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Wills, Trusts, Estates

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Income Assistance

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Income Assistance

This is by no means an exhaustive summary of social programs available, but only a few that sometimes have legal implications. Please contact your local Area Agency on Aging for more information, and see the resources included in this article and listed below.

Basically there are two ways to enlarge the spending power of older persons: by increasing the amount coming in, and by decreasing the amount going out. Here are some ways of doing each:

    Increasing Income
    • Working - Community Programs
    • Supplemental Security Income
    • Veterans Benefits
    Decreasing expenses
    • QMB, SLMB, QI-1 (paying Part B premiums)
    • Food Stamps, Senior Rx, Help with Utilities
    • Caregiver Assistance
    • Rethinking Investment Strategies
    • Avoiding Unnecessary Expenditures

Increasing Income

Working. Many retirees have looked forward to the day when they could retire only to find that either they are bored or they cannot manage on their retirement incomes, or both. There are many businesses glad to have older part-time employees who will work flexible hours and bring experience and good judgment to their jobs. A few may offer insurance benefits.

There are also jobs available through the State Community Services Employment Program for low income residents 55 or over. They pay no less than minimum wage and offer various kinds of employment for up to twenty hours a week. Some offer transition into unsubsidized or private sector employment. Contact the local Area Agency on Aging or on the web, go to www.adss.state.al.us/senioremployment Either type of employment offers increased income while providing mental, physical and social stimulation.

Supplemental Security Income (“SSI”). A major resource for lower-income seniors is Supplemental Security Income, or SSI. In order to receive SSI an applicant must be disabled and have limited income and assets. Unlike Social Security Disability Insurance (SSDI) which is a program to which workers contribute during their work years, SSI is a form of public assistance. It provides income assistance to the “aged, blind and disabled” of any age. Those 65 or older automatically meet the “aged” test.

Disability is defined as being “unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period not less than twelve months.” [42 U.S.C. § 1382c (a)(3)(A).] Inability to work is affected by age, education and work experience. It is more likely that a 62-year-old with a significant chronic illness or impairment would qualify than a 25-year-old with a similar health problem, especially if the situation were complicated by limited education and experience.

One major advantage to qualifying for SSI is that SSI recipients are automatically qualified for Medicaid assistance. A person who receives only $350 in Social Security benefits and who also qualifies for SSI will usually receive medical care without co-payments and deductibles and and will receive substantial assistance with prescription drug coverage, and costs of prescribed drugs.

In 2009 an individual SSI applicant may have no more than $674 (plus an additional $20 a month that is not counted, or a total of $694) in income and no more than $2,000 in cash resources. The residence, a vehicle worth no more than $4,500, and burial plots and burial or life insurance up to $1,500 do not count against the resource limit. A couple may have a combined income of no more than $1,011 (+$20, for a total of $1,031) and resources of no more than $3,000, with the same exemptions. Food stamps, energy and public housing assistance are not counted as income. Working individuals have slightly higher limits.

Some contributions from others count as income, whether cash or “in-kind”. If an elderly person lives with an adult who is not a spouse, and does not pay rent, or pays only a token, the applicant's SSI benefit may be reduced by about one-third. A portion of the income of a spouse who is not SSI-eligible may be attributed to the SSI applicant. On the other hand, a third party may pay an SSI beneficiary's medical bills or utility bills without being counted as income.

SSI applications are made at the Social Security district offices and can now be made online. Applicants should be prepared to document income, assets and current expenses. There is information online at www.ssa.gov.

Veterans Benefits. Veterans and surviving spouses of veterans should contact the VA representative in their areas to see if they are eligible for any of the array of benefits the VA provides for veterans and survivors with limited incomes. In addition to pensions and survivor income benefits, homebound beneficiaries may be able to qualify for aid and assistance payments to help them stay in their homes. Other health care assistance may be available as well. Every county has a representative who is either located at the courthouse or makes regular visits there.

Decreasing Expenses

QMB, SLMB and QI-1. Seniors on Social Security and whose incomes are limited but who do not qualify for SSI, may qualify for assistance with their Part B Medicare premiums. An important factor is that, at this time, in Alabama, assets are not counted and in most cases income from assets is disregarded. Note that the income limits change each year.

QMB. In 2009, individuals with monthly retirement incomes up to $923 and couples with combined retirement incomes up to $1,235 may qualify as “Qualified Medicare Beneficiaries”. For those who qualify Medicaid not only pays the monthly Part B premium, now $96.40 (for individuals with incomes under $85,000 and couples under $170,000), but also pays all co- payments and deductibles. It does not pay for medicine, but it is an excellent benefit.

SLMB. In 2009, individuals with incomes up to $1,103 and couples with incomes up to $ 1,477 may qualify as “Special Limited Medicare Beneficiaries”. For those qualifying, Medicaid will pay the monthly Part B premium, currently $96.40 a month per person (except those with high incomes).

QI-1. At present, Alabama is not accepting applications for QI-1 because of limited state funds. In better economic times, individuals whose incomes would not qualify for QMB or SLMB might qualify as "Qualifying Individuals-1". In 2009, the limits for states that can provide the supplement, are $1,239 for individuals and $1,660 for couples. QI-1 pays the monthly Part B premium.

