Note from the Author:  This is an article about how we, in America, can build homes for our homeless military veterans using wasted money from the Social Security Administration since it is that … “wasted money.”  We now have an estimated 40,000 to 50,000 veterans living on the streets in various cities across our country who were willing to give all for our country.  To understand fully, you must read the entire article.

My Role as Financial Advisor

During my 42 years as a financial advisor I would not only recommend good investments for my clients but I would also recommend solid risk management to protect their investments.  Part of this risk management had to do with illness and death as well as protection against frivolous law suits … but part also had to do with their inability to work and produce an income – which, for most – was their most valuable asset.

Did you know … A 35-year-old has a 50 percent chance of becoming disabled for a 90-day period or longer before age 65. About 30 percent of Americans ages 35-65 will suffer a disability lasting at least 90 days during their working careers. About one in seven people ages 35-65 can expect to become disabled for five years or longer?

Many people are living pay check to pay check so a disability of even 6 months or less could wipe them out financially … and 1 in 7 people could suffer a severe shortfall if they happen to suffer a disability lasting 5 years or longer. So, I would encourage people, especially younger people, to consider applying for long-term disability insurance to protect their most valuable asset … the “Ability to Work and Earn a Living.”

Disability Income Insurance was one of the hardest sales I would have to make and also the most important in most families.  In most families there is …

A lack of disability coverage … Some of these may shock you …

• At least 51 million working adults in the United States are without disability insurance other than the basic coverage available through Social Security.
• Only 48 percent of American adults indicate they have enough savings to cover three months of living expenses in the event they’re not earning any income.
• Almost half of American adults indicate they can’t pay an unexpected $400 bill without having to take out a loan or sell something to do so.

Chances of missing work due to illness, injury, or pregnancy are greater than most realize …

• More than one in four of today’s 20-year-olds can expect to be out of work for at least a year because of a disabling condition before they reach the normal retirement age.
• 6 percent of working Americans will experience a short-term disability (six months or less) due to illness, injury, or pregnancy on average every year. Almost all of these are non-occupational in origin.

The most common reasons for short-term disability claims are …

1. Pregnancies (25%)
2. Musculoskeletal disorders affecting the back and spine, knees, hips, shoulders, and other parts of the body (20%)
3. Digestive disorders, such as hernias and gastritis (7.8%)
4. Mental health issues including depression and anxiety (7.7%)
5. Injuries such as fractures, sprains, and strains of muscles and ligaments (7.5%)

The most common reasons for long-term disability claims are …

1. Musculoskeletal disorders (29%)
2. Cancer (15%)
3. Pregnancy (9.4%)
4. Mental health issues including depression and anxiety (9.1%)
5. Injuries such as fractures, sprains, and strains of muscles and ligaments (9%)

The consequences are alarming …

• A 2014 study of consumer bankruptcy filings identified the following as primary reasons: medical bills (26%), lost job (20%), illness or injury on part of self or family member (15%).
• A 2013 study of bankruptcy filings in Washington state found that cancer patients were 2.65 times more likely to go bankrupt than people without cancer, with younger (under age 50) cancer patients having the highest rates of bankruptcy. This is because when most people stop working all income stops.

Most of the people I would try to convince to consider Long-term or even short-term disability would through up Workers’ Compensation and Social Security to me …

Workers’ Compensation and Social Security do not cover most of these challenges.

• Workers’ Compensation only covers time away from work if the disabling illness or injury was directly work-related. In 2016, only one percent of American workers missed work because of an occupational illness or injury.
• From 2006 to 2015, only 34 percent of Social Security Disability Insurance (SSDI) claimants had their applications approved: 23% at the initial application stage and the remainder after a reconsideration or appeals process.
• It generally takes three to five months from time of application for SSDI benefits to get an initial decision. The backlog of appeals cases was more than one million in 2017, with associated processing time averaging more than 18 months.
• The average SSDI benefit as of January 2018 was $1,197 a month. That equates to $14,364 annually — barely above the poverty guideline of $12,140 for a one-person household, and below the guideline of $16,640 for a two-person household.

