Work Incentives and Assistive Technology

Transcription

1 Work Incentives and Assistive Technology Using the SSDI, SSI, Medicare and Medicaid Work Incentives to Fund AT Or Leverage Funding for AT September 28, 2010 Bridges to Better Advocacy 2010 Annual Conference 1 Today s Presenters James R. Sheldon, Jr., Esq. National AT Advocacy Project Neighborhood Legal Services, Inc. jsheldon@nls.org Edwin J. Lopez-Soto, Esq. Employment and Disability Institute Cornell University ejl44@cornell.edu 2

2 Purpose of this Session Identify AT to support education, training or work How work incentives can fund AT SSDI or SSI Medicare or Medicaid How work incentives can leverage funding for AT 3 The Two Disability Programs 4

3 Programs Known As Social Security Disability Benefits RSDHI (Retirement, Survivor, Disability, Health Insurance) SSDI (Social Security Disability Insurance) Title II, DIB (Disability Insurance Benefits) Supplemental Security Income SSI (Supplemental Security Income) Title XVI 5 Work History Social Security Disability Benefits Wage Earner must have accrued sufficient credits of coverage Supplemental Security Income No work history is required 6

4 Title II Disability Benefits Spouses: At least age 62, or if caring for either a child under 16 or a disabled child of the worker Divorced Spouses: If the marriage lasted at least 10 years and the person is age 62 years old or older and remains unmarried. Child: If under age 18 (or under 19 is a full time high school or elementary student) and dependent unmarried child of an insured eligible worker. Disabled Adult Child/Childhood Disability Benefit: Adult children (18 or older) of a retired, disabled, or deceased worker, if the disability began before the age of Benefits to Recipient s Family Supplemental Security Income No family member of the SSI recipient will be eligible for SSI benefits unless he or she independently establishes eligibility for SSI 8

5 What Affects Benefit Amount? Social Security Disability Benefits Only Worker s Compensation or other Federal or State disability payments may affect payment level. Supplemental Security Income Any income (earned or unearned) affects benefits. 9 Effect of Resources Social Security Disability Benefits Supplemental Security Income No resource limits Resources must be below $2,000 for an individual and $3,000 for federally married eligible couples. 10

6 Health Benefits Social Security Disability Benefits Eligible for Medicare 24 months after establishing eligibility for SSDI Supplemental Security Income In two thirds of states, eligible for Medicaid if receiving even $1.00 of SSI 11 The Case or Mark, Age 48 Disability Multiple sclerosis, severe vision problem Power wheelchair for mobility Computer use Difficulty typing Needs magnifier to see screen AT Needs Adaptive keyboard/mouse AND/OR voice dictation software Enhanced computer screen AND/OR voice output software 12

7 Mark Work Background, SSDI Receipt Snow City Gazette Sports reporter, columnist Age 24 to 42 SSDI Approval, July 2004 Currently $900 per month Medicare effective 2006 $96.40 Part B premium in Mark s Need for Power Wheelchair Current wheelchair 8 years old Constantly needing repairs Not equipped for changing disability Needs standing power wheelchair $24,000 Medicare Part B will not pay for standing feature $12,500 without standing feature Mark s co-pay is $2,500 14

8 Mark s AT Funding Needs $96.40 for monthly Medicare Part B premium 20 percent Part B co-pay = $2,500 Standing feature on wheelchair Medicaid? State VR agency? 15 Mark Returns to Snow City Gazette Part-time, high school & college sports $1,650 gross 2007 $1,800 in 2010 Drives old van Hydraulic lift, passenger lock down for wheelchair 114,000 miles, bad shape AT funding needs New or newer used van Modified for travel as passenger 16

9 Payment for Mark s Driver Driver duties Operate lift, wheelchair lock down Drive, eyes at the game Driver payments 50 hours x $8 = $400 per month , payment by State VR agency , payment by Mark 2010, daughter does some free services 17 Mark Reports Statutory Blindness September 2010 I am now legally blind SSA term is statutorily blind Was Mark blind in 2007 or later? BPQY says not statutorily blind Ophthalmologist first certified blindness in November

