Federal Disability Policy Poses Insidious Problems for Disabled People Who Want to Generate Income

How to Bring the Disabled Out of the Economic Closet.

By Michael Gorback, M.D., at the Center for Pain Relief in Houston, TX:

N.B.: The disability benefits system as described here is a very simplified version. It is incredibly complex, so I have limited the discussion to some rather broad generalizations. However, I believe the message does come through that the system discourages behavior that would reduce taxpayer burdens while improving self-esteem and economic well-being among those with disabilities. I have only recently begun to delve into this issue, so if I have made factual errors please be kind in the comments. ;-)

As a pain specialist, I see quite a few people who receive disability benefits. Most of them receive federal benefits, which comprise both income payments and Medicare benefits.

My two main objections to the current system are the delay in medical benefits and the disincentive to return to work. The first is obvious; the second is a bit more subtle.

The most obvious problem is that, although one might be granted disability benefits, the income starts in five months but the health insurance (Medicare) doesn’t kick in for two years. But for the majority on disability, Medicare is a necessity.

The following scenarios do not represent actual patients. They are fictitious composites of patients I have treated in the past, used for illustrative purposes.

Let’s consider the case of Jack, who has avascular necrosis of the hip. He can’t walk without assistance. He needs a hip replacement. Unable to find work due to his incapacity, Jack lost his job and ended up on disability. He now receives his $800/month pittance from the government, but he won’t have Medicare coverage for a hip replacement until 2020. Jack’s employer has told him he would be re-hired if he could walk. Instead, Jack will be on the public dole for two years instead of going back to work. You can’t pay for a hip replacement on $800/month.

The more insidious problem with federal disability policy is that there are disabled people who are capable of generating income but won’t because if they do, they will lose not only their financial benefits but their health benefits as well.

Most people on Social Security Disability (SSDI) can earn about $1,700/month without losing their benefits (blind people can earn about $1,900). The government subtracts $85 from the outside income amount (I have no idea how they arrived at $85), divides the result by two, and that is how much their SSDI income benefit is reduced.

Exceed those income numbers and you lose both income and Medicare benefits. There are “deductions” available. For example, if your disability requires certain accommodations such as hiring private transportation to get to work, that expense can be deducted from income before the calculation is made.

There is a very nasty “gotcha” here. If you report that one month you made $900 (well below the $1700 limit) you run the risk of attracting the attention of your disability overlords. They might re-open your case to see if you really need the financial benefits. I doubt many people want to try that because they would lose both the financial and Medicare benefits.

For comparison, I used to pay $950/month for an HMO Bronze plan with a $6,000 deductible before I went on Medicare. My premiums are about half and my deductible costs less than a dinner for two at a fancy restaurant. Who wants to risk it?

Susan was paralyzed in a skiing accident. She’s 50 years old, paraplegic, and lives in a nursing home. Last Christmas, Susan, a very intelligent woman, decided to pass the time making jewelry. The nursing home staff noticed it and started buying jewelry from her. But the nursing home forced her to stop, claiming that she was not allowed to have any outside income. This was a big hit to a smart creative woman with the capability of earning a little money that would have allowed her to gain self-esteem as a productive member of society.

Suppose Susan were allowed to earn money making jewelry, but for each dollar of income she’d lose perhaps half a dollar of disability payments? Susan gets to add to her sense of self-worth and obtains some economic independence, and the taxpayers aren’t paying for all her income benefits.

Allan was hit by a bus and suffered a severe fracture of his hip and pelvis. He required a hip replacement, which became infected and had to be removed. With no ability to exercise plus the superimposed depression that many in his situation suffer, Allan’s weight gradually rose to 350 pounds. The orthopedic surgeon wouldn’t replace his hip due to his weight. Bariatric surgeons wouldn’t operate because he couldn’t participate in their perioperative exercise program.

We finally broke this vicious circle by finding a bariatric surgeon who understood the situation. Allan lost a couple of hundred pounds, got his hip replacement, and he’s up and about. Allan and I both like to hunt. One day he dropped off a couple pairs of camo pants that he no longer wanted. At 5’8” and 185 pounds I couldn’t close the waistband. I’m starting to hate Allan.

Allan is a talented craftsman and painter. He sells his products privately for cash. When I saw samples of his work, I suggested that he start a legitimate business because he could make a lot more than $800/month. He agreed he could make a lot more money, but he was afraid to because if he did that, he’d also lose his Medicare coverage (Allan is in his 50s).

Suppose we made a deal with Allan: start a legitimate business. Advertise on Etsy, eBay, Amazon, or wherever. Make a lot more money. But, for every dollar he earns, he’d lose half a dollar of disability income. So, Allan goes into a legitimate business, earns $3,000/month and loses $800 in disability payments. Allan is not only off the dole, but the government collects sales tax and perhaps income tax, FICA, and Medicare tax. However, we allow Allan to keep his Medicare coverage.