Source for the above information:  Disability Can Happen.org

Social Security is not the easiest thing in the world to get – maybe!  You’ll see why I say “maybe” later.

To draw Social Security Disability, you must be approved.  It does not matter that you paid for it and should get it if a doctor says you are disabled, the Social Security Administration must also agree that you are disabled.

To be disabled under the eyes of the administration you first must have worked enough quarters under the system to be fully insured.  In most cases this means that you must have paid in 40 quarters or ten years into the system.  There are some exceptions to this that I will discuss later in this article.

Where do you begin?

The first step in the process is to apply for disability.  To do this a doctor must agree that you are disabled.  You would then fill out an application with the Social Security Administration to see if you qualify.  The Administration uses what is called a blue book to determine if you have a condition that MAY qualify you.  It can take between 90 to 120 days to complete this stage of the disability claims process. Only 30 percent of Social Security Disability applications will be approved at this stage of the process.  That’s 3 in 10 applications for those who don’t know how to calculate 30%.

Remember earlier I said that most people are in dire financial situations if they miss income for three months or longer.  This is why a cash or Emergency Reserve Fund is so critical … which I will cover in another article at a later date.

Most claims are denied upon the initial review. You shouldn’t give up hope though. With the right evidence and documentation, you could have your claim approved during the initial review, though it is not likely.

There are two kinds of disability benefits, Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI). You should be aware of the differences and what is necessary to apply for each.

• SSI is a needs-based disability program. While you must provide the medical evidence to medically qualify, you must also be able to meet the income requirements as well. You will need to provide proof of household income as well as proof of the number of people in the household. Not all income is counted. You must show proof of all resources you own including cash, bank accounts, stocks and bonds, real estate, vehicles, life insurance, and personal property or anything that you own that could be converted to cash and used to pay for shelter and food. The maximum resource limits for an adult or child is $2,000 per person and $3,000 for a couple. As of 2020, the federal benefit rate for SSI is $783 monthly for an individual and $1,175 per month for a couple. Since not all income is counted, you may be able to earn more than $783 and still qualify for SSI benefits.
  • The bottom line here is that if you have any assets that provide an income … you may not qualify under SSI. And, to draw this benefit you need not only be injured or ill … but you must be close to financial destitution.
• SSDI is based on your work history. To be able to receive SSDI benefits, you must have worked enough to earn adequate credits. For most people, that would be the equivalent of having worked full-time for 5 of the last 10 years. Most people – but it can vary based on age – will need to have 40 credits with 20 of them having been earned during the last 10 years, ending in the year that you became unable to work because of your medical problems.

RECONSIDERATION

If your claim is denied during the initial review – and there is a 70% chance it will be – you will receive a denial notice.  The notice will tell you why you were denied and how long you have to make an appeal.  This appeal is called a “Request for Reconsideration” and it needs to be filed before your time runs out.  Otherwise you will have to start the claims process all over again.

Many claims are denied at this level as well and to go further you will have to request a hearing before an Administrative Law Judge.  At the hearing level before the Judge the odds of having your claim approved increases significantly.  At this level you will be questioned by a judge and there will most likely also be a vocational expert in attendance.  Sometimes a medical expert will also be asked to testify about your condition and if they believe your disability keeps you from doing your job.

At this level you will need a “DISABILITY ATTORNEY” who will prepare you for questioning and will be able to cross examine the expert witnesses for you. When a disability claim reaches this level there is about a 50 percent chance of having your claim approved.

Hearing

The Social Security Disability hearing is the second step of the appeal process. You have sixty days from the date of your denied reconsideration request to ask the SSA for a hearing. When you request a hearing, your case will be examined by an administrative law judge. This judge will review your case and can either approve your claim, send your case back for review, or deny your claim. This stage of the appeal process can take up to two years to complete. In 2009 the average completion time for this stage of the Social Security Disability appeal process was 491 days. Fortunately, 63 percent of hearing cases are decided in favor of the applicant.  However, you must be patient and have assets or income that will last during this long period of review.

