The 1619(b) Medicaid Work Incentive: Details on Strategies to Establish and Maintain Eligibility

Sep 12, 2024

27 min read

Description: This article provides a comprehensive guide on the Section 1619(b) Medicaid Work Incentive, which allows Supplemental Security Income (SSI) recipients to retain their Medicaid coverage even after earning too much to receive cash benefits. It details the specific criteria for establishing and maintaining eligibility, offering practical strategies—such as using ABLE accounts, managing resource limits, and calculating individualized thresholds—to help beneficiaries increase their income without losing essential healthcare.

Introduction

The fear of losing Medicaid when working for significant wages often leads persons with disabilities to avoid anything other than part-time work for modest pay. The emergence of 1619(b) Medicaid during the 1980s helped many Supplemental Security Income (SSI) recipients overcome this fear, but only if they’d heard about 1619(b).

Section 1619(b) became a permanent part of the SSI program in 1987. It allows SSI recipients, who lose cash payments through countable earned income, or a combination of earned and unearned income, to retain Medicaid so long as they continue to meet 1619(b) eligibility criteria. In fact, your co-authors know of people who have retained Medicaid for more than 30 years after first becoming 1619(b) eligible. With fewer employers offering employee health insurance or offering coverage with increased out-of-pocket costs, and with Medicaid often covering services not available through a private insurance plan, keeping Medicaid while working is more important than ever.

How much do benefits counselors need to know about 1619(b) eligibility criteria? Is it enough to have a link to this year’s eligibility threshold (i.e., the annual earned income limit) for your state? What else do you need to know? And are there things an SSI recipient needs to do proactively to establish or maintain 1619(b) eligibility?

Many of our readers received a 1619(b) overview in training to become a benefits counselor. You likely also learned about key 1619(b) policy in the Social Security Administration’s (SSA’s) Program Operations Manual System, POMS SI 02302.010 – 02302.060. This article will not repeat the basic 1619(b) overview.¹ Instead, we will take selected eligibility criteria and explain how to meet them to establish and maintain eligibility. The discussion below is largely based on experiences of the authors and benefits counselors we supervised or supported over the years. Where appropriate, we give references with links to SSA’s relevant policies.

A note about the Medicaid Buy-In for working people with disabilities (MBI-WPD). The MBI-WPD, known by different names in some states, is an optional work incentive available in more than 45 states. The MBI-WPD, when available, offers an alternative path to continued Medicaid eligibility when 1619(b) is either not available or not as advantageous as the MBI-WPD. We will touch on the relevance of the MBI-WPD in the discussion below, but a detailed discussion of that work incentive is beyond the scope of this article.

The 1619(b) Medicaid Eligibility Basics

Section 1619(b) provides a way to retain Medicaid when an SSI recipient’s countable earnings, combined with countable unearned income (if any), results in a loss of the right to a monthly SSI payment. This person will qualify for 1619(b) and then maintain eligibility by meeting a five-part test:

Disability continues. They continue to meet the SSI medical disability criteria.
Received SSI in a prior month. They were eligible for an SSI payment, or were eligible for 1619(b) Medicaid, during a previous month within the current period of eligibility (i.e., within the previous 12 months).²
Would still be eligible for an SSI cash payment if earnings are ignored. After ignoring earnings, they would continue to be eligible for an SSI payment based on countable unearned income and countable resources of $2,000 or less.
hey meet a Medicaid use test. They used Medicaid during the past 12 months; or expect to use Medicaid during the next 12 months; or could not pay for unexpected medical bills during the next 12 months without Medicaid.
Earnings are below an annual “threshold” for their state. This eligibility “threshold” is based on projected earnings for a 12-month period.³

We highlight below how aspects of each of these criteria can be crucially important, particularly as it relates to maintaining 1619(b) eligibility. In some cases, the SSI recipient, their family member, and/or their benefits counselor will need to be vigilant and stay on top of what needs to happen to continue their 1619(b) eligibility.

Medical Continuing Disability Reviews (CDRs) Will Still Happen in 1619(b) Cases

To keep 1619(b) the person’s disability must continue. All 1619(b) recipients will be subject to a medical CDR from time-to-time, generally every three to seven years depending on the disability. In anticipation of the CDR, the 1619(b) recipient must:

Notify SSA if their address changes. Since the medical CDR is usually started with a mailing sent to the recipient, if that mail is returned to SSA as undeliverable it could lead to a suspension or termination of 1619(b).
Always open and read mail from the SSI program. If forms are sent to be filled out about a continuing disability, make sure to fill them out and return them to SSA. If the recipient is scheduled for a consultative exam before a doctor hired by SSA, they must attend that appointment. Failure to return forms or attend scheduled consultative appointments could lead to a 1619(b) termination.

