Susan Thinks About Working Again

After she had been on Social Security Disability Insurance (SSDI) for 2 years, Susan became eligible for Medicare. Susan had been on Medical Assistance (MA) due to her low income, but now that she was on Medicare, she couldn’t get income-based MA anymore and she didn’t qualify for disability-based MA either, due to her $5,000 retirement account. (Griffin could stay on MA, since he didn’t qualify for Medicare.)

At first, Susan was worried about not getting MA anymore for herself, since it had worked so well for her. But it turned out that Medicare was also a pretty good deal for Susan. Her income and assets were low enough that she qualified for the Specified Low-Income Beneficiary (SLMB) Medicare Savings Program, which meant she didn’t have to pay the Medicare Part B premium. She also automatically qualified for Medicare Part D’s Low Income Subsidy (LIS), so she didn’t have to pay the Part D premium either. On top of that, she didn’t have to pay a deductible for prescription drug benefits and didn’t have to worry about the donut hole.

Susan needed 2 more years before she felt ready to go back to work. By then it had been more than 4 years since her accident; years that were a major adjustment, both physically and financially for her family. While her migraines had become much less frequent and she was no longer as forgetful as she was immediately after the accident, she would be using a wheelchair for the rest of her life. And both she and Griffin had had to get used to living very carefully with their money, which was really hard for a teenager who wished he could have nicer clothes and a new videogame system.

Susan and Griffin really needed more income so that they could live a little better; struggling on benefits just wasn’t right for their family. After all she’d been through mentally and physically, Susan wasn’t prepared to go back to work full-time. However, she did want to try giving work a shot. But first, she needed to clarify a couple of things related to the Social Security Disability Insurance (SSDI) and Child’s Benefits they got from the Social Security Administration (SSA) and her Medicare and his Medical Assistance (MA) health coverage.

Both the benefits from Social Security and the health coverage had been a huge help and Susan didn’t want to lose them, so she decided to talk to a benefits expert again. She remembered Tom at the independent living center and gave him a call.

“I remember you — the architect,” Tom said. “Glad to hear you’re doing better. What’s up?”

Susan explained the situation, “I want to go back to work, but my family still needs the benefits we’ve been getting, because I’m not ready to go back to work full-time, due to my disability.”

“I understand,” Tom paused. “The good thing is that all of the benefits you and Griffin are getting right now — SSDI, Medicare, and MA — are designed so that you can work, make some money, and keep getting benefits if you need them.”

“That’s a relief,” commented Susan. “How do the rules work? And what do I have to do to make sure everything goes smoothly when I find a job?”

Learning SSDI’s Work Rules

“It’s a little complicated, but I can explain it,” Tom said. According to Tom, the short version was this: she would continue to get the $1,004 per month in SSDI direct-deposited into her bank account for at least her first 9 months of working and making more than $880 in a month. Months where she made less than $880 would not count against this time limit, which was called the Trial Work Period. If she earned more than $880 for a total of 9 months, then, depending on how much she was working, she would keep getting SSDI for an additional 3-month grace period, but after that her benefits would stop. However, if her countable income dropped below $1,220 a month at any time during the following 3 years, she could give Social Security a call and start getting SSDI again. “That’s called the Extended Period of Eligibility (EPE),” Tom explained. “It’s there to help you just in case your income drops again.”

“So, it sounds like I’ll be able to test the waters for a while to see if I am able to balance my disability, a part-time job, and my parenting responsibilities for at least a year,” Susan said. “And then I’ll have 3 more years where I can easily restart my SSDI benefits if for some reason I am not able to keep up with work due to my disability. What about the $488 a month that we’re getting to help with Griffin’s expenses?”

Tom continued explaining, “His benefits are based on your SSDI benefits, so any month you get SSDI benefits, he’ll get Child’s Benefits. If you stop getting SSDI after the 9-month Trial Work Period and 3-month grace period are completed, he’ll stop getting Child’s Benefits. If at any point during the 3-year Extended Period of Eligibility you get SSDI benefits, he’ll also get Child’s Benefits.”

“This makes sense,” Susan said. “So, we’ll have 12 months where we’ll be getting both my work income and the benefits from Social Security. After that, if I keep working, it’ll just be the work income. Since I plan to make more money by working than we get from SSDI and Child’s Benefits, we’ll be in better shape overall. What about our health coverage? Will I lose my Medicare and Griffin his MA? Will that happen before or after the SSDI Trial Work Period ends?”

“Well, I’ve got good news there,” said Tom. “Right now, you have Medicare. Even if you stop getting SSDI benefits after your Trial Work Period ends, your Medicare will continue for at least 93 months (that’s 7 years and 9 months). So, there’s nothing for you to worry about there.”

“For Griffin, he’s been getting MA because your family income is below 280% of the Federal Poverty Guidelines (FPG). That’s $46,088 per year for a family of 2. So, as long as your total combined income from your SSDI benefits, his Child’s Benefits, and your new job are below that amount, he’ll be able to stay on MA. All you have to do is make sure to update your family income on MNsure. If it turns out that your income is higher than that, Griffin might have to switch to a private plan using MNsure, which is pretty easy.”

Then Tom added. “The best news for you is that once you start working, you’ll qualify for Medical Assistance for Employed Persons with Disabilities (MA-EPD).”

Susan paused for a moment and then said, “But I thought I couldn’t get MA because I have too much in my retirement account? And why would I want MA-EPD if I already have Medicare?”

Tom explained that MA-EPD had a higher asset limit than MA for people with disabilities usually had. “MA-EPD helps people who get jobs and have higher income and assets. You can have up to $20,000 and still get MA-EPD coverage.”

Tom also told Susan that there were other good reasons to have MA-EPD and Medicare at the same time. "You will no longer qualify for a Medicare Savings Program due to your increased income, but instead MA-EPD will pay for your Medicare Part B deductible and co-insurance, and maybe your Part B premium. Plus, being eligible for MA-EPD makes you automatically eligible for the Part D Low Income Subsidy, which can help pay for out-of-pocket expenses for medications. As an added bonus, MA-EPD might pay for some in-home services, if you need them.”

Tom continued, “You’ll have to pay a premium for MA-EPD, which is based on your income, including your work income and your SSDI benefits. To figure out if the additional benefits MA-EPD provides are worth the expense of the premium, add up your out-of-pocket expenses for Medicare for last year. If that amount is more than what your MA-EPD premiums would add up to, MA-EPD probably makes sense for you.” Tom knew that this was pretty complicated, so he added, “Call me up after you get your job and I’ll help you apply if you think it makes sense for you.”

Susan thanked Tom for the information and said she would get in touch with him if she needed further help.