Like millions of other Americans, recipients of Medicaid and Supplemental Security Income (SSI) have received or should soon receive a one-time $1,200 coronavirus relief payments from the federal government. And, if Congress can come to an agreement, a second round of economic impact payments will be coming. (If you haven’t received your payment and did not file a 2019 tax return, click here to access the IRS’s page for non-filers.)
Although this money does not immediately affect eligibility for means-tested programs like Medicaid and SSI, if the money is not spent within 12 months it will count as an asset and could affect eligibility.
One solution is to put the funds in an Achieving a Better Life Experience (ABLE) account, where it can remain without affecting eligibility for programs like Medicaid and SSI. Authorized by Congress in 2014, ABLE accounts are a tax-advantaged way to put money aside for dependents with disabilities. Funds in the accounts can be spent on a wide range of disability-related expenses without compromising eligibility for government benefits. Unlike a special needs trust, an ABLE account can be managed and controlled by the beneficiary.
Not everyone with a disability can qualify for an ABLE account, however. Eligibility is limited to people who developed their disability before age 26. Also, total contributions to ABLE accounts are limited to $15,000 per year, although beneficiaries who work can make ABLE contributions above the $15,000 annual cap from their own income up to the Federal Poverty Level. If the value of the account exceeds $100,000, any SSI income is suspended until the account dips below that limit. These savings plans may be used for a broad array of products and services related to the eligible individual’s disability.
For help opening or investing in an ABLE account, please give us a call.
Despite being more than 500 pages long, the Coronavirus Aid, Relief, and Economic Security (CARES) Act contains little relief specifically targeted to support people with disabilities, disability advocates assert. And one provision in the bill could actually jeopardize the rights of special education students during the pandemic.
“This is an unprecedented crisis for everyone, and everyone includes people with disabilities and their families,” Peter Berns, CEO of The Arc, said in a statement. “While this bill does provide some important support in this pandemic, there are huge risks facing people with disabilities, their families, and the direct support professional workforce that were largely ignored in this response.”
On the plus side, the $2.2 trillion stimulus bill entitles most low- to moderate-income people to a one-time $1,200 stimulus payment, including Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) recipients (although SSI recipients may have difficulty getting their checks). Unemployment insurance has also been expanded significantly and businesses will be eligible to apply for loans incentivizing them to avoid firing workers.
However, despite extensive advocacy from disability rights groups, the bill includes no new money for Medicaid-funded home and community based services. These programs are critical to keep the elderly and disabled from having to enter institutions like nursing homes, which continue to be a primary source of COVID-19 outbreaks.
Disability advocates, however, did receive a key temporary victory with a funding extension through November for the Money Follows the Person program, the federal government’s largest grant program for helping states transfer people with disabilities from institutions into independent living arrangements.
The Department of Housing and Urban Development (HUD) has also received $12 billion in funding that could potentially assist people with disabilities, many of whom live in units subsidized by HUD, such as Section 8 housing. Landlords participating in these programs were ordered to suspend evictions.
The special education community has particular concerns as well. Under the bill, Department of Education Secretary Betsy DeVos has 30 days to submit recommendations to Congress to waive certain requirements under the Individuals with Disabilities Education Act (IDEA) during the COVID-19 pandemic. This law, passed in 1975, affords nearly seven million students the right to individualized instruction and other support services. With schools shifting instruction online during the pandemic, DeVos could relieve school districts of their obligation to meet the special education needs of students with disabilities. However, unlike the case with earlier versions of the bill, DeVos would need to obtain congressional approval before issuing any such waivers, which would be unprecedented in the IDEA’s 45-year history.
Click here to read the full bill.