In anticipation of the Annual 1619(b) Recertification, the recipient should follow the same advice about notifying SSA about address changes, opening and reading mail from the SSI program, and completing enclosed forms and returning them to SSA.

A Person Can Move Back and Forth Between 1619(b) Status and Cash Payment Status – Without a New Application

Many people we work with will see their wages go up and down during the year. Often, this just means that the monthly SSI payment will go up and down. However, once the recipient has been eligible for 1619(b) for at least one month, a later reduction in earnings can mean a return to cash payments. Since SSI payments and 1619(b) are each considered a form of SSI benefit, a person can easily move from cash payments, to 1619(b), and back to cash payments again as their countable earnings go up and down. POMS SI 02302.010 C.3. There is no limit to how many times this can happen! Remember, if reduced countable earnings will make the 1619(b) recipient eligible for an SSI payment, the person must report changes in income to SSA in order to get their cash benefits reinstated.

The Case of Danielle, Age 24. She was getting SSI payments of $943 per month in January 2024 and started earning $985 gross per month, working part time. Based on countable earnings of $450 per month ($985 – 20 - 65 = 900/2 =

$450), her SSI payment was reduced to $493 per month and her Medicaid continued (Medicaid is automatic for recipients in her state as it is in most states). Keeping Medicaid is important as it pays for Danielle’s mental health counseling sessions and prescription medication.

Effective April 1, 2024, Danielle’s job became full-time, and her gross pay increased to $2,185 per month. Now, her countable earnings increased to $1,050 per month ($2,185 – 20 – 65 = 2,100/2 = $1,050). Since the new countable income amount exceeds her state’s $943 SSI rate, she is no longer eligible for an SSI payment. However, she should be eligible for continued Medicaid through 1619(b) assuming that her disability continues, her projected annual earnings of

$26,220 are below her state’s eligibility threshold,⁴ and her countable resources are at or below SSI’s $2,000 limit. Based on the facts presented, she will meet the “prior month” requirement as she got an SSI payment during the first three months of the year and will meet the Medicaid use test based on past use of Medicaid to pay for mental health treatment and prescription medication.

Danielle continues to work full-time until September 2024 when she enrolls in a local community college and reduces her work hours. During her fall semester she will earn $765 gross each month, September through December. With countable earnings reduced to $340 per month ($765 – 20 – 65 = 680/2 = $340), Danielle will now be eligible for an SSI payment of $603 ($943 – 340) with automatic Medicaid as an SSI recipient. The SSI program allows her to transition back to payment status without a new application.⁵ If she works full-time again during the next semester or during the summer, she will likely lose the right to an SSI payment but transition back to 1619(b) eligibility.

Section 1619(b) Medicaid is Often Available to SSI Recipients with Unearned Income and Modest Wages

The 1619(b) state-by-state earnings thresholds or limits, subject to the ability to have an individualized threshold based on extra expenses unique to the recipient, must be met. However, there is no minimum level of countable earned income a person must have to become eligible for 1619(b). So long as the person lost the right to an SSI payment due to countable earned income, in combination with countable unearned income (if any), they can be eligible for 1619(b) if all other eligibility criteria are met. If the unearned income, on its own, does not make the SSI recipient totally ineligible for SSI, even small earnings can make the individual eligible for 1619(b).

The Case of Marlin, age 44, who has an intellectual disability. He receives Social Security Childhood Disability Benefits (CDB) of $760 per month on the earnings record of his father who is deceased. With $740 of countable income, after a $20 general income exclusion, he is eligible for an SSI payment of $203 per month in 2024 ($943 – 740). He also qualifies for automatic Medicaid as an SSI recipient based on state policy. Medicaid pays for doctor visits, prescriptions to control high blood pressure, and other services as needed. Marlin lives with his mother who is also his representative payee. Keeping Medicaid is important as he does not qualify as a dependent on his mother’s private insurance plan.

Marlin starts a job at a local grocery store, sweeping floors and helping to stock shelves. He gets paid twice per month and has $665 in monthly gross earnings – earning $12 per hour for about 56 hours per month. With $300 in countable earnings ($665 – 65 = 600/2 = $300) added to his $740 in countable CDB benefits, he now has $1,040 in countable income and will lose his right to an SSI payment.⁶ Marlin should be eligible for 1619(b) Medicaid. He has a continuing disability, received SSI until his earnings suspended his eligibility for a payment, his projected $7,980 in annual earnings is well below the earnings threshold limit for his state (and all states), he meets the Medicaid use test based on recent use of Medicaid, and would still be eligible for an SSI payment if earnings are ignored. So long as Marlin and his mother, the payee, work together to keep countable resources at or below SSI’s $2,000 limit he will be eligible for 1619(b).

