CONNIE FERRELL:  You know, for who are on supplementary security income or 
Social Security disability insurance, one of the biggest concerns we have from 
people considering going to work is:  What is going to happen to my medical 
insurance coverage?  More so even than the cash loss or perceived loss is that 
issue of:  Am I going to have medical coverage?  And you can't really blame 
people for worrying about this and planning for this.  And, so even though some 
of you have been through many trainings having to do with the Social Security 
work incentives or may have been through the two previous telecasts that are 
part of this series, we're going to take just a few minutes and review the work 
incentives associated with medical insurance for people on SSI and people on the 
SSDI.
   So we'll start first with SSDI.  Let's look at what's some of the good news 
for SSDI beneficiaries concerning their medical coverage should they decide to 
become employed?
   Well, first of all, in order to do that, we probably need to start with a 
little bit of a review of what Medicare is all about, an overview of Medicare 
and how that works.  And, so, remember from previous trainings you may have had 
that someone on Social Security Disability Insurance, after serving a waiting 
period, is eligible for Medicare coverage.  And in that Medicare coverage, you 
have two parts.  You have hospital insurance, which is Part A of the Medicare 
coverage, and that's just what it says it is.  It's your hospitalization 
coverage.  It's funded by the Social Security tax fund.  FICA, Federal Insurance 
Contribution Act, funds this particular part of the program.  And so, therefore, 
there's no premium associated with Part A for the beneficiary.  It covers 
inpatient hospital care and certain followup that is associated with hospital 
care.
   Part B, which is your other doctor coverage, or other medical coverage, is 
not funded by FICA.  So, therefore, there is a premium for this portion of 
Medicare coverage for SSDI beneficiaries.  This part, Part B, covers doctor 
services and other medical services that aren't covered under Part A.  It's 
voluntary.  Of course, it would be voluntary because there is the monthly 
premium.  This year, the monthly premium for a person on the SSDI that chooses 
to have Part B coverage is $54 a month.  And that premium changes a little bit 
every year, usually goes up just a little bit.
   So, that, first of all, is what Medicare is about.  What about Medicare for a 
person that goes to work?  So let's assume for a moment there's an individual 
who receives SSDI, that has also served their waiting period and is now 
receiving Medicare coverage.  And let's assume for the moment that they receive 
both Part A and Part B coverage.  What happens when they go to work?
   Well, first of all, there has been, for some time, extended coverage once an 
individual goes to work for a minimum of 39 months following the conclusion of 
the trial work period.  So, of course, we know that the first few months an 
individual is working is the trial work period, Medicare stays untouched during 
that period of time.  And so after that period of time, for at least 39 months, 
for years individuals have been able to count on the Medicare continuing.  What 
does that mean?  It means that the continued Part A coverage is still funded 
through FICA which means that the individual can still count on having their 
hospitalization coverage without having any increased premium, which of course 
they haven't had one up until that point.  It also means that they continue to 
have their Part B or other medical services provided with no increase in their 
monthly premium, so if they've been paying $54 before, then they will continue 
to pay $54 during this period of time.  So for years, I know I've trained 
individuals on the concept of 39 months following the trial work period.  Well, 
that was prior to the ticket to work and work incentives improvement act.  Now 
we're in the post-ticket area.  So now the ticket to work and work incentives 
improvement act has been funded, one of the improvements in there -- is the 
Medicaid coverage period of time.  It takes that 39-month extended period of 
coverage and extends that to at least 93 months following the trial work period.  
So where we had at least 39 months before, we now have at least 93 months after 
the trial work period that an individual should be able to continue receiving 
their Medicare coverage.
   Again, what this means is:  As we said before, that Part A is continuing all 
during that period of time to be free to the individual.
   If you need more information about how this extension to the extension works, 
you can look in the section 202 of the ticket to work and work incentives 
improvement act for the particulars around this extended period.
   Just, again, as a note for you and a review, that became effective and 
available to people on October 1, year 2000.
   So it's already been in place almost two years.  And at that point, it 
covered anyone who had -- was already receiving Medicare, that hadn't lost it 
due to working, regardless of whether they had begun employment or not.
   Now, what are the other things that we have to remember?  Is that when we're 
talking about at least 93 months, we're talking about people who have begun to 
work and are working enough that they have actually lost their cash benefit.  So 
in some cases, the individual may have that extended Medicare coverage much 
longer than 93 months following the trial work period.  But for the individual 
who is working, gets out to the end of these extensions and has finished 
receiving benefits, is earning above the SGA, then that's the point in time 
which their Part A-funded FICA-funded Medicare coverage is going to end.  Well, 
is it all over at that point?  Well, not exactly.  Again, for many years, 
there's been an opportunity that many people don't really understand or know 
about, and that is that beneficiaries can continue to buy into Medicare programs 
after these extended periods are cover -- over.  And the way that works is that 
if your extended coverage has been exhausted now, the 93 months following the 
trial work period, is exhausted and the individual is now no longer eligible for 
free Part A, then an individual can choose to, if they would like to, continue 
to have Medicare, but they have to pay for Part A and Part B premiums at that 
point.  Maybe that's one of the reasons why this hasn't been highly used, and 
that's because Part A's rather expensive.  So by the time an individual might 
pay for Part A and Part B, we're probably talking in the range of close to $300 
a month.  Now, that's better than no insurance at all for many people, but it's 
still cost-prohibitive for some individuals.
