Two Social Security programs provide essential financial assistance to individuals with disabilities, but these programs are often confused with each other. The key programs that frequently come up in discussions about disability benefits are Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI). Both aim to support individuals with disabilities, yet they differ significantly in terms of eligibility criteria, funding sources, and the benefits they provide.
Sackett and Associates Disability Law Office understands that distinguishing between these disability programs can be difficult to those who are new to the Social Security bureaucracy. Our entire legal practice concentrates on getting people living with disabilities the government benefits to which they are entitled. We know all the details relating to every program and we can help you get through the maze of rules and regulations to get your disability benefits approved.
In this article, we explain the distinctions between SSI and SSDI and help you understand which program may be applicable to your circumstances.
Supplemental Security Income (SSI)
SSI is a needs-based program designed to assist people who have limited income and resources. The program is administered by the Social Security Administration (SSA) and provides monthly payments to eligible individuals to help meet basic needs such as food, clothing, and shelter.
Eligibility Criteria
To qualify for SSI, applicants must meet the following requirements:
- Age or Disability: Applicants must be aged 65 or older, blind, or disabled. Disability, in this context, is defined as the inability to engage in substantial gainful activity (SGA) due to a medically determinable physical or mental impairment expected to last at least 12 months or result in death.
- Income and Resources: SSI is strictly means-tested. Applicants must have limited income and resources. In 2024, the resource limit is $2,000 for an individual and $3,000 for a couple. Certain assets, such as a primary residence and one vehicle, among others, are excluded from this limit.
Funding Source
SSI is funded by general tax revenues, not Social Security taxes. This distinction is crucial because it highlights the program’s focus on need rather than previous employment.
Benefits
The amount of the SSI benefit varies depending on the applicant’s other income and living arrangements. In 2024, the federal base rate for SSI is $943 per month for an individual and $1,41 for a couple. Many states, including California, supplement the federal payment, leading to higher benefits in those states.
Social Security Disability Insurance (SSD)
Purpose and Overview
SSDI provides benefits to disabled individuals who have a sufficient work history and have paid Social Security taxes. This program is also administered by the SSA but aims to replace a portion of the claimant’s lost income due to their disability.
Eligibility Criteria
To qualify for SSDI, applicants must meet the following requirements:
- Disability: The definition of disability for SSDI is the same as for SSI. The impairment must prevent substantial gainful activity and be expected to last at least 12 months or result in death.
- Work Credits: Applicants must have accumulated enough work credits, which are earned through paying Social Security taxes. The number of required credits varies by age, but generally, an individual needs 40 credits, 20 of which must have been earned in the last 10 years before the onset of disability. Younger workers may qualify with fewer credits.
Funding Source
SSDI is funded through the Social Security trust fund, which is financed by payroll taxes under the Federal Insurance Contributions Act (FICA). This funding mechanism ties benefits to an individual’s work history and contributions to the Social Security system.
Benefits
The amount of SSDI benefits is based on the applicant’s average lifetime earnings covered by Social Security. Higher earnings result in higher benefits. In 2024, the average SSDI benefit is approximately $1,537 per month. Additionally, after receiving SSDI benefits for 24 months, beneficiaries are eligible for Medicare, a federal health insurance program.
Key Differences Between SSI and SSDI
Eligibility Based on Financial Need vs. Work History
One of the most fundamental differences between SSI and SSDI is the basis for eligibility. SSI is a needs-based program targeting individuals with limited income and resources. In contrast, SSDI requires a work history and the accumulation of sufficient work credits, focusing on individuals who have contributed to the Social Security system through their lifetime employment.
Source of Funding
SSI is funded by general tax revenues, which reflects its purpose as a welfare program for the neediest individuals. SSDI, on the other hand, is funded through payroll taxes, making it a form of insurance for workers who become disabled.
Benefit Calculation
SSI benefits are standardized with a federal base rate, subject to adjustments based on other income and state supplements. SSDI benefits are personalized, calculated based on the individual’s average lifetime earnings covered by Social Security.
Health Insurance Benefits
While SSI beneficiaries typically qualify for Medicaid, a state and federally funded health insurance program for low-income individuals, SSDI beneficiaries become eligible for Medicare only after two years of receiving SSDI benefits. Medicare is a federal program that primarily serves individuals aged 65 and older, but it also covers younger disabled individuals receiving SSDI.
Application Process and Wait Times
The application process for both programs can be lengthy and complex, often requiring extensive medical documentation and sometimes involving appeals. However, the wait times and approval rates can differ. SSDI applications might be expedited under certain conditions, such as terminal illnesses or severe disabilities listed in the Compassionate Allowances program. SSI applications are typically more straightforward but still require thorough documentation of financial needs and medical conditions.
Applying for SSI and SSDI
Applying for either SSI or SSDI involves several steps:
- Initial Application: Applicants are not required to have an experienced disability attorney help them apply for disability benefits, but working with such a professional will increase the likelihood of the initial application being completed correctly and completely supported by the appropriate documents. I someone insists on filing their claim without experience assistance, they can apply online, by phone, or in person at a local Social Security office. The application requires detailed information about the applicant’s medical condition, work history, income, and resources.
- Medical Documentation: Both programs require substantial medical evidence to prove disability. This includes medical records, treating physican’s statements, and potentially additional examinations arranged by the SSA.
- Review Process: The SSA reviews the application and medical documentation. This process takes several months. Unfortunately, it is common for initial claims to be denied, requiring the applicant to file an appeal. This is a key reason why we recommend beginning the application process with a qualified disability lawyer. They will minimize errors and be ready to file any appeals in a timely and thorough manner.
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