Marlin’s case illustrates the importance of 1619(b), for example, to the person who gets a very modest SSI supplement because they receive unearned income in the form of a Social Security CDB payment. Working about 13 hours per week is enough in his case to suspend his SSI payments and make him eligible for 1619(b). Hopefully, Marlin can be referred to a benefits counselor who can assure him and his mother that Medicaid can continue indefinitely, even as his earnings increase in the future, so long as gross annual earnings are at or below his state’s 1619(b) threshold and he continues to meet other 1619(b) criteria.

To Retain 1619(b) Medicaid, a Person Must Maintain Countable Resources at or Below SSI’s $2,000 Limit

1619(b) Beneficiaries are Subject to SSI’s Resource Limit, Not the Resource Limit for a Different State Medicaid Category. We must always remember that 1619(b) is considered a non-cash form of SSI. This means that 1619(b) recipients must continue to meet the SSI resource limit. POMS SI 02302.010 C.1.b. (the 1619(b) recipient must “[m]eet all non-disability requirements for regular benefits except for earnings”).

Sometimes 1619(b) recipients believe that a different, often higher resource limit applies to them, based on a State Medicaid category that does not apply to them. This is incorrect and can have dire consequences to the recipient.

Let’s return to Danielle’s case. She tells her mental health counselor, during a June 2024 appointment, that she lost SSI payments because of higher earnings, but can keep Medicaid through a special work incentive. She then mentions that a benefits counselor told her she needed to keep her bank account at or below

$2,000. The mental health counselor explains that several of her clients were told they could have up to $5,500 in the bank and keep their Medicaid.

Luckily, Danielle can call her benefits counselor to discuss these Medicaid issues. The benefits counselor explains that 1619(b) eligibility is tied to the SSI program’s $2,000 resource limit and points out that the $5,500 figure is the resource limit for the state’s medically needy or spend down category of Medicaid. She then notes that some people she serves get Medicaid through this category while others get Medicaid through the State’s Medicaid Buy-In for working people with disabilities program which has a $10,000 resource limit.⁷The benefits counselor provides Danielle with educational materials on 1619(b), along with links to 1619(b) resources on SSA’s website.

Danielle’s confusion about 1619(b)’s resource limit is not unusual. Once she qualified for 1619(b), she could have gone through many months of no contact with the SSI program. Since 1619(b) continues to be a best-kept secret within many service provider agencies and likely within the Medicaid agency itself, it is very likely that a well-intentioned agency employee might improperly tell her that she faces a $5,500 resource limit.

Danielle could use an ABLE Account to Avoid 1619(b)’s $2,000 Resource Limit. More than half of Danielle’s earnings were excluded, as part of the SSI payment calculation, through the end of August 2024. The exclusions will continue into September when her earnings are reduced. If her savings are likely to exceed $2,000, she could save some of her money in an exempt ABLE account. At age 24, she clearly meets the ABLE account requirement of a disability onset before age 26. By starting an ABLE account, she can set aside some of her earnings to avoid going over the SSI resource limit, then later use money held in the ABLE account for a range of Qualified Disability Expenses (QDEs), such as educational expenses, housing expenses, transportation, and food, with no impact on SSI or 1619(b) eligibility. For an in-depth discussion of the ABLE account, see Deeper Dive # 9, Achieving a Better Life Experience (ABLE) Accounts and the Benefits Counselor (December 2023), available at the Members Only section of www.nabwis.org.

Paying off debt to reduce countable resources below $2,000.

The Case of Sandra, age 29. She developed statutory blindness at age 22 and was approved for SSI benefits shortly after that in late 2017. She graduated from college in December 2021 and started work as an elementary education teacher in January 2022 with a $38,000 annual salary. Shortly after starting work, her SSI payments were suspended, based on her countable earnings, and she qualified for 1619(b) since her gross annual earnings were below her state’s $55,000 eligibility threshold. Continued Medicaid will be important as her employer-funded insurance provides for many out-of-pocket costs that Medicaid can pick up, including co-payments for ophthalmology treatments and eye medications.

Facing the challenge of a $2,000 resource limit when her ability to save has increased, Sandra works with her benefits counselor to set up the following savings plan. She plans to get her savings account up to about $1,500 to be safely below the $2,000 resource limit. Then she will enroll in the ABLE program (her disability onset is prior to age 26 as required for an ABLE account) with an initial deposit of $500. Then each month she will put $250 in her ABLE account and use another $250 to begin paying off a $2,500 balance on her credit cards. If she continues this pace of saving, her credit cards would be paid off within a year and she’d then devote all her savings to her ABLE account.

Extra principal payments on a home mortgage to keep resources below $2,000.

