The views expressed herein have not been approved by the House of Delegates or the Board of Governors of the American Bar Association, and accordingly, should not be construed as representing the policy of the American Bar Association.
Eleven-year-old Evan entered care with his three younger siblings due to medical neglect.1 Evan’s parents’ rights have been terminated because they failed to plan for reunification with the four children. Although a close family friend agreed to become the permanent legal guardian for the children, she is struggling financially to care for them. The state’s child protective service agency has set the family up with food stamps and incidental payments for clothing, but the family is not eligible for TANF or other kinship financial assistance because the caregiver is not a blood relative. Shortly after entering state custody, Evan was diagnosed with epilepsy and post-traumatic stress disorder. As a result, his attorney GAL applied for Supplemental Security Income (SSI) on his behalf, which will help financially stabilize this placement on a long-term basis.
Permanency should be the goal for children in the child welfare system, whether it is reunification, adoption, or placement with a relative or kin. However, financial resources may be a barrier to permanency for many families. One way to promote permanency for children or foster independence for older youth is to determine whether any social security benefits could financially assist youth in care and their families. Income received from the Social Security Administration (SSA) can be used to support room and board payments while youth are placed in state custody,2 and help provide financial support to promote stability.
Three main social security programs may benefit youth in state custody:
- Supplemental Security Income (SSI) is a financial resource for low-income individuals with qualifying disabilities.
- Social Security Disability Income (SSDI) Survivor Benefits are available to children when a parent has either become disabled or dies.
- Social Security Survivor Benefits (SSSB) are also available to children when a parent qualifies through retirement age requirements or dies.
It is important to understand the types of social security income and how they may be spent to maximize the financial benefits to eligible youth in the child welfare system.
Supplemental Security Income (SSI)
SSI is a means-tested benefit based on financial eligibility and disability criteria. About 6% of youth in foster care receive SSI based on their disabilities, but many more are likely to be eligible if properly identified.3 A child’s attorney/representative should always evaluate whether the child currently receives SSI or may be eligible to receive such a benefit. If the child does not appear eligible for SSI, it is worth revisiting whether she might be eligible later. Since there may be scant information about a child’s functional abilities when she first enters care, a later application for SSI might be more successful when documentation can be compiled from various sources.
SSI funds may help promote reunification or relative placement. Because many children who enter care come from low-income families, adding a funding stream to help a family may make reunification possible if stable income is a barrier. Alternatively, for relatives interested in becoming caregivers, social security funding may help a child live with family members instead of being placed with a foster family. Such additional financial resources may help promote financial stability for families seeking guardianship or kinship care and minimize the trauma and disruption youth experience from being removed from their families.4
SSI Advocacy: Key Steps to Maintain SSI Benefits
Once a youth is found eligible for SSI (see SSI Eligibility Questions, below), strict rules govern how the money may be spent and how many assets the youth may amass at any given time. Social security may penalize an individual with assets over $2,000 by either forcing the recipient to return excess money or disqualifying the individual from receiving SSI benefits.5
If a recipient’s assets exceed $2,000, the recipient has three options: (1) spend down the money before assets exceed $2,000; (2) create a special needs or pooled trusts; or (3) discontinue benefits for the period that assets/resources exceed $2,000. It is important to discuss the options in a team meeting for the youth. As a team, it may help to determine if the youth would benefit from specific items that can be purchased with Social Security funds.
