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SSI vs. SSDI: Understanding the Differences

Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) are two of the most common federal financial assistance programs administered by the Social Security Administration. Generally, these cash payment programs are available to individuals who meet the federal definition of “disabled.” However, it is important to keep in mind that these two programs have different eligibility requirements and benefits.

Understanding the key differences between these two programs would allow you to plan accordingly and avail the most benefits.

Eligibility Requirements

Supplemental Security Income (SSI) is a need-based benefit program available to older adults and disabled persons with limited income, assets, or resources. This program is funded by General Revenues and is considered an “entitlement” program, so a person’s work earning history is not a factor for eligibility. Rather, the focal basis to be eligible under this program is whether a person has very little money and is either age 65 and above, or blind or disabled.

Social Security Disability Insurance (SSDI) is an earnings-based benefit program that supports disabled individuals with qualified work history, whether through their own employment or a family member (typically, a spouse or parent). Employers and wage contributions fund this program, so a person’s income, assets, or resources are generally not considered for eligibility. However, wages may affect benefits if a person is under full retirement age or disability benefits. A disabled person’s work history credit is the basis for eligibility under this program. In essence, SSDI allows workers who become disabled to receive their Social Security retirement benefits early, even if they are high-income earners.

Access to Medicare or Medicare Benefits

In most states, including Arizona, a person eligible for SSI benefits automatically qualifies for Medicaid. The Social Security Administration (SSA) determines Medicaid eligibility using the SSI criteria, so a person’s SSI application is also an application for Medicaid.

However, a person who is eligible for SSDI is not automatically eligible to receive Medicare. Rather, a person has to be eligible for SSDI benefits for two years before receiving Medicare benefits. It is also good to note that Medicare is not as comprehensive as Medicaid. Medicare covers most, but not all, primary medical care, so many Medicare beneficiaries end up having to purchase private policies to fill in the gaps in their Medicare coverage.

Financial Payment Benefits

Benefit calculations and payouts dramatically vary between the two programs. SSI bases its benefits amount on Federal laws, while SSDI benefits amount is calculated based on a person’s average lifetime earnings.

Currently, the federal SSI payment standard is $783 per month for an individual and $1,175 for a couple. However, this standard payment is subject to reduction by any other income received by the SSI recipient.

In contrast, an SSDI payment is not affected by any income received by the SSDI recipient since SSDI payments are based on a person’s working earning record instead of income. However, it is good to note that a person who receives an SSDI payment that exceeds the SSI monthly payment set by the federal law would not be eligible for SSI.

Timing of Benefits Payment

Another difference between SSI and SSDI is when a person can expect to receive their disability benefits.

Under SSI, a waiting period begins with the first full month after the date that the SSA had decided when a person’s disability began. However, an SSI recipient is paid their disability benefits for the first full month after the date they filed their claim, or, if later, the date they become eligible for SSI.

Whereas, under SSDI, a five-month waiting period is imposed before eligible recipients can begin their benefits. SSA will pay the first benefit for the sixth full month after the date that they have determined the disability began.

Family Auxiliary Benefits

Another critical difference between the two programs is whether auxiliary benefits are extended to eligible family members of the recipient. Auxiliary benefits are dependent benefits that are extended to certain family members of the beneficiary, which may include: spouse, ex-spouse, minor children, adult children, grandchildren, or parents.

Under SSI, auxiliary benefits do not extend to a recipient’s family members.

On the contrary, SSDI allows eligible family members to collect auxiliary benefits when a recipient collects disability benefits.

Under SSDI rules, a dependent may be eligible for up to 50% of the amount received by the disabled recipient. However, Social Security limits the family benefits up to 150-180% of the disabled individual’s benefits.

Contact Walner Law to Learn More About SSI and SSDI

Understanding the many differences between SSI and SSDI can be an arduous task. Jon Walner is here to simplify this process for you and make sure you get the benefits you deserve. If you need a lawyer specializing in Social Security Disability, contact Walner Law for a free consultation.