I regularly get phone calls or emails from potential clients who tell me that they “want to apply for SSI.”  In some respects “filing for SSI” has become a shorthand phrase for someone who wants to file for disability, but, in truth, there is a huge difference between SSI and SSDI.

SSDI stands for “Social Security Disability Insurance” and refers to benefits payable to claimants who have enough credit hours to be considered “insured” for disability.  The monthly payment is a function of what you have paid in to the system.  In my practice the average SSDI monthly payment is around $1,50o.

SSI stands for “Supplemental Security Income” and refers to welfare benefits payable to claimants who do not have enough credits to be insured for disability.  The maximum monthly payment is set out in the law – and for 2011 is $674 per month for an individual.

Last week, for example, I received a long email from a concerned woman who was writing on behalf of her father.   Apparently, her father had worked at a very physical job for over 20 years before suffering a stroke in 2002.   This gentleman filed for Social Security disability in 2002 and was denied at a hearing, which I will assume was held at some point in 2003.

After being denied, this gentleman did not file anything else.  He remained at home, unable to work because of the ongoing complications from the stroke as well as depression and anxiety.

In 2009, the gentleman filed a second application.  In May, 2011, he appeared at a hearing and in July a “fully favorable” decision was issued.

But, the daughter notes:

there is still one little problem. For the past two years we thought we were fighting for SSDI and apparently we weren’t. I remember early on getting a letter stating that he was denied social security disability. But when we wrote to appeal, that is what I thought we were appealing. A few weeks after receiving the judge’s decision we realized that he did not get SSDI but SSI instead. I was in utter shock I had no clue there was a difference between the two and I truly thought my father would get his full disability benefits but this is not the case. I had no knowledge that social security only looks at the past ten years, and that the applicant must have worked five of those last ten years.

What happened here is this:  when the father stopped working in 2002, he was “insured” or covered for SSDI until about 2007.  Why?  SSDI looks at your earnings during the ten year prior prior to your “onset date.”  In order to collect under SSDI, you need to show that you have worked and earned credits for at least 20 out of the past 40 quarters.  There are four (4) quarters in a year, so 20 out of 40 is equal to five out of the past 10 years.  If you have earned full credits for ten out of ten years, your insured status will carry forward for approximately five years.  The requirements are a little different for younger workers, but the principle is the same.

Generally, to earn a credit, you need to show around $1,000 of earnings for that quarter.  So, if you show around $4,000 of earnings for a calendar year, you get all 4 credits for that year.

When the father reapplied in 2009, he should have alleged an onset date prior to his date last insured.  In this case, he could have alleged an onset date anytime after the date of the 2003 hearing denial, but before his insurability ran out in 2007.

My guess is that when he applied in 2009, the intake person at the Social Security Administration used the date of his application as the onset date.   No one ever thought to amend (change) this onset date.  It is also possible that the intake person only processed an SSI application because her computer showed that the father did not currently have credits.

In her email, the daughter does not say if her father had a lawyer appear with him at his hearing.   Assuming that the evidence supported an onset of disability back to 2004 or 2005, that lawyer should have requested an amended onset date back to the earliest possible date.

Of course, the attorney may have made this request but the judge could have denied it on the grounds that the evidence did not support an onset prior to 2009.

SSI pays claimants around $674 per month, and may reduce that amount if the claimant receives support – including room and board – from family, friends or welfare.  SSDI, by contrast, pays a monthly benefit based on the claimant’s past earnings.  Often SSDI payments can be $1,500 to $2,000 per month and there are no household support offsets.

Here, the best advice I could give the daughter and her father would be to speak to a Social Security lawyer about filing an appeal to the favorable decision.  The basis of the appeal would be that the judge used an onset date that was too late – it should have been earlier.   The father will also have to argue that the SSA intake person erred in not taking an SSDI application.  The attorney may have to argue that the father did not have the capacity to understand the difference and thus should not suffer because of his lack of capacity or knowledge.

You can probably sense that the father has an uphill battle.  It would have been a lot easier to deal with this issue prior to the 2011 hearing.  I hope it is not too late for the father to undo what should have been done several years ago.