One of the issues that comes up quite frequently in Social Security Disability, and is probably the most confusing for clients, is the “Date Last Insured”; in Social Security-speak, the DLI.
Clients come in with a letter from Social Security saying that they are being denied because they had to prove they were disabled before some date in the past and there is not sufficient proof from the past. Sometimes the date is two years ago; sometimes it is decades in the past. So,what is past date issue? It is the date that client was last insured (yes, Social Security Disability is NOT a welfare or entitlement program; it is an insurance program) for disability benefits– or, Date Last Insured.
Social Security Disability Insurance is very much like a private insurance disability policy or even an automobile or homeowners insurance policy.
Let’s use the example of an automobile insurance policy. If you want auto insurance, you have to pay a large up-front premium to the insurance company. If you pay that premium, you have insurance. But, if you stop paying your premiums, after a while–not right away, the insurance company will cancel your policy. If you have an accident after the policy has been canceled, you are not covered. However, if you have the accident before the policy is canceled, even if you make a claim against your insurance, say a year later, so long as the accident happened before you insurance was canceled, you are covered.
Social Security Disability works very much the same way. Each week, when you work, and your employer takes out for Social Security and medicare, or if you’re self-employed and you pay Social Security, you are paying the premium for the insurance. When you work for a period of time long enough to pay that large, up-front premium, you become covered for Social Security Disability. As long as you work, you are continuing to pay into the system and paying your insurance premiums, you are covered. When you stop working, and therefore stop paying into Social Security, you are effectively not paying your premiums and eventually you are no longer covered. But, just like the auto policy, if you become disabled while you are still insured, even if you wait a long time to make the claim, you are still covered.
It is a bit more complicated, because there are some rules about how long you have to pay in to become covered initially, and there are minimum amounts you have to earn each quarter for those earnings to be counted as a premium payment. Currently in 2016, you have to earn $1,260.00 for one credit or $5.040 for the full four annual credits.
Like the auto insurance, your coverage is not canceled for a while. Sometimes it takes as long as five years to lose the coverage. That’s the Date Last Insured or DLI. That’s what started this discussion. So, even if you stop working while you are still healthy and become disabled later, you may still be covered when you become disabled.
There are times when people stop working due to their disability but do not apply for a very long time for Social Security. Sometimes they don’t realize they can apply. Sometimes they keep thinking they will get better and delay applying. At the time they do apply, their DLI was sometime in the past. That person can still apply and still qualify for Social Security Disability benefits, if that person can provide the proof that he/she was disabled going back to the DLI and has remained disabled since then.
In my practice, many years ago, I had a client who waited 10+ years before she applied for disability. Her disability coverage had ended 5+ years before. This woman had, however, been seeing the same orthopedic doctor for all 10 years. The records were there and we were able to prove that she had been disabled for all 10 years. She was able to get her full disability monthly rate.
So, what’s the hurry to apply now, instead of waiting? Because Social Security Disability can pay you only for 12 months before the date of your application. The woman who had waited 10 years was able to get her full monthly rate, but she received only 1 year in back benefits. She lost 9 years in benefits for which she was qualified, by waiting for 10 years before she applied.
What if you became disabled long after you stopped working or can’t prove you were disabled before your DLI, what can be done? If you meet the other income and asset guidelines, you may still qualify for SSI benefits.