Social Security Disability Insurance (SSDI)
SSA SSDI, or Social Security Disability Insurance, is a government program administered by the Social Security Administration. It is one of two disability programs offered through Social Security. SSDI is often confused with Long-term and Short-term disability, which insurance policies typically offered as employment benefits or purchased individually.
Different from SSI (Supplemental Security Income), SSDI is a program designed to make an individual’s work history an asset to them. The work year is divided up into four quarters. Every quarter that you earn $1,200 and have Social Security withheld from your check, you receive one quarter of coverage.
$1,200 income per quarter = 1 quarter of coverage
With these quarters, coverage builds up over your years of work, laying the foundation for Social Security Disability Insurance. Under this program, if you become disabled through injury or illness by no fault of your own, and that injury has lasted or will last for more than 12 months, you are eligible for benefits.
If you are over the age of 30 and wish to qualify for SSDI, you are required to have worked twenty out of the last forty quarters—that’s 5 of the last 10 years.
- To qualify you need 20/40 quarters
When you have worked the required number of quarters, you obtain “insured status” and are eligible to apply for SSDI benefits. Once you obtain “insured status,” you get to keep it until you stop working and for 5 years after you stop working. If you become disabled while you have insured status, you are eligible to apply for benefits.
Disability Benefits Aren’t Available When You Start Receiving Retirement Benefits
The SSDI program does not allow anyone over retirement age to apply. When an individual reaches the age of retirement, the Social Security Administration converts disability benefits into retirement benefits. If you receive disability benefits before the age of 65, you are essentially receiving your retirement benefits early.
What benefits do you get
The amount of cash disability benefits you will receive depends on how much money you made during your working life. The more income you earned, the greater the percentage of FICA taxes Social Security withheld from your paycheck to put into the Social Security system. Essentially, disability benefits are a return on investment. You get back what you paid in.
However, cash benefits are not the only benefit received under the disability program. Through SSDI, medical benefits are also available. Once SSDI benefits have been received for 24 months, you are automatically enrolled in Medicare. Because many people lose their group health insurance benefits when they stop working, this allows them to continue receiving the medical treatment needed for their disability.