10 SSDI and Medicare Work Incentives 19 Substantial Gainful Activity [SGA] Countable gross earned income over a set amount per month. Currently, in 2010, the set amount is $1000/month for all SSDI recipients who are not statutorily blind. Currently, in 2010, the set amount is $1,640/month for those who are statutorily blind. 20

11 Application of the SGA Rule: Applicants for SSDI & SSI If an applicant s countable earnings are over the SGA amount, the application will be denied. This is true for both SSI and SSDI applications. However, the SGA rules will never apply to SSI recipients. The SGA rules will apply to SSDI recipients after the 9-month trial work period. 21 Trial Work Period (TWP) A 9-month period, within 60 months, in which a person on SSDI can work and earn any amount of money without earnings affecting SSDI eligibility Each month an SSDI beneficiary earns more than $720 in 2010 counts as one TWP month. TWP amount usually goes up each year. These months need not take place one after another or reflect earnings from one job. 22

12 Mark s Trial Work Period As SSDI beneficiary, first work was in 2007 $640 was required for TWP month in 2007 Mark earned $1,650 gross per month in 2007 Mark used his 9 TWP months in 2007 January through June September through November 23 Extended Period of Eligibility (EPE) A period of eligibility that starts with the month after the TWP ends and continues for the next 36 months. For any month during period that countable earned income is less than the SGA level, person continues to receive the SSDI check. When they earn more than the SGA level, SSA plans to stop benefits, but: Will get benefits for that month, plus two more This is three-month grace period 24

13 The EPE Continued - After the 3-Month Grace Period After the grace period, the SSDI stops if earnings ever go above the SGA level. SSDI can be restored during 36-month EPE If earnings again fall below the SGA limit, the SSDI benefits can be restored. During remainder of EPE, can go on and off SSDI as countable wages go above or below SGA level. 25 Reducing Countable Earned Income Below SGA Level Paid Time Off, Impairment Related Work Expenses & Subsidies 26

14 Deductions for Paid Time Off Paid time off includes vacation, personal, holiday and sick pay. Amounts received as paid time off are deducted from gross pay to determine countable wages. 27 Case Scenario Paid Time Off Roger is in his EPE and earns $1,100 gross per month. In January he receives $50 in holiday pay for January 1st. He receives $100 for taking two vacation days in January. His countable wages for January are reduced by $150 to $950 below the $1,000 SGA level for Since Roger is in his EPE, he will get an SSDI check in January. 28

15 Impairment Related Work Expenses [IRWEs] Three-part test to determine if an IRWE exists: The individual with a disability pays for the item or service The item or service is related to an impairment of the person on benefits The person would not be able to work if he or she did not spend the money and receive the item or service 29 Sample IRWE Expenses Supported employment services Attendant care services Transportation costs SSA approved mileage allowances Medical devices Prosthesis Work related equipment & assistance Residential modifications Routine drugs/medical services Diagnostic Procedures Non medical appliances and devices Similar items and services 30

16 IRWEs Application to Mark During EPE His EPE begin in December 2007 after his 9 th TWP month. His EPE ends 36 months later in November Mark s earnings subject to SGA level for blind December 07: Gross earnings $1,650 and SGA level $1,500 Calendar year 08: Gross earnings $1,700 and SGA level $1,570 Calendar year 09: Gross earnings $1,750 and SGA level $1,640 Calendar year 10: Gross earnings $1,800 and SGA level $1, Mark s IRWE Analysis Payments to Driver/Onsite Assistant VR agency payments, , not an IRWE as Mark did not pay. Mark s $400 (later $300) payments, , met 3-part test: He paid; disability related; could not work without driver s services Countable earnings below SGA each year 2009: $1, = $1,350 (less than $1,640 SGA level) 2010: $1, = $1,500 (less than $1,640 SGA level) Mark entitled to SSDI payments in 2009 and