Back to Sandra’s Case. It is now September 2024. She continues to teach at the same elementary school and her annual salary is now up to $47,000. During 2023, she purchased a modest home and qualified for a special home ownership and mortgage program for teachers in targeted areas. After paying for her mortgage, she is still trying to put savings into the ABLE account to pay for future remodeling of the home. Note: Depending on how much Sandra had at the time in her ABLE account, she could have taken an ABLE distribution toward a downpayment on her home purchase without any impact on 1619(b) eligibility.

Sandra has another option for paying down debt while increasing her modest wealth as a homeowner. She can make “principal payments” on her home mortgage, i.e., in addition to making her monthly mortgage payments she can periodically make a non-mandatory extra payment. And although the extra payment will increase the equity value of her home (i.e., fair market value – less outstanding debt or mortgage), that will not count toward her $2,000 countable resource limit for 1619(b) as the residential home of any value is an exempt resource. POMS SI 01130.100. Moving forward Sandra may be able to use the increased equity value of her home for a home equity loan or line of credit. When the proceeds of a home equity loan or line of credit are used, for example, to pay for a new roof on her home or any other major expense, the proceeds used for the roof or other item will qualify as borrowed money and not be counted as income in determining 1619(b) eligibility. See POMS SI 000815.350 A (proceeds of a loan is not countable income to the borrower).

Sandra’s case illustrates how to use an ABLE account and paying down of debts (credit cards and home mortgage in her case) to make use of potential savings while keeping resources within the $2,000 limit. Then she can make creative use of the home equity loan or line of credit – essentially borrowing money from her own assets – to meet necessary expenses moving forward. Of course, with 1619(b) things would be easier if the rules were changed to allow for a higher resource limit and to allow recipients to save money in a variety of self-funded retirement accounts like IRAs or 401ks.

Ineligibility for Both SSI Payments and 1619(b) for 12 Consecutive Months Will Result in a Termination of those Benefits

See POMS SI 02302.006 B.2.f, providing that “[e]ligibility for SSI is terminated only if people medically improve or have been ineligible for any SSI benefit (including 1619(b)) for 12 consecutive months.”

Most likely to occur when countable resources are above $2,000 for 12 consecutive months. Here are some common ways this can occur:

A recipient regularly deposited a portion of earnings into a bank account which then exceeded $2,000 for 12 consecutive months.
The recipient gets a significant windfall that, combined with existing resources, lead to a recipient’s bank account exceeding $2,000 for 12 consecutive months. This could be from: a federal and/or state tax refund; a retroactive Social Security or SSI payment; a retroactive pay increase or bonus that was retained; a gift; or money or its equivalent from any other source. Always make sure the recipient takes advantage of any time-limited exclusion of the windfall in question.⁸

The 12 consecutive months of ineligibility rule can be unforgiving. While a lack of understanding of the SSI resource rules might support a without fault finding in an overpayment waiver request, it will not defeat the 1619(b) termination under the rules and circumstances described.

Reinstating 1619(b) after the 1619(b) termination. Now the SSI eligibility process must start all over. Since the termination ended the existing SSI claim upon which 1619(b) eligibility was established, a new SSI application will now have to be filed and approved. If the new application is approved, this new SSI recipient must once again meet the 1619(b) eligibility criteria when earnings result in a suspension of SSI payments.

The new SSI application will be denied if a person is working at the SGA level, unless they are statutorily blind. If the terminated 1619(b) recipient has countable earnings above the current year’s substantial gainful activity (SGA) level for those who are not statutorily blind, i.e., $1,550 in 2024, those SGA-level earnings will result in a denial of the SSI application.⁹ Even though SSI recipients do not face an SGA test for continuing benefits (SSI payments or 1619(b)), SSI applicants who are not statutorily blind must have countable earnings at or below the SGA level. Tragically, the person’s continued progress in terms of earnings level becomes a new barrier to reestablishing 1619(b) eligibility in some cases.

Might the Medicaid Buy-In come to the rescue? In some cases, the recipient will reside in one of 45 States with a Medicaid Buy-In for working people with disabilities (MBI-WPD) program and qualify for the MBI-WPD despite increased resources above SSI’s $2,000 limit and/or current wages at the SGA level. If resources are too high for the MBI-WPD, they may be able to spend down their resources, allocate some of them to excluded items, or start an ABLE account if eligible before submitting their MBI-WPD application.¹⁰Work at the SGA-level will not be a bar to Medicaid Buy-In eligibility.

A note of caution: Section 1619(b) allows a person whose earnings are reduced or who stops working to go right back to SSI payments without a new application. And, in most states, Medicaid will continue to be automatic when they transition back to SSI payment status. By contrast, if the person loses the MBI-WPD because they stopped working and exhausted any short-term grace period to retain eligibility, they will not be able to return to SSI payment status without going through the full SSI application process.

