Many people know about Social Security retirement and their eligibility by age, but fewer realize they may be eligible for Social Security disability benefits.
Belleville, IL (Vocus) September 16, 2010
The Social Security retirement program is top of mind as baby boomers age into eligibility, but the Social Security Disability Insurance (SSDI) program is a significant safety net for taxpaying workers when they experience a severe or permanent disability, according to Allsup, a nationwide provider of Social Security disability representation and Medicare plan selection services.
This year, 206.5 million workers are insured for retirement benefits. In comparison, there are 152.4 million workers who are insured in the event of a disability, and 7.8 million people received Social Security disability benefits last year. (Source: SSA, Workers Insured for Social Security Benefits, 2010.)
“Many people know about Social Security retirement and their eligibility by age, but fewer realize they may be eligible for Social Security disability benefits,” said David Bueltemann, supervisor of senior claimant representatives at Allsup.
One of the common misconceptions is that the SSDI program is means-based, meaning that only lower income individuals are eligible. Not true. SSDI is a payroll tax-funded, federal insurance program. It was enacted in the 1950s and provides monthly benefits to individuals who can no longer work because of disability.
While millions of people are covered under the SSDI program, it does carry a number of requirements that add to the difficulty in receiving these benefits. Allsup has outlined the following little-known facts about SSDI to help explain why Social Security disability benefits can be hard to get.
1. You must be currently insured to receive SSDI benefits. “You might think of this like your car insurance, it only covers your car accident if you’ve paid the premium,” Bueltemann said. “When you work, your payroll taxes are the premium that you pay for Social Security Disability Insurance.” You are considered “current” in your coverage if you’ve had enough earnings during the past 10 years. To be currently insured for SSDI, you must have 20 quarters of coverage for the past 10 years on record with the Social Security Administration (SSA). You can earn up to four quarters every year. In 2010, you can “buy one quarter” by making $1,120 in wages.
2. You also must be fully insured. In basic terms, you must have at least 40 quarters of coverage. These 40 quarters of coverage could have been earned over your entire working career, as long as you meet the “currently” insured condition.
Here’s an example to illustrate:
Jane Doe’s Work History
This example illustrates how Jane Doe is both fully insured and currently insured for Social Security Disability Insurance (SSDI) benefits.
- 1986-1998: Office worker; earned four quarters each year (the maximum allowed); 48 quarters = fully insured
- 1999-2000: Serious illness, stopped working; no earnings, no quarters
- 2001-2008: Office work, temp work, intermittent work because of illness; earned three quarters in 2001; four quarters in 2002, 2003 and 2004; two quarters in 2005; one quarter in 2006; two quarters in 2007; one quarter in 2008; earned total of 21 quarters = currently insured
- November 2008: Stopped working because of disability
- 2009: Not working; no earnings, no quarters; applies for SSDI benefits
Source: Allsup/chart on Allsup.com
Because of Jane Doe’s work history, she is both fully insured and currently insured. You must have both to qualify for SSDI benefits. There are some exceptions for younger workers who become disabled. If you are under age 31, you may be currently insured with less than 20 quarters of coverage. Also, for younger workers—you may be fully insured if you have six quarters of coverage, plus one quarter of coverage for each year after the year you reach age 21.
3. You can apply for SSDI anytime after your disability occurs—as long as your disability is long-term, permanent or terminal. “Some disabilities are progressive, and the decision to stop working isn’t made immediately,” Bueltemann said. “This means someone might not apply for SSDI until some time after their initial diagnosis. Individuals should apply for SSDI only when they can no longer work.”
Note: There are additional risks from waiting too long to apply for SSDI benefits, including the risk of losing your “currently insured” status. There also is a time limit of 12 months for receiving retroactive benefits. For instance, if you became disabled in the summer of 2006, but did not apply for benefits until winter 2007, your retroactive benefit will only go back 12 months.
4. Disability benefits eventually convert to retirement benefits. After you reach full retirement age, which ranges from 65 to 67 depending on your birth date, any disability benefits you are receiving convert to retirement benefits. You can apply for disability benefits up to the date you attain full retirement age.
5. You must meet the Social Security Administration’s definition of disability to receive SSDI. The definition of “disabled” can vary among state and local government agencies. The SSA has its own definition of disabled. The federal agency uses a five-step process to determine if you qualify for disability benefits.
6. Two out of three people are denied SSDI benefits with their initial application. The SSDI program has strict requirements for receiving benefits, but you can appeal this initial denial of benefits. You also can get assistance with your SSDI application. Allsup provides representation services for people whether they are just beginning their application or they already have been denied a couple of times. Keep in mind that 90 percent of claimants reaching the hearing level, or their second appeal, choose to have a representative on their side.
7. You can increase your chances of award with a representative. “In the same way you get help with your tax return, Allsup helps people with their SSDI applications,” Bueltemann said. “Allsup representatives use their knowledge and experience to help claimants get through the process more quickly and with less hassle. Our team of professionals will answer your questions along every step of the process.”
If you have questions about whether you are eligible for SSDI benefits, please contact the Allsup Disability Evaluation Center at (800) 279-4357 for a free evaluation of your situation.
Allsup is a nationwide provider of Social Security disability, Medicare and Medicare Secondary Payer compliance services for individuals, employers and insurance carriers. Founded in 1984, Allsup employs nearly 700 professionals who deliver specialized services supporting people with disabilities and seniors so they may lead lives that are as financially secure and as healthy as possible. The company is based in Belleville, Ill., near St. Louis. For more information, visit http://www.Allsup.com.