17 IRWE Calculation 2009 STEP ONE $1750 Gross Monthly Earnings 400 Minus IRWE $1350 Equals Adjusted Gross Earnings (Non SGA) STEP TW0 $1750 Gross Earnings Plus SSDI $2650 Equals Monthly Income 400 Minus IRWE $2250 Equals Total Usable Income 33 Additional IRWEs for Mark December 2007: Repairs to Lockdown Mechanism in Van $218 expense meets 3 part test for an IRWE Countable wages reduced to $1,432 ($1, ) Less than SGA of $1,500 January 2008: Ramp Construction $3,000 expense meets 3 part test for IRWE Mark will opt to spread cost out over 12 months ($250 per month IRWE) Countable wages reduced to $1,450 ($1, ) Less than SGA of $1,570 SSDI Payments Continue in December 07, all of

18 Subsidies A Subsidy Exists When the Employer: Willingly pays more in wages than the value of the services performed; or Receives full value only because some agency provides extra services to the employee. 35 Subsidies Special Conditions Human services agencies may provide support and services to beneficiaries, potentially subsidizing an individual s ability to work at an SGA level. By regulation subsidy should be computed using the employee s hourly wage. Typically, this occurs in a supported employment setting i.e., extra service of job coach can amount to subsidy. 36

19 Subsidy for Mark VR Agency Payment for Driver Paid $400 per month during 10 work months of Driver assistance (driving, operating van lift, eyes at game) analogous to job coach and should count as subsidy. Countable wages reduced to $1,250 in 2007 ($1, ), less than SGA level of $1,500 Countable wages reduced to $1,300 in 2008 ($1, ), less than SGA level of $1,570 Mark is Eligible for SSDI for 12/07 and all of Expedited Reinstatement (EXR) of SSDI Persons Who do SGA-level Work, after EPE, can Return to Benefits Status Key Eligibility Criteria: Was receiving SSDI SSDI terminated due to SGA-level work after EPE No longer performing SGA because work stopped or earnings drop below SGA level Requests EXR within 60 months of last month or the EPE or last month of SSDI eligibility (whichever is later) Meets medical standard of disability (using medical improvement review standard) 38

20 How EXR Might Apply to Mark Mark Thrives at Job, SSDI Terminated Countable wages now more than SGA level for blind, even with paid time off, IRWEs, subsidies Mark Stops SGA-level Work within 60 Months Cannot handle physical demands and reduces work hours; or Employer cuts back on sports coverage, hours and pay reduced; or Pay remains constant, but SGA level for the blind goes up Has additional IRWEs for new or replacement AT 39 Mark s SSDI Reinstated through EXR Gets 6 months of provisional benefits while waiting for decision Benefits can be retroactive up to 12 months His dependents can be reinstated, if they still meet criteria 40

21 The Importance of Medicare Eligible for Medicare after 24 months eligibility for SSDI Part A hospital insurance is automatic and cost free Part B optional and subject to premium ($96.40 in 2010 for existing enrollees & $ for new enrollees) Covers durable medical equipment, subject to 20 percent copayments Part C optional managed care coverage Part D prescription drug coverage 41 Extended Medicare Eligibility SSDI beneficiary entitled to Medicare coverage during 9-month trial work period and at least 93 months following TWP During extended period Medicare Part A is still automatic and cost-free Medicare Part B is still optional and subject to premiums, deductibles and copayments SSDI beneficiary who goes to work can keep Medicare for at least 102 months (nearly 9 years)! 42

22 SSI Work Incentives 43 Special Connection Between SSI and Medicaid SSI Recipients in Most State Get Automatic Medicaid Exception, 209(b) states: Connecticut, Hawaii, Illinois, Indiana, Minnesota, Missouri, New Hampshire, North Dakota, Ohio, Oklahoma, Virginia. 209(b) states use their own Medicaid criteria. When Medicaid Automatic, a Primary AT Funder is Leveraged AT usually funded as durable medical equipment (DME) Could pay for expensive wheelchairs, patient lifts, speech generating devices, and many more things 44

23 SSI Federal Benefit Rate 2010 In 2010, the Federal Benefit Rate (FBR) is: $674 per month States Supplement the FBR at their Option In New York, for example the FBR is supplemented by $87 to $761 for individuals who live alone in the community In Texas, FBR not supplemented and base SSI rate is $ SSI s Key Work Incentives Reducing Countable Earnings $65 plus 50 percent exclusion $1,640 student earned income exclusion (up to $6,600 per year) Impairment related work expenses (IRWEs) Blind work expenses (BWEs) Plan for Achieving Self Support (PASS) 46

