One of the biggest misconceptions we address as financial advisors to neurodivergent clients is that people with disabling conditions cannot work and receive government benefits and supports. Not only that but that government is trying to make sure that you don’t work if you have a disability. While the rules can be obnoxiously complicated, the truth is that people with disabilities can work while receiving disability benefits, including Social Security and Medicaid. While the programs are intimidating, they are structured to support and encourage employment.
All the neurodiversity hiring programs are designed to get people into jobs that they can be successful in. The best programs create a culture of inclusion that enable all people to bring their whole selves to the workplace and feel that there will be support when needed to get the job done. One of the biggest challenges to these programs being successful is finding people who are willing to take the job, because they are still afraid that they will be giving up on their benefits. As a disability aware financial planner, the greatest advocacy I can do is to educate my clients and their families understand their opportunities better.
Social Security Employment
For a very brief high-level review, Social Security has two main programs for people with disabilities. Supplemental Security Income (SSI) limits both assets and income. SSI is the baseline for cash benefits provided to a disabled individual. Social Security Disability Insurance (SSDI) is a benefit that a worker pays to earn for themselves or their children through employment taxes. SSI income can decrease when countable income exists by $1 for every $2 counted. SSDI is not reduced but stops when someone earns above the Substantial Gainful Activity (SGA) amount ($1,470 a month starting in January 2023). Notably, if someone has successfully worked above SGA for longer than 6 months, they will not be eligible for a benefit based on their parent’s work record (the Disabled Adult Child benefit) and will have to rely on their own work history to produce their SSDI benefits.
As part of both programs, earned income can be uncountable for a few reasons. First, if the employed person is a full-time student, income is excluded up to $2,220 a month but not more than $8,950 for 2023. In many cases, a full-time student’s full income can be excluded from their Social Security benefits, especially if they are working limited hours. When the student leaves their full-time program, they must consider if the long-term benefits of independent employment outweigh the support of their SSI or SSDI income.
Impairment Related Work Expenses (IRWEs) are another way a working person receiving SSI or SSDI can exclude income when expenses related to their disability enables them to participate in their own employment. Notably, if someone is self-employed and working less than 40 hours a month, all their business expenses are discounted from income in this way. Someone is not under guardianship can own a business to allow individuals greater control their income.
Beyond IRWEs, there are also work subsidy programs within Social Security regulations that enables someone paid the same as their peers without disabilities to discount some earnings if they do less work than their peers.
The Social Security Administration encourages people to work towards greater independence because employment reduces a reliance on the Social Security system. This increases the amount available for SSA to give to the most vulnerable people who are unable to work at all and brings more income into the SSDI program through payroll taxes. SSA counselors can be available to share with individuals how long benefits will last and any programs they can take advantage of to make them stretch into any competitive work attempt.
To many, Social Security is not the lifeline that matters most when considering employment. Medical insurance and access to Medicaid supports are often the most vital benefits. In many states, Medicaid has low asset limits and low-income limits. However, most states also have disabled worker programs to enable someone who is earning money beyond the traditional limits to still be eligible for the benefits of community supports and medical insurance. An individual is not automatically enrolled in the Medicaid program for disabled workers. The employed individual must actively apply and be accepted into the program to have the continued benefit of health care and waiver supports.
Some states are doing away with strict Medicaid asset and income caps. While there is no clear momentum here, advocates should look to their neighbors to see if it makes more sense for them to stay restricted by tight income and asset rules or to move to a state that can offer them more opportunities. The studies of Medicaid expansion programing are finding that fewer people with chronic conditions are delaying health care overall,1 which can leave to fewer costs for individual and the state’s program. Beyond health care, Medicaid programs for community support and inclusion are very often the reason to keep Medicaid well into a working adult’s life. Advocates should become aware of their own state’s Medicaid legislation around work with a disability and if there is any legislation to encourage greater participation in meaningful work.
Saving While Working
If an individual is eligible to use an ABLE account (has a disability that has a documented start prior to age 26 regardless of when diagnosed), the ABLE to Work Act of the Tax Cuts and Jobs Act of 2017 gave working adults with disabilities the ability to contribute up to an additional $12,880 to their ABLE savings account if they earned that much. This ABLE to Work contribution is over and above the annual contribution limits of an ABLE account. This Act primarily benefits people who would have contributed the full amount to their ABLE account in a year through gifts or contributions of their own from their SSDI or other income (i.e., rental income, settlement, inheritance up to limit). Saving into an ABLE account allows someone who is on an asset protected program to continue using money as needed vs requiring a spend down to a low asset cap.
Asset caps are being reviewed by legislators, including the long standing $2,000 asset cap for SSI. Advocates are pushing for the higher asset cap of $10,000 to allow more flexibility. While we advocate for the federal laws to change for SSI, that doesn’t mean that the Medicaid programs will change at the same time, and the Medicaid programs are the most in need of protection. Individuals with disabilities will always need to be mindful of the interaction between different programs they are using and be aware of the most important programs for them to be as independent as possible. We recommend an ABLE account over a special needs trust of any kind because the person would be able to manage their own account or with assistance.
Benefits of Work (Summary)
The benefits of work are not just an income, but connection to a broader range of experiences and communities. Work allows people to invest in a purpose. How much someone works is highly dependent on their personal goals and personal needs, but some work may be better than being afraid to work at all.
McInerney M, McCormack G, Mellor JM, Sabik LM. Association of Medicaid Expansion with Medicaid Enrollment and Health Care Use Among Older Adults with Low Income and Chronic Condition Limitations. JAMA Health Forum. 2022;3(6):e221373. doi:10.1001/jamahealthforum.2022.1373