Where is the downside if we allow disabled people to earn money, deducting it from their benefits, and allowing them to keep their medical coverage?

There is precedent for this type of deduction: workers who begin collecting Social Security before reaching full retirement age will lose $1 from their benefit payments for every $2 they earn above the annual limit. For 2019, that limit is $17,640, which is less than the cap for disability.

What is the downside to letting Jack immediately start his Medicare coverage, get his hip fixed, and return to work, thus getting him off both the income dole (and resume paying income tax) and Medicare, since he will have private insurance at his old job?

Over the years I have encountered many people on disability who participate in an underground economy of barter and/or under-the-table cash deals. I had one patient who made $50,000/year as a technical writer. She worked “underground” to keep her medical benefits.

If we separate the income and medical benefits, we create productive citizens who are off the disability-income rolls, generate tax revenues, and regain the self-esteem that comes with feeling like a productive member of society.

This underground economy among the disabled is a sign of systemic dysfunction. I would love to see an OMB analysis of how many taxpayer dollars could be saved if we allowed those receiving disability income benefits to generate unlimited income in the legitimate economy while keeping their health insurance benefits. By Michael Gorback, M.D., at the Center for Pain Relief.

Enjoy reading WOLF STREET and want to support it? You can donate. I appreciate it immensely. Click on the beer and iced-tea mug to find out how:

Would you like to be notified via email when WOLF STREET publishes a new article? Sign up here.

  56 comments for “Federal Disability Policy Poses Insidious Problems for Disabled People Who Want to Generate Income

  1. 2banana says:

    The obvious downside is Medicare is bankrupt.

    Having the happy shiny feel good ideas of giving “free” medical care for life so people can be liberated and happy doesn’t fiscally work.

    Especially with open borders.

    • Michael S Gorback says:

      You’re going off-topic. This isn’t about the viability of Medicare. It’s about saving money by getting people back to work. Fixing Medicare is topic for another day.

      Here’s your choice:

      1. Give the disabled free money and “free” medical care

      2. Let them earn their own money and give them “free” medical care.

      (Medicare isn’t 100% free BTW)

      What I’m proposing isn’t perfect, but wouldn’t you like to at least get the income burden off your back? There are over 10 million people on SSDI. The average monthly payment is about $1,000/month per recipient.

      Suppose we got 10% of recipients off of Social Security at no extra cost to the taxpayer. What’s your objection to saving $1 billion per month?

      • Dale says:

        Thank you, Michael.

        I have heard that in addition to income limitations, folks on disability are discouraged from building up assets. If so, that would seem to deter them, for example, from obtaining an education, starting a business to be self-employed, or even saving for retirement.

        Is there any truth to this? Thanks again.

        • Dale says:

          And, if so, it would tend to make these people join a permanent, disadvantaged underclass, entirely dependent on the state forever.

        • GK says:

          That is definitely true – for SSI.

          Not true for SSDI.

        • RJOGuillory says:

          – Regardless of the formula one uses to insure the disabled are properly and honorably cared for, it always goes back to good ethics on both sides.
          – I am a disabled person who was forced to retire from a 25 year career with US DoD after being diagnosed as epileptic at the age of 49, and surviving a 70 mph drive off a 200 foot cliff. I also endured thousands of seizures over a five year period. so I know the issues.
          – It is the status of being disabled that is most pernicious, as once you are on it, almost all behavior of the supporting groups is designed to get you off of it. It took me over 18 months from my first seizure, to the start of my benefits, and in between I racked up almost $500,000 in medical bills. DoD would not cover me with their private insurance, and I had no Medicare yet. After going through all my cash savings, I had to stand in a food line once….just because of their bureaucracy. -So it is the status of being disabled that people are in fear of losing, as they know their odds of getting that status back back quick enough to avoid dying are a bit long.
          – In the community I live in we see abuse of these systems by people who use a lot of drugs and love to game all day. It is physically difficult to ascertain their disability, as it is not obvious. But we also have various degrees of disability such as myself, who appear normal for the most part, but due to the brain damage of driving off the cliff and seizures, I have very little memory. Additionally, if I were to get a job, and collapsed on the first day…my disabled status is gone! Poof.
          – Solve that problem, and almost any ethical formula will work if the politicians quit stealing the trust fund.

      • Paul says:

        Problem I see is that I believe 90% of people on SS Disability are collecting because they don’t want to work, not because they have a legitimate disability.

    • raxadian says:

      Is not free, is paid with taxes.

      If everyone paid high taxes, then everyone could have not really free health care.

      But Americans don’t want to pay high taxes.