Meeting 1619(b)’s Earnings Threshold Test

Are projected “annual gross earnings” below your state’s threshold? The eligibility thresholds for each state and the District of Columbia appear in POMS SI 023002.200. The annual earnings limits for calendar year 2024 range from a low of $34,490 in Tennessee to a high of $86,438 in Alaska, with 24 states having thresholds of $45,000 or higher. When a state initially certifies eligibility and when it does its annual recertification, the SSI program is required to consider expected earnings for the next 12 months. POMS SI 02302.045 A.1. A 1619(b) applicant/recipient and their benefits counselor should:

Make sure you are looking at the current year’s threshold (or next year’s threshold if available). The POMS reference above is always the best source of that information. Those thresholds could appear in the POMS as early as late October of the previous year, but often they do not appear until one or more months into the new year.
Not overstate projected earnings. Projected earnings may be easy if the job will not change and any raise in pay is already known. By contrast, if looking for a full-time job upon graduation, estimate future earnings conservatively as that first job may not start right away and may not pay as much as expected.
Consider 1619(b) threshold for the other state if the recipient is considering moving to another state. Many persons with mobility limitations for example, including wheelchair users, will look to move from a northern state to a state with a warmer climate. If use of 1619(b) will be a consideration, check out the eligibility thresholds in the state you might move to. The person should also make sure the other state’s Medicaid program covers the optional service categories the recipient will need.

Meeting an “Individualized Threshold” Earnings Test

If the person’s gross earnings exceed the threshold for the year in question, they may be able to establish a higher individualized threshold by adding up the following amounts:

The “Base Amount” from the threshold chart in POMS SI 02302.200
The Medicaid, i.e., Title 19 amount from the threshold chart, or actual 12-month Medicaid expenses for the person, whichever is higher
Impairment Related Work Expenses (IRWEs) or Blind Work Expenses (BWEs)
Income Excluded under an Approved Plan to Achieve Self Support (PASS)
The value of non-Medicaid publicly funded personal or attendant care

The sum of these items will become the person’s individualized 1619(b) threshold. If their projected earnings for the year in question are below the individualized threshold, they are eligible for continued Medicaid through 1619(b) so long as all other eligibility criteria are met.

Antonio’s Case, Age 38. He has cerebral palsy, uses a wheelchair for all mobility, and relies on Medicaid for many hours of personal care aid services, as well as for a range of other items. He was certified for 1619(b) five years ago but believes that benefit may be in jeopardy if he accepts a promotion with a higher salary. His state’s eligibility threshold is $48,855 for 2024 and he expects to earn $45,000 over the next 12 months at his current job. However, if he accepts the promotion and starts the new job next month, he is projected to earn $57,000 during the next 12 months. He is thinking of turning down the promotion rather than put 1619(b) at risk. Antonio’s benefits counselor works with him to present the following information to SSA to support an individualized threshold:

Base amount from threshold chart $23,652
Actual 12-month Medicaid-funded costs $43,000
Additional IRWEs or BWEs $. 0
Income excluded in approved PASS $ 0

Total/Individualized Threshold $66,652

Since Antonio’s projected 12-month earnings, $57,000, are below his individualized threshold, he will retain 1619(b). Armed with this information, he accepts the promotion, and his 1619(b) Medicaid continues. Sadly, we are aware of persons who have either declined promotions or decided not to apply for better paying jobs because they feared losing 1619(b).

What if Antonio’s Medicaid-funded costs were $10,000 less but he is statutorily blind? How to use Blind Work Expenses in an individualized threshold.

Blind work expenses (BWEs) are described in POMS SI 00820.535. BWEs include the reasonable cost of any work-related item, even if not related to the person’s blindness, that a person pays for without being fully reimbursed. It includes, for example:

Income taxes (federal, state, and local)
Social Security and Medicare taxes
Union dues
Transportation to and from work
Guide dog expenses (food, veterinary bills, special harness and walking lead)
Meals during work hours
Readers (only if paid by the recipient)
Medical devices/equipment used on the job or to assist in getting to the job, including any smart phone apps used in the commute to and from work

Let’s assume that Antonio’s monthly BWEs are $1,200, for a total of $14,400 per year. His individualized threshold would now be:

Base amount from threshold chart $23,652
Actual 12-month Medicaid-funded costs $33,000
Additional BWEs $14.400
Income excluded in approved PASS $ 0

Total/Individualized Threshold $71,052

Even though Antonio’s actual Medicaid-funded costs in the second example are

$10,000 less, his annual BWEs more than make up the difference. Since the new individualized threshold is well above his projected $57,000 in earnings, he will continue to be 1619(b) eligible.

