You are currently viewing Exciting Benefit Updates Are In the Works

Exciting Benefit Updates Are In the Works

Cheeseburger inflation is making me mad. If you know me, you know I love a good cheeseburger. Actually, I love almost any cheeseburger. Don’t tell my cardiologist and keep it between us. And pass the ketchup.

At a restaurant in Denver, the cheeseburger that cost $11 in 2018 now costs $16. From what I can tell, it’s pretty much the same cheeseburger. I don’t think there’s a conspiracy to keep me from eating them; it’s just the grinding gears of inflation at work.

Over time, inflation drives prices higher. We like the increase we get in home and investment prices and can’t stand it when it impacts food, clothing and costs of daily living.

One place inflation has not kept up is the resource cap needed to qualify for Supplemental Security Income (SSI). People receiving SSI cannot have more than $2,000 and maintain the benefit. It’s possible that by losing SSI, people will also be removed from Medicaid and stop having medical, housing, food and community benefits. It’s been the same resource limit for more than 50 years.

As a special-needs planner, I spend a lot of time talking about strategies to keep people with disabilities from having money so they can keep their SSI payments. Frankly, it’s a tragedy that we spend so much time and energy to impoverish people who frequently cannot work and depend on benefit programs.

Fortunately, changes might be coming at the national level and at least one state has made it easier to receive Medicaid-funded services.

Bipartisan legislation recently reintroduced in the House of Representatives aims to modernize a number of outdated rules regarding SSI eligibility.

The federal government enacted SSI in 1972, and yet many of the regulations outlined at that time have seen minimal to no updates since. We’d all love to pay the same for cheeseburgers, cars and sneakers as we (or our parents or grandparents) paid in 1972. And while all of that has gotten more expensive, the SSI resource limit has been the same the entire time at $2,000.

The Supplemental Security Income Restoration Act proposes several revisions to boost support for the millions of low-income seniors and people with disabilities who rely on SSI cash assistance. The proposed changes include the following:

  • Raising the $2,000 resource limit, allowing individuals to have savings of up to $10,000 without jeopardizing their SSI benefits. (Couples would be able to save up to $20,000, rather than just $3,000.)
  • Eliminating the marriage penalty so that married couples would not experience a reduction in their monthly SSI income. In 2024, an individual can receive $943 in SSI and couples receive $1,415 (some states offer more). Adults with qualifying disabilities frequently do not marry to preserve the higher benefits.
  • Increasing the SSI benefit level by more than 30 percent to be at least 100 percent of the current federal poverty level.
  • Doing away with the transfer penalty. Currently, SSI recipients cannot transfer ownership of resources without potentially facing a period of ineligibility.
  • Ending the provision that counts in-kind support and maintenance as income and that often results in a reduction in benefits.

This is great news – not enough relief but at least some recognition that current rules enforce poverty and create planning stress.

California already lifted the resource test for qualification for their version of Medicaid benefits. Unfortunately, individuals with disabilities will have to decide whether to continue with the Federal resource tests to keep SSI or give them up in favor of more relaxed State rules. The monthly income of $943 will likely mean most people keep to the Federal guidelines but at least there’s choice.

Current rules enforce poverty for people with disabilities and I hope the proposed updates are the first of many to help our family members enjoy better quality lives without the fear of losing their access to housing, health care, food and friends.

Personally, I am stuck. There’s no way I will stop eating cheeseburgers but I make choices and I can cut costs in other ways. For people with qualifying disabilities, they do not have the same flexibility and the changes to benefits are needed. The ones in the new act are not enough but they are a beginning. In the meantime, did anyone see my fries?

This article is not intended as investment advice or representative of any specific investment strategy. Consult with your legal, tax and investment team before taking any action.