The Connection Between Social Security Disability Benefits and Health Coverage Through Medicaid and Medicare

In 2021, 13 million individuals beneath age 65 obtained revenue from the Social Safety incapacity packages, Social Safety Incapacity Insurance coverage (SSDI) and Supplemental Safety Earnings (SSI), which give month-to-month revenue to people who find themselves unable to work on account of a incapacity. A less-commonly appreciated advantage of qualifying for Social Safety incapacity packages is the connection to medical health insurance protection by way of Medicare or Medicaid. In most states, SSI beneficiaries robotically qualify for and obtain Medicaid protection, whereas SSDI beneficiaries qualify for Medicare after receiving incapacity advantages for a minimum of two years. Many who obtain advantages from the SSDI and SSI packages additionally qualify for each Medicare and Medicaid, generally known as dual-eligible people.

This evaluation examines enrollment in incapacity packages and traits of enrollees from 2002-2022 Social Safety Administration information and associated well being protection by way of the Medicare and Medicaid packages utilizing information from the Facilities for Medicare and Medicaid Companies for 2021, the newest yr of knowledge accessible. (See strategies for particulars.) State-level information concerning the incapacity packages are additionally accessible on KFF’s State Well being Info.

Key Takeaways

• In 2021, 12.9 million individuals had been eligible for Medicare or Medicaid as a result of they obtained incapacity advantages from both SSDI or SSI. Of that whole, 4.5 million, or greater than one-third (35%), certified for well being protection beneath each Medicare and Medicaid (dual-eligible people). One other 4.8 million SSI beneficiaries had Medicaid protection solely and three.6 million SSDI beneficiaries had Medicare protection solely.
• A complete of 13.0 million individuals beneath age 65, together with working-age adults and youngsters, obtained incapacity advantages in 2022, together with 7.8 million individuals who obtained revenue from SSDI, 4.2 million who obtained revenue from SSI, and 1 million who obtained revenue from each packages.
• Enrollment of working-age adults in each the SSDI and SSI packages has decreased since 2014, reflecting the altering demographics of the U.S. inhabitants, the economic system, and different elements which have lowered the variety of new beneficiaries, together with in newer years, the lasting results of Social Safety workplace closures through the COVID-19 pandemic. The decline in SSDI enrollment has additionally meant a decline within the variety of Medicare beneficiaries beneath age 65 who qualify as a result of incapacity.
• Psychological issues—which embody mental and developmental issues and different psychological issues—comprise the biggest share of disabling circumstances throughout each packages. Within the SSDI program, musculoskeletal circumstances are the commonest disabling circumstances amongst disabled beneficiaries (30%), adopted by different psychological issues (16%) and mental/developmental issues (14%). For SSI beneficiaries, mental and developmental issues are the commonest disabling circumstances (33%), adopted by different psychological issues (19%) and musculoskeletal issues (12%).
• The typical month-to-month profit in 2022 was greater than twice as massive for disabled employees within the SSDI program (almost $1,500 per thirty days) than disabled beneficiaries within the SSI program (almost $650 per thirty days).

How many individuals beneath age 65 qualify for Medicaid and Medicare by way of the Social Safety incapacity packages?

In 2021, 12.9 million individuals who obtained advantages by way of the Social Safety incapacity packages certified to obtain protection from Medicare, Medicaid, or each packages on account of their eligibility for incapacity advantages (Determine 1). Whereas 61% of working age adults and almost half of youngsters had well being protection by way of an employer in 2022, employment-based protection is way much less frequent amongst individuals with disabilities, who’re much less prone to work. Consequently, the Social Safety incapacity packages – Social Safety Incapacity Insurance coverage (SSDI) and Supplemental Safety Earnings (SSI) (see Field 1) – play an essential function in serving to individuals with disabilities entry medical health insurance protection by way of the Medicaid or Medicare packages, with some individuals with disabilities qualifying for well being protection beneath each Medicare and Medicaid (generally known as dual-eligible people).