Should Antonio consider his State Medicaid Buy-In? Let’s assume in the above scenario Antonio does not have enough expenses to establish an individualized threshold. Before he declines the promotion, his benefits counselor urges him to consider his State’s MBI-WPD. With eligibility set at 250 percent of the federal poverty level in his State, i.e., countable earnings of up to $3,138 per month, he could earn up to $6,361 per month or $76,332 per year and qualify for the MBI-WPD if he does not also have countable unearned income.¹¹ And, as the benefits counselor reminds him, countable resources of up to $10,000 are allowed in his State MBI-WPD. Since he is already eligible for 1619(b), she suggests a strategy of building up his bank account to more than $2,000, alerting the SSI program of this to effectively suspend his 1619(b) eligibility with a new application to the MBI program to be done immediately thereafter. Note: States will set their own guidelines for maximum income and assets for their MBI-WPD program.

If Antonio transfers to the MBI-WPD and he is not eligible for 1619(b) or an SSI payment for 12 consecutive months, SSA will terminate his SSI and 1619(b). The rule provides that Antonio will first enter a 12-month suspension period, beginning with the first month the benefits should have been suspended regardless of when SSA actually took the suspension action. After 12 consecutive months of ineligibility for either an SSI payment or 1619(b), a termination will occur. Should he need to reapply for SSI in the future, he will be subject to the substantial gainful activity (SGA) earnings level for that year unless he is statutorily blind. As noted above, SGA is considered when establishing initial SSI eligibility, but once an individual is eligible, their monthly SSI payment depends solely on their total countable income and resources.

Can 1619(b) Recipients Marry and Retain Eligibility for 1619(b)?

The answer is it depends.

First, let’s assume that both members of a married couple receive SSI and work. When both members of the couple seek 1619(b), “the earned income of both is dropped from the test computation,” i.e., computing whether the individual would be eligible for an SSI payment if wages were ignored. POMS SI 02302.030 C.6.

For example, using the New York threshold, if each spouse had $44,000

in gross annual earned income (i.e., less than New York’s 2024 threshold of $59,826) and both sought 1619(b), the other spouse’s earned income in each case

would be dropped (i.e., not deemed) in determining whether the person is “otherwise eligible” for SSI (i.e., eligible if wages were not counted). In those cases, 1619(b) eligibility should be established if other criteria are met.

Let us now assume that both members of a married couple receive SSI but only one member of the married couple goes to work and earns $44,000 gross per

year. Then, the working SSI recipient in the couple would be eligible for 1619(b) but the non-working spouse cannot be eligible for 1619(b). Instead, the non-working spouse’s continued eligibility for an SSI payment will be determined under traditional rules for deeming of spousal income. In New York, if the working spouse had $44,000 in gross earned income, that would be enough, when deemed, to make the non-working spouse ineligible for a cash benefit (we assume the couple have no dependent children under 18 which would change the deeming calculation). POMS SI 02302.030 C.6. After 12 months of ineligibility for an SSI payment, the non-working spouse will see their SSI case terminated. Note that the non-working spouse, if they took a low-paying part-time job, would be able to establish 1619(b) eligibility under the POMS policy directly above.

What if a 1619(b) recipient, earning $44,000 per year plans to marry a non-SSI recipient who earns $50,000 per year? When this marriage occurs, under a complicated calculation, the SSI program will determine whether 1619(b) should be suspended because “deemed income” is available in a sufficient amount so that the 1619(b) recipient is not otherwise eligible for an SSI payment (after excluding all recipient earnings). In most, if not all states, marriage to a person with $50,000 per year in earnings will be enough, after disregarding recipient earnings, to make the recipient ineligible for an SSI payment and, thus, ineligible for 1619(b).¹²When that ineligibility continues for 12 consecutive months,1619(b) is terminated. Your co-authors have, on many occasions, had to explain to 1619(b) recipients who plan to marry that their marriage will result in the suspension and eventual termination of 1619(b) Medicaid. In one memorable case, with the wedding dress purchased and invitations already sent out the couple opted for a commitment ceremony, rather than a marriage, to ensure continued 1619(b) eligibility.

Meeting the Medicaid Use Test: Everyone Should Say “Yes” to One of the Three Questions

To be eligible for 1619(b), an individual must depend on Medicaid coverage to continue working. This is called the Medicaid Use Test. POMS SI 02302.040. During an annual recertification, SSA must determine whether the 1619(b) recipient meets the Medicaid Use Test. The SSA claims representative will ask the 1619(b) recipient three questions:

Did the 1619(b) recipient use Medicaid coverage within the past 12 months?
Does the 1619(b) recipient expect to use Medicaid coverage in the next 12 months?
Would the 1619(b) recipient be unable to pay unexpected medical bills in the next 12 months without Medicaid coverage?