   Now, in some cases, that individual who is out of the all the extended 
periods that's choosing to buy back their Medicare might be able to receive some 
help in paying for that Part A premium as well as Part B through their state 
Medicaid office depending upon whether or not they meet the financial criteria 
for the qualified workers with disabilities category.  So, again, some 
individuals might qualify for that, others would not because their income and/or 
assets may exceed the limits set by their state Medicaid office.
   So that's a little of the good news for SSDI beneficiaries who are receiving 
Medicare who go to work.  But whenever you hear that there's good news, you can 
be sure there's also some bad news, right?  So let's look at some of the bad 
news for SSDI beneficiaries who receive Medicare and go to work.  First of all, 
you probably know that with most -- with the at that additional style of 
Medicare, when you're talking about the Part B coverage, there's no prescription 
coverage.  So for many individuals who are dependent only on Medicare coverage, 
they may have many costs that are uncovered.  And as we know with a rising 
prescription cost, that can be extremely expensive for some individuals to have 
to pay for prescription costs.  That's not associated with going to work or not.  
It's just the way the Medicare system works.
   Now, depending on your stay and how they're set up, there may be a managed 
care option for Medicare, but the traditional program does not have prescription 
coverage.
   The other thing about Medicare, if that's your only medical insurance, is 
that there are deductibles, and there are copayments.  So you have an annual 
deductible, and then after that's met, then an individual has to pay a certain 
percentage of covered costs.  So there are some out-of-pocket expenses for the 
person who's exclusively dependent on Medicare for their health insurance 
coverage.
   Those pieces are in place, again, whether you're working or whether you're 
not.
   Now, many people who are on Medicare and on SSDI may also qualify for 
Medicaid.  And if an individual is qualified for Medicaid as well as Medicare, 
and then they go to work, the bad news is that their Medicaid will probably, if 
they haven't already, begun to apply a spend down, which is similar to an annual 
deductible, but it's a monthly deductible.  So this spend down goes up, not 
dollar for dollar, but it goes up pretty quickly for individuals who go to work.  
And for many people, I've heard them say "well certainly I can hang on to my 
Medicaid if I'm on SSDI and I go to work."   to a certain extent but my spend 
down gets cost prohibitive.  Everything I seem to be making goes around back 
into my spend down.  For other individuals, they're going to lose their 
eligibility for their Medicaid when they're on SSDI as they go to work because 
they're either going to stop meeting the disability definition or their income's 
going to be high enough that they're just going to max out of that system 
altogether.  And if that's the case, if they've been depending upon that to pick 
up their prescription costs, they no longer have that to rely upon.
   So that's a little bit about the lay of the land, or the scheme of things for 
people who are on SSDI who go to work and how their medical insurance is 
affected.  So there's good news.  There's bad news.  Certainly the extended 
Medicare coverage is much better than nothing at all, but there's still some 
gaps in a person's medical coverage.
   Let's turn our attention now to supplemental security income.  An individual 
who is an SSI recipient, what happens if they go to work?  What happens to their 
medical insurance?  Well, in most cases, a person who receives SSI also receives 
Medicaid.  Not in all cases, but in most cases they do.  So there's some good 
news for SSI recipients concerning their Medicaid as they become employed.
   And that good news is because of a work incentive that provides for continued 
Medicaid coverage when they go to work.  It's called section 1619(b).  Now, 
that's not new.  That's been around since 1987.  So some of us old veterans that 
have been at this for a while have been talking about and training on and 
utilizing 1619(b) for some years.  On the other hand, it's surprising to me how 
many people still don't know about it or don't know who might all take advantage 
of it.  So let's just take just a couple of minutes and review what 16191 about.
   First of all, let's look at who qualifies for 1619(b).  To qualify for 
1619(b) status you have to continue to have your disability.  You have to be 
unable to afford benefits equal to those received if you weren't working, and 
the general way that they establish that is that there is a state annual income 
threshold that is set.  And if your income is -- your gross annual income is 
below that amount, you still qualify.
   You have to meet all other SSI requirements other than earnings.  For 
instance, you still have to be under the resource limit for SSI.  You still have 
to be an American citizen and the other pieces that are part of qualifying for 
SSI.
   And you have to need Medicaid in order to work.  Oh, oh.  What does that 
mean?  Need Medicaid in order to work?  Well, let's look at that one a little 
more closely.  The way the SSI rules read, an individual must need Medicaid in 
order to work, and that is proven by being able to answer yes to at least one of 
the following questions:  You've either used your Medicaid in the past 12 
months, or you expect to use your Medicaid within the next 12 months, if you got 
sick or injured, you would need to use your Medicaid within the next 12 months.  
That Medicaid needs test is applied annually, but there's no time limit for how 
long a person might be in 1619(b) category.
