Learn About Working While Exploring Disability Options

Understanding Work Incentives for People With Disabilities

Many people with disabilities want to work but worry about losing benefits like Social Security or Medicaid. The truth is that several work incentives exist to help people balance employment with benefit programs. These incentives are built into federal law and managed through Social Security and state vocational rehabilitation agencies. Understanding these programs can help you make informed decisions about working while receiving benefits.

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Work incentives differ from regular benefit rules. Normally, earning money reduces or stops your benefits. Work incentives change this by allowing you to keep some or all of your benefits while you work. For example, under a program called Impairment Related Work Expenses (IRWE), certain costs related to your disability can reduce your countable income. This means if you spend money on disability-related work needs—like special equipment, medical devices, or transportation to work—those costs may not count against your earnings limit.

Another key incentive is called Plan to Achieve Self-Support (PASS). This program lets you set aside income and resources for a specific work goal. If you want to become a web designer but need to save money for training, a PASS plan can help you save that money without it counting against your benefits. You create a written plan, and the money you set aside doesn't reduce your benefits during the plan period.

Student Earned Income Exclusion is a third incentive for people under age 22 who are still in school. If you work while attending school, a portion of your earnings may not count toward your benefit limits. This encourages younger people with disabilities to develop work skills and education simultaneously.

The Trial Work Period is another significant incentive. If you receive Social Security Disability Insurance (SSDI), you can work for nine months without it affecting your benefits at all. During these nine months, you earn your full paycheck and keep your full benefits, no matter how much you earn. This gives you a risk-free period to test whether work is realistic for you.

Practical takeaway: Before starting any job, contact your local Social Security office or a benefits planning service to learn which work incentives you might use. Having a plan reduces the risk of unexpected benefit loss.

How the Trial Work Period Actually Works

The Trial Work Period is one of the most valuable tools for people with SSDI who want to test employment. It lasts for nine months within a rolling 60-month period. During these nine months, you can work any number of hours and earn any amount of money. Your SSDI check continues at full amount, and you keep your Medicare coverage. This period exists specifically to let you find out whether you can sustain work without risking your financial security.

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A trial work month counts when you earn $940 or more in a single calendar month (as of 2024; this amount changes yearly). You don't need to work every single month during your trial period—you can space out your nine trial months over 60 months. For instance, you might use three trial months in year one, skip several months, then use the remaining six trial months in year three. This flexibility lets you experiment with different types of work or adjust your approach based on experience.

After your nine trial work months end, you enter an Extended Eligibility Period lasting 36 months. During this time, you still keep your Medicare coverage, but your benefits now depend on how much you earn. If you exceed your earnings limit (about $1,550 per month in 2024), you lose benefits for that month. However, your benefits don't stop permanently—they pause and restart when your earnings drop below the limit again.

Here's a real example: Jordan has SSDI and hasn't worked in three years due to bipolar disorder. He starts a part-time job earning $1,200 per month. For his first nine months of trial work, he gets his full $1,300 SSDI check plus his $1,200 paycheck—$2,500 total. After nine months, he enters Extended Eligibility. Now if he continues earning $1,200, he exceeds the limit and loses his SSDI for months when he earned over the threshold. But if his employer cuts his hours and he earns $900 that month, his SSDI check comes back. His Medicare continues throughout.

Understanding the timeline matters because many people don't realize their trial period has ended and suddenly lose benefits. The Social Security Administration sends notices, but these can be confusing. Some people benefit from working with a benefits planner—a professional who tracks your trial months and helps you understand transitions.

Practical takeaway: Write down the dates your trial work months occur. Track which months you earned over $940. Know that ending your nine months doesn't mean you must stop working—it just means the benefit structure changes. Plan for this transition in advance.

Medicaid Buy-In Programs and Healthcare Continuation

One major fear people with disabilities express about working is losing Medicaid. Many people depend on Medicaid to afford prescriptions, therapy, doctor visits, and medical equipment. Medicaid Buy-In (also called Medicaid for Workers with Disabilities) programs exist in most states specifically to address this fear. These programs let you keep Medicaid while working, even if your income exceeds normal Medicaid limits.

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How it works: You pay a premium or contribution amount, usually small, to keep your Medicaid. The amount depends on your income and state rules. Some states base the premium on income percentage; others charge flat fees. In many cases, the premium is far less than private insurance would cost. You're essentially "buying into" the program by contributing, which is why it's called a Buy-In.

Eligibility requirements for Medicaid Buy-In vary by state, but common criteria include: having a disability recognized by Social Security or another recognized process; living in a state with a Buy-In program; earning under a certain amount (usually $75,000 per year, but state limits differ); and having worked for a minimum period. Because rules differ significantly by state, the information you need is specific to where you live.

Let's look at an example: Marcus lives in a state with a Medicaid Buy-In program. He has cerebral palsy and receives SSI, which includes automatic Medicaid. He gets a job earning $2,000 per month. Normally, this income would eliminate his Medicaid. But through the Buy-In program, he continues Medicaid by paying $75 per month from his wages. This $75 is far cheaper than private insurance, and it covers his physical therapy and medications.

Another option to know about: Medicaid Section 1619(b). If you lose SSI due to work income but still have a disability, you may continue Medicaid under Section 1619(b). You must meet the original disability criteria, and your income must fall between the SSI limit and a higher threshold set by your state. This provision acts as a bridge—you're not disabled enough to get SSI anymore based on income, but you're still disabled and need healthcare coverage.

Medicare, which covers people on SSDI, works differently. You get four years and nine months of Medicare coverage during your Extended Eligibility Period after SSDI ends, regardless of earnings. This gives people time to find other healthcare coverage options or potentially return to benefits.

Practical takeaway: Before starting work, contact your state Medicaid office to learn whether a Buy-In program exists in your state and what it costs. Compare this cost against private insurance. Many people find Buy-In programs make employment financially feasible.

Impairment Related Work Expenses and Plan to Achieve Self-Support

Impairment Related Work Expenses (IRWE) and Plan to Achieve Self-Support (PASS) are two sophisticated work incentives that reduce the income counted against your benefits. They're particularly valuable for people pursuing better employment or job training.

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IRWE lets you deduct certain disability-related work costs from your gross income before Social Security counts it toward your benefit limit. The key word is "impairment related"—the expense must be necessary because of your disability and necessary for you to work. Examples include: specialized equipment like a custom orthotic device; personal assistance services such as a job coach or reader at work; transportation costs specifically needed because of your disability; medications needed to enable work; therapy sessions required to maintain work capacity; and accessibility modifications to your workplace.

To use IRWE, you itemize these expenses, document them, and report them to Social Security. You need to show that without this expense, you couldn