Proposed Law: Social Security

Changes to the Supplemental Social Security Income Benefits Program: The Supplemental Security Income Program (Title XVI of the Social Security Act), is designed to provide supplemental income to those who are 65 years or older, blind, or disabled and who meet certain financial requirements.  On March 6, 2014 Senator Sherrod Brown (D- Ohio) introduced a bill (S. 2089: “Supplemental Security Income Restoration Act of 2014”), co-sponsored by Senator Elizabeth Warren (D- Massachusetts), which proposes amendments to Supplemental Security Income Program in order to update its eligibility requirements.  On March 6, 2014 the bill was read across and referred to the Senate Committee on Finance.

The proposed changes would amend 42 U.S.C. §1382a(b)(2)(A) to increase the annual income exclusion to the first $1,320.00.  The amendments would also include an increase in the earned income exclusion found in 42 U.S.C. §1382a(b)(4) to $4,284.00 and an increase in the resource limits imposed by 42 U.S.C. §1382(a)(3) to $15,000.00 through calendar year 2015 (subject to increase) for persons with a qualified spouse, and $10,000.00 (subject to increase) for those without a qualified spouse.   The bill, if enacted as currently drafted, would also subject qualified income and other financial prerequisites to an inflation adjustment by inserting such a provision and a method of calculation into 42 U.S.C. §§1382 and 1382a.  The proposed legislation would also exclude support and maintenance furnished in kind from the calculation of unearned income found in 42 U.S.C. §1382a(a)(2)(A)(i) and elsewhere throughout Title XVI of the Social Security Act.

Perhaps the most significant change proposed is the repeal of the penalty imposed for the disposal of assets for less than fair market value found in 42 U.S.C. §1382b(c).  This would effectively eliminate the 4 year look back period and any associated penalties for pre-application dispositions of assets.   The proposed Amendment would supplant within the statute, in place of the section occupied by the penalty, a mandatory warning that must be provided to certain individuals at the time of application for the Supplemental Social Security Income Program; the warning would state that dispositions formerly subject to the penalty may still affect the individuals’ qualification for Medicaid. The proposed effective date of  S. 2089 is January 1, 2015.  The legislation is still in its early stages, yet, if enacted, it would bring about substantial changes to the Supplemental Security Income Program.

Michael Malone, J.D., LL.M.
Research, Drafting, and Quality Control Law Clerk:
Marquardt Law Firm, P.C.

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