An individual may use any sum of money in excess of the $2,000 limit on a variety of approved items that fit within social security guidelines. Allowable expenditures are considered “exempt resources” based on the list on p. 86. A good rule of thumb is to spend the excess down quickly and deliberately within the month the recipient receives the check.6
A dedicated account is one used specifically for SSI beneficiaries and is maintained by a representative payee. A representative payee may be an organization or an individual.8 There is greater scrutiny for representative payees when a child is in foster care.9 The SSA has a list of preferred representative payees, but having a prior felony record or undocumented status may create barriers to approval.10 A dedicated account should be established to manage a lump-sum payment or any amount left over from the monthly SSI check. Typically, when an individual applies for SSI, it takes anywhere from 10-20 months for the SSA to approve eligibility. If determined eligible, a recipient is then entitled to benefits dating back to the first month he or she first applied. As a result, a recipient may receive in excess of $2,000 lump sum for back benefits accrued during the application process. The lump sum must be spent down in a reasonable timeframe of roughly 10 months; otherwise the excess must be remitted to Social Security.11
Social Security Disability Income (SSDI) and Social Security Survivor Benefits (SSSB)
SSDI and SSSB are available to children whose legal parent is deemed disabled, deceased, or reaches the retirement age for social security.12 Survivor benefits do not have as many legal requirements for approved expenditures as SSI benefits. A surviving child may receive a special additional one-time lump-sum death payment of $255 if he or she meets certain requirements: that the child either already received SSDI/SSSB, or was eligible for benefits the month the parent died.13 SSDI and SSSB are available to youth under age 18 (or up to 19 if enrolled in school full time) or at any age if they have a disability, as defined by the SSA, that is diagnosed by age 22.14 (With a qualifying disability, a youth may be entitled to SSI and SSDI/SSSB). SSDI and SSSB are paid from the time of application, not from the time of the parent’s death. Since SSDI and SSSB are based on the work history of the parent, there is no means test and dependent children can accrue an unlimited fund. In addition, the benefits do not need to be used for specific expenses.
If the child welfare agency is notified that a legal parent of a child in state custody has passed away or is (or has become) disabled based on social security requirements, then it should proactively apply for SSDI/SSSB and the lump-sum death payment when applicable. It is important for the child welfare attorney or youth’s attorney/representative to inquire whether parents in dependency/neglect proceedings receive SSDI benefits (or “disability”), whether the child has a deceased parent, or whether the parent qualifies for retirement benefits under SSSB. Any of those scenarios may signify that the child is eligible for benefits as a dependent child. Survivor benefits need to be used to benefit the child, but do not have specific parameters for how to spend the money.
Notably, if a child is eligible for SSDI benefits before a termination of parental rights, that child’s SSDI benefits usually continue even after she is adopted or achieves another permanency option.15 In addition, SSSB often continue even after a child is legally adopted by another family as long as the natural parent contributed to the child’s support and the child lived with the birth parent under the following circumstances:
- when the birth parent applied for social security,
- when the birth parent died, or
- when the birth parent became entitled to disability or old-age benefits.16
Such income can be saved in any type of account without penalties for exceeding $2,000 in assets. As a result, survivor benefits can be spent on youth in custody for any items related to their care. Alternatively, such benefits may be saved until the youth ages out to help with finances as an eligible youth exits care.17
Extending Social Security Benefits into Adulthood
Many youth who receive SSI/SSDI/SSSB benefits as children will not be eligible for benefits as adults because some eligibility categories of SSI/SSDI/SSSB benefits are discontinued at age 18. If benefits are not likely to continue into adulthood, Social Security Section 301 may be an option to prolong benefits. Under Section 301, if a youth remains in her education program, SSI/SSDI/SSSB benefits will extend beyond age 18.18 As such, Section 301 is critical for youth exiting foster care.
To determine whether a youth might be eligible for Section 301, the first step is to convene a meeting of the child welfare team when the youth turns 17. In general, SSDI/SSSB beneficiaries who remain full-time students at age 18 are entitled to benefits until they reach age 19 or complete their secondary (grade 12 or below) education, whichever occurs first. Youth who receive SSI with an IEP are eligible for continued SSI benefits as long as they are full-time students with no significant lapse in education attendance. The benefits could potentially continue until age 21 as long as the student is actively attending or does not stop a secondary school program for more than three months.19
Note: Section 301 must be actively applied for within 10 days of the cessation notice. Cessation notices are usually generated because the youth is turning 18 OR because he/she no longer meets the criteria for an SSI disability. Not many individuals (including Social Security staff) know about this provision, but it could greatly benefit youth exiting foster care.
