The Social Security Administration (SSA) provides Social Security Disability Insurance (SSDI). Your eligibility for SSDI depends on your ability to demonstrate disability; the amount you can collect depends on the amount you have paid through tax deductions from your work life to date. If you are under 18, the determination is made according to your parents' account(s). If you qualify, you can collect monthly checks which are not taxable.

In 1972, the Supplemental Security Income Program (SSI), an amendment to the Social Security Act, guaranteed a minimum income to elderly, blind, and disabled individuals who could not sustain gainful employment. Just as meaningful, SSDI recipients were made eligible for Medicare, a federal health insurance program, and SSI recipients were made eligible for Medicaid, a program administered by the states that covers medical expense.

At first glance, disability benefits would seem a blessing. Indeed, this money has made a great difference, but there is a growing movement for Social Security reform. The problem comes if you want to work. The SSA has designed the programs with the intent of providing incentives for people with disabilities to work. However, it turns out that these benefits are a trap for some people who could otherwise be earning their own living, particularly for those with lower income potential.

According to the Government Accounting Office, 42 percent of people with disabilities would like to work, and 33 percent of Social Security beneficiaries have the potential to work. The 1998 NOD/Harris Survey of Americans with Disabilities finds an even higher percentage of Americans with disabilities between the ages of sixteen and sixty-four wanting to work:

Employment continues to be the area with the widest gulf between those who are disabled and those who are not. Only three in ten working-age adults with disabilities are employed full or part-time, compared to eight in ten nondisabled adults. Working age adults with disabilities are no more likely to be employed today than they were a decade ago, even though almost three out of four who are not working say that they would prefer to be working. This low rate of employment has, in turn, led to an income gap that has not narrowed at all since 1986, with one in three disabled adults, compared to just one in eight nondisabled Americans, living in very low income households with less than $15,000 in annual income.¹

Trial work period

There is an "extended period of eligibility" (EPE) during which you can collect a benefit in a month when you make less than $500, or go back on regular benefits if you must go off work altogether. Timed from the beginning of trial work, the EPE is thirty-six months.

Medicare and Medicaid benefits are another part of this formula. You must collect Social Security disability benefits for twenty-four months before you qualify to begin with. You can maintain your Medicare benefits during the EPE, and in some cases can continue Medicare on your own beyond that time. You might pay some premiums yourself, which will be deducted from your check if you still receive benefits.

Social Security offers some Vocational Rehabilitation (VR) services, which could contribute to education, counseling, equipment, or job placement, among other benefits. The Social Security Administration (SSA) is experimenting with a program to allow you to choose approved outside providers of VR who could be paid by SSA.

You are allowed to deduct some expenses, including access modifications, some attendant care (getting dressed for work, for example), transportation, or even the cost of a service dog. Money you have to spend to be able to work can be subtracted from the calculation of your monthly income.

So if you are able to get and maintain a good paying job with health coverage, the twelve month period is a blessing which allows you to make all the money you want and still collect your tax-free disability income. You could do this on a contract or part-time basis while still covered on Medicare, which could attract an employer to give you a try, and hire you full-time with benefits once your benefits lapse. It could also give you time to start a business, in which case forty hours of work per month also counts as a trial work month.

Unfortunately, there is a large population of people with disabilities who do not fit this description.

If you don't make enough

Part-time work is often the only option for people with limited stamina or occasional need for time off to tend to demands of their disability, such as an exacerbation of MS. Part-time jobs do not offer medical coverage and are not a reliable long-term source of sufficient income for independence. Yet part-time jobs are a way to stay active, participate in the community, and take pride in earning at least part of your income. Although the government booklet "Red Book on Work Incentives" states that "the SSI and SSDI programs should not be viewed as permanent sources of income," the present system all but completely closes off other options for many people.

Dr. Ed Nieshoff, a quadriplegic rehabilitation physician in Detroit, Michigan, says of the system:

There's a huge disincentive to work. People think, "I can stay home and make $600 a month, or I can go to work 160 hours a month and make half again that much after taxes." They say, "The hell with it. Why bother?"

PASS

There have been mixed reviews. In New Mobility magazine, Irving Laibson describes his struggles with his PASS program. He relied on PASS to begin a business and line up clients. But when he was ready to start work, PASS deemed him out of compliance because he had existing clients! He lost the clients and his business failed when the PASS operating money fell through. Yet in the same article, Barb Knowlen describes her activities as a consultant helping people to develop PASS plans, stating that seventeen of her clients earn more than $20,000 per year and no longer receive disability benefits.²

PASS might be of value to you, but make certain you do very complete research into the program requirements and--as with any bureaucratic process--provide full information on forms, document conversations, and keep good files.

It's a messy bureaucracy

It can be just as hard to get Social Security to stop the money as getting it in the first place. When you complete a trial work period, Social Security Administration is likely to keep sending you checks. No matter how efficiently you fill out their forms reporting your income, they are so immensely overloaded that they could keep sending you money for months to come.

Once they finally get to your case, they'll come calling to get that money back. If you are not very careful about which months qualify against trial work and cash those checks--perhaps for groceries or rent--you can easily find yourself asked to pay back thousands of dollars you don't have. Just because it was the fault of the system's inefficiencies does not excuse you. At best--after a lengthy and complicated appeal process for which you might need to pay an attorney--they will allow you to pay back the money in monthly payments. The system is a mess, and it needs to be changed.

Reform

Proponents say that the present system wastes taxpayers' money, since entitlement benefits go to some people who would prefer to contribute to part of their own income. They say that if people can maintain their healthcare benefits, they are more likely to continue work rather than returning to the benefit rolls. They say that reforms would result in large savings to the Social Security trust fund.

Reform is no small political challenge. There is a tremendous amount of attention focused on the Social Security program. There is widespread belief that it will be bankrupt about a quarter of the way into the 21st century unless something is done to increase income and/or curtail expenditures. There is talk of raising the age for senior benefits and limiting Medicare spending. Disability reform has to compete with many other Social Security reform proposals.

Medicare is also thought to be in fiscal trouble, so the suggestion of extending Medicare coverage is another formidable political challenge for the disability community. But suggested reforms will not increase the numbers of people on Medicare--they would be getting it anyway if they stayed on disability. Instead, reforms are designed to increase the ability of people to get off of Social Security and Medicare.

The disability advocacy community is concerned that people with disabilities will be scapegoats in the current Social Security debate. People want independence, not a handout. But as long as the money is there, it should be used wisely, capably administered, and delivered through programs which truly promote work, rather than require people to risk being left poor and medically unprotected.

Notes:

1. Peter Risher and Stacey Amorosi, project directors, The 1998 N.O.D./Harris Survey of Americans with Disabilities, conducted for The National Organization on Disability (New York: Louis Harris, 1998).

2. Laura Hershey, "PASS Hits a Wall: But Advocates Are Chipping Away at Work Disincentives," New Mobility, April 1998: 31.