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Medicaid and Persons who qualify for Supplemental Security Income (SSI)

With one important exception, States are required to provide Medicaid coverage to recipients of SSI. SSI, authorized under Title XVI of the Social Security Act, is a means-tested cash assistance program for aged, blind, and disabled individuals whose income falls below the Federal maximum monthly SSI benefit and whose resources are limited. To qualify for SSI, a person must satisfy the program criteria for age or disability and meet certain citizenship or United States residency requirements. Eligibility for SSI is restricted to otherwise qualified individuals whose resources do not exceed $2,000 for an individual and $3,000 for a couple; certain resources, such as a person’s home, are exempt. Income cannot exceed the maximum Federal SSI benefit of $841 per month in 2022 for an individual living independently, and $1,261 for a couple. The SSI benefit level of $841 per month for an individual is 74 percent of FPL

The major exception to Medicaid coverage of SSI recipients is in States that exercise the so-called “209(b)” option described in Section 209(b) of the Social Security amendments of 1972 (P.L. 92-603). These States may use income, resource, and disability standards that are no more restrictive than those in place on January 1, 1972. As of 2021, there were nine Section 209(b) States, including Connecticut, Hawaii, Illinois, Minnesota, Missouri, New Hampshire, North Dakota, Oklahoma, and Virginia. Each of these has at least one eligibility standard that is more restrictive than current SSI standards and some have certain standards that are more liberal. States that use more restrictive eligibility rules under Section 209(b) must also allow applicants to deduct medical expenses from their income when determining financial eligibility for Medicaid. This process is sometimes referred to as “spend-down.”

Initially, both Georgia and Tennessee are “SSI States.” This means that if you qualify for Supplemental Security Income (a federal benefits program), then you also qualify for Medicaid. [Note 8]. In SSI states, a single dollar of SSI will result in Medicaid coverage. Thus, planning for individuals under 65 often begins by determining whether you qualify (or can become qualified) for SSI.

Note 8: 42 C.F.R. § 435.120. See Georgia ABD Manual § 2111-1; See Tennessee Medicaid Manual

Because the Medicaid and SSI are linked, losing SSI eligibility can result in the loss of health care benefits. That’s why it’s important to have an understanding of basic SSI eligibility.

SSI is a federal welfare program established under Title XVI of the Social Security Act [Note 9] to provide cash assistance to financially needy individuals who are age 65 or older, or blind, or disabled,[Note 10]  to assure such individuals a minimum level of income ($841 per month in 2022).

Note 9: Title XVI of the Social Security Act, 42 U.S.C. §§1381 et seq.; 20 CFR §416.101 et seq.; governed by operational guidelines contained in the Social Security Program Operation Manual System (POMS).

Note 10: Disabled is defined as “unable to engage in any substantial gainful activity because of a medically determinable physical or mental impairment that can be expected to result in death or that has lasted or can be expected to last for a continuous period of at least 12 months.” 42 U.S.C. §1382c (a)(3)(A).

An individual is considered financially needy for purposes of SSI if he has “countable resources” of no more than $2,000 (or $3,000 for a married couple) [Note 11], and has limited income. Resources that are not considered [Note 12] when determining this valuation include the individual’s home place, limited household goods, an automobile, certain life insurance, burial spaces, and a Certificate of Deposit of up to $1,500 designated for funeral expenses. [Note 13].

Note 11: 20 C.F.R. § 416.1205. See also 20 CFR § 416.1201 (defining resources). In Georgia, when both spouses are receiving long-term care Medicaid, each is treated as an individual and has a $2,000 resource limit.

Note 12: See POMS SI 01110.210 for list of excluded resources.

Note 13: 20 C.F.R. § 416.1210; see also POMS SI 01110.210 (describing excluded resources).

The Social Security Administration defines income as “anything you receive in cash or in kind that you can use to meet your needs for food, clothing, and shelter.” [Note 14]. This includes gifts, inheritances [Note 15], in-kind assistance, earned, unearned, cash, and non-cash income. [Note 16]. However, because many kinds of income are not counted in determining SSI eligibility, an individual may be eligible for SSI even though his income is somewhat higher.

Note 14: 20 C.F.R. § 416.1102.

Note 15: 42 U.S.C. § 1382a(a)(2)(D)

Note 16: 20 C.F.R. § 416.1102.

To get SSI, you must be age 65 or older or blind or disabled. The Social Security Act defines disability as follows: “an individual shall be determined to be under a disability only if his physical or mental impairment or impairments are of such severity that he is not only unable to do his previous work but cannot, considering his age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy, regardless of whether such work exists in the immediate area in which he lives, or whether a specific job vacancy exists for him, or whether he would be hired if he applied for work. For purposes of the preceding sentence (with respect to any individual), “work which exists in the national economy” means work which exists in significant numbers either in the region where such individual lives or in several regions of the country.” [Note 17].

Note 17: 42 U.S.C. § 1382c(a)(3)(B). See also 20 C.F.R. § 416.905 (adults) and § 416.906 (children). Where coverage is disputed, it often turns on whether the applicant is disabled. Social Security disability is sufficiently complex so that it comprises its own practice area.

If you meet the SSI criteria, then in an “SSI State,” Medicaid eligibility is “automatic” (assuming you apply for Medicaid) [Note 18]. If you do not qualify for SSI, it is possible that your estate can be re-structured to make you eligible. This is called Medicaid Planning.

Note 18: 42 U.S.C. § 1396a(a)(10)(A)(i)(II).

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