When determining ways to maximize financial resources for youth in state custody, it is important to work with the child welfare agency. If the child welfare agency does not have a point person to address social security benefits, it may help to develop a policy outlining roles and responsibilities between the child welfare agency and other stakeholders. Equally, it is important to train child welfare social workers and child advocates to determine when youth may be eligible to apply for social security benefits. Such benefits may provide a significant financial safeguard to help youth achieve reunification and/or permanency with low-income families considering placement. Social security benefits may also help provide a modest financial cushion for youth exiting foster care on their path toward independence.
Eliza Hirst, Esq., CWLS, is deputy child advocate in the Delaware Office of the Child Advocate. She can be reached at firstname.lastname@example.org
1 This case is based on a four siblings I currently represent as their attorney guardian ad litem.
2 Washington State Dep’t of Social and Health Servs. v. Keffeler, 537 U.S. 371 (2003).
4 Kinship Care Givers and Permanency; Rubin, et. al, “The Impact of Kinship Care on Behavioral Well-being for Children in Out-of-Home Care,” Journal of Pediatric & Adolescent Medicine.
5 Money returned to Social Security Administration cannot be recovered at a later point if assets dip below the $2,000 financial limit. www.socialsecurity.gov/pubs/EN-05-10076.pdf.
6 https://secure.ssa.gov/poms.nsf/lnx/0603030020. HI 03030.020 Resource Exclusions.
7 http://www.socialsecurity.gov/pubs/EN-05-10076.pdf; 20 C.F.R. § 416.1210.
8 20 C.F.R. §404.2021,§ 416.621.
11 20 C.F.R. § 416.1233.
15 http://policy.ssa.gov/poms.nsf/lnx/0300203035 (POMS Child’s Benefits Termination of Entitlement Part C.)
16 20 C.F.R. § 404.361; POMS GN 00306.100.A.2; 64 F.R. 14608, Mar. 26, 1999.
19 https://secure.ssa.gov/poms.nsf/lnx/0414505010. Sections 225(b) and 1631(a)(6) of the Social Security Act, as amended; 20C.F.R §404.316(c), 404.327, 404.328, 404.337(c), 404.352(d), 404.902(s), 404.1586(g), 404.1596(c)(2), 404.1597 (a), 416.1320(d),416.1331(a) and 416.1331(b), 416.1338, and 416.1402(j) (as amended regulations effective July 25, 2005).
SSI Eligibility Questions
When determining whether to recommend a youth for an SSI application, consider the following eligibility questions:
- Is the youth in an institutional setting?
- Has the youth been hospitalized (either for a physical or ental health need) more than three times in the past year?
- Has the youth been expelled or suspended excessively for behavior issues in the past two years?
- Does the youth have an Individual Education Plan (IEP)?
- Does the youth have a seizure disorder or a loss of functional abilities?
- Does the youth have significant developmental delays?
- Does the youth ever have hallucinations, delusions, illusions, or paranoid thinking?
- Does the youth have a diagnosis or symptoms of bipolar disorder?
- Does the youth have a severe lack of impulse control?
- Does the youth have significant cognitive disabilities (i.e., a low IQ)?
- Does the youth have a significant disturbance of concentration, attention, or judgment?
- Does the youth have significant deficits in gross or fine motor development?
- Does the youth have significantly impaired social functioning? (e.g., a serious inability to achieve age-appropriate autonomy as manifested by excessive clinging or extreme separation anxiety)
- Does the youth have any diagnoses that make it difficult for him or her to function in school, in a home setting, or in other aspects of life?
- Does the youth have a diagnosis of attention deficit hyperactivity disorder (ADHD), post-traumatic stress disorder (PTSD), bipolar disorder, or other diagnoses coupled with difficulty in school and in a home placement?
SSI Exempt Resources7
Permissible items most relevant for youth in (or aging out of) care are bolded.
- Residence: purchasing a home, paying off rent or mortgage for that calendar month only, or security deposit. (Note: an SSI recipient cannot make advanced rent or mortgage payments.) Making modifications to accommodate disabilities, home repairs, or maintenance.
