As the first part of this article discussed, an unexpected illness or injury that leaves you disabled can be devastating both personally and financially. If you're unable to continue working in your previous job, it can be extremely challenging to deal with the partial or total loss of income that may result. It's important to know what financial resources are available to help you adjust to new circumstances.
While private disability insurance offers much-needed replacement income to disabled people, there are other programs administered by state and federal government agencies that offer additional services and funding to the disabled. In addition to replacement income, these programs offer medical care, job training, and assurance that employers will treat you fairly and in accordance with laws protecting disabled workers.
SSI and SSDI
The Social Security Administration has two programs that provide benefits to disabled people. The first, Social Security Disability Insurance or SSDI, is available to anyone who meets the eligibility requirements related to work history. In order to qualify for SSDI, you need to have earned enough money over the course of your career to have collected 40 credits. Most workers earn four credits per year, so the requirement generally involves having worked for at least 10 years. However, if you become disabled at an earlier age, then the number of credits needed is reduced.
Applying for SSDI involves a long process that can take several months before you find out whether or not your claim is approved. Once you're approved, you'll start receiving benefits six months after the date you were disabled. The amount you receive depends on your work history and is determined using the same type of calculation that Social Security uses to determine the benefits you'll receive when you retire. From time to time, your case will be reviewed to verify that you remain disabled; if you are able to work and earn more than a certain limit, then your benefits may stop.
The other program, Supplemental Security Income or SSI, provides assistance to disabled people with little or no income or other financial resources. The application process is somewhat similar to that for SSDI, although the necessary documentation differs because of the different requirements of each program. The maximum benefit changes from year to year; during 2006, the maximum monthly benefit was $603 for an individual and $904 for a couple. In some cases, state governments add an additional benefit.
Medicare and Medicaid
In addition to financial support, disabled people may also qualify for federal or state health benefits under Medicare or Medicaid. Although Medicare generally covers people over 65, it also provides coverage for younger people with certain types of disabilities. In particular, if you qualify for Social Security disability benefits for at least 24 months, then you may be eligible for Medicare even if you're not yet 65.
Medicaid, on the other hand, provides benefits only to people with little or no income or other financial resources. In general, people who are eligible for SSI benefits are also likely to qualify for Medicaid.
Along with financial and medical assistance, there are a number of laws designed to make it easier for disabled people to find jobs and to remain employed. The best-known of these laws is the Americans with Disabilities Act, or ADA, which includes a number of provisions designed to protect disabled people from discrimination. In general, the ADA prevents employers from basing hiring decisions on whether or not a person is disabled. If a disabled person would be able to perform the essential functions of a particular job, then employers must make any reasonable accommodation necessary for the person to perform those functions. For instance, if a disabled person needs special work equipment, the employer must provide it, unless doing so would place an undue hardship on the employer.
People who suffer a disabling illness or injury face a huge challenge in adjusting their lives to their changed condition. However, there is help available for disabled people, both in dealing with the financial aspects of their disability and the social and emotional ramifications of being disabled. Although it isn't always easy, people who become disabled can make a smooth transition back to being financially and physically self-sufficient.
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Fool contributor Dan Caplinger has worked with disabled clients across the income spectrum. He doesn't own shares of the companies mentioned in this article. The Fool's disclosure policy won't hit you when you're down.