If the answer is yes to one of the questions, the 1619(b) will be initially approved and continued at recertification. If the answer to all three questions is no, 1619(b) will be not be approved, or suspended and terminated if 1619(b) eligibility is not reestablished within 12 months.

Most of the people we work with will say yes to both questions 1 and 2, or at least say yes to one of them. However, even if the answer is no to questions 1 and 2, shouldn’t everyone respond yes to question 3 – agreeing that they would be unable to pay unexpected medical bills in next 12 months without Medicaid. As a practical matter everyone should be able to answer yes to question 3, as it would be rare, if not impossible, to have a private health insurance plan that is guaranteed to continue under its present terms and that would pay any and all unexpected medical bills no matter what intervening events occurred. Even when the 1619(b) recipient has great private insurance from an employer, meeting all or most of their current health needs, one never knows what will happen in the next 12 months.

Always a good strategy to retain 1619(b) even if the recipient has not been using Medicaid.

Many persons will be quite happy to call it quits with the Medicaid bureaucracy and not pursue 1619(b) if some combination of private insurance and Medicare will meet all or nearly all of their needs. However, there are several reasons why keeping 1619(b) is a good idea even if not likely to be used except in the case of unexpected medical bills.

If 1619(b) is terminated, getting it restored could be a challenge. This has been fully documented in the examples above.

Changes in employer-based health insurance may create a need for Medicaid in the near future. A person currently covered by an employer-sponsored plan may see costly changes in that plan in the upcoming years. These include establishing or increasing an employee’s contribution for monthly premiums; establishing or increasing copayments for covered services; and eliminating previously covered service categories. The employer may also decide to no longer offer insurance coverage to its employees.

Finally, the employee could lose the coverage if laid off. These potential scenarios also support answering “yes” to question 3 in the Medicaid use test, as Medicaid will be needed in the future “to pay unexpected” medical costs.

Section 1619(b) if You Reside in a 209(b) State

There are eight 209(b) states: Connecticut, Hawaii, Illinois, Minnesota, Missouri, New Hampshire, North Dakota, and Virginia. These states do not provide automatic Medicaid eligibility for SSI recipients. Instead, they make their own Medicaid eligibility determination and “use at least one eligibility criterion more restrictive than the SSI program.” POMS SI 01715.010 A.1. To qualify for 1619(b) in a 209(b) state, the person “must have been eligible for Medicaid in the month immediately prior to becoming eligible for 1619 status to retain their Medicaid eligibility.” POMS SI 02302.010 D.¹³

In a 209(b) state, 1619(b) eligibility follows a two-step process. At step one, SSA determines whether the core criteria are met: SSI payments were stopped due to earnings, or a combination of earned and unearned income; the person would still be eligible for an SSI payment if earnings are ignored; they meet the Medicaid use test; and projected earnings are at or below a general “threshold” for their state, or a higher “individualized threshold” based on criteria described above. At step two, SSA notifies the state that the person has met the core criteria through the electronic State Data Exchange (SDX) system. POMS SI 01715.015 B.1. The state or local Medicaid agency then determines whether the person was eligible for Medicaid, based on state criteria, in the month immediately preceding the month they became eligible for 1619(b) status. If the person as eligible in that month the Medicaid agency is expected to certify them as 1619(b) and do no additional analysis.¹⁴

A Caveat to Readers. At least one 209(b) state, Virginia, does apply additional State Medicaid criteria before certifying eligibility under 1619(b). Michael Klinger, a NABWIS board member and part of our Deeper Dive Advisory Group, provides training and technical assistance to a benefits counseling network in Virginia. He explained that the state’s local Medicaid agency makes the final determination of 1619(b) eligibility based on Virginia’s $5,000 equity value limit on property that a person owns that is not otherwise exempt. We will not attempt to go into details of how that policy is applied.

See, Virginia Medical Assistance Eligibility Manual, M0320.205, Qualified Severely Impaired Individuals (QSII)-1619(B) Status. Mike reports that 95 percent or more of the persons authorized for benefits counseling within his network by vocational rehabilitation counselors end up eligible for 1619(b).

If you provide benefits counseling services in a 209(b) state, it is critical that you become familiar with state policies for implementing this final step in the 1619(b) eligibility process. If like Virginia, your state creates an additional hurdle to establish 1619(b) eligibility, knowing about it allows the potential 1619(b) recipients you serve to navigate those criteria. You might also contact your state’s Protection and Advocacy for Beneficiaries of Social Security (PABSS) program or another advocacy group to challenge the use of additional eligibility criteria.

