Physical Disability v. Fiscal Disability

We received the following explanation of earning limits from our very smart, experienced lawyer who has a particular talent for simplifying & communicating the rules guiding participation in Medicaid programs. Keith & I are pretty astute and have had a reasonable amount of experience decoding legalese. We've had to read it a few times and I think the next step is drawing a diagram, LOL.

Start practicing your decoding now, it only gets more complicated!

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I'm glad you asked. Here are responses as to the short-term and long-term questions:

1. Short-term: To prepare an answer, I constructed the attached spreadsheet for calculating how much income you can have under Buy-In. That in turn led me to review the new HHSC Buy-In rules, and I found that the $2,167 limit applies only to earned income. There is no limit on unearned income (such as SSDI income). That is because under the old rules, all but $674 per month of unearned income had to be paid as a premium for Buy-In coverage. The new rules cap the premium at $500 per month, but they still don't include unearned income in the income cap (250% of poverty level) on countable earned income. And the first $65 of earned income plus one-half the rest doesn't count. Therefore, bottom line, you can have a maximum of $4,399 of actual earned income (only $2,167 of which is countable), and you can have unlimited unearned income (of which you will have to pay $500 as a premium).

That puts Buy-In back in the running as a possibility, but I'm still strongly recommending you look first at StarPlus to see what level of benefits it offers. You can get into Buy-In at any time later as your earned income develops. We do still have the problem under StarPlus that any income over $2,022 per month (after deduction of medical premiums) has to be paid as a copayment; and that program counts all earned income (no deduction of $65 plus one-half the rest).

2. Long-term: Your more general question motivated me to research a Buy-In issue that has puzzled me: what does it really mean that to qualify for Buy-In you have to have a disability as defined by SSA, "except the requirement that the person be unable to engage in any substantial gainful activity does not apply."? Here is the answer I've come up with, somewhat tentatively (excerpted from my summary of Buy-In, attached):

Under the Social Security Disability rules, a person with actual gross earned income exceeding $980 per month is (with some exceptions) presumed not disabled. The above-quoted rule removes that presumption. Where does that leave us? The answer would appear to require reference to the Social Security Administration's disability determination rules, which state that person who is not currently engaging in "substantial gainful activity" as defined in the rules may or may not meet the disability definition. If not, the next inquiry is whether the person's impairments are "severe." If so, they ask whether the person has an impairment that meets or equals the definition of a "listed impairment." If the answer to that question is also "Yes," then the person meets the definition of "disabled." This may resolve the apparent paradox that one can be engaging in substantial gainful activity (making over $980 per month) as defined by the Social Security Disability rules, yet still meet the "disability" requirement of Medicaid Buy-In. Notice that an individual in this category is likely to lose the Social Security Disability benefit and, after 24 months, the Medicare benefit. However, they can still have full medical coverage under Medicaid (for a very low premium if they have no unearned income) and $4,399 per month earned income. (Footnote: The basic rule on the 5-step process is at 20 C.F.R. §404.1505. It is broken down more specifically at POMS DI 22001.001 et seq. See especially the chart at DI 22001.035. The author does not practice in the area of disability determination, and these complex rules can be difficult to apply. Therefore, it is particularly important that the planning decision in such a case be based on advice from a specialist in this practice.)

The C.F.R. and POMS provisions cited in the footnote are attached.

Bottom line, it appears you can keep Medicaid Buy-In as long as your earned income is below $4,399 per month, because your condition is clearly severe and I'm sure you have listed impairments.

Whether you can also keep SSDI income at that level of earned income is another question. If you look just at the 5-step sequential evaluation chart, it would seem not, because you would be engaging in substantial gainful activity the chart says you should be denied at the first step. However, see the attached excerpt from a treatise on disability determinations for some important conditions and exceptions. Most importantly, "impairment-related work expenses" are deducted from earned income for the purpose of determining whether you have $980 per month earned income; and there are lots of other deductions, trial work period rules, etc. From a quick reading of it, because substantial gainful activity is an exception to the rule that you keep the disability benefit as long as your impairment continues at the same level, I think that (after a trial work period) you would lose the SSDI and (after 24 months) Medicare if you had earned income on a sustained basis over $980 per month (after deductions for IRWE, etc.). However, that still leaves you with up to $4,399 per month earned income AFTER those deductions. For example, if attendant care and other IRWE costs $5000 per month, you can have up to $9,399 per month earned income.

In summary, I've found that Buy-In eligibility won't be affected by your SSDI income, and you can have up to $4,399 per month earned income while still qualifying for it. StarPlus is much more restrictive on income, essentially requiring (at your income level) that any earned income be paid as a copayment (but not counting Ruth's income or assets at all). Long-term, you can have acute-care benefits plus limited home care under Buy-In if you have as much as $4,399 per month earned income, AFTER deduction of whatever attendant care, etc. you can deduct as income-related work expenses (probably several thousand dollars per month).

Quick Update

The lack of posts is not indicative of all problems being solved...lol.

Actually, we've been dealing with a host of new problems, the kind that no insurance covers. It's pretty normal to have attendants rotate out of our lives. Sometimes it comes in waves, this month was one of those times. Although I was a bit panicked to find out that both of our experienced attendants would be leaving at once, Keith was quite calm. He's been dealing with this his entire life. I had already taken over the afternoon shift (2-8p) so that we could stretch our budget a bit further. I could do any of the tasks needed to keep Keith safe & comfortable. Unfortunately I am not able to get Keith into his wheelchair myself so his movement to other parts of the house and beyond was severely limited. So, my working that shift was not ideal, but at least Keith & I got to spend more time together.

We placed an ad on Craig's List and were overwhelmed with the large number of responses. Some very high quality people were excited at the possibility of working with Keith, not only to strengthen their caregiving skills, but also to learn about life from his perspective. We were able to get two new attendants hired and trained by last week. The new shift is 9a-4p which eventually me to get out of the house & be more productive financially (and maybe even work out a few times a week.) Until the new attendants are completely comfortable in the work, I need to be here for support and direction. I will continue to cover the 4-8pm shift until we can get Keith enrolled in the Medicaid Buy-in plan and (hopefully) get some of the hours covered.

While all this is going on, the project I have been incubating since April 17, 2002 has a serious funding opportunity which will bring a great (and much needed) financial windfall to our lives. Naturally, it will require a lot of my time as well. This is something I've been preparing for since 2002 and I'm fortunate to have a husband who wants me to pursue this dream to its highest level. I know that there are folks out there who don't get me or understand what I do. To them, I can only say, watch!

We'll update this blog as we can. Big news will be shared...we promise!

A growing light...

...and it's not an oncoming train!

We found out about a program yesterday that might just be the answer we've been looking for to help manage our medical financial budget. It's the Medicaid Buy-In program and, fingers crossed, we can use it effectively to keep our budget in the black in 2009!

The Medicaid Buy-In program allows people of any age who have a disability and are working to receive Medicaid by paying a monthly premium. The monthly premium is based on earned and unearned income. One of the most important aspects for us is that each client is considered a "household of one" which means that a spouse is not penalized for assets owned by the other spouse. This also applies to income as well, so I can earn all the money I want and Keith will not lose his benefits! This is incredible news and we will be getting more details next week. This will call for a whole new level of paperwork, but it's worth it for financial sustainablity.