24 When SSI Recipient Works Simple Formula Applies First $20 earned disregarded if no unearned income The next $65 earned is disregarded as a work exclusion IRWEs then subtracted One half of the remaining earned income is disregarded BWEs then subtracted Approved PASS expenses subtracted What is left is the net countable earned income Countable earned income is subtracted from state SSI base rate 47 SSI Budget Unearned Income Only Ted has a disability Ted receives $385/month SSDI benefits. The SSI program will disregard or not count the first $20 each month of Ted s SSDI benefits. $ 385 Social Security Disability - 20 Disregarded $ 365 Countable income $ 674 SSI base rate Countable income $

25 SSI Budget Earnings, No IRWES or BWES Ted earns $385/month. SSI will disregard the first $85 each month (20 general, 65 earned income disregards) Then, an additional 50% will also be disregarded $ 385 Gross wages 20 General Disregard $ Earned Income Disregard $ Additional 50% disregarded $ 150 Countable wages $ 674 SSI base rate 150 Countable income $ 524 Monthly SSI check 49 Impairment Related Work Expenses and SSI Same 3 Part Test as with SSDI SSI recipient must pay for item/service Must be related to disability Could not work if did not get item/service An IRWE reduces earned income in SSI calculation Subtracted after $65 exclusion, before additional 50 percent exclusion Result is reduction of $1 of earned income for every $2 in IRWEs 50

26 IRWE Example - Leonard Has Post Polio Condition, Works from Home Income: $420 SSDI, $885 in wages $810 in countable income, too much for SSI $400 countable unearned ($420 20) $410 countable earned ($ = $820 2 = $410) Eligible for Medicare, not presently getting Medicaid Obtains Loan to Convert Spare Bedroom to Office Widened doorway, accessible entrance, work station for wheelchair user $400 per month payments for three years Will telecommute as an employee Meets 3 part IRWE test (he pays, disability related, needed to work) 51 Leonard s SSI Budget with IRWE Step 1: $420 SSDI Step 3: $400 Counted unearned - 20 General exclusion +210 Counted earned $400 Counted Unearned $610 Total counted Step 2: $885 Earned income Step 4: $674 SSI federal benefit rate IRWE deduction Counted income 485 $ 64 SSI payment - 65 Earned income exclusion $ Additional 50 % exclusion $210 Counted earned income Leonard will qualify for automatic Medicaid in his state. 52

27 Blind Work Expenses Must be statutorily blind Exclusion from earned income for any expense reasonably attributable to the earning of income. A BWE is not counted in determining SSI eligibility and monthly cash payments. 53 BWEs Allowable Expenses Need not relate directly to individual s blindness. Need only be work-related expenses incurred by the individual, be reasonable, and may not exceed total countable income. A BWE taken under SSI may also be simultaneously counted as an IRWE under SSDI. 54

28 BWEs - Deductible Expenses Guide dogs Fees Transportation to and from work Vehicle modifications Training to use impairment-related items Tax withholding (income tax and FICA) Prosthesis Meals consumed during work hours 55 BWEs Deductible Expenses (Cont.) Physical therapy Other work-related equipment/services Non-medical equipment/ services Drugs and medical services essential to work Expendable medical supplies Mandatory pension contributions Attendant care 56

29 Use of BWEs by Mark Mark Was an SSI Recipient when he Started Working for Snow City Gazette Has multiple sclerosis and is statutorily blind Earns $2,585 per month gross Mark has $865 in Monthly BWEs: $ 95 State and federal income taxes 160 Social Security, Medicare taxes (FICA) 15 Union dues 300 Driver/onsite assistant 45 Guide dog 250 Ramp construction payments 57 Mark s SSI Budget with BWEs $2585 Earned income - 85 $20 + $65 exclusions Additional 50 % exclusion $ Blind work expense $ 385 Counted earned income $ 674 SSI base rate Counted income $ 289 SSI payment Leonard will qualify for automatic Medicaid in his state. 58

