Benefits Training

and Consulting


October 18, 2010

No Cost-Of-Living Adjustment for 2011


By now, I imagine you have received, at least, one email announcing there will be no cost-of-living adjustment to Social Security benefits in 2011.  The email notices I received failed to provide details. So here are the details.


Why was there no COLA for 2011?


By law (the Social Security Act) the increase is calculated based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of the last year a cost-of-living adjustment (COLA) was determined to the third quarter of the current year.  There is no increase in the CPI-W from the third quarter of 2008, the last year a COLA was determined, to the third quarter of 2010, therefore, there can be no COLA in 2011.


The law further states - if the increase in the CPI-W is at least one-tenth of one per­cent (0.1 percent), there will be a COLA. However, if the CPI-W increases by less than 0.05 percent, or if the CPI-W decreases, there will not be a COLA.  This will determine if there will be an increase for 2012.  The increase will be calculated from the third quarter of 2008 to the third quarter of 2011.


Comparison Table 2010 and 2011


The amounts marked by one asterisk (*) will be unchanged in 2011 because of the COLA (see above)

The amounts marked by two asterisks (**) will be unchanged in 2011 because there was a decrease in the national average wage index for 2009.  The index is 0.97 percent lower than the index for 2008.


The amounts marked by one asterisk (*) will be unchanged in 2011 because of the COLA (see above)

The amounts marked by two asterisks (**) will be unchanged in 2011 because there was a decrease in the national

   average wage index for 2009.  The index is 0.97 percent lower than the index for 2008.



Maximum Taxable Earnings:



Social Security (OASDI only)



Medicare (HI only)

No Limit

(This is the maximum amount of taxable wage for the calendar year.)


Quarter of Coverage:



Earnings needed to earn one Social Security credit



(Beginning January 1st, your goal is the earn four credits which are converted to quarters of coverage.)


Retirement Earnings Test Exempt Amounts:




Under full retirement age
NOTE: One dollar in benefits will be withheld for every $2 in earnings above the limit.




The year an individual reaches full retirement age
NOTE: Applies only to earnings for months prior to attaining full retirement age. One dollar in benefits will be withheld for every $3 in earnings above the limit.



There is no limit on earnings beginning the month an individual attains full retirement age.


Social Security Disability Thresholds:



Substantial Gainful Activity (SGA)








Trial Work Period (TWP)

$ 720/mo.

$ 720/mo.**


SSI Federal Payment Standard:




$ 674/mo.

$ 674/mo.*





SSI Student Exclusion:



Monthly Limit



Annual Limit



If you have an interest in how the COLA is calculated, SSA provides a thorough explanation. Go to Automatic Increases  


As of October 15th, Medicare has not announced premium adjustments to Part A or Part B.

I’ll let you know these amounts when Medicare announces the COLA for 2011.


The “Medicare and You - 2011" publication is available, but it contains 2010 figures, at this time.

Go to Medicare and You - 2011  


SSA is preparing to initiate BOND - January 2011

(Benefit Offset National Demonstration)


The Ticket to Work and Self-Sufficiency Improvement Act of 1999 contained a requirement for the Social Security Administration to test and evaluate an alternative approach to administering title II benefits when a beneficiary goes to work.  For years, the barrier to significant employment encountered by beneficiaries is the performance of substantial gainful activity (SGA) after the Trial Work Period .  By performing SGA, the beneficiary’s disability ceases and the cash benefit stops.  A majority of working beneficiaries “park” their earned income below SGA during the Extended Period of Eligibility and continue to receive their cash benefit.  While work incentives are available to reduce the amount of wage SSA counts, these work incentives continue to be under-utilized.  


As directed by Congress in 1999, SSA initiated a pilot demonstration project in four states in 2005 and it concluded in 2008.  The project is known as Benefit Offset Pilot Demonstration Project (BOPD).  The four states were Connecticut, Utah, Vermont, and Wisconsin.   Participation in the pilot projects was voluntary and enrolled approximately 1,800 title II beneficiaries, 900 in the treatment group and 900 in the control group (no concurrent beneficiaries participated). 


The focus of BOPD was to evaluate an 1 for 2 benefit offset approach to adjusting cash benefits when a beneficiary worked.   In other words, when the beneficiary was found to be performing SGA in the Extended Period of Eligibility, the cash benefit would be reduced $1 for every $2 of wage above SGA.  This pilot project gave SSA insight to design and implement a national demonstration project.  You can review the findings and reports from the four pilot states at BOPD  


SSA used their experience and that of the participating BOPD states to design the next step, a national demonstration project named the Benefit Offset National Demonstration (BOND) project which is set to begin in January 2011 and run for approximately 8 years.  Ten sites were selected to implement BOND


BOND Site Name

                 Site Geography*


  State of Alabama

Arizona/ Southeast California

  States of Arizona, and

  southeastern California


  States of Colorado and Wyoming

DC Metro

  Washington, DC; suburban Maryland;

  northern Virginia; northeastern West


  Greater Detroit

  Southeastern Michigan

  Greater Houston

  Southeastern Texas

  Northern New England

  States of Maine, New Hampshire,

  Vermont, and northern Massachusetts

South Florida

  Southern Florida

Western New York

  Western New York and northern



  State of Wisconsin

* Small areas of each state may not be included.


BOND is designed to have two stages.  In the first stage, SSDI and concurrent beneficiaries will be randomly assigned to either a treatment group or a control group.  The treatment group will assigned to the $1 for $2 offset (the cash benefit is reduced $1 for every $2 of wage above SGA after cessation of disability has been found).  The

control group will be subject to current policies.   In the second stage, volunteer SSDI-only beneficiaries will be randomly assigned to one of three groups.  The first group will be eligible for the benefit offset and enhanced benefits counseling (beyond what the Work Incentives Planning and Assistance (WIPA) projects currently provide).  The second group will be eligible only for the benefit offset.  The third group will be the control group subject to current policies.


