Your loved one with a disability will likely require some level of financial support throughout their lifetime. As you plan for their current and future financial needs, you’ll want to consider all potential sources of assets and income available to your family. You’ll also want to ensure that your loved one’s future plans are aligned with your own savings goals.
Some resources you might be able to tap into could include family income and assets, savings, investments, insurance, legal settlements, gifts, or an inheritance. You also may have access to outside resources through disability related nonprofits, your school board, or the county or state development disability board.
More broadly, your loved one may qualify for some or all of these government benefits:
Health plans available for people with disabilities
The care of a loved one with disabilities can come with additional health-related costs and expenses. These are typically covered by a combination of these sources:
- Private insurance
- Personal resources (such as income and savings)
- Government-sponsored plans (such as Medicaid, Medicare, or CHIP)
- Employer’s group health plans
- ACA Marketplace
The resources available to your family generally depend on the age of your dependent. For example:
- CHIP is more common for minor children.
- Medicaid is more common for adults.
Be sure to understand the eligibility requirements for government insurance programs, including age, asset or income limitations, guardianship status, and the nature of your loved one’s disabilities. For example, while income thresholds for many programs may be low, if your loved one is truly dependent and you exceed the threshold, the eligibility could be waived.
For most employer’s group health plans, children can retain coverage under their parent’s plan until age 26. Some states and plans allow a dependent to remain enrolled beyond 26 if their child is considered disabled by the insurance carrier.
Be sure to research the details of your family's health plan options, as their rules may vary.
Common government disability benefits
Your loved one’s disabilities will often limit their ability to be financially independent and self-sustaining. The government offers financial benefits for which a person typically qualifies through either a financial need or a severe disability. Assuming requirements are met, such benefits can help support your loved one’s financial needs throughout their lifetime.
Commonly used programs include:
Supplemental Security Income (SSI)
SSI is a federal program designed to help individuals with disabilities who have little to no income by providing cash to meet basic needs such as food, clothing, and shelter.
Social Security Disability Insurance (SSDI)
In some circumstances, a dependent can qualify to receive SSDI benefits based on the earnings record of their parents. This is generally available if the parent is either deceased or already receiving retirement or disability benefits, the child is unmarried, does not have “substantial” earnings, and has a disability that started before the age of 22.
Medicaid
Medicaid is a joint federal and state program that provides health coverage to millions of Americans, including eligible low-income adults, children, pregnant women, elderly adults, and people with disabilities. Medicaid is administered by states, according to federal requirements.
What are countable resources? Limitations on government benefits
Government programs such as SSI, SSDI, or Medicaid often come with limitations that can hinder your loved one’s ability to save. For example, to qualify for and preserve benefits, these programs usually require that your loved one’s available or owned assets—known as “countable resources”—don't exceed $2,000 ($3,000 for married individuals). This means they can't have more than $2,000 in their name without losing their benefits.
For many families, the countable resource limit can present challenges because the future financial needs of their loved one can quickly exceed that amount.
Some common countable resources
- Financial assets (cash, savings, and investments)
- Property (land or vehicles)
- Anything owned or exchangeable for cash
Things that are usually not considered countable resources
- The home your loved one lives in and the land it is on
- One vehicle used for your loved one’s transportation
- Personal effects and household goods
- Life insurance policies with a combined face value of $1,500 or less
- Up to $100,000 in ABLE accounts
Countable resources and income limits vary by program, so be sure to research how they may impact you before applying.