SSD vs. SSI

While Social Security Disability (SSD) and Supplemental Security Income (SSI) are both programs providing benefits to persons with disabilities, managed by the Social Security Administration (SSA), entailing the same medical requirements for evaluating an individual’s disability, the initial “technical” eligibility criteria are entirely different for each program.

SSD is considered the work-credit based system funded by our payroll dollars. In other words, SSD recipients were workers that have paid sufficient FICA Social Security taxes (which translate into Social Security “credits”) during their relevant working years. A worker can earn up to four credits in one year from wages or self-employment income. The amount a worker would need to earn to accumulate a credit usually changes from year to year. In 2014, for example, a worker can earn one credit for each $1200 of wages or self-employment income – capping out at $4800 or 4 credits regardless of additional earnings. To give some perspective, in 1978, an individual earned a credit for each quarter where $50 was made. After 1978, the amount of earnings satisfying a credit became dependent on the national average wage index.[i]

Therefore, when an individual files for SSD, Social Security will first review that individual’s work record to ensure that the applicant has earned sufficient credits, before even evaluating that person’s disability. Essentially, a worker will need 40 credits, 20 of which must have been earned in the last 10 years from the date that you became disabled or allege disability. SSA has termed an individual’s date last insured (DLI) as the date when the worker’s credits “expire.”  The worker must be found disabled as of, or prior to, his DLI in order to be eligible for SSD.

On the other hand, SSI applicants need not have worked at all; even a child could qualify. SSI applicants, however, must prove that their resources are below the threshold outlined by SSA before the disability evaluation process will begin.[ii] SSA has recently mandated that a recipient of SSI payments must not have “countable” resources exceeding $2000 for an individual[iii] or $3000 for a married couple.[iv] If the value of all of the countable resources is above the allowable limit at the beginning of the month, SSI payments will not be paid for that month.

As referenced above, FICA taxes paid from the workers payroll dollars make-up the SSD fund. Therefore, the amount an individual receives upon approval is based on the wages contributed during the relevant working years.[v]  The monthly amount is typically calculated using the “averaged index monthly earnings” (AIME). SSA applies a formula to the individual’s AIME which will dictate the actual monthly amount.[vi]  SSD recipients will receive this monthly amount regardless of other resources[vii], and will also be eligible to receive Medicare. However, SSI payments derive from general tax revenues. Essentially, SSI is designed to provide assistance to the aged, blind, and disabled who have little to no income and resources. In addition to providing a monetary benefit to help pay for basic needs such as food, shelter, and clothing, recipients may also receive Medicaid entitlement. What’s more, unlike SSD recipients who must wait 2 years from the date of entitlement to be eligible for Medicare, SSI recipients may be entitled to receive Medicaid immediately upon approval.[viii]

Our attorneys and staff at Disability Attorneys of Michigan understand the highly technical and evolving rules that may impact an individual’s eligibility for SSD, SSI, or both, including the alleged onset date of disability, DLI, countable resources, and more. These factors can become crucial factors even at the initial application stage. We specialize in assisting individuals with filing their initial application through the appeals stage if necessary. Contact us today for a free consultation at (888) 678-5839.

[i] http://www.ssa.gov/OACT/COLA/QC.html.

[ii] Note: there are additional criteria, primarily as it relates to citizenship and categories of qualifying aliens. To read more, please visit http://www.ssa.gov/ssi/text-eligibility-ussi.htm.

[iii] Or child. Note that the disability evaluation process for children is inherently different and will be discussed at greater length in another blog submission.

[iv] For a list of resources considered in this analysis, please see http://www.ssa.gov/ssi/text-resources-ussi.htm. However, please note that there are numerous exceptions, and we recommend contacting one of our attorneys today to discuss any questions or potential eligibility. Further, the way in which SSA disburses passed due benefits also varies from SSD to SSI payments, depending on the amounts. Our attorneys explain the eligible amounts and timeframes in detail to our clients based on their particular situation.

[v] Note: FICA taxes also fund Social Security Retirement and Medicare benefits.

[vi] For more information and examples of how the formula works, see www.ssa.gov/oact/cola/Benefits.html.

[vii] Non-earnings. [viii] While there are exceptions to the rule where individuals can bypass the 2-year wait period, such as individuals with end-stage renal failure and amyotrophic lateral sclerosis (or Lour Gehrig’s disease), most people won’t qualify for the exception. For additional facts and arguments against the waiting period, see http://www.medicarerights.org/pdf/two_year_waiting_period_fact_sheet.pdf.

Blog Post Provided By:

Disability Attorneys of Michigan
30500 Van Dyke Ave, Ste. 400
Warren, Michigan 48093

 

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