Possible Loss of Benefits

For individuals in the United States who receive Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI), the Social Security Administration (SSA) regulations regarding the effect of earned income on benefits are often perceived as posing a substantial barrier to employment. Most people with mental illness are aware that their illness can flair up at any time. In the event of a relapse, Social Security may be the only source of income available. The fear of losing one's benefits, coupled with the fear that one may not be able to sustain employment, makes the perceived risk of attempting employment very great (Ford, 1995). In fact, the perceived risk is often much greater than the actual risk. The Social Security regulations regarding earned income and work incentives are discussed in Box 9.2.

BOX 9.2

Social Security Benefits and Earned Income

In 1999, President Clinton signed the Ticket to Work and Work Incentive Improvement Act (TWWIIA) into law. This law was designed to reduce the disincentives to employment for which the previous regulations were notorious. Following are general descriptions of the current SSI and SSDI regulations regarding earned income and the provisions of the TWWIIA that address the most common concerns of people considering employment.

The regulations for SSI employ a formula for determining specific reductions in cash benefits as a result of earned income. The person's cash benefit will be reduced by $ 1 for every $2 the person earns in excess of any exclusions to which the person is entitled. Those exclusions may include an earned income exclusion and a general income exclusion. These exclusions ($20 and $65, respectively) are earnings that Social Security allows without effect on benefits.

The SSDI recipient is entitled to a 9-month trial work period (TWP) during which his or her SSDI cash benefit is protected even though the person is earning wages. This period is followed by a 36-month extended period of eligibility (EPE) during which time the person's entitlement to the cash benefit will depend on whether or not the person's earnings exceed the amount that is considered to be substantial gainful activity (SGA). There is no formula to reduce the SSDI amount. Instead, it is an all-or-nothing proposition. The person either receives the SSDI cash benefit or he or she does not.

Both of these programs include work incentives that can be used to reduce the person's countable earned income and maintain some or all of the cash benefit at least for a time.

Provisions of TWWIIA

Ticket to Work

The Ticket to Work is a voluntary initiative. Each eligible SSI and SSDI recipient is issued a document called a ticket to work. The ticket holder can use the ticket to obtain employment services from any approved employment service provider known as an employment network (EN). An EN may be a public or private service provider, a state organization such as VR or One-Stop Centers, schools, employers, or others (Jensen & Silverstein, n.d.; Roessler, 2002). In principle, the ticket holder gains a measure of control and choice in selecting services because he or she can withdraw the ticket and reassign it to another EN if he or she is dissatisfied with the services being provided. An additional benefit to the ticket holder is that while using a ticket he or she will not be subject to continuing disability reviews by Social Security. Payments to the EN are based on the ticket holders' reduced cash benefits due to earned income.

Medical Insurance

For most recipients of Social Security benefits, the greater fear is the loss of medical coverage. SSI recipients are covered by Medicaid and may continue to be covered until their earnings reach a particular amount, even after their earnings have resulted in the cessation of their cash benefit. TWWIIA made it possible for states to allow working individuals with incomes greater than 250% of the federal poverty rate to purchase Medicaid coverage if it is needed to cover medical costs. SSDI recipients are eligible for Medicare. TWWIIA extended the period of Medicare coverage to 93 months after the trial work period (Jensen & Sil-verstein, n.d.; Roessler, 2002). This results in a total period of 102 months during which time a SSDI recipient can be working and still be covered by Medicare.


TWWIIA addressed other common concerns of people with disabilities considering employment. To ensure that the regulations and work incentives are widely understood and administered in a consistent way, SSA established employment support representatives (ESRs) to train local SSA claims representatives and to provide outreach about work incentives. Further, TWWIIA provided funding for the establishment of community-based Benefits Planning, Assistance and Outreach (BPAO) projects. These projects are staffed with well-trained specialists to assist people who are receiving benefits to understand and use SSA work incentives.

Expedited Reinstatement of Benefits

As mentioned before, a major concern for people with psychiatric disabilities in becoming employed is the fear of losing benefits and then being unable to sustain employment. TWWIIA addressed this concern by establishing an expedited reinstatement of benefits process. If an individual becomes unemployed for reasons related to their disability within 60 months of termination of their benefits, they can request an expedited reinstatement of benefits. That is, they do not have to go through a new application process. During the period that SSA is reviewing their request the person may receive temporary benefits including health care coverage. If SSA determines the person to be ineligible for benefits, the temporary benefits will not have to be repaid.

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