      That’s why, besides corporate greed, their heathcare sucks.

      Asks the Nordic Countries how it works, okay? Their heathcare is better than the one in the USA.

      Why? Because high taxes go to pay it and so it doesn’t depend on corporate greed.

      The same kind of corporate greed that has caused the opiod crisis in the USA, that gives teachers the power to tell parents their kids should take drugs for attention disorder and that makes legal drugs in America so expensive.

      • fajensen says:

        Is not free, is paid with taxes.
        Not quite.

        The sovereign country USA can issue exactly as many USD the USA feels like issuing for whatever purpose. What gives those USD’s their value is that everyone must acquire them in order to pay their taxes (and their relative scarcity because the 0.001% doesn’t pay taxes and they are hoarding USD so they never go into circulation).

        It is just that the USA choses, because this is 100% a political choice, to print up trillions of USD every year and then waste most of it on the most bloated military and security apparatus ever, from where it is hoovered up by the defence contractors running the circus (That printed money goes straight to vaults in Zürich, thus it never causes the general inflation that “economists”, despite many many years of observation, believe that it should).

        Thus American Citizens get to suck up to several strands of security goons and are then told that the USA simply cannot afford anything for them because “it all comes out of their taxes” – which is a lie.

        Regarding the “high” taxes in the nordic countries. That is of course a lie too.

        I am considered a high income earner, so I currently have to pay about 15000 SEK (1619 USD) per month out of my gross salary, which corresponds to a total tax rate of about 32%.

        But – that is IT, All of it! Nothing more is required!!!

        Those 1619 pays for health-care, access to education, roads, university, child care, disability benefits (should I ever need it), a very measly pension (my employer pays 15% gross salary into the pension, according to the contract). Whatever.

        I hear Americans are paying similar amounts JUST for the health care insurance – never mind that maybe whatever is allowed to kill them eventually is not covered by the insurance when the event happens – THEN education, THEN child care … and on and on and on.

        So, sure “Taxes are low”, But,

        Americans are being billed to Death on “After Tax”-fees for services and “safety nets” that most of them will need to procure anyway!

        The net effect of all this fragmentation and “low tax gaming” is that America has one public and a murder(?) of privatised tax systems and all of them wants all of the pie – as these things do. The misery is compounded by the fact that only the representatives for a single one of those many tax collecting systems can be voted out!

        … and I haven’t even started on the US regulatory regime :).

        PS –

        I have lived and worked in several countries. “The rule” is that a normal working person must expect to get stiffed for about 50% of ones earnings, whatever one does and wherever one resides.

        If the money doesn’t go out via taxes for sure insane property prices, bribes, or something similar, that one just can’t route around, will always be there to fix that “excess money problem”.

        “High Taxes” are way simpler and less stressful, in my opinion.

        • Paul says:

          Ok, you pay 32% of your gross in income taxes, but what about the 25% VAT, and property taxes, etc???

          In the USA, I believe government is about 30% of GDP, and in many Euro countries is 50%??

        • David Hall says:

          I read an article by a back surgeon that most back surgeries do not work. I have read statements by patients that they were worse after their surgery than before it. Am not sure how much the government is paying for medical treatments that do not work.

        • raxadian says:

          The people who ewrn more are the people who avoid the most taxes because they have legal teams to do so.

          Meanwhile the people that earn less is the one that ends paying more taxes compared to what they earn.

          Why do you care ao much about illegal immigration and so little about the guys that scam that atate out of billions of dollars?

      • ultra says:

        raxadian: The US has by far the most expensive health care system in the world on a per capita basis, but it performs less well than the more universal health care systems of other developed countries (and some 2nd world countries). To illustrate the magnitude of the problem: Currently, life expectancy in Cuba is longer than it is in the US. Americans also pay more in out-of-pocket medical expenses and they have higher deductibles than everyone else. The problem is not our unwillingness to pay higher taxes for health care (we’re are already paying more than everyone else), but rather our stubborn unwillingness to reform the current health care system so that it more closely resembles the health care systems of other developed countries.

    • alex in San Jose AKA Digital Detroit says:

      According to you, someone like me, an American citizen of very modest income, should just curl up and die.

      I had pneumonia (seems to be taken care of now) and cellulitis on my face (ear) which is to be treated seriously because it can spread, get into the blood where it becomes sepsis, or into the fascia where it becomes necrotizing fasciitis.

      I was able to go to the ER, where they X-rayed me and checked me and gave me a prescription for $58 worth of pills, at least I had the $58.

      According to you, someone like me should just get sicker and sicker, lose my job, and end up dying in an alley.

      My advice to young people in the USA: Get out! Get out while you can!