30 The Medicaid Work Incentives 1619(b) The Medicaid Buy-In for Working People 59 Under 1619(b), Former SSI Recipients Can Still Get Automatic Medicaid Person must lose SSI due to budgeting of wages Person who receives 2010 federal benefit rate, $674 per month, loses SSI if monthly wages are $1,433 or higher The person s disability must continue 60

31 Section 1619(b) s Financial Criteria Person must be otherwise eligible for SSI Unearned income must be within SSI s limits Resources must be within SSI s limits 61 Section 1619(b) s Earned Income Eligibility Threshold This will vary from state to state For calendar year 2010, New York s threshold is $43,956 per year Threshold for Texas is $28,730 Threshold for Alaska is $50,054 Threshold of Oklahoma is $26,422 62

32 Mark s Eligibility for 1619(b) Mark was getting a reduced SSI check and working for the Snow City Gazette He gets a promotion to make $3,500 per month/$42,000 per year. He loses his SSI check. His disability continues and his resources are within SSI limits. He will be eligible for continued Medicaid as his annual earnings are less than $43,956 Medicaid will continue to be a source of payment for expensive AT like his power wheelchair. 63 Additional 1619(b) Criteria Prior month criteria To be initially eligible, must have received an SSI check within the previous 12 months A person loses 1619(b) only if he/she went through a period of 12 consecutive months with no eligibility for an SSI check or 1619(b) Medicaid use test: Met if the person Used Medicaid within past 12 months, or Expects to use Medicaid in next 12 months, or Would need Medicaid to pay unexpected medical bills in next 12 months. 64

33 Individualized Eligibility Threshold for 1619(b) This is determined by adding Base amount from threshold chart Medicaid amount from chart, or actual Medicaid expenses for a year if higher IRWEs BWEs Income excluded under a PASS Publicly funded attendant care that would be lost based on earnings If annual wages below new total, Medicaid continues. 65 Mark s Individualized 1619(b) Threshold Mark earns $42,000 in state with $28,000 threshold Mark s individualized threshold is $49,577 based on A base amount of $17,197 from chart Actual Medicaid expenses of $22,000 Blind work expenses of $10,380 ($865 x 12) Since his annual gross wages are less than $49,577, he will be eligible for continued Medicaid. 66

34 The Problems with 1619(b) Not available if never on SSI Not available if prior month requirement not met If no SSI or 1619(b) eligibility for 12 consecutive months Resources subject to $2,000 SSI limits 67 The Medicaid Buy-In for Working People 68

35 Key Federal Requirements for Medicaid Buy-In Paid work, with countable income, using SSI exclusions, less than 250 percent of federal poverty level (can be up to 450 percent of FPL) Not required to have been on SSI in past Meets SSI definition of disability Disability determined by state if no disability determination by SSA No SGA rule Can earn more than $1,000/$1,640 per month in 2010 States can charge premiums or cost-sharing charges States Have Medicaid Buy-In Some States at Today s Training (Income Limits) Alaska 250% of federal poverty level (FPL) Arizona 250% of FPL Iowa 250% of FPL Illinois 350% of FPL New Jersey 250% of FPL New York 250 % of FPL Oklahoma (section 1115a HIFA waiver) Texas 250% of FPL Utah 250% of FPL Links to websites: 70

36 New York s Medicaid Buy-In for Working People with Disabilities Key Eligibility Criteria: Meets SSI definition of disability Age 16 to 64 Paid work (part-time or full-time) Countable income up to $2,257 per month (250% of FPL) Up to $55,188 if only income from work Resources up to $13,800 No SGA test $25 monthly premium, if income more than $1,354 (150% of FPL) 71 Key Medicaid Buy-In Monthly Income Exclusions These are the same as SSI s and apply in every state. $20 general income exclusion $1,640 student earned income exclusion (up to $6,600 per year) $65 earned income exclusion IRWEs Additional 50% earned income exclusion BWEs Income set aside in Plan for Achieving Self Support (PASS) 72

37 Mark s Eligibility in New York Mark receives $900 in SSDI $880 counted ($900 20) Mark earns $1,800 gross per month, with $865 in BWEs $2.50 in counted earned income $1, = 1,735/2 = BWEs = $2.50 Countable income, $882.50, is less than $2,257. Mark will be eligible for Medicaid Buy-In in New York (and all other states with a Buy-In). 73 SSI s Plan for Achieving Self Support (PASS) 74

