By Zach Bloxham, JD, and Stefanie Dion Jones
Various public benefit programs are available to individuals living with disabilities and other challenges. These programs have their fair share of acronyms, which can confuse those relatively new to elder law or special needs planning—be they attorneys, beneficiaries, or loved ones.
This primer offers basic information about some common types of public benefits and can serve as an at-a-glance glossary of acronyms commonly used within the practice.
Medicaid
- What it is: Medicaid is a needs-based, means-tested government assistance program to help people cover healthcare costs. It is jointly administered by the federal and state governments, with states given flexibility in shaping their eligibility guidelines and benefits under federal standards. There are many different Medicaid programs even within the same state, each with its eligibility requirements.
- Who qualifies: Individuals, couples, and families living on limited income and assets ($2,000 in most states) qualify for Medicaid. Medicaid also generally covers indigent children, pregnant women, and individuals living with a disability, including those institutionalized.
- What else you should know:
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- The median cost of private-pay nursing home care is $10,025 per month in 2024. Older Americans who meet their state’s Medicaid eligibility standards and need long-term care can qualify for assistance.
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- Many states offer Medicaid buy-in programs for working people with disabilities, through which they can earn income without losing their benefits.
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- The best practice is to begin proactively planning at least five years before needing long-term care Medicaid services. Specialized trusts, such as the Medicaid Asset Protection Trust, can aid in preserving assets and providing a roadmap to future Medicaid eligibility.
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- States are required to recover all benefits paid on behalf of deceased Medicaid beneficiaries from their respective probate estates—and in some states, any assets the beneficiary held at the time of death that passed to successors beyond probate.
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- If a client is in a crisis and paying for care out of pocket, it is always recommended that they speak to an elder law attorney who can assist them in navigating an application for Medicaid before they run out of money.
Medicare
- What it is: Medicare is a federal health insurance program consisting of four parts: (1) hospital insurance, (2) medical insurance, (3) additional benefits relating to care, and (4) prescription drug coverage.
- Who qualifies: Those aged 65 and older, individuals under 65 who have received Social Security Disability Insurance (SSDI) for at least two years, and those with end-stage renal disease or Lou Gehrig’s disease qualify for Medicare.
- What else you should know:
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- Medicare Part A covers hospital inpatient care, hospice and home care, and short-term stays at a skilled nursing facility.
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- Medicare Part B covers outpatient and home healthcare provided by doctors and other healthcare providers, medical equipment, and many preventative services.
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- Medicare Part C is an alternative Medicare option approved by Medicare but offered and run by a private company. It offers similar coverage as traditional Medicare but extra benefits such as vision, hearing, dental, and more.
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- Medicare D covers prescription drugs and many recommended vaccines. This coverage is optional and provided through private insurance companies but offered to anyone who qualifies for Medicare.
Supplemental Security Income (SSI)
- What it is: SSI is a means-tested public assistance program administered by the Social Security Administration (SSA) that provides financial support to help cover the cost of basic necessities.
- Who qualifies: People with a disability who meet the SSA’s definition of disabled and seniors (aged 65 and older), all of whom meet strict income and asset limits as defined by their state, qualify for SSI.
- What else you should know:
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- People aged 65 and older do not need to meet disability requirements to qualify for SSI.
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- In most states, an individual receiving SSI will also qualify for Medicaid.
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- The maximum monthly federal benefit in 2024 is $943 for an eligible individual and $1,415 for an eligible individual and eligible spouse.
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- The SSA considers income from an ineligible spouse, ineligible parent, sponsor, or essential person in determining whether an individual is eligible for SSI.
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- If an SSI recipient’s resources are over the allowable limit at the beginning of the month, the SSI recipient is ineligible for benefits that month.
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- Some states supplement the federal SSI amount with additional benefits.
Social Security Disability Insurance (SSDI)
- What it is: SSDI is a federal public insurance program that pays disabled workers regardless of their income and asset level.
- Who qualifies: People who have worked a sufficient number of years (generally 40 work credits, 20 of which have been earned in the last 10 years ending with the year disability began) and who meet the definition of disabled qualify for SSDI. Specifically, their condition must prevent substantial gainful activity and be expected to last for at least one year or result in death.
- What else you should know:
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- For 2024, the average SSDI benefit is estimated to be $1,537 per month.
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- The maximum SSDI payment is $3,822 per month.
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- In most cases, after two years of SSDI, the individual qualifies for Medicare benefits.
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- Younger workers may qualify for SSDI with fewer work credits.
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- Because SSDI is not means-tested, additional options in planning for long-term care are available to SSDI recipients, particularly when receiving assets on behalf of family members seeking Medicaid eligibility.
Special Needs Trusts (SNTs)
- What it is: An SNT is a trust that supplements an individual’s assets while allowing them to maintain their eligibility for public assistance programs such as SSI and Medicaid; it may be referred to as a supplemental needs trust in certain circumstances.
- Who qualifies: Persons living with a disability, chronic health condition, or life circumstance that necessitates a barrier of protection between the beneficiary and their money qualify for an SNT.
- What else you should know:
- A first-party SNT is established with funds belonging . . .
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