   How does a person take advantage of 1619(b)?  Do you have to fill out an 
application?  How does it happen?
   Well, when a person who receives SSI goes to work and their cash payments 
cease due to earned income, in other words, they're earning enough money that by 
the time every other dollar is counted towards the federal benefit rate, they 
reached the break-even rate.  Then at that point the Social Security 
Administration determines the person's eligibility for 1619(b).  So the person 
does not need to know about it, go down and apply for it, go through a special 
test other than the ones we just said, but Social Security is where this process 
starts.
   They go through asking those Medicaid needs questions, et cetera.  And then 
establish whether or not that person qualifies.  And in most cases, they would, 
if the reason they hit the break-even point was due to earnings.
   Now, once that's done, that's entered in that person's computer file, and 
whatever the state agency is in your state that administers Medicaid has that 
notation on file in that person's file.  There's shared data exchange between 
the Social Security Administration and the service agency that administers 
Medicaid.  So that is that's a relatively simple process that a person goes 
through.
   Okay, then what happens if you are qualified for 1619(b)?  Well, the nice 
things about that, as we just mentioned, are that first of all, it means that 
you get to keep your Medicaid.  Well, guess what?  Not only do you get to keep 
your Medicaid eligibility, but your state process of establishing a spend down 
is waived.  So the individual not only is keeping their Medicaid coverage, but 
they're not incurring an increase in spend down that's due to increase in 
earnings.
   There's one other sidebar that's a real important one that is part of 
establishing 1619(b) eligibility as well, and that is that you're maintaining 
your SSI eligibility.  So even though you're not getting a cash benefit, an SSI 
check, you're still on the SSI rolls, which means that should you lose your job 
or drop that break-even been point, would have your SSI benefits reinstated.
   Now, it's real important for people to ream that it's best if that Medicaid 
eligibility is established prior to hitting a 1619(b) status.  That particularly 
is important for individuals who may be living in what's called a  29 (b) state, 
in a state in which the Medicaid eligibility might be different than the SSI 
eligibility, I live in one of those states, so I know a lot about that.  So it's 
not really that difficult, it's just important because if you're working with 
someone that is on SSI and they're going to work to make sure all the kinks are 
out in terms of having established themselves for Medicaid before they actually 
get to the point that they reach a break-even point.
   Now, where there's good news there's bad news.  So what's the bad news for 
the SSI recipient who goes back to work, the 1619(b) sounds like a pretty good 
deal, so what could possibly be a barrier?  What could possibly be a gap in this 
system?
   Well first of all 1619(b) does not address the need to save money.  So what 
it does is allows the individual to earn more money, to get Mormon he, but not 
to save Mormon he.  So the resource test remains the same, an individual who 
exceeds $2,000 of accountable resources is going to go into a suspension 
category.  So for some individuals, it's great that you can earn more but people 
would like to save and they can't necessarily due to this provision not taking 
that into consideration.
   The second thing is transitioning into a 1619(b) status and being able to 
have that trouble-free, transitioning into that status and continued Medicaid is 
far from smooth.
   Now, don't really ask me why.  You would think something that's been around 
for 15 years, we'd have the kinks out of it, but we don't.  I've traveled all 
over this country doing training around this issue and everywhere I go, 
particularly in 209 B states but not limited to it, I'm hearing that there are 
glitches, and I'm not only hearing it but I'm experiencing it as I do benefits 
counseling myself, that for whatever reasons, the communication breaks down 
between Social Security Administration and your state agency administering 
Medicaid in some cases.  And although it's fixable should a person erroneously 
be taken off of the Medicaid rolls or erroneously incur a hefty spend-down, you 
could certainly get it fixed.  We are still having to deal with that on a case 
by case basis in many instances.  And so, therefore, individuals are still a 
little gun shy about this provision in cases where they've heard of other 
individuals that it did not go smoothly.  So it takes a lot of monitoring and 
some handholding of the system to assure that an individual for whom Medicaid 
continuation is critical to assure that there's no break in coverage.
   The next piece is that annual income threshold that I mentioned that vary 
from state to state are very low, still, in some states.  And I just looked at a 
chart to -- that goes through each state, how much the annual income is, in 
other words, when you'd max out of 1619(b).  I said okay, I'm going to look at a 
few.  I thought well, I'll look at Arizona because I got a son that lives in 
Arizona.  Arizona's annual income threshold is right about 15,000 a year.  So if 
you earn over 15,000 a year in Arizona, you're out of the 1619(b) status.  So I 
said okay, I've got another sun and he lives in Virginia.  It is about 21,000.  
So you earn more than 21,000, you're out of there.  And then I grew up in 
Tennessee, so I thought well I'll look at that one, too.  17,000.  So even 
though it's certainly a wonderful work incentive, in some states, the state 
annual income threshold is relatively low.  Well, now certainly an individual 
could have an individualized threshold set should their Medicaid costs be higher 
than normal, but many individuals don't understand that or don't ask about an 
individual threshold.  And in many cases, no one brings that up so it's not 
considered.
   So there still are, again, some problematic areas for the SSI recipient 
regarding continued Medicaid coverage should they go to work.