The Achieving a Better Life Experience (ABLE) Act of 2013 (S. 313/ H.R. 647) was introduced in the 113th Congress with bipartisan support from Rep. Ander Crenshaw (R-FL) and Sen. Robert Casey (D PA).
The ABLE Act would amend Section 529 of the IRS Code of 1986 to create tax-free savings accounts for individuals with disabilities. The bill aims to ease financial strains faced by individuals with disabilities by making tax-free savings accounts available to cover qualified expenses. This bill would supplement, but not supplant, benefits provided through private insurances, the Medicaid program, the supplemental security income program, the beneficiary’s employment, and other sources.
To encourage and assist individuals and families in saving private funds for the purpose of supporting individuals with disabilities to maintain health, independence, and a better quality of life.
Covered Qualified Expenses
Education – including tuition for preschool thru post-secondary education, books, supplies, and educational materials related to such education, tutors, and special education 6 services.
Housing – Expenses for a primary residence, including rent, purchase of a primary residence or an interest in a primary residence, mortgage payments, home improvements and modifications, maintenance and repairs, real property taxes, and utility charges.
Transportation – Expenses for transportation, including the use of mass transit, the purchase or modification of vehicles, and moving expenses.
Employment Support – Expenses related to obtaining and maintaining employment, including job-related training, assistive technology, and personal assistance supports.
Health Prevention and Wellness – Expenses for health and wellness, including premiums for health insurance, mental health, medical, vision, and dental expenses, habilitation and rehabilitation services, durable medical equipment, therapy, respite care, long term services and supports, nutritional management, communication services and devices, adaptive equipment, assistive technology, and personal assistance.
How to Qualify for an ABLE Account:
Any individual who is receiving, deemed to be, or treated as receiving supplemental security income benefits or disability benefits under Title II of the Social Security Act.
Any individual who has a medically determined physical or mental impairment, which results in marked and severe functional limitations, and which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 month or is blind, and provides a copy of their diagnosis signed by a physician.
No one who qualifies for an ABLE account is able to use that eligibility to secure supplemental security income benefits or Medicaid.
Federal Treatment of ABLE Account under Supplemental Security Income Program:
When the assets in an ABLE account reach $100,000, if the beneficiary is receiving Supplemental Security Income (SSI) benefits, any monthly SSI benefits will be placed in suspension
If the assets in the ABLE account drop back below $100,000, the SSI benefit suspension ceases and any SSI benefit resumes
The beneficiary will not have to reapply for SSI benefits once the account drops back below the $100,000 threshold
No Impact on Medicaid Eligibility:
Under no circumstance will anyone with an ABLE account who is currently receiving Medicaid benefits lose their benefits –even if their SSI benefits are suspended
The beneficiary will never lose their eligibility for Medicaid based on the assets held in their ABLE account
Medicaid Payback Provision:
In the event the qualified beneficiary dies (or ceases to be an individual with a disability) with remaining assets in an ABLE account:
The assets in the ABLE Account are first distributed to any State Medicaid plan that provided medical assistance to the designated beneficiary.
The amount of any such Medicaid payback is calculated based on amounts paid by Medicaid after the creation of the ABLE Account.