During the settlement process, a personal injury attorney needs to consider what government/public benefits their client is enrolled in and what they may be eligible for in the future. Several questions need to be asked. Have you considered Medicare’s interest in the settlement? How will the settlement proceeds be handled? Will a lump sum payment disqualify them from their government benefits? These questions need to be addressed because a client’s settlement could have long-lasting financial implications.
When it comes to settling a case with public benefits there are many nuances to consider. Hiring a team of experts such as an Elder and Special Needs Law Attorney, a Structure Settlement Broker, a Medicare Set-Aside (MSA) Allocator, and/or a Trust Advisor can assist you in protecting your client’s benefits and preserving the settlement proceeds.
Getting Familiar With Public Benefits
Public benefits can either be federal or state-run programs. If the benefits program is run by the state, each state has its own set of criteria for eligibility. Needs-based public benefits are also known as asset means-tested public benefits. Asset means-tested means that eligibility is based on an individual’s income level and assets. To learn more about all the different types of government benefits Gov/Benefits.
Government benefits are categorized into two types which are Needs-Based Benefits and Entitlement Benefits.
Needs-Based Benefits – Also referred to as “means-tests,” these are based on an individual’s income and/or assets
Non-Needs Based Benefits Aka Entitlements Based – These are determined by what an individual has contributed or paid into a given benefits system
Common Government Benefits
Below is a list and summary of the most frequently used government benefit programs. However, this is not a complete list, and a full investigation of a client’s use of government benefits should be conducted before the settlement process begins.
Government national health insurance program in the United States, begun in 1965 under the Social Security Administration and now administered by the Centers for Medicare and Medicaid Services. It is intended for people who are 65 or older, certain younger people with disabilities, and people with end-stage renal disease.
Social Security Disability (SSDI)
Payroll tax-funded federal insurance program of the United States government. It is managed by the Social Security Administration and designed to provide monthly benefits to people who have a medically determinable disability that restricts their ability to be employed.
Social Security Income (SSI)
Means-tested program that provide cash payments to disabled children, disabled adults, and individuals aged 65 or older who are citizens or nationals of the United States.
Health coverage programs operated by states, within broad federal guidelines. Although the federal government pays a portion of the costs, Medicaid is administered and operated by states, and each state’s program is different and based on the needs and goals of the individual state.
Medicaid Adult / Disability-Based
Permanently disabled & unable to work
Only Income Test applies in California
Income & Asset Test applies
Supplemental Security Income (SSI) recipients
In-Home Support Services (IHSS) recipients
Home & community-based waivers participants
Long-Term Care Facility residents
Medicaid Adult / Non-Disability Based
Able to work & income is below the Federal Poverty Level (FPL)
MAGI Medicaid on household income
Assets are not counted toward