If your claim is denied (and 4 in 10 are) you will then advance to the Appeals Council.

Appeals Council

If you do not agree with the judge’s decision regarding your claim for Social Security Disability benefits, you may appeal the decision with the Appeals Council. It is important to understand that fewer than 2 percent of Social Security Disability cases are won at this stage of the appeal process. The review by the Appeals Council will usually take between six months to one year to complete.

Federal District Court

If your claim is also denied by the Appeals Council, you may ask for your case to be reviewed in the Federal District Court. The Federal District Court can approve or deny your claim for Social Security Disability benefits or they may send your case back to the SSA for further review. Thirty percent of appeals are decided in favor of the applicant at this stage of the disability claims process.

Source for the above material:  Disability Benefits Center.org

Again, Social Security Disability is not easy to get.  You begin by simply trying to qualify for it.

The Top 5 Steps that Determine Whether You Qualify for Disability

#1:  Are you working while applying for Social Security Disability?

• Social Security Disability is meant specifically for those people who are unable to work. It provides payments to those who are otherwise unable to fulfill their work duties due to their disability.
• Therefore, if you are currently working and earning enough to support yourself, you will probably not qualify for disability. The SSA does not consider those who are able to work as “disabled.” This includes those who may give up a professional position to flip burgers at the local McDonalds for minimum wage.
• Though the income threshold may change from year to year, in 2020, if you earn more than $1,260 a month, you cannot qualify for disability. If you earn less than this, you may qualify under the program and can move on to the next step.

#2: How Severe Is Your Disabling Condition?

• In order to qualify for Social Security Disability, your condition must be severe enough to restrict you from working. It must “interfere with basic work-related activities,” according to the SSA.
• Disabled individuals are usually unable to work, or they are unable to complete the tasks they normally would have prior to their disability. If your condition is severe and you are unable to do your job, the Social Security Administration may label you as disabled, and you may qualify for disability.

#3: Is Your Condition Recognized by The Social Security Administration?

• You may find it a bit shocking, but the fact is, not all medical conditions qualify for disability insurance, even if they seem severe enough to you. The Social Security Administration has a Listing of Impairments resource that lists all of the major body systems that the Administration recognizes as being disabling. These are in that Blue Book I mentioned earlier.
• If your condition is listed in the SSA’s Listing of Impairments, then you can get disability benefits. You will, however, need to meet the specific requirements of the condition required by the SSA.
• For example, you may need to have the symptoms listed or the limitations of your condition outlined by your doctor.
• If your condition falls under one of the disabling conditions which automatically qualify for disability, you do not have to go on to the fourth or fifth step. For example:  Total Blindness.
• The Social Security Administration then determines if your case is a “compassionate allowance” case, in which certain cases are qualified as soon as diagnosis is confirmed or if your case is a quick disability determination case, where a computer program screens the information provided and makes a decision of its accuracy.

#4: Are You Able to Do the Work You Used to Do?

• If your condition does not fall under one of the Listing of Impairments specifically, you need to work through the final two steps to get disability benefits.
• In this case, you need to show that the condition you have is severe enough to limit your ability to work. The Social Security Administration is trying to determine if you qualify for disability insurance based on your ability to work.
• If your condition is severe enough that it interferes with your ability to do the type of work you did previously, then you can move on. If not, then you are not disabled in the eyes of the SSA.

#5: Can You Do Other Work?

• The final qualification for receiving Social Security Disability Insurance is to document your ability to do other types of work. If you are unable to do the work you used to do, the Administration wants to learn if you can do any other type of work, such as with changes made to the way you work.
• In this area, the Administration looks at a variety of factors to determine if you may qualify including:
  • Your medical condition
  • Your age
  • Your education
  • The type of past work experience you have
  • Any type of transferable skills that could follow you to a new position.
• If you are able to do other types of work, taking these things into consideration, you are not disabled. For example, the Million Dollar a year Surgeon who can no longer perform surgery due to arthritic hands … but who can run the surgical department for several hundred thousand less per year.  Or, the teacher who can no longer teach but can join the janitorial staff and help keep the school clean.

