ABCs of Public Benefits | 2024
What are the options and who qualifies?
A Go-To Resource on Benefit Options
Various public benefit programs are available to individuals living with disabilities and other challenges. These programs have their fair share of acronyms, which can be confusing.
This primer offers basic information about some common types of public benefits and can serve as an at-a-glance glossary of common acronyms.
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 own eligibility requirements.
Who qualifies
Individuals, couples, and families living on limited income and assets ($2,000 in most states) qualify for Medicaid. Medicaid also gener- ally covers indigent children, pregnant women, and individuals living with a disability, including those institutionalized.
What else you should know
- 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.
- 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.
- 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.
- 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 LouGehrig’s disease qualify for Medicare.
What else you should know
- Medicare Part A covers hospital inpatient care, hospice and home care, and short-term stays at a skilled nursing facility.
- Medicare Part B covers outpatient and home healthcare provided by doctors and other healthcare providers, medical equipment, and many preventative services.
- 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 with extra benefits such as vision, hearing, dental, and more.
- 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:
- People aged 65 and older do not need to meet disability requirements to qualify for SSI.
- In most states, an individual receiving SSI will also qualify for Medicaid.
- The maximum monthly federal benefit in 2024 is $943 for an eligible individual and $1,415 for an eligible individual and eligible spouse.
- The SSA considers income from an ineligible spouse, ineligible parent, sponsor, or essential person in determining whether an individual is eligible for SSI.
- 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.
- 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:
- For 2024, the average SSDI benefit is estimated to be $1,537 per month.
- The maximum SSDI payment is $3,822 per month.
- In most cases, after two years of SSDI, the individual qualifies for Medicare benefits.
- Younger workers may qualify for SSDI with fewer work credits.
- Because SSDI is not means-tested, additional options in planning for long-term care are avail- able 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 to the disabled person, such as a personal injury settlement or inheritance.
- An individual must be disabled and under the age of 65 at the time the trust is funded to be eligible for a first-party SNT.
- A first-party SNT may be established by a parent, grandparent, legal guardian, court, or the disabled individual and must include a payback provision securing the state as the beneficiary of any remaining assets in the trust at the time of the grantor’s death up to the value of benefits paid out on behalf of the deceased.
- A third-party SNT is sometimes referred to as a supplemental needs trust.
- A third-party SNT is established with funds belonging to someone other than the disabled individual.
- A third-party SNT does not have an age limit nor the necessity of a payback provision and is commonly drafted by estate planning attorneys as springing or standalone instruments within general trust documents.
- Like the SECURE SNT, a third-party SNT can be utilized to take advantage of provisions within the SECURE Act relating to lifetime stretch on distribution from inherited retirement accounts when directed to disabled or chronically ill beneficiaries.
Supplemental Nutrition Assistance Program (SNAP)
What it is
SNAP, commonly referred to as food stamps, is a federal program that provides nutritional support.
Who qualifies
Households with limited resources, including seniors (aged 60 and older) and people with disabilities who meet specific criteria qualify for SNAP.
What else you should know
- In 2024, the maximum monthly SNAP benefit for a one-person household is $291.
- Individuals must apply for SNAP through their state agency.
Supplemental Nutrition Assistance Program (SNAP)
What it is
SNAP, commonly referred to as food stamps, is a federal program that provides nutritional support.
Who qualifies
Households with limited resources, including seniors (aged 60 and older) and people with disabilities who meet specific criteria qualify for SNAP.
What else you should know
- In 2024, the maximum monthly SNAP benefit for a one-person household is $291.
- Individuals must apply for SNAP through their state agency.
Achieving a Better Life Experience (ABLE) Accounts
What it is
An ABLE account is a savings account that allows people with disabilities to save without jeopardizing their access to means-tested public benefits and to use those funds for a wide variety of
qualified disability expenses.
Who qualifies
An individual who acquired their disability before turning 26 years old and who is either receiving SSI or SSDI or has received a doctor’s certification that they meet the SSA definition and criteria regarding limitation qualifies for an ABLE account.
What else you should know:
- Annual contributions are limited to the federal gift tax exclusion of $18,000 for 2024.
- The first $100,000 of an ABLE account is excluded as a resource for SSI eligibility; the entirety of an ABLE account, up to the state’s limit for 529 accounts, is excluded as a resource for Medicaid eligibility.
- People and trusts can contribute to an ABLE account.
- Qualified disability expenses may include transportation, assistive technology, education, recreation, prevention and wellness, and more.
Veterans Benefits
Special Monthly Pension with Aid and Attendance (A&A)
What it is
A&A is a monthly payment to reimburse a wartime Veteran or surviving spouse for long-term care costs incurred as a result of disability.
Who qualifies
Veterans Affairs (VA) rules restrict beneficiaries to those who meet service, medical, income, asset, and transfer rules. Veterans need not have served in combat or boots on the ground; they need only have served at least 90 days of active duty, with one day during a Congressionally defined wartime period.
What else you should know:
- VA A&A is designed to assist claimants in reimbursing long-term care costs, including care provided at home or in an assisted living or nursing home facility.
- A claimant can receive up to $2,727 per month for a married Veteran, $2,300 per month for a single Veteran, or $1,478 per month for a surviving spouse in tax-free income for as long as the claimant needs and pays out-of-pocket for care.
- VA imposes a three-year look-back period on gifting.
- VA rules, while similar, are distinct from Medicaid; some planning strategies unavailable in the latter are best practices in the former.
Special Monthly Pension with Aid and Attendance (A&A)
What it is
A&A is a monthly payment to reimburse a wartime Veteran or surviving spouse for long-term care costs incurred as a result of disability.
Who qualifies
Veterans Affairs (VA) rules restrict beneficiaries to those who meet service, medical, income, asset, and transfer rules. Veterans need not have served in combat or boots on the ground; they need only have served at least 90 days of active duty, with one day during a Congressionally defined wartime period.
What else you should know:
- VA A&A is designed to assist claimants in reimbursing long-term care costs, including care provided at home or in an assisted living or nursing home facility.
- A claimant can receive up to $2,727 per month for a married Veteran, $2,300 per month for a single Veteran, or $1,478 per month for a surviving spouse in tax-free income for as long as the claimant needs and pays out-of-pocket for care.
- VA imposes a three-year look-back period on gifting.
- VA rules, while similar, are distinct from Medicaid; some planning strategies unavailable in the latter are best practices in the former.
Concurrent Retirement and Disability Pay (CRDP)
What it is
CRDP is a monthly payment that provides additional financial support to Veteran service members with service-connected disabilities.
Who qualifies
Military retirees who have completed at least 20 years of service, are eligible for military retired pay, and have a service-connected disability with at least a 50 percent rating qualify for CRDP.
Combat-Related Special Compensation (CRSC)
What it is
CRSC is a monthly payment that provides additional financial support to military retirees with combat-related disabilities.
Who qualifies
To qualify for CRSC, Veterans must have completed at least 20 years of military, National Guard, or Reserve service; retired under the Temporary Early Retirement Act; be on the Temporary Disabled Retired List; or be on the Permanent Disability Retired List.
Questions? Contact us today.
- 856-642-6445
- info@posternockapell.com
Questions? Contact us today.
- 856-642-6445
- info@posternockapell.com