  2. chillbro says:

    The main purpose of the current system is to provide good government jobs first and shame people who need help second. This is a uniquely american way to do welfare.

    • WES says:

      Chillbro: It is the Canadian way too!

      • Paulo says:

        Nonsense statement about Canada. Here is a web site that lists the BC wait times for hip relacement surgery… obviously with no cost to the patient. It is broken down to patient name, time waited for surgery, and time needed to complete treatment (rehab). It also mentions the remaining patients in the wait line.


        If you are waiting for hip surgery and cannot work, and are on disability, this is the current policy in Canada: “You can earn up to a certain amount without telling us and without losing your benefits. For 2018, this amount is $5,500 (before taxes). This amount may increase in future years. If you earn more than the amount allowed, you must contact Canada Pension Plan.May 7, 2019” (I thought this was pretty fair policy).

        I have never heard of anyone on disability in Canada denied medical coverage or payments due to side jobs. Obviously, if you are not really disabled and able to make a decent wage doing whatever, then you don’t really need to be on disability and collecting payments is fraud. It would have absolutely nothing to do with your medical coverage or when you receive operation.

        My sister-in-law, ex American by the way and ex army nurse veteran (Captain US Army) has received two hip replacements in short order (BC). She did the 2nd immediately after recovering from the first. She has fully recovered and lives an active hard working lifestyle.

        • Paulo says:

          I need to make a correction because the linked chart is confusing. The names mentioned are the orthopedic surgeons, and not the patients. That would be violating confidentiality. (My mistake on post) The numbers waiting are those patients on their surgery list. In Campbell River, my closest hospital, the wait time was shorter than most…11 weeks I believe.

          personal note: I was scheduled for fixing up a knee…partial torn acl and a meniscus tear. My other knee was operated on almost 40 years ago. Even though our coverage and surgical repairs are free with single payer, I declined the surgery and chose to instead build up the muscles with a stationary bike program for 8 months of the year. In good weather I walk several miles per day. This was 3-4 years ago and knock on wood it continues to work for me. I mention this only as an example of personal responsibility. I have never heard of people choosing to use medical procedures over being healthy or staying healthy…if possible, regardless of who pays.

          With reference to the Doctor’s article, the system is insane down there, literally. Furthermore, it is cheaper to offer single payer and most likely more efficient. Regarding Petunia’s comment, the pharma and insurance companies seem to have bought and paid for the political system. There is no incentive to change.

        • WES says:

          Paulo: You have obviously not been on disability in Canada! I have! God help you if you have any earned income! The sky literally falls on you!

          I simply gave up any idea of working!

          However, ironically, investment income is of no concern to them!

          They zero in on “earned” income like vultures! They have a huge big hang up about you working at all!

          Earned income is just as big a crime in Canada as importing eggs, cheese, milk, or chicken from the US into Canada!

        • alex in San Jose AKA Digital Detroit says:

          Paulo as usual you are a breath of fresh air.

        • Thor's Hammer says:

          I’m a US citizen. Lived most of my life in the Pacific Northwest, and was employed in BC Canada for two length periods.

          So during the first week of employment at my new company I was called into the Financial Secretary’s office: She—“have you received your Care Card yet?” Me— ” I’m a f***ing Yank. Don’t I have to wait a year or so to qualify?” She—- “You are in a civilized country now. We don’t permit people to go without access to health care.”

          I filled out a single page application form and two days later received my Care Card in the mail. At least for the three instances I used the Provincial health services the wait time was less than half I’ve experienced in the US.

          In the US doctors live in continual fear of being sued should anything not go as hoped during treatment or surgery of their patients. (My ER doctor girlfriend in Seattle was paying $100,000 per year in liability insurance premiums and working two jobs to pay for it.) In order to protect themselves doctors spend half as much time in documentation and form filing as they do in patient treatment. That is why 40% of the health care costs in the US go to bureaucracy, insurance overcharges, and $800 dollar pills.

          Quite a contrast to the British Colombia one-paragraph application process and instant medical coverage for someone who wasn’t even a citizen.

  3. Petunia says:

    The social security system, whether retirement, disability, or medicare is too complex and nonsensical. Being given disability payments while not being given medical coverage is crazy. Being allowed to retire at 62 but not being able to get medicare until 65 is also crazy. Not letting healthy young people buy into medicare is crazy too.

    The current system is the creature of those in congress, especially the ones there for decades. If you need proof these people have no idea what they are doing, this is it.

    • IdahoPotato says:

      “If you need proof these people have no idea what they are doing, this is it.”

      They know exactly what they are doing. See how many of their donations come from pharma and insurance companies.

      • Petunia says:

        You make an excellent point. People keep voting for them in spite of all the evidence that they only care about donors.