Bonus Step – Medical Vocational Allowance

• In some cases, if your medical condition does not meet the standards to receive disability benefits according to the Blue Book guidelines, you could still qualify under a medical-vocational allowance.
• The medical-vocational allowance examines whether or not you are physically and mentally able to perform the duties of your job given your condition. The Social Security Administration will take into consideration your age, education, work history and experience and your residual function capacity (RFC) to determine if the medical-vocational allowance is right for you.
• The SSA will look at your ability to perform the physical demands of a job, including the ability to sit, stand, walk, lift and carry items, reach for things or bend over. The mental demands considered include being able to read, remember, follow directions and communicate. The RFC is a measurement of the maximum amount of work you are capable of performing given the limitations of your condition. If you can sit but not stand, then you would not be considered to be disabled, but if you are found to be unable to adapt to any kind of work then you might be eligible for disability benefits under the medical-vocational allowance.

Source for the above material:  Disability Benefits Help.org

A unique Citizenship that has Special Privileges under Social Security Rules for Disability Income:

It is this last point that brings me to writing this article.  I did not realize it but Puerto Ricans are classified as United States citizens.  On March 2, 1917, the Jones–Shafroth Act was signed, collectively making Puerto Ricans United States citizens without rescinding their Puerto Rican citizenship.  Puerto Rico was a Spanish colony until the U.S. took control of the island after the Spanish-American War of 1898. In 1917, the U.S. granted citizenship to Puerto Ricans.

The Commonwealth government has its own tax laws and Puerto Ricans are also required to pay some US federal taxes, although most residents do not have to pay the federal personal income tax. … Residents also pay federal payroll taxes, such as Social Security and Medicare taxes.

While listening to the news this past week I learned that more than $7 Billion in improper payments were made by the Social Security Administration to people that did not suffer a physical or mental disability.  I started digging a little bit deeper and found that this money was going to people from Puerto Rico who could not speak English if the job required it.

Russell Thurlow Vought is an American political aide and government official who is the Acting Director of the Office of Management and Budget. … Vought was nominated by President Trump for Deputy Director of the Office of Management and Budget in April 2017.  He had an interview with the folks an NPR this past week and this is what he had to say …

“There’s about $7 billion in improper payments in the program, so we obviously want to root those out. But in general, we want to get people back to work in the labor force. Right now, the inability to speak English is a qualifying factor that allow you to get disability. We think that’s not how the program was meant to work. And so that’s an example of one of the reforms that we have within the disability program.”

When I heard this, I was shocked.  I certainly wished I’d known this back in 1976 when my wife was able to get her US Citizenship.  After all, she was a citizen who – at the time – had a real problem speaking and understanding English … though it certainly did not keep her from working.

Now NPR, being the left-winged news organization that they are, tried to make light of this.  You can read about it here … or better yet once you click on the link, just click on the 3-minute Listen button, turn up your speakers and listen to it.

Selena Simmons-Duffin may believe $7 Billion to be “Decimal Dust” when it comes to the overall amount being paid out by Social Security … but I say if that money is saved and placed where it is really needed it would build 70,000 homes at a value of $100,000 each to help house our military veterans who are now living on the streets (According to the U.S. Department of Housing and Urban Development, there were 40,056 homeless veterans living in the U.S. in a single night in January 2017, which was a little more than nine percent of all homeless adults.)  Now I will admit that $100,000 would not be much of a home in some states and a palace in others … but it would get our veterans in and out of the weather allowing them to prepare themselves better for the job market.

I personally would much rather see that money being spent on the homeless veterans and real disabled people than to see it spent on people that are simply too lazy to learn the language of this country.  I mean the facts are simple … if you or I chose to leave a country we love to live and work in Spain, France or Italy or even Saudi Arabia … we would learn the languages of those countries.  Why do we pay Puerto Rican’s or others who can’t and won’t learn English?  That’s not solving any problems … it is only adding to them.

I’d love to hear your thoughts on the subject!

Thanks for reading …

Jerry Nix | Freewavemaker, LLC