What is the difference between Social Security Disability (SSD) and Supplemental Security Income (SSI)?

What is the difference between Social Security Disability (SSD) and Supplemental Security Income (SSI)?

The Social Security Administration has two programs that provide financial benefits to those who are disabled as that term is defined in the Social Security Act: Social Security Disability Insurance Benefits and Supplemental Security Income.

Disability Insurance Benefits

The purpose of Disability Insurance Benefits (DIB; Title II of the Act) “is to provide the measure of economic security for program beneficiaries.” HALLEX I-1-2-57(A)(1)

To qualify for Social Security Disability (SSD) benefits, (1) you must have “insured status” under the Social Security Act (Act), and (2) you must be found “disabled” under the Act.

Medical Disability Standard

The medical disability standard for DIB and SSI is the same: “the inability to do any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.” 20 C.F.R. § 404.1505(a); see also, 20 C.F.R. § 416.905(a) (SSI).

To meet this definition, you must have a severe impairment(s) that makes you unable to do your past relevant work . . . or any other substantial gainful work that exists in the national economy.” 20 C.F.R. § 404.1505(a); see also, 20 C.F.R. § 416.905(a) (SSI).

Under the Medical-Vocational Guidelines (a/k/a Grid Rules), the definition of disability can be modified for individuals age 50 and over depending on their education and work history.

Insured Status under the Act

Insured status is obtained by earning sufficient quarters of coverage under the Social Security Act through payment of FICA taxes, which are typically deducted from one’s paycheck (6.2%) or are paid directly if self-employed (12.4%).

Insured status can be checked by creating a “my Social Security” account at www.socialsecurity.gov/myaccount or by checking with your local Social Security Office.

The most important thing to know about insured status is that for purposes of disability insurance benefits, insured status expires. Once you leave the workforce and stop contributing FICA taxes, your insured status for disability insurance benefits will expire at some point in time; the longest your insured status will extend beyond your departure from the work force is five (5) years. The expiration of your insured status is referred to by SSA as your date last insured or DLI. Applying for benefits or proving you are disabled after your DLI is possible but it creates significant procedural and evidentiary hurdles that make success less likely.

Receipt of Disability Insurance Benefits

Disability Insurance Benefits provide for retroactive cash benefits up to twelve months before the date of application. DIB also will pay additional auxiliary benefits if you have a spouse or dependent minor children.

Once eligible for DIB and after receiving DIB benefits for 24 months, you become concurrently eligible for Medicare coverage. The total waiting period for Medicare coverage is actually 29 months as for the first five months you are eligible for DIB, you do not receive any cash benefits. This is referred to as the 5-month waiting period. Once the 5-month waiting period passes and after you receive 24 months of DIB benefits, you are eligible for Medicare.

Supplemental Security Income

The purpose of Supplemental Security Income (SSI; Title XVI of the Act) “is to assure a minimum level of income for supplemental security income recipients who otherwise do not have sufficient income and resources to maintain a standard of living at the established Federal minimum income level.” HALLEX I-1-2-57(A)(1)

To qualify for Supplemental Security Income (SSI), (1) you must satisfy strict financial requirements regarding income and assets; and (2) you must be found “disabled” under the Act.

Medical Disability Standard

The medical disability standard for DIB and SSI is the same: “the inability to do any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.” 20 C.F.R. § 404.1505(a); see also, 20 C.F.R. § 416.905(a) (SSI).

To meet this definition, you must have a severe impairment(s) that makes you unable to do your past relevant work . . . or any other substantial gainful work that exists in the national economy.” 20 C.F.R. § 404.1505(a); see also, 20 C.F.R. § 416.905(a) (SSI).

Under the Medical-Vocational Guidelines (a/k/a Grid Rules), the definition of disability can be modified for individuals age 50 and over depending on their education and work history.

Financial Criteria

SSI benefits are means-tested benefits available only to those with very limited income and assets. The financial certification requirements for SSI are very detailed; however, generally speaking, one’s home and one car are considered excluded assets that are not counted. Otherwise, an individual cannot have more than approximately $2,000 in assets and a couple cannot have more than approximately $3,000 in assets. The financial criteria for SSI eligibility are subject to change and this information is provided as a general guide only.

Receipt of SSI Benefits

Supplemental Security Income is available only from the date of application. No retroactive benefits are available. SSI does not provide auxiliary benefits for a spouse or dependent children.

Currently, individual SSI benefits for 2015 are capped at $733 per month. The monthly benefit amount can be reduced if you have any other sources of income or are living with a family member without paying rent. While receiving SSI, you are obligated to report all sources of income to SSA.

If you are found eligible for SSI, you become concurrently eligible for Medicaid coverage.