Further details are available at BOND.  Use the following address (cut and paste)‑%20Enclosure%20‑%20Section%20234%20

Report%20‑%2005242010.doc    SSA is currently developing a web page for the project.


My comment: The project has the potential to significantly change how income effects SSDI benefits and enable beneficiaries to generate significant income.  They would experience “the more you earn, the less you receive in benefits” rather than “fall off the cliff.”  If you provide services in one of the selected BOND sites you should encourage your customers to participate in the project.  When more details are available, I’ll let you know.


Successful Launch of Internet-based Training


Earlier this month, I sent out a notice of the availability of Internet-based training (Webinars) on a 24 hour per day, seven days a week basis.  The response has been great.  I began with three basic training sessions to address the needs of people unfamiliar with Social Security Programs or people needing a refresher because they don’t routinely

work with benefits.  The currently available sessions are:


1.  The Basics of the Social Security Programs

2.  The Basics of the title II Program (Social Security, SSDI)

3.  The Basics of the title XVI Program (SSI)


Before each training session, you have the opportunity to printout a handout (about 15 pages) to follow the presentation and to take notes.  After the session, you can email me any questions to clarify your understanding of the material presented.


Recent participants indicate they like the convenience of this format, they can fit into their schedule. 


I’ll be adding additional training sessions.  Currently, I am working on 1) Applying for Benefits, 2) Using Impairment-related Work Expenses, and 3) School-to-Work Transition.  Customers have offered suggestions for topics and I’m still looking for additional suggestions.  Let me know what you need.


If your colleagues (particular new staff) have not attended one of my live presentations, they probably are not on my newsletter distribution list, please let them know of this resource.  Also, I would appreciate your notifying families and other people supporting a person with a disability of this new resource. 

To access the training sessions go to WEBINARS.


Questions I Receive


Question 1


“I have been working with a widow, age 53, with disabilities. She has been found disabled by SSA. Her record would give her a benefit of $1600 per month. However, Social Security has issued her a benefit of about $1200 based on her late disabled husband’s record.”


Without additional information, the best possible answer is - While she was found medically disabled by SSA, she may not be entitled to SSDI based on her own work record.  To qualify for SSDI due to a disability, a person must be fully insured and insured for disability.  This means at 53 years of age, she would need 32 quarters of coverage to be fully insured.  To be insured for disability she would need 31 quarters of coverage and 20 of these quarters must be earned in the 10 years before qualifying for benefits.  (Individuals with statutory blindness must only be fully insured.)


If she does not qualify for SSDI, she could qualify for Disabled Widow’s benefits off her deceased spouse’s work record because: 1) she is over 50 years of age; 2) she has a disability; 3) the marriage lasted for 10 years; and 4) the spouse deceased within seven years of her disability onset and he was fully insured at the time of his death.


Question 2


“I have a client that receives SSI only who works, usually summer seasonally at a drugstore chain. He moved into his own apartment this summer with Supported Living assistance (paid for by our agency). He is making approximately $1100 a month net. I’m trying to get him on a budget. His SSI has been cut to $600 a month for now. Can I get a % taken off his earned income based on accommodations given by his employer? I get a letter from them? (I don’t think they really give him many accommodations but…)


And can I take an IRWE for the time Supported Living Services takes to get him ready for work?


Also can I deduct his transportation ($5 taxi daily) since he can’t take the bus HOME as it stops running at 6 PM – public transportation isn’t available.”


Many people ask similar questions.  The accommodations provided to work are considered a subsidy or special support and the supported living services could also be considered a subsidy.  People who receive SSI can not use subsidy or special supports to reduce their countable earned income and receive a higher SSI amount.


The taxi ride can be an Impairment-related Work Expense (IRWE) if he is unable to drive a vehicle, because public transportation is not available a the time he is finished work. Another common IRWE that should be considered is the co-payments for prescribed medication and/or over-the-counter medications.


Social Security considers his gross earned income not his net income.  So, the SSI adjustment to $600 is an inadequate adjustment.  If this is not corrected, he will be found in overpayment when they perform the Annual Redetermination of benefits.


Note: This question came from California.  In California, a SSI recipient receives a state supplementary payment (SSP) that is administered by Social Security.  The amount of SSP is based on the person living arrangement.  Since he recently moved into an apartment, I suspect Social Security is still using the higher SSP for a group living arrangement.  This also must be corrected to avoid further overpayment of the cash benefit.  He must formally notify Social Security of the change in living arrangement.


Upcoming Workshops


The specific location for each workshop is posted at my web site.  Registration can also be completed at the site.  Go to WORKSHOPS    


October 25, 2010       Wichita, KS

October 26, 2010       Lawrence, KS

October 27, 2010       Olathe, KS


November 1, 2010     Dayton, OH

November 2, 2010     Bowling Green, OH

November 3, 2010     Dublin, OH    (Columbus area)

November 4, 2010     Richfield, OH  (Cleveland area)

November 5, 2010     Mansfield, OH


November 8, 2010       Vestal, NY   (Binghamton area)

November 9, 2010       Latham, NY  (Albany, area)

November 11, 2010     Syracuse, NY

November 12, 2010     Kenmore, NY


November 15-20, 2010   Pennsylvania (schedule will be post at the web page)

November 29-December 3  New England (schedule will be post at the web page)


Anyone interested in hosting a workshop in Florida, Georgia, or Louisiana in January 2011?

As the host organization you have ten free seats in exchange for meeting space and light refreshments.  Contact me if you are interested.


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