38 What is a PASS? A special SSI rule for not counting income or resources that support a work goal. If approved the PASS can result in: Retained SSI eligibility A larger SSI check SSI eligibility when none existed before Establishing Medicaid eligibility or retaining Medicaid eligibility 75 SSI Payments Based on 2010 State SSI Rate $674 federal benefit rate State supplement is optional If individual has income, other than SSI, part of income subtracted from base rate to determine monthly SSI payment. 76

39 The Case of Joan Joan, age 33, receives SSDI of $580 per month based on a cerebral palsy. SSI disregards $20 and remaining $560 is subtracted from the $674 SSI base rate, giving Joan a $114 monthly SSI check. Her total monthly income is $694 ($580 SSDI, $114 SSI). Since Joan gets SSI, she also qualifies for automatic Medicaid in most states. 77 Joan s Need for a PASS SSI Rule: If income or resources are used in a PASS to support a work goal, the income/resources will not count when determining SSI eligibility. Example. Joan plans to attend a two-year community college program to become a social work assistant. State VR agency will pay for tuition, transportation to college, books, and hand controls for car she hopes to buy. Will still need: $700 for laptop; $10,800 for a used car to travel to work; and $650 for six months of car insurance. Joan proposes to set aside $450 of her SSDI check each month, for 27 months, to save for these items to meet her work goal. 78

40 Joan s Approved PASS With approval, SSI no longer counts $450 of SSDI Countable income reduced to $110. SSI check increased to $564. PASS savings = $12,150 (27 months x $450) Savings will pay for computer, car, and insurance. PASS starts July 2010, continues through August 2012 Can purchase car and insure it in August Will borrow mother s car, in interim, to travel to job interviews. Will graduate in May Joan still has $694 for living expenses ($564 SSI, $110 SSDI). 79 PASS Must Increase Prospect for Self Support PASS policy requires: If SSI received before PASS approval, work goal must significantly reduce the SSI payment amount. If only SSDI received before PASS approved, goal must be expected to eliminate SSDI (through work at SGA level - $1,000 per month in 2010). Joan s goal: make $22,000 ($1,833 per month) upon graduation. She meets the first criteria as this would eliminate her SSI eligibility. If SSDI were her only income before PASS approval, she would meet the criteria, as she will earn more than $1,000 per month. 80

41 What Money Goes Into a PASS? Earned income Wages from a job Income from a business Unearned income Such as a Social Security check or VA pension Resources Savings Personal injury award Inheritance Lump sum Social Security or SSI award 81 Allowable PASS Expenses All reasonable and necessary expenses, such as: College or training costs Transportation, including vehicle lease or purchase Vehicle insurance, maintenance, repairs, warranty costs Computer, software and Internet costs Work clothes, professional clothing Business start-up costs Dues, fees, licenses Child care Anything reasonably tied to the work goal 82

42 PASS Time Limits General Rule: A PASS can be approved for whatever period of time is needed to achieve the goal. Application to Joan s PASS: Her PASS should go for 27 months, through August 2012, to allow her to save for the computer, car, and car insurance, find a job, and start working. 83 Mark s Use of a PASS Goal: Retain newspaper work and make more money. Current income: $900 SSDI, $1,800 gross wages Needs new van for travel as passenger Would allow Mark to retain and expand his sports writing Mark to save $880 from SSDI and $2.50 from wages Savings will increase by $250 when ramp loan paid and BWEs decrease. Will save $10,590 during first 12 months ($ x 12) Will save additional $13,590 during next 12 months ($ x 12) Total saved toward van = $24,180 84

43 Mark s PASS Approved He meets key PASS criteria Van needed to meeting sports writing goal Cannot save for purchase without PASS Goal: earn $42,000 per year ($3,500/month) when PASS completed Even with IRWEs, more than SGA for blind Meets self support criteria Will purchase van in 24 months $24,180 savings enough to purchase new van State VR agency will pay for new lift, lockdown PASS has leveraged VR agency funding for AT! 85 Thank You for Joining Us Please Complete Evaluations 86