Of the 12.9 million individuals with disabilities who’ve protection from Medicare, Medicaid, or each primarily based on their eligibility for incapacity packages, a complete of 4.5 million, or greater than one-third (35%), are dual-eligible people. Total, the general group consists of:

• 4.8 million SSI beneficiaries who’ve Medicaid solely;
• 3.6 million SSDI beneficiaries who’ve Medicare solely;
• 2.9 million SSDI beneficiaries who’ve each Medicare and Medicaid; and
• 1.6 million beneficiaries receiving each SSDI and SSI, who’ve each Medicare (by way of SSDI) and Medicaid (by way of SSI).

Though most individuals qualify for Medicare primarily based on age after they flip 65, individuals beneath age 65 could turn into eligible for Medicare if they’ve obtained SSDI funds for twenty-four months. In 2021, 8.3 million individuals beneath the age of 65 had been eligible for Medicare due to a disabling situation. Practically all (8.1 million) had been eligible by way of SSDI, and 0.2 million had been eligible as a result of that they had Finish-Stage Renal Illness (ESRD) however didn’t obtain SSDI. SSDI beneficiaries usually should wait 5 months for SSDI funds after the onset of advantages, adopted by a two-year ready interval between receipt of SSDI advantages and Medicare eligibility, known as the “Medicare ready interval.” It’s unknown how many individuals are at the moment within the ready interval or what their medical health insurance protection is throughout this era. Due to the size of the SSDI utility course of and the truth that SSDI eligibility is retroactive, candidates could full some or all the ready interval previous to receiving SSDI advantages, however many expertise gaps in protection throughout this time too. (These beneath age 65 who qualify for Medicare primarily based on having ESRD or Amyotrophic Lateral Sclerosis (ALS) should not have to attend 24 months for his or her Medicare advantages to begin as a result of they don’t seem to be required to qualify for SSDI first.)

In accordance with KFF evaluation, though majorities of individuals with Medicare of all ages price Medicare positively, individuals beneath age 65 with disabilities are much less possible than older beneficiaries to provide constructive scores to Medicare and a few options of it, akin to the standard and availability of suppliers. Medicare beneficiaries beneath age 65 with disabilities have additionally reported worse entry to care, extra value considerations, and decrease satisfaction with care than these age 65 or older. The decrease scores by individuals beneath 65 with disabilities could probably be associated to their totally different pathways to Medicare eligibility and since this system was initially designed to cowl older adults, with protection for youthful individuals with disabilities added later. Additionally, as a result of a bigger share of individuals with Medicare beneath 65 with disabilities report that they’re in honest or poor bodily and psychological well being and have extreme persistent circumstances in comparison with individuals age 65 or older, these beneath 65 with disabilities could also be extra prone to have a number of encounters with the well being care system through the yr and encounter issues after they do.

States should usually present Medicaid to individuals who obtain SSI. In 2021, 6.5 million individuals had been eligible for Medicaid by way of the SSI incapacity program. If states don’t wish to use the SSI eligibility standards, they will use extra restrictive guidelines as long as the principles aren’t any extra restrictive than what the state had in place in 1972 when the SSI program was established. There are at the moment 8 states utilizing their very own standards, generally known as the 209(b) states: Connecticut, Hawaii, Illinois, Minnesota, Missouri, New Hampshire, North Dakota, and Virginia.

How many individuals beneath age 65 obtain revenue from Social Safety incapacity packages?

Among the many 268 million individuals beneath age 65 within the U.S., 5% or 13 million individuals obtained revenue from SSDI, SSI, or each packages in 2022. Greater than half (60%, or 8 million) of Social Safety incapacity program beneficiaries beneath 65 solely obtain SSDI revenue, and almost a 3rd (32%, or 4 million) obtain solely SSI, whereas over 1 million individuals obtained advantages from each packages (Determine 2).

How has enrollment within the Social Safety incapacity packages modified over time?