      • Kathy says:

        I’m in that 2 year gap between being declare disabled and becoming eligible for Medicare. That will probably drain about $10,000 from my meager resources. This whole thing is why I vote as close as I can get to a real, hard-core socialist as this rigged political system will allow. I’ll even vote for Bernie’s weak, milk-toast, half-reforms if that’s the best I’m allowed. And yes, knowing where this comment board is located, I’m sure lots of rich people will sneer at me. The sneering has already begun above. Don’t worry, when the peasants come for you with the torches and pitchforks, I’ll be there in my wheelchair carrying at least one of the two. If its downhill, I’ll have both.

        • Paulo says:

          I am pretty sure most people will be rooting for your health and recovery, kathy. It does no country/society any good to have disabled and angry citizens. Most regular folks are pretty caring, obviously not all, but most in my opinion. (Now, done…last comment…hit the limit)

        • Paul says:

          Dear Kathy – If you can’t pay your own way, how do you expect me to pay my own way plus contribute to taking care of you?

          That is a short explanation of why socialism fails so badly.

        • Thor's Hammer says:

          re the failure of Socialism

          If you are willing to put blind ideological stereotyping aside for a minute I suggest you examine the history of Iceland.

          Fifteen years ago it was a finance capitalist dream, it’s economy controlled by a bankster cabal bent upon committing massive fraud for their personal benefit. The economy collapsed, banksters jailed, the economy at a standstill. The banking system was nationalized and socialized. Fifteen years later Iceland has the highest median net worth of any country on the planet. It’s citizens net worth is 300% that of their US counterparts, and it doesn’t have people living on the streets and defecating on it’s crown jewel cities.

          Paul, are you planning to live underground for a few years when Kathy and her army of deplorables come for you with pitchforks and AK 47’s? A wiser move might be to use a fraction of your wealth and political power to build a society that the other 99% could live in as well.

        • 728huey says:

          Do you really think peasants are going to come with torches and pitchforks when they can get access to assault weapons and all the ammo they want?

  4. EThan in NoVA says:

    Would the issue be the people on disability could undercut the people in the workforce? Would companies use them to get cheaper labor?

    Would it be either for those on disability to skirt the system by not reporting everything?

    Overhead to track non-steady incomes might be difficult. Participants would have to report their income often, similar to sales tax.

    Just thinking out loud. I know people in the situation and could see their desire to actually move to the workforce but wouldn’t risk loosing benefits.

    • Petunia says:

      The entire “safety net” in the US is designed to trap people in the system once they are in or keep them out altogether. There are no mechanisms to transition them back to work and off the dole.

      • alex in San Jose AKA Digital Detroit says:

        Petunia – Indeed. My only access to medical care is to go to the ER, and this is only because the ER can’t turn people away. It’s like the doctors have decided, “Hey, we’re doctors, we’ve devoted our lives to helping people, and we’re going to heal the sick and help the wounded etc., no matter what the insurance companies say!”.

    • NoEasyDay says:

      There are many creative people who are stuck in a corporate cubicle being inculcated with diversity training because they need that family health care plan. With a “single payer” system they would be in a garage somewhere inventing the next technology similar to Hewlett-Packard, Jobs-Wozniak, Brin-Page, et al.

      • chillbro says:

        We don’t need that here anymore. The guys in in the Bay area patented the right to innovation and to dictate social policy to the rest of the nation. We must all respect and defer to our betters. Probably should stop reading wolfstreet too… Just too much wrong think can be found here.

      • RagnarD says:

        Only problem is that in a “single payer” system, the best and the brightest amscray from the business. There is many a doctor who does not reccommend to their child to follow in their footstops due to
        the “system”. Back in 1995ish I read an article in Heeb magazine about how many Jewish parents were reccoing their kids to go into business/computers vs becoming doctor. Considering the FAANGs vs ObamaCare, I think they got that one right.

      • Iamafan says:

        After being in Obamacare and now in Medicare, I just go with the flow and hope the government pays. I have been paying my own insurance as a business owner since the 90s. Yes I’d like to “bitch and moan”, but this is the USA so pay up and “suck it up”. Frankly, I have no interest in moving to another country.

      • EchoDelta says:

        Diversity training is the least of our worries. Right wing nut job going off with his gun collection is priority number one. Which abused employee has the least to lose in a live shooter scenario? How about those patriot types looking to go out in a blaze of glory shooting government employees?

        That’s a worry. Diversity at worst is a day spent in a different building.

        • NoEasyDay says:

          The training could have also been about climate change, identifying latent asbestos fibers, handicap access, etc. My point was about the “mind-numbing” conditioning.

  5. Double D says:

    The problem is it’s a corrupt system run by lazy, inept federal employees. They care not about improving the system or genuine care about the people who genuinely need it.

