined by the SSA’s medical impairment guidelines, which has lasted or is expected to last at least one year or is expected to result in death.
Finally, should an individual qualify for either the SSDI or SSI programs, the SSA reserves the right to review the individual’s medical (SSDI & SSI) and/or financial (SSI only) conditions to see if there has been any medical improvement or any increase in resources and income which may disqualify an individual from either or both programs. Further, the SSA allows an individual to attempt to return to the work force within certain financial and time parameters to test one’s ability to secure and maintain employment without penalty or reduction in one’s monthly disability benefit. These parameters are specifically outlined in the SSA’s rules and regulations.
Hopefully, many of those suffering from job loss or economic hardship will find this article and the information contained therein helpful. Let us hope that the solution for most in this economic current crisis will be reemployment and reintegration into the workforce. However, if neither of these options is realistic or possible, then certainly, this information and the programs discussed herein, do offer some hope to those in despair who began reading this article.