- Household furnishings and appliances
- Household expenses: food, utilities
- Medical expenses not covered by Medicaid, dental expenses, glasses, therapy
- Education expenses, which include computer, software, books, etc.
- Burial arrangements
- Entertainment expenses: books, magazines, movie/concert tickets, sporting events, audio/video equipment
- Vacation travel: airline tickets, train/bus passes, hotels, restaurants, any other things associated with travel
- Attorney fees for estate planning and/or Medicaid planning
- Debt repayment: existing credit card debt or loans. (Note: show is required to demonstrate that the debt was owed and paid using SSI funds.)
- Personal hygiene: haircuts, manicures
- Automobile: auto payments, registration, insurance, and maintenance. (Note: the recipient must be listed on the title to the car.)
- Purchase clothing
- $30/month for recipients in a residential treatment facility for personal needs
Specific Prohibitions to Spending Down Resources
- Gifts to another person
Approved Expenditures from a Dedicated Account
A representative payee must use dedicated account funds for the benefit of the child only for:
- Medical treatment
- Job skills training
- Personal needs assistance for the child
- Special equipment for the child, which might include computers, software
- Housing modification based on the child’s need
- Special foods to maintain a specific diet (i.e. gluten free, lactose intolerant, etc.)
- Therapy for the child
- Rehabilitation for the child
- Respite care or specialized day care for the child
- Other items and services that SSA determines appropriate. (Note: It is best practice to get SSA approval before diverging from the list of approved expenses.)
A payee may not use dedicated account funds for:
- Repayment of SSI overpayments
- Basic maintenance costs (food, housing, clothing, and personal items) not related to the child’s impairment
- Any items that do not knowingly and directly benefit the recipient
- Emergency Exception: The funds may be used for basic living expenses only when failure to do so may result in the child becoming homeless or malnourished. (Note: under this emergency exception, it is important to maintain documentation of such expenses.)
Representing Kate: What Would You Do?
Sixteen-year-old Kate lives in a group home under the permanency goal of APPLA (another planned permanent living arrangement). She was initially removed from her family because of significant neglect and dependency at age 13. Last year, she was placed in a residential treatment center (RTC) for nine months to treat post-traumatic stress disorder, ADHD, and bipolar disorder. She has not lived with her mother in almost three years because her mother never completed her case plan and then moved out of state.
When Kate was discharged from the RTC, her mother was not a placement option. Kate is now relatively stable in her group home, but wants to be reunified with her mother. She attends therapy once a week and has a community aide. She receives independent living services through the group home and is doing well in high school. Kate’s mother is back in the state but is unemployed and does not have stable housing. As a result, Kate’s mother is not financially stable enough to care for Kate.
- Would Kate likely be eligible for SSI based on her past and present mental health needs?
- If SSI is awarded, how could a lump sum and monthly SSI income be used?
- Would the application process take too long?
- What other services or supports would the family need for Kate and her mother to reunify?
The short answer: It depends! Although Kate was in an RTC for nine months, she is now relatively stable. To qualify for SSI, she would have to meet the eligibility criteria, plus show marked or severe functional limitation in her activities of daily living. In addition, the process to obtain SSI can take 10+ months. At the point where she might prevail on an SSI eligibility finding, Kate would be close to aging out of the foster care system. While there is no penalty for applying for SSI, the family may need to explore other options to help with reunification, such as applying for SSDI for the mother, applying for subsidized housing, pursuing mental health and job assistance for the mother. Another option would be to increase visitation and participation in counseling to preserve Kate and her mother’s relationship.
Steps to Obtain SSDI/SSSB:
- At or before the adjudicatory hearing, the attorney should determine if the parents are deceased, disabled, or meet age requirements for retirement. If disabled, inquire whether the parent receives SSDI or SSSB.
- Collaborate with the child welfare caseworker to ensure any SSDI /SSSB benefits go toward the child.
- Ask the child welfare caseworker to apply for SSDI /SSSB and the special lump-sum death payment, if the youth is eligible at the time of application.