    In 2018 I was awarded permanent disability which was retroactive to 2015. The government keeps (i.e. steals) 5 months of that money for no other reason than they can. Then it took another 6 months for them to issue the lump sum payment for no other reason than they can (and BTW, what the hell are you going to do about it).

    The current Fed law says you can make up to $1,220/month without it affecting your benefits. But as mentioned, the overlords will start screwing with you if you report “any” income. I know. I worked for Lyft for a period of 4 months back in 2018 & made $897. Today I’m still getting calls requesting income verification from Lyft to present, even though I signed forms under penalty of payment suspension that the information I provided was true & correct.

    Besides Lyft being a complete ripoff, I quickly figured out it’s worthless to try & make a little more to supplement your disability income – despite what they claim.

    • WES says:

      Double D: It is no better in Canada! The same stupid stuff!

    • Christina C says:

      You can only make that $1220 a month, better known as SGA, for 36 months, where you either get your wages or your SSDI, NOT both. There are cases where a person gets more in disability income than for wages under this scheme, so those who are the best able to leave due to education, who cannot work at all in their field and do not want to do the typical minimum wage job to stay under $880, are stuck on SSDI. After the 36-month EPE, you are cured as far as SSA is concerned, and can only get disability again with a **new application.** Medicare continues for roughly another five years after conclusion of the EPE, but just try buying comparable coverage. Have been over my options with a benefits counselor numerous times, including the health insurance issue presented when Medicare ceases.

      “EXAMPLE: Tom completes his TWP in 12/2004 and continued to work at an SGA level throughout his EPE. His disability benefit cessation month is 01/2005. Benefits are payable for 01/2005 through 03/2005 (the month of cessation and the two following months). His EPE 36th month re-entitlement period begins with the first month following the completion of the nine TWP months (01/2005) and ends the last day of the 36th month period following the TWP (12/2007). In this example, Tom continued to work at SGA levels; **his benefit termination month (BTM) is 01/2008, the first month in which he worked SGA after the end of the 36th month re-entitlement period.**


      • Michael Gorback says:

        Yes, there is a lot more to it and that’s why I put a disclaimer at the beginning. I didn’t want to wander so far into the weeds that we lost sight of the road.

        There are actually two main disability tracks: SSI and SSDI. SSI is means-tested whereas SSDI income benefits depend on your work history like it does with Social Security.

        In addition, SSDI does not count passive income so you can be a multimillionaire and still get SSDI payments. SSI counts every asset and source of income.

        With SSDI you get Medicare after 2 years but you still might want to buy Medigap and Part D. With SSI you get Medicaid right away. Some people opt for SSI so they can get medical care immediately but in reality Medicaid isn’t welcome at most doctors’ offices.

        SSDI also has a rule where if you earn more than $880 in any 9 months during a 60-month rolling period, you’re kicked out.

        So SSDI is more like an entitlement program, where if you worked the required number of years and are judged disabled, you get SSDI. That’s like Social Security – you pay in over the years and if you qualify you get your SS payments.

        SSI is more like welfare in that it’s means-tested.

        I’m not sure about SSDI being terminated after 3 years. It’s my understanding that they review your case every 3 years.

        There’s more to all this, but I just wanted to post this reply to show why I over-simplified the process. The model that most resembles my discussion is SSDI, where formerly productive workers could and perhaps would like to return to work.

        • Christina says:

          “SSDI also has a rule where if you eam [$880 or more] in any 9 months during a 60-month rolling period, you’re kicked out.”
          False. If you have not used up your 36-month EPE and have been reporting your work activity right along, and have documentation to support hours worked per month. If some SSA worker determines some of your work activity is worth more in the market, or in my case, manipulates the half days I worked, so an “extra” shift appeared in a 31-day month to put me over the lower TWP figure, than one or more of the nine Trial Work months is considered used. With a letter from my former employer as to what my schedule was in October, I prevailed in Federal Court and got my Trial Work month back.

          Everyone is reviewed every 3-, 5- or 7 years for continuing to meet disability criteria (the Blue Book). However, a report of working or work stoppage triggers another review as well, unless your Ticket is assigned to Voc Rehab or an Employment Network, a scam where the SSA pays them $20K for each case that closes due to work activity, no matter how little they had to do with finding or creating the job.


  6. RD Blakeslee says:

    I was hurt in a vehicle accident and qualified for disability retirement under the Federal Government employee’s (FEP) system. I’ve suffered none of the problems discussed here. Why?

    I sincerely believe it’s because members of the Congress are in the FEP system, not social security.

    I have my retirement check sent first to a Federal credit union, then transfer funds elsewhere. Why?

    If there’s a financial panic, the guv’mint folks will take care of themselves, first.