Enrollment of working-age adults within the Social Safety incapacity packages elevated from the early 2000s by way of 2014 however has been declining since (Determine 3). Enrollment of individuals beneath age 65 in SSDI and SSI has decreased from 14.9 million beneficiaries in 2014 to 13.0 million beneficiaries in 2022. Enrollment tendencies within the incapacity packages mirror the demographics of the U.S. inhabitants, the economic system, and different elements. Program measurement relies upon partially on the dimensions of the labor power, and among the decreased participation lately displays the infant boomers coming into their retirement years. For the SSDI program, participation additionally requires individuals to satisfy previous employment necessities and decrease labor power participation means fewer individuals can meet these necessities. Analysis has additionally discovered decrease utility and award charges for “contingent employees,” which incorporates impartial contractors, consultants, and people in short-term, on-call, and gig economic system jobs, who make up an growing share of the workforce. Decrease SSDI enrollment over the previous decade additionally possible displays fewer functions stemming from the tip of routinely-mailed social safety statements in 2011.

Extra stringent incapacity determinations may additionally contribute to the decrease enrollment. Between 1999 and 2019, the share of candidates who had been accredited to obtain advantages (the “award price”) declined for each incapacity packages: from 56% to 29% for SSDI and from 44% to 34% in 2021 for SSI. Decrease award charges imply that even when an identical variety of individuals apply, fewer individuals will enroll and obtain advantages.

The decline in SSDI enrollment has meant fewer individuals beneath age 65 qualifying for Medicare as a result of having a long-term incapacity. The overall variety of Medicare beneficiaries beneath age 65 with disabilities (excluding those that qualify primarily based on having end-stage renal illness) has declined since 2016, each when it comes to the full quantity and the share of general Medicare enrollment, primarily based on Medicare enrollment information from the Facilities for Medicare & Medicaid Companies. In 2016, there have been 8.6 million Medicare beneficiaries beneath age 65, or 16% of all beneficiaries, reducing to 7.2 million in 2023, or 11% of the full.

The identical development just isn’t noticed in Medicaid as a result of individuals have extra choices for qualifying for Medicaid than they do Medicare. Between 2014 and 2022, most states adopted Medicaid expansions beneath the Inexpensive Care Act, which supplied one other mechanism for adults beneath age 65 to qualify for Medicaid and spurred enrollment progress. Enrollment additionally grew between 2020 and 2023 due to the COVID-19 steady enrollment interval, a three-year interval throughout which Medicaid eligibility disenrollments had been paused.

Traditionally, financial downturns led to will increase in SSDI and SSI enrollment, however notably, there was no enrollment surge through the financial downturn related to the COVID-19 pandemic. In actual fact, the enrollment decline accelerated through the COVID-19 pandemic, when Social Safety places of work had been closed for two years, possible additional lowering the variety of candidates. Workplace closures additionally contributed to a backlog of instances that’s inflicting individuals to attend longer for eligibility choices: Social Safety information present that the typical evaluation time for preliminary functions elevated from 4 months or much less earlier than the pandemic to almost 8 months in 2023. Related tendencies occurred for functions that had been reconsidered after an preliminary denial.

The applying for Social Safety incapacity advantages is usually a prolonged and complex course of, spanning months, if not years. A chart visualizing the steps to incapacity determinations in 2022 by the Nationwide Group of Social Safety Claimants’ Representatives exhibits that 62% of the 1.8 million candidates in 2022 had been denied on the preliminary utility, however that lots of of 1000’s pursued reconsiderations and subsequent authorized proceedings to determine eligibility. A 2022 examine by the Nationwide Bureau of Financial Analysis discovered that authorized illustration didn’t have an effect on the probability of a profitable SSDI consequence however lowered the time it took for approval by almost one yr. The problem with demonstrating eligibility is in proving that one has a disabling situation that makes substantive employment unimaginable.

The Biden-Harris Administration’s proposed FY 2025 funds features a $1.3 billion (9%) improve to the Social Safety Administration’s funds from FY 2023 to 2025 to enhance customer support throughout area places of work, incapacity willpower, and teleservice, and scale back wait instances. The Biden-Harris Administration additionally helps utilizing the funds improve to advance fairness and accessibility. The brand new funding would assist simplifying the SSI utility course of, broadening entry to Social Safety packages particularly for unserved populations, and stopping overpayments. The Social Safety Administration would additionally use the funding to proceed enhancing info expertise techniques to make accessing companies and communication with workers simpler each on-line and through cellphone.

