Cuts to social security are being proposed in the White House’s recently released 2018 budget and are only aimed at the Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) programs. It does not propose changes to the Retirement, Survivors and Disability Insurance (RSDI) program.
“The acronyms can sometimes be overwhelming but understanding the programs and what each one does should not be,” said Sara Khaki, a Social Security Disability Attorney with The Khaki Law Firm. Generally speaking, benefits from any of the Social Security programs are based on an individual’s work history, and whether they have earned wages from which Social Security taxes were deducted.
If an individual has a disability that prevents them from working, he or she will likely apply for disability payments under Social Security. The two programs that make payments to disabled workers based on work history (or lack thereof) are SSI and SSDI.
If an individual has been disabled and unable to work since birth, or if they have become disabled and have a limited work history, he or she will likely apply for SSI. The SSI program makes payments to a qualifying individual regardless of whether they have ever earned wages or paid Social Security taxes.
In order to qualify, the person must be determined to be disabled under Social Security’s regulations, and also have a very limited amount of assets (normally less than $3,000). The benefit amount is small (roughly $750 per month) but often includes automatic eligibility for health care through Medicaid.
If the individual has a work history, he or she will likely apply for SSDI. Eligibility for SSDI is based upon the amount of work credits the individual has earned during their lifetime and whether the person qualifies as disabled under the Social Security regulations. Amounts paid under SSDI are generally larger than SSI payments, and eligibility does not take into consideration whether the individual has other assets. The determination of eligibility for payments is based solely on an individual’s ability to work.
The RSDI program is the program that most people are thinking about when they use the phrase “Social Security”. RSDI is available to individuals age 62 or above, and payments are based on that individual’s average earnings during their lifetime, unless benefits are being paid to a surviving spouse or child, in which case payments are based on the earnings on the deceased spouse or parent.
The changes being considered by Congress, as noted above, will only affect the SSI and SSDI programs. These cuts are likely to have a negative impact on the ability of injured and disabled individuals to apply for benefits through the Social Security program. If you are considering applying due to a disability, do not delay. Starting the process now may allow access to benefits unavailable in the future.