  7. Paul says:

    I believe the current law allows people to collect if they are deemed incapable of doing their prior job.
    It should be changed to allowing for partial benefits and requiring people who can work to work at whatever they can do.
    On a personal note, I will say that less than 10% of the people I have ever known on disability were actually unable to work.
    I was in Maine last year and met 30 year olds on disability claiming ADD!!!
    I am ADD, and always considered it an advantage in jobs requiring high volume, real time decision making based on incomplete information, like running a factory.

  8. Paul says:

    Have you ever tried reporting SSD FRAUD?????
    I have.
    A bit over 20 years ago, I was working in a factory near Houlton, Maine.
    It was downsizing, and a lab tech nearing 50 was laid-off.
    His daughter was a nurse at Houlton Regional Hospital, and married to the best friend of my best friend at the time.
    Her husband was aware of the fact that she was having an affair with a doctor at the hospital, and I found out via our common “best friend”.
    Next thing I know, the guy we laid-off is on SSD, claiming a bad back!
    Pretty obvious how that happened!
    So I called SS Administration to report an obvious case of fraud, and explained all this.
    I was asked for his SSN.
    Obviously, I didn’t know it, but said he was the only guy named B.E. living in Island Falls, Maine, a town of only 200, collecting disability.
    I was told that was not how they located people in their system and that they needed his SSN.
    I went to the personnel department and requested it.
    I was told that they were prohibited by law from giving it to me.
    I called the same person back at SS and explained, and she said there was nothing she could do.
    I will also note that based on her enunciation, I am quite sure she was an “affirmative action employee”, well over 300 pounds, and couldn’t care less.

  9. Paul says:

    To finish the story, the nurse eventually left her husband, married the doctor, and her father collected SSD until such time as he was forced to change to conventional SS, at 70?

    Makes me proud to have paid my taxes for 40 years!

  10. HR01 says:

    Thanks for the piece. You’ve prompted some worthwhile discussion.

    Couple of points. Something like 96% of all SSDI applications are initially denied. The Feds then force the applicant into a lengthy appeals process.

    The first appeal just forces the applicant to file a fresh set of paperwork and then wait a number of months before they must go see a few doctors (of the government’s choosing and who get paid for their patient assessment by the government). So the first appellate phase also results in better than 90% rejections. The doctors chosen to evaluate the patient aren’t going to bite the hand that feeds.

    The third phase goes to the courts. Applicant must file a third round of paperwork, get their attending physician to fill out lots of paperwork, send it all in, retain the services of a lawyer and then wait again for a hearing in front of an Administrative Law judge (ALJ).

    Better than 90% of those who stick out the process through all three phases have the disability claim approved by the ALJ.

    From start to finish, the process of applying for SSDI takes on average, 18 to 24 months before the applicant ever sees a dime.

    As someone above stated, the government won’t start payments until 6 months after the initial claim has been filed.

    Once the claim has been approved and benefits commence, 6 months later the applicant will automatically be enrolled in Medicare and the Medicare premiums will be deducted from the monthly benefit amount.

    • Paul says:

      It probably should be noted that most people would have insurance, worker-comp, etc. to cover them through the SSD application period.

      In many, maybe most cases, there should be such delays to determine if a condition is going to be long term or is simply temporary.

      Personally, I suspect the 90% rejection rates are appropriate, as from what I have seen, 90% of those collecting have little or no problem that would prevent their working IF THEY WANTED TO.

      Three years ago, I couldn’t walk 100 feet.

      I had back surgery for a ruptured disc impinging on my sciatic nerve, paid for it myself (in Thailand), and was helping teach TaeKwonDo and aerobic walking over 4 miles at a time within 10 days of surgery.

      The abuse of the system by parasites that DON’T WANT TO WORK is disgusting.

      Sadly, it drains resources and creates obstacles for the few who really need it.

      • fajensen says:

        The abuse of the system by parasites that DON’T WANT TO WORK is disgusting.

        Sadly, it drains resources and creates obstacles for the few who really need it.

        Maybe look at it differently: Nobody want parasites that don’t want to work around their place or business. So, what are we to do with them?

        We can’t just euthanise them, we can’t reintroduce slavery (except in prisons, apparently), we don’t really want them living in the streets crapping everywhere and stealing – because it will be our stuff they are stealing and we get hepatitis A-C too!

        Maybe it is simpler, more economical and easier to give the bums a basic income so they will be out of everyones hair, and maybe they will recover or maybe they drink & drug themselves to death?

        The second half “draining resources from those who needs is”. I think that situation comes from people being moralistic about the fact of life that some people are just useless whatever one does, then fighting reality by setting up this huge bureaucracy to weed out “all” the slackers and cheats. That system will of course sprout tentacles and grow, many professional people will stick their fingers into the new flow of “processing money” and the whole thing will eventually burn so many resources on its own accord, that indeed it will divert attention from “those who needs it”.

