What is the difference between SSDI and SSI?
Social Security Disability Insurance
SSD is based on your work history, requiring you to have earned enough work credits through paying Social Security taxes to qualify for monthly disability benefits.
Supplemental Security Income
Overview
- Provides financial assistance to individuals with disabilities
- Needs-based program
- Program Requirements
- Limited household income
- Limited resources (savings or things of value)
Social Security Disability Insurance benefits (“SSD”) are based upon an individual’s work record. A “quarter of coverage” is the basic unit of Social Security coverage used in determining a worker’s insured status. As an individual works and pays Social Security taxes, they are able to earn one quarter of coverage for every $1,640 they earn in 2023, up to a maximum of four quarters of coverage per year. Generally, you need to have worked five years out of the last ten to be currently insured and have accumulated a total of forty quarters of coverage.
SSD Work Requirements:
To be eligible for SSD benefits, you must have paid Social Security taxes for enough quarters. For people aged 31 and over, they must earn at least twenty quarters in the ten years prior to becoming disabled. Typically, if a person has worked five out of the last ten years consistently, that person would have earned twenty quarters of coverage. Younger individuals aged 30 and under must earn at least twelve quarters out of the last six years. Workers who become disabled prior to age 24 must have six quarters out of the last three years. It is essential to file for benefits as soon as you become disabled because your Date Last Insured (DLI) is the final date that Social Security considers you qualified for benefits. If you wait too long, you may no longer be entitled to the money you have paid into the system.
Family Maximum (FMAX) for SSD:
Your Primary Insurance Amount (PIA) that you see on your SSA statements is the money you would receive if you are found disabled. Additionally, the Family Maximum (FMAX) is the maximum amount of money you would receive if you also claim dependents in your household. After receiving disability benefits for two years, SSD recipients are automatically given Medicare health coverage.
There are exceptions for younger individuals that have not had enough time to accumulate forty quarters of coverage, allowing them to become insured with less. It is important to note that as a rule of thumb, you only remain insured for SSD benefits for about five years after you cease full-time work. Why is this important? Because you must prove disability while still insured for benefits. If you are found disabled after your insured status has expired, you cannot be entitled to SSD benefits. The amount you are entitled to on a monthly basis is based on how much you have earned over your working years. Your monthly amount is called your Primary Insurance Amount (“PIA”). This amount can vary, and we have personally represented clients with PIAs as low as a few hundred dollars to well over $2,000 per month.
Supplemental Security Income benefits (“SSI”) are income-based benefits and you do not need to have ever worked to initially file an application. However, there are income and resource limitations. Generally, a single individual must have less than $2,000 in resources in order to qualify financially. A married individual must have less than $3,000 in resources. Resources are considered anything that can be turned into cash. However, there are exceptions, including one car and the house in which you live. SSI pays a maximum of $914 for an individual per month in 2023. This amount will be reduced if you are receiving food and shelter from another source or if you are receiving income, among several other possible reduction sources.
SSI Qualification Criteria:
Because SSI is needs-based, you must prove that you are in need of assistance to provide food, clothing, shelter, and medical care to yourself. Basic qualifications include possessing less than $2,000 in any and all bank accounts, owning no more than one property that is your residence, and no more than one vehicle. Claimants who are married are allowed up to $3,000 in their bank accounts.
Medicaid Adjustment for SSI:
The current amount an SSI recipient would receive is $914 per month. This is adjusted periodically for the cost of living (COLA). The adjustment occurs yearly. SSI recipients also receive Medicaid.
5 Step Process For Determining If You’re Disabled By The Social Security Administration
Despite SSD and SSI having different requirements to file the application initially, the analysis followed to determine whether you are medically disabled is the same. The Social Security Administration (“SSA”) will use the 5-step sequential evaluation to determine if you qualify medically. At the first step, SSA determines whether you are performing substantial gainful activity (“SGA”). SSA has set the monthly threshold of gross (before any taxes are taken out) earnings that disqualify you at $1,913 in 2023. It is possible to have your gross earnings reduced to below the SGA threshold if you have impairment-related work expenses or if one of the several work incentive rules apply.
At the second step, SSA determines whether you have a “severe” impairment which is defined as an impairment or combination of impairments that significantly limit your physical or mental abilities to do basic work activities. This is a low threshold and most individuals are able to satisfy this requirement and move on to the other steps of the analysis. If SSA finds that you do not have a severe impairment, the analysis stops and you are denied benefits.
At the third step, SSA determines whether your condition meets or equals one of those set forth in the Listing of Impairments. If you do, the analysis stops there and you are found to be disabled. If not, the analysis continues to the fourth and fifth steps at which SSA determines your residual functional capacity (“RFC”) – what you retain the ability to do both physically and mentally – and whether or not it allows for you to return to your past relevant work (full-time work you performed in the last fifteen years) and if not, if you could perform any other job in the national economy. If you can do either, your claim will be denied but if you cannot perform your past relevant work or any other job due to your limitations, SSA will find that you are disabled.
Health Coverage
SSD and SSI both provide for health insurance coverage. If you are entitled to SSD benefits, you are eligible for Medicare health coverage. However, there is a wait period, and the health coverage does not begin until you are receiving a monthly disability check for twenty-four months. At that time, you can purchase different parts of Medicare coverage for the designated monthly premium. If you are entitled to SSI benefits, you are eligible for Medicaid health coverage, which can begin as soon as you are in pay status.
It is possible for an individual to be entitled to both SSD and SSI, so it is important that when you apply, SSA takes an application for both. For example, you may have a low PIA of $250 for SSD benefits because you do not have a significant work history. If you are also entitled to the full $733 in SSI benefits, SSA will pay you $250 in SSD and the remainder of $503 ($483 plus a $20 pass-through from the SSD benefits) in SSI benefits. As another example, if you were last insured for SSD benefits several years in the past as was discussed above and you cannot prove your impairments were disabling while you were still insured, or covered for SSD benefits, you may be entitled to at least SSI benefits as it does not have an insured requirement, and you can qualify for the same as long as you meet the financial and medical requirements.
Now What?
As discussed herein, navigating the turbulent waters of applying for disability benefits can be an difficult journey. The attorneys and staff at Balin Law are here to assist you every step of the way. Do not hesitate to contact us by phone or email for a free consultation at one of our conveniently located offices.
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