The authors request that benefits planners in 209(b) states, other than Virginia, let them know how their states treat 1619(b) determinations.

Conclusion – The Benefits Counselor’s Role with 1619(b)

The 1619(b) program is a powerful work incentive. It provides for continued Medicaid eligibility for persons whose countable earned income, in combination with countable unearned income (if any) is too high to qualify for SSI payments if their projected annual earnings do not exceed a special earnings limit or threshold set for their state. They will be eligible for the 1619(b) Medicaid when the sole cause for SSI payment suspension is earned income, and they would still be eligible for an SSI payment if earnings are ignored. Many of the people we serve will be 1619(b) eligible and may increase their earnings potential, without fear of losing Medicaid, if they know about this program.

After 37 years since its creation, the 1619(b) program is still a best-kept secret. Often, when the authors present on it to persons with disabilities and service providers and ask, at the outset, who knows about 1619(b), few hands, if any, are raised. Let’s make sure that employed SSI recipients utilize this work incentive to increase earnings and better their lives.

Please be a part of the effort to get the word out about 1619(b) Medicaid! In fact, if your state also has a Medicaid Buy-In Program for working people with disabilities, you should consider outreach and educational efforts to get the word out about both programs. With both work incentives available, very few persons in your caseloads should have a legitimate fear that they cannot work and retain Medicaid.

Dated: September 12, 2024

Authors: James R. Sheldon, JD (Board Member), Disability Consultant and Edwin J. Lopez-Soto, JD (NABWIS member), Extension Faculty, Cornell’s Yan Tan Institute (YTI)

Footnotes:

¹ See Understanding 1619(b) (January 2024), an 8-page overview, updated regularly by Virginia Commonwealth University’s (VCU’s) WIPA National Training and Data Center.
² As explained below, in the eight section 209(b) states the recipient must establish they were Medicaid eligible in the month immediately preceding the month they became eligible for 1619(b).
³ Importantly, monthly countable earnings at the substantial gainful activity level, i.e., $1,550 or
$2,590 per month in 2024 if statutorily blind is not a bar to 1619(b) eligibility.
⁴ With annual earnings of $26,220 Danielle’s income will be below the 2024 eligibility threshold figures for all 50 states and Washington, D.C. POMS SI 02302.200 A.
⁵ An added complication, which we will not explore in this article, is the concept known as Retrospective Monthly Accounting (RMA). The basic RMA rule requires that countable income in one month is used to calculate the SSI payment two months later. This gets more complicated when the SSI payment goes to $0 in a month, or when the person whose SSI payments were suspended, once again becomes eligible for an SSI payment. For more information on RMA, see POMS SI 02005.001 .
⁶ We assume that Marlin has no additional earned income exclusions, such as impairment related work expenses, that would allow a modest SSI monthly payment to continue.
⁷ The Medicaid Buy-In resource limit will vary from state to state.
⁸ For example, the SSI program provides for a 9-month exclusion when a retroactive Social Security or SSI payment is received, POMS SI 01130.600, and for a 12-month exclusion when any federal tax refund is received (including any portion of the federal Earned Income Tax Credit received as a refund). POMS SI 01130.676 A. and D.
⁹ There is no SGA test in the SSI program for persons who are statutorily blind. POMS DI 26005.005. Therefore, earnings at what would be the SGA level for the statutorily blind, i.e., $2,590 per month in 2024, will not be a bar to reestablishing SSI eligibility.
¹⁰ The value of assets in an ABLE account will not count in determining eligibility for the MBI-WPD. Centers for Medicare and Medicaid Services’ (CMS) Dear State Medicaid Director Letter, SMD # 17-002, Implications of the ABLE Act for State Medicaid Programs (Sept. 7, 2017).
¹¹ Countable monthly income is determined in State MBI-WPD programs by using the SSI earned income exclusions, e.g., subtracting a $20 general income exclusion, then the first $65 of earned income, and half of the remaining income.
¹² We assume there are no dependent children in the household under 18.
¹³ Similar language appears on page 30 of Social Security’s 2024 Red Book on Work Incentives and in VCU’s 2024 Understanding 1619(b) article as approved by SSA, note 1 above.
¹⁴ See Centers for Medicare and Medicaid “Implementation Guide: Medicaid State Plan Eligibility Groups – Mandatory Coverage, Working Individuals Under 1619(b),” https://www.medicaid.gov/resources-for-states/downloads/macpro-ig-working-individuals-under-1619b.pdf. It provides at page 3: “In 209(b) states, if an individual was eligible for Medicaid in the month prior to placement by SSA in 1619(b) status, the individual maintains eligibility for Medicaid; the state’s more restrictive eligibility requirements do not apply.“ The web-based properties on this undated document show that it was created and last edited on July 23, 2018.