QWDI. This program is applicable to certain disabled persons who work (Qualified Working Disabled Individuals). Those who might qualify for this program should contact the nearest Medicaid office for further details.

Food Stamps, Senior Rx, Utility Assistance and Other Programs

Food. The food stamp programs are operated though county food stamp offices; applications can also be obtained a social security offices, and from the Social Security web site (see below). Eligibility requirements vary according to circumstances; age, number and status of persons in the household and so on. The resource limits are similar to those for SSI, but if a household includes someone 60 or over, the cash resource limit is $3,000 rather than $2,000. Applicants under 60 are expected to try to find work. Anyone who is having trouble making ends meet should investigate the possibility of assistance from this source.

Another good resource is the nearest senior center that serves meals, although some programs have been affected by the recession. Meals are nutritious and tasty and offer the additional benefit of social contact. The charge is small and there is no charge for those unable to pay. Seniors unable to leave home should investigate the availability of home-delivered meals. Contact your local Area on Agency about these programs.

Prescription Drugs. Contact the Senior Rx program at your local Area on Aging for help in applying for programs provided by pharmaceutical companies to help those 55 and over who cannot afford medications. Have the exact name, dosage (grams, milligrams, etc.), times taken per day, and name of the prescribing doctors for each of your prescriptions before you call. Drugs will be sent to the prescribing doctor for the patient. Most programs require re-checking every three months. Also see the Medicare article on this web site for information about the Medicare Prescription Drug Insurance program.

Alabama Cares. Another program available through Area Agencies on Aging is the caregiver assistance program. Severe budget problems in Alabama may somewhat curtail this excellent program, but it can be a lifesaver to the senior struggling to care for another person. The program provides vouchers for caregiver substitutes so that the primary caregiver can have a break. Although the amounts provided are not unlimited, responses have been enthusiastic. If you are a caregiver, contact yoru local AAA to find out if you qualify for this assistance.

Help with Utilities. Most utility companies offer level payments, and help with high bills in extreme weather for some seniors. The telephone company offers a small discount for seniors on Medicaid. Call the utility or company for more information, or check with the local Area Agency on Aging.

Avoiding unnecessary expenditures. Seniors seem particularly vulnerable to aggressive marketing schemes and outright scams. Seniors must be particularly wary in Alabama, where there has been and still is little protection for consumers. In this connection see on this web site the Consumer topics, including Insurance, Funerals, Credit Cards, Avoiding Scams and Exploitation, and Identity Theft.

This may be a good time in life to return to an old-fashioned budgeting approach; detailing every anticipated expense, planning for emergencies, and ferreting out where money is being spent with little to show for it. Rule No. 1 for most of us might be to resist impulse shopping! Writing down every penny spent for a month will help to identify ways in which money is leaking out with no real enhancement of life style.

Rethinking investment strategies. Many seniors fall into that middle-income group who have too many assets and too much income to qualify for assistance of any kind, but find they are dipping into savings and resources to a disturbing extent. Even in this time of miserable returns on almost every investment, a careful review of all assets might indicate that some resources are not working for the senior as well as they could: Is the CD getting the best rate available? Is there a bond fund that would bring a higher return without unacceptable risk? Should some portion of resources be in a conservative stock equity fund? Is too much cash being kept in a checking or passbook savings account, when part of it could bring a slightly higher return in a money market account or CD? Would a reverse mortgage be an option? (Keep in mind, though, that while reverse mortgages can be helpful, they are also very complicated and expensive.)

If you can find a qualified financial planner who is interested in providing assistance to middle-income seniors, that might be helpful. Unfortunately, the field has many charlatans and honest but ill-informed people as well as well-qualified planners. Of those who are qualified, we prefer fee-only counselors. While there are many knowledgeable insurance and investment brokers, we believe there is an inherent conflict for those “advisers” who are paid through commissions from sales of their companies’ products. But be wary. There is no law to prevent anyone who wishes from having business cards printed up that say “Financial Planner”.

Any qualified planner will ask for a complete inventory of all assets with original prices, rates of interest, etc. In fact, the senior who goes through this information-gathering process may discover that the process itself is helpful in developing a better approach independently. There are books, magazine articles and websites that can help you educate yourself. Do not “buy” the first approach you read about – look around. Financial magazines and newspapers often list financial institutions with the best savings rates, and credit card companies with the best rates for different kinds of consumers. The time and effort required to educate oneself can pay dividends in enhancing resources as well as in self-satisfaction.

See also the topic Medicare, Medigap and other insurance. Few seniors have given adequate attention to what supplemental policy is best for them, and as a result pay high premiums without addressing their greatest risks.

For more information contact your local Area Agency on Aging, or the Alabama Department of Senior Services (1-800-242-5463) or on the web through our links or at www.adss.state.al.us. The state web site offers links to the thirteen Area Agencies on Aging.

Also try the Eldercare Locator, a service of the federal Administration on Aging, 1-800-677-1116; on the web at www.aoa.dhhs.gov/elderlocator .

The Social Security web site can be accessed through our site or at www.ssa.gov .

Another excellent resource is “Benefits Check-up” developed by the National Council on the Aging. It takes time to provide all the information requested but could be extremely useful in targeting benefits that might be available for particular persons. www.benefitscheckup.org

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