What are the commonest circumstances that qualify individuals for Social Safety incapacity advantages?

For each SSDI and SSI, musculoskeletal system illnesses and psychological issues are the commonest circumstances that qualify individuals for incapacity advantages (Determine 4). Each Social Safety incapacity packages use a strict definition of incapacity when assessing eligibility, which limits how many individuals with disabilities finally qualify for SSDI or SSI funds. The Social Safety Administration defines incapacity for adults as the shortcoming to have interaction in any “substantial gainful exercise” due to a number of medically determinable bodily or psychological disabilities which might be both anticipated to lead to loss of life or have lasted or are anticipated to final for a steady interval of a minimum of 12 months. Substantial gainful exercise describes a stage of labor that entails doing vital bodily or psychological actions or a mix of each. For kids to qualify as disabled, they have to be beneath 18 and have a number of bodily or psychological impairments which lead to marked and extreme practical limitations and the impairment will need to have lasted or be anticipated to final for a minimum of 12 months or be anticipated to lead to loss of life.

Over the previous twenty years, musculoskeletal system illnesses and psychological issues (together with each mental and developmental issues and different psychological issues) have accounted for the biggest shares of incapacity determinations, and in 2022, these circumstances mixed account for 60% of incapacity determinations amongst SSDI beneficiaries and 64% amongst SSI beneficiaries. The commonest circumstances for SSDI beneficiaries are musculoskeletal system illnesses, which embody non-healing or complicated fractures, abnormalities of main joints, and issues of the backbone. The commonest circumstances for SSI beneficiaries are mental/developmental issues which embody autism spectrum issues and neurocognitive issues. Different psychological issues embody depressive, bipolar, and associated circumstances and schizophrenia spectrum and different psychotic issues.

How a lot do Social Safety incapacity program beneficiaries obtain in month-to-month advantages?

SSDI beneficiaries obtain common month-to-month advantages which might be over twice as massive as what SSI beneficiaries obtain, with month-to-month SSDI funds for disabled employees averaging almost $1,500 per thirty days, in contrast with roughly $650 per thirty days for individuals receiving SSI advantages (Determine 5). Relations of SSDI employees obtain decrease month-to-month advantages, on common: slightly below $900 for widowers and $1,000 for grownup youngsters. The month-to-month cost from SSDI is calculated utilizing a statutory formulation that accounts for individuals’s earnings and is designed to pay larger advantages to individuals with larger earnings however to exchange a bigger share of earnings for individuals with decrease earnings. In 2022, SSDI advantages ranged from lower than $600 to greater than $3,000 every month. The utmost SSI profit is ready by Congress and in 2022 was $841 per thirty days for a person ($943 in 2024) and $1,261 for a pair ($1,415 in 2024). If individuals have non-SSI revenue, their SSI advantages are lowered by the quantity of countable revenue.

Many beneficiaries at the moment are dealing with profit reductions on account of prior overpayments by the Social Safety Administration, as reported by KFF Well being Information, however the Biden-Harris Administration is taking steps to restrict the results of profit reductions. Annually, greater than 2 million beneficiaries have been receiving notices that their incapacity advantages had been overpaid and are being requested to repay the particular quantities inside 30 days or have their month-to-month incapacity advantages lowered. In lots of instances, these funds had been made years earlier with out the recipients’ data. There have been overpayments in each packages, however they’re extra frequent in SSI as a result of SSI eligibility and cost quantities change when recipients expertise modifications in revenue and property.

From April by way of June 2024, new overpayment insurance policies went into impact to deal with these profit reductions, together with:

• Limiting the quantity that may be withheld from a recipient’s month-to-month incapacity advantages (to regulate for overpayments) to not more than 10% of the recipient’s month-to-month advantages for SSI recipients and both 10% or $10 for SSDI recipients (whichever is larger), quite than withholding the complete quantity,
• Rising the period of time for recipients to repay the overpayment,
• Making overpayment notices simpler to know,
• Simplifying the waiver utility for beneficiaries who meet compensation exemption standards, and
• Holding the Social Safety Administration liable for offering proof of overpayment quite than the beneficiary.