        It is also a popular political move to blame (some of) the claimants while the fact is that the “verification system” sucks up ever more resources. The forces of bad are aligned here: People in general like to blame others for their own situation, “divide and conquer” always works well, and it’s an excuse to add more bureaucracy around ever more claims checking. Bureaucracy *never* misses an opportunity for growth!

        I.O.W; Any sufficiently complex ecosystem has parasites. It is easy to destroy everything else on a holy quest to eliminating them, but, it is much better for everyone to manage the problem and just live with it.

      • AnonWife says:

        Paul and Fajensen

        This (and other posts) infuriates me as it is filled with misinformed opinions and falsely labels sick and injured people who PAID into the social security system as “parasites” and other horrific statements.

        Your opinion is based on a couple of people you personally think cheated the system without anything but anecdotal evidence/ meaning NO EVIDENCE.

        Fajensen: bemoans that we can’t Euthanize or Enslave these sick workers who might steal from us, crap on the streets, or give us hepatitis…really? Sounds exactly like a Nazi to me or worse, as we should have values and ethics in America with some level of humanitarianism. IF Fajensen you are not an American, I do hope you LEAVE. If you are an American, I am ashamed that you think so harshly of our sickest people.

        These so-called parasites are human beings and were also workers just like you and paid into the system for an average of 22 years before becoming disabled per SSAs website.

        My trucker husband became disabled due to a serious neurological disease after paying into the system for about forty years. Maybe in your opinion he should crawl into the cab of a 80,000 lb. GVW big rig so he would still be “working”and not be a drag on the system, while trying to avoid crunching any Tesla’s that he can’t see or feel once they go under his wheels…particularly if he passes out.

        Do you really think disabled folks don’t want to work and would rather be sick and have a payment that is less than1/2 of their work-based income? What a preposterous presumption on your part. What we wouldn’t give for the health for our sick loved ones.

        FYI…workers comp only covers work related injury or sickness. It does not cover injury outside of work or general illness. Most people have NO insurance to carry them through the disability waiting period.

        One in five male (1 in 6 female) SSDI recipient dies within about 5 years of receiving benefits, which are only approved after rigorous medical and administrative review. SSA states SSDI is only given to those with a very serious disabling condition expected to last 1 year or more, or to result in DEATH. Rigorous proof of continuing disability are also required depending on the ailment, after approval.

        So you are young and healthy and able to get well thru medical care and physical rehab. Goody for you. What about those who are older and in chronic permanent ill health and unable to get better? The SSDI program is designed precisely for these sick people who cannot work.

        So get a life and be grateful for your health and hope that some uninsured drunk driver doesn’t hit you or some disease doesn’t strike you and destroy your life.

        Find the nearest church and pray for those who are not as lucky as you and actually need disability and Medicare to stay alive.

        As for FAjensen…you have NO IDEA what it takes to get approved for SSDI and that any so-called fraud is estimated at below 5% of recipients…meaning 95% are legitimately approved. The rejection rate for applicants is much HIGHER today than in previous decades. Your remarks: Calling sick workers bums who should drink and drug themselves to death…Stating some people’s lives are “useless”…who are you to judge another person’s value or suggesting they should die? Why…to lower your taxes??

        What is wrong with you people!!

        Maybe you two will someday get the opportunity to apply for SSDI only to be rejected because you look or sound weird and your doctor didn’t fill out all the forms. Then you can find out how EASY cheating the system truly is…NOT. Only then will you discover the falsity of your fraudulent uninformed condemnation of others.

  11. Top-GUN says:

    Simple Solution,,,,, given that all this stuff is UnConstitutional Uncle $ugar should get out of both the disability insurance business and health care insurance business….

    Then all this complaining about these programs will go away, along with complaints about politicians, greedy military complex, lousy government employees and the rest of the usual clap trap….

  12. WSKJ says:

    Thank you, Dr. Gorback, for writing this informative post, and thx Wolf, for epublishing here.

    With a family member on disability, I can attest to the main point above, which is the difficulty and unlikelihood, for many, of ever succeeding in finding adequate income through employment, and getting off the disability income.

    IMHO, the increasing participation in healthcare by U.S. government is implicit in the problem. Here I refer to, for example, the federal government’s decision, decades ago, to establish dietary guidelines, which have had disastrous ramifications. (And you provide other examples above, Dr. Gorback.)

    For an individual with a chronic disability, daily life is more difficult than it is for the “normal healthy” individual. Trying to get off disability, as stated above, is a very high risk venture. (This includes the risk of exacerbating the existing injury/illness.)

Comments are closed.