Why should you apply?

Being awarded Social Security Disability Insurance (SSDI) offers many financial and health care related benefits:

Monthly Cash Benefits

SSDI is a wage replacement benefit for individuals who have worked and paid FICA taxes. You receive monthly payments during the period that you meet the Social Security Administration’s (SSA) definition of “disability.” This may include retroactive benefits that can help to offset some incurred financial obligations.

Social Security Retirement Protection

SSA calculates your retirement benefits based on your average income earned over your working life. So, a significant amount of non-working years would factor many zeros into your average, resulting in a substantially lower retirement benefit. However, if SSA determines that you are disabled under the Social Security Act, your earnings record will be “frozen” for the years that you couldn’t be gainfully employed, protecting your Social Security retirement benefit.

This is known as “zero wage-earner” status, and applies even if you are receiving workers’ compensation payments or benefits under a long-term disability insurance policy.

Tax Advantages

Less than one-third of current SSDI beneficiaries pay taxes on their benefits. Typically, you’ll only pay federal income taxes if you have significant income beyond your SSDI benefits, such as:

  • Wages or self-employment income
  • Interest, dividends, and other taxable income

A tax professional can provide additional clarity for your particular circumstances.

Return-to-Work Incentives

Special “work incentive” rules, such as Trial Work Period, Extended Period of Disability, and Continuation of Medicare Coverage, make it possible for people with disabilities receiving SSDI to work and still receive monthly payments, as well as Medicare.

Dependent Benefits

SSDI recipients who have a dependent child under the age of 18 may also qualify for a monthly benefit for their child that is up to half of the primary beneficiaries’ amount.

Health Insurance Through Medicare

SSDI recipients are entitled to Medicare coverage 24 months after the date that SSA determines them to have first been entitled to SSDI cash benefits, regardless of age. If you suffer from end-stage renal disease or ALS, you could be eligible even sooner.

These benefits include:

  • Part A: Hospital Insurance (usually free)
  • Part B: Medical Insurance ($115.40 per month in 2011)
  • Private Medicare Supplement, Medicare Advantage and Medicare Prescription Drug coverage

For SSDI recipients without access to other health insurance, this benefit is essential to preserving your financial well-being.

COBRA Extension

You and your family likely qualify for an additional 11 months of COBRA coverage if:

  • You are awarded SSDI benefits prior to the expiration of your 18-month COBRA period, and
  • SSA determines that you became disabled within the first 60 days of COBRA coverage.

To qualify for the extension, you must send your COBRA administrator a copy of your SSDI Notice of Award:

  • Within 60 days of receiving it (even if you don’t need the extension yet), and
  • Prior to the expiration of your 18-month period of COBRA coverage.

Learn More About COBRA »
Visit the U.S. Department of Labor Online »