When people talk about “social security disability”, they may be referring to any one of several federal government programs intended to provide benefits to US citizens who are unable to work due to a medical or mental condition. Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) are the largest and most important of these Federal disability programs. These programs provide a monthly benefit check as well as medical insurance in the form of either Medicare or Medicaid.
Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI)
The SSDI and SSI disability programs are often confused and misunderstood. The confusion is understandable, as SSDI and SSI share similarities, but also differ in very important ways. Both programs have the same standard of “disability”: the claimant must be unable to perform any work because of a mental or physical impairment. That inability to work must last, or be expected to last, at least 12 consecutive months.
The basis for benefit payment, however, for SSDI and SSI differ in fundamental ways. SSDI is basically an insurance program that claimants are entitled to based upon payment of Social Security taxes. SSDI claimants gain “insured status” for SSDI by paying Social Security taxes. In general, claimants will have no problem with SSDI insured status as long as they have worked at least 5 of the prior 10 years.
SSI, however, is a welfare program, not an entitlement program like SSDI.
SSI is available even if the claimant has never worked and paid social security taxes, but the monthly benefit is very low. Benefits under the SSI program are based upon “need”. The government’s definition of “need”, as you might guess, is quite stingy. For 2021 in the state of Texas and throughout the US the maximum SSI benefit is $794 a month for an individual or $1,191 a month for a couple.
SSI benefits are payable only to the claimant: there are no benefits payable to family or dependents based upon the claimant’s SSI disability.
Because SSI is a “needs-based” program, “resources” (like cash or other assets) and any income available to the claimant will either eliminate the possibility of month payments or substantially reduce the SSI benefit amount. The SSI rules for determining need are complex, and social security will reduce the monthly benefit based upon spousal income or any room and board being provided without charge to the claimant. The reality is that SSI benefit qualification requires near indigent status.
In contrast to SSI, benefit payment under the SSDI program has nothing to do with “need”: one can be a millionaire and still collect SSDI if disabled and fully insured. The amount of the monthly SSDI benefit is based upon the claimant’s average lifetime earnings. The average monthly SSDI benefit is $1,234. The highest benefit is $2,861 per month. The payment of past due SSDI benefits are limited to 1 year prior to the application, whereas SSI benefits are payable only as of the date of the application. SSDI, however, has a 5-month waiting period, so the earliest SSDI benefits could be paid is in the sixth month from the date of disability onset.
Unlike SSI, so-called “auxiliary benefits” under the SSDI program are available to the claimant’s spouse and children as follows:
- Spouse if under 62 years old and the joint caregiver of children shared with the claimant that are under the age of 16
- Children if unmarried and under the age of 18, or if a full-time student, under the age of 19.
Benefits may also be available to a divorced spouse, a disabled child, or adult child disabled before 22 years of age.
The amount of the auxiliary benefit is calculated based upon the wage-earner’s benefit amount, and total benefits payable for all persons based upon the wage-earner’s disability is limited to an amount referred to as the Family Maximum (FMAX). FMAX is between 150% and 180% of the claimant’s benefit amount. In other words, an addition 50% to 80% is available to be split between dependents and paid as auxiliary benefits. The calculation of auxiliary benefit amounts can get complex when there are several beneficiaries.
Medical Insurance under SSDI and SSI
When pursuing a social security disability claim, the federal government medical insurance can often be even more important than the monthly check. Medicare is available to SSDI beneficiaries after 24 months of entitlement to disability benefits. The following example may make the 24-month Medicare waiting period clearer
Assume Johanna Smith is fully insured for SSDI and is found to be disabled as of January 1, 2018. Her SSDI benefit payments would not begin until July 2018 because of the 5-month waiting period for SSDI benefits. (The rule is 5 full calendar months, so the month counting starts with February 2018). Johanna Smith would not be entitled to Medicare until August 2020.
In contrast to SSDI and Medicare eligibility, Medicaid in the state of Texas is available to SSI beneficiaries as of the date of SSI entitlement. (Oddly enough, Medicaid has no “waiting period” , in contrast to the 24-month wait for Medicare in SSDI claims).
Basis of Disability under the SSDI and SSI programs
Unlike the many differences between SSDI and SSI we have discussed above, when it comes to the definition of “disability” SSDI and SSI are exactly the same. Disability is defined as follows:
“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.”
The Social Security Administration utilizes a decision-making framework called the 5-step sequential evaluation process to implement this definition of “disability”. The 5-step sequential evaluation process is simply a sequence of questions the social security disability decision-maker asks in determining if you are disabled as follows:
Step 1 whether the claimant is engaging in “substantial gainful activity” (SGA).
In 2019 if a claimant is earning more than $1220 he will found to be “working” (i.e., engaging in “substantial gainful activity” and therefore not disabled). If the claimant is working and earning less than this “substantial gainful activity” amount social security will not denial the claim based upon work. However, any work activity will jeopardize a disability case because the decision-making will be wondering whether the part-time work reflects that the claimant really could work more and is therefore not disabled.
Step 2 examines if the claimant has a “severe” medically determinable impairment
This rather obtuse language simply means the claimant needs to have bona-fide medical or mental condition recognized by the medical community and diagnosed by a medical doctor, preferably a special in the appropriate field. The impairment or impairments and its symptoms must have a significant impact on the ability to do work-related activity.
Step 3 examines whether the impairment or impairments meet a Listed condition.
The so-called “listings” describe for 14 different body systems, medical problems which are deemed serious enough to prevent work of any kind. The listings are intended to be a screening device by which claims filed by the most obviously disabled individuals can be quickly approved. Not all medical conditions have a listing, and ; they are not an all-inclusive list of disabilities under which all individuals must be found disabled. Failure to meet the conditions of a listing simply means the case cannot be approved immediately, and the examination of the claim under the Sequential Evaluation Process moves on. If the criteria for a listed are not met, the social security disability decision-maker will determine what the claimant’s “residual functional capacity” (RFC) is. This is simply a decision about what work-related functions, such as standing, walking, sitting, and lifting, does the claimant still have despite his impairment
Step 4 considers whether the claimant’s impairment(s) prevents performance of Past Relevant Work
The decisionmaker will examine whether the RFC would allow the claimant to return to any of her work performed in the last 15 years.
Step five considers whether a claimant can make the vocational adjustment needed to perform other work
This is the state at which the claimant’s age is very important. In general claimants over the age of 50 years of age who cannot do past relevant work are more likely to be found unable to adjust to other work and consequently are disabled under the Social Security Act.