Nassau-Suffolk, New York Social Security Disability Blog

The current sluggish economy and its accompanying financial woes have put many people out of work. For these Americans, bills and financial obligations pile up, creating a virtual quagmire where escape seems impossible.

A recent study illustrates the grim situations in which many Americans find themselves. The study concluded that many Americans who have exhausted their unemployment benefits are seeking to receive Social Security Disability Insurance (SSDI) benefits, as a financial life preserver.

The study, as reported in the Wall Street Journal, found that 10 percent of Americans between the ages of 50 and 65 who did not have assets of at least $5,000 applied for (SSDI) benefits just before their unemployment benefits ran out.

The number of people applying for SSDI benefits increased as they exhausted their unemployment benefits. A mere one percent of the unemployed in the 50 to 65 age range applied for SSDI benefits when there was 50 weeks left in their unemployment benefits.

The Social Security Administration (SSA) oversees two different disability benefit programs for those who are disabled and cannot work. One of the programs is called Social Security Disability Insurance (SSDI), and whether an applicant qualifies for SSDI benefits depends on how long an applicant worked and the applicant's medical condition. The SSA considers a number of factors when determining whether to grant an applicant benefits and most applicants can benefit from having an experienced attorney guide them through the complicated SSDI application process.

Work History

One of the first things the SSA will look at in an application for SSDI benefits is whether the applicant has worked long enough to qualify for benefits. SSDI functions similarly to a traditional insurance program in that people pay premiums in order to insure themselves against future disability. The premium payments come out of a person's paycheck in the form of Federal Insurance Contributions Act (FICA) payroll taxes.

An applicant needs to have worked a certain amount of time to be insured for SSDI benefits. The current requirement is an applicant needs to have worked for 20 quarters of the past 40 quarters prior to the application date. This works out to be five of the past 10 years. Additionally, a person needs to have earned a minimum amount of money during each of those quarters. The current minimum for 2011 is $1,120.

SSA Definition of Disability

The SSA then looks at an applicant's medical condition after it has determined that a person has worked enough to qualify for SSDI benefits. In order for the SSA to grant SSDI benefits, it needs to find a person:

• Can no longer do the work that he or she did due to a medical condition
• Cannot do other work to make Substantial Gainful Employment (SGA) to support him or herself
• The condition will last at least a year or result in the applicant's death

Many people assume that they cannot work at all if they receive Social Security disability benefits. However, the Social Security Administration (SSA) has programs and incentives for Social Security disability benefit recipients to encourage them to go back to work and to help them do so. While a person's earnings will affect the amount of a person's monthly payments, the work incentives ensure that the recipient will not lose all of his or her benefits or experience an overall decrease in monthly income.

Work Incentives

The SSA offers people receiving SSDI and SSI incentives to try to go back to work. Some of the incentives that those on SSDI or SSI may qualify for include:

• Impairment related work expenses (IRWE): the SSA will deduct costs of special services or equipment that a person needs to go to work from a person's gross monthly earnings
• The SSA might deduct subsidies and special conditions from a person's monthly gross pay
• The SSA might deduct unincurred business expenses, or goods or services that would have cost the recipient money but the recipient did not actually pay for, from a person's gross monthly pay
• Unsuccessful work attempts lasting less than six months do not affect benefits
• Continued benefit payment while in a vocational rehabilitation program that will lead to a person becoming self-supporting
• Expedited reinstatement of benefits without a new application if a job does not work out
• A nine-month trial work period for those on SSDI before earnings affect benefits
• Earned income exclusion for those on SSI
• Continued Medicare or Medicaid coverage

When a person receives Social Security disability benefits, the Social Security Administration (SSA) periodically reviews his or her medical condition to make sure that the recipient still meets the SSA's definition of disabled and should continue to receive benefits. Many people are confused about what happens during a review and what the outcome of the review could mean for their benefits.

How Often the SSA Reviews Conditions

When the SSA awards an applicant disability benefits, they place the person in one of three categories for review timelines, based on the applicant's condition:

• Medical improvement expected: if the SSA determines that a person's condition is likely to improve within a given time, the SSA will review the applicant's condition between six and 18 months after the benefit award
• Medical improvement possible: if the SSA decides that it is possible that a person's condition could improve but does not expect it to do so, then the SSA will review the applicant's condition every three years
• Medical improvement not expected: if the SSA does not anticipate that an applicant's condition will improve, then the SSA reviews the person's condition every five to seven years

Many Social Security Disability benefit recipients already fear that the Social Security Trust will fully deplete within the next 25 years. But now another, more immediate, threat looms: changes to cost-of-living adjustments. Lawmakers are looking for ways to balance the massive federal deficit and some see the consumer price index (CPI) as an appropriate way to do it. Unfortunately, changes to the CPI would readjust the cost-of-living standards, therefore reducing government payouts of Social Security benefits in millions of cases.

It is one way legislators can technically cut Social Security Disability benefits without facing an outright public assault for doing so. Formally proposing Social Security cuts would be an unpopular move with many disabled Americans, senior citizens and aging baby-boomers.

One question - whether or not someone is genuinely disabled under the eligibility requirements set forth by the Social Security Administration - is the question we should be asking in making arguments for or against the Social Security Disability benefits program.

The New York Times reports that "[p]rograms intended to steer people with more moderate disabilities back into jobs have managed to take only a small sliver of beneficiaries off the Social Security rolls." The Times continues by referring to a prediction that many commentators have been trumpeting for awhile now: that in 2018, just a handful of years from now, the Social Security Disability fund will be out of operating cash.

In today's political climate, few people are making speeches about preserving so-called social safety net programs - programs that according to National Public Radio serve the "truly needy" - like Supplemental Security Income.

In making its comparison, NPR quotes Ronald Reagan: "The poverty-stricken, the disabled, the elderly, all those with true need - can rest assured that the social safety net of programs they depend on are exempt from any cuts."

Housing advocates in New York City are doing the best they can to push through a bill that would provide rent caps for those living with HIV/AIDS-in effect, keeping the cost of shelter down for a group of extremely vulnerable people, as vulnerable as others who deal with significant medical impairments and depend on sources of income like Social Security Disability to make ends meet.

Former New York Times contributing columnist Peter Orszag makes a good point about applying for benefits under the Social Security Disability Insurance (SSDI) program.

Orszag opines that the longer a person remains separated from the workforce, whether because of job loss or because of disability, the harder it will be for that person to return to work. Job skills "atrophy," he writes. This spells trouble for an economy that continues to be hampered by high unemployment. Orszag is probably right.