The Miriam Example

Read Miriam’s story to learn about her financial situation, and to see what services and resources may be helpful for her.

Two years ago, when she was 25, Miriam had a serious fall that left her with a traumatic brain injury. She and her husband were forced to sell their home and move into a two-bedroom apartment located near her rehabilitation program. 

Miriam is now able to work part-time at a local supermarket that is walking distance from her apartment. However, she still needs regular appointments with an occupational therapist to learn how to work through personality and behavioral changes connected to her brain injury. Her co-pay is $180/month for this service. 

Knowing that she needs to retain these services, Miriam is careful to keep her earnings below $1,350 per month so that she can keep her Social Security Disability Insurance, or SSDI, benefits. She receives $800 per month in SSDI. Her total income is less than $2,150 per month, or less than $25,800 per year.

A benefits planner at her local VR agency explained to Miriam the impact of part-time earnings on her SSDI. After a 9-month “trial work period” (during which she keeps her SSDI regardless of how high her earnings are), she needs to keep her earnings below “substantial gainful activity (SGA)” in order to keep SSDI.

Earnings of $1,170/month or more may be counted as SGA, but Social Security subtracts impairment-related work expenses, or IRWEs (disability-related expenses that Miriam pays for in order to work), from her earnings. Miriam pays $180/month in IRWEs for therapy co-pays, so she can earn almost $1,350/month gross wages ($1,170 SGA + $180 IRWEs) and still keep SSDI. 

After working for a year at her part-time position, Miriam would like to work full-time. She wants to contribute more financially so that she and her husband are able to purchase a home. She knows she will lose her SSDI benefits after she begins working full-time, but that did not prevent her from applying for a job as an assistant manager at a retail outlet. 

Miriam’s Options: Work Part-Time or Full-Time?

With the new position, she would earn $17 per hour and gross an average of $2,947 each month. Miriam’s annual salary would be $35,364 per year. She was concerned about how these financial changes would affect her SSDI and medical coverage, so she met with a benefits planner again.

Her benefits planner explained that full-time earnings would be above SGA, so Miriam would keep her SSDI payments for three more months (a grace period), and then they would stop.

However, if her earnings should fall below SGA (or if she should stop working) less than three years after her trial work period ended, she can get SSDI back without having to reapply. She can also keep her Medicare for years after her SSDI has stopped. 

Finally, Miriam can enroll in her state’s Medicaid Buy-In program. This work incentive qualifies her for Medicaid while she works, and has much higher financial limits than other forms of Medicaid.  

Medicaid will cover some of the out-of-pocket costs Miriam pays for Medicare. She will pay a monthly premium for Medicaid, but she and the benefits planner determine that she will save more on medical costs than she will pay in premiums. 

Miriam saw that her net income working full-time, even without SSDI, would be substantially higher than working part-time while keeping SSDI. Although she and her husband would pay $298/month more in income taxes if she worked full-time than they do now, the couple’s net income would still be $499/month higher. She also liked the idea that she would no longer have to limit her earnings to protect her SSDI.

Miriam was hired as assistant manager, and enrolled in the Medicaid Buy-In program. Thanks to the high asset limit for the Medicaid Buy-In, she has been able to save money toward the down payment on a new home without losing Medicaid.

The benefits planner told Miriam about a way she can save even more than the asset limit for the Medicaid Buy-In: an ABLE account. This is an investment account that enables a person who became disabled before age 26 to save large amounts of money (typically, over $200,000, depending on the state) without the account funds counting against the Medicaid asset limit. 

Miriam opened an ABLE account and has saved even more toward the down payment. She and her husband are hoping to buy a house in the coming year.

 

 

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