People most commonly identified as eligible for Medicare are those who are 65 years of age or older.  However younger individuals who cannot work because of their disabilities may also be eligible for Medicare.

Medicare eligibility for both older and disabled people is linked to eligibility for Social Security benefits[i], and requires a work history with contributions to Social Security for varying periods of time.  Disability is defined as:

(A) inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or has lasted or can be expected to last for a continuous period of not less than 12 months, or
(B) blindness.[ii]

Unfortunately, individuals who become entitled to disability benefits must wait 24 months for Medicare coverage to begin. The hospital insurance portion of Medicare (Part A) is free, and a monthly premium is charged for the supplemental medical insurance portion of Medicare (Part B).

But what about an individual who attempts working again after receiving disability benefits?   The continuation of health care coverage by the Medicare program is very important to such individuals as they test their uncertain ability to work.  Congress has taken this need into account by providing for continued Medicare eligibility during various stages of reentry into the job market by disabled individuals.

Medicare eligibility for working people with disabilities falls into three distinct time frames.  The first is the trial work period, which extends for 9 months after a disabled individual obtains a job.  The second is the seven-and-three-quarter years (93 months) after the end of the trial work period.  Finally, there is an indefinite period following those 93 months. Keep in mind that Medicare eligibility during each of these periods applies only while the individual continues to meet the medical standard for being considered disabled under Social Security rules.

Trial Work Period

An individual who is receiving Social Security disability benefits is entitled to continue receiving Medicare as well as Social Security income during a maximum 9 month "trial work" period.[iii]  To qualify, an individual must have gross earnings of at least $670 per month in 2008, or work at least 80 hours per month.  The nine months of the trial work period do not necessarily have to be consecutive.  During the trial work period, the ability to perform such work will not disqualify the individual from being considered disabled and receiving Social Security and Medicare benefits.   However, independent evidence that the individual is no longer disabled could end benefits during the trial work period.  After the nine month trial work period has ended, the work performed during it may be considered in determining whether the individual is no longer disabled, and thus no longer eligible for Social Security income and Medicare benefits.

Extended Medicare Coverage

Individuals who still have the disabling impairment but earn income that meets the "Substantial Gainful Activity" level can continue to receive Medicare health insurance after successfully completing a trial work period.[iv]  The Substantial Gainful Activity level for 2008 is $940 a month, or $1,570 for the blind.  This new period of eligibility can continue for as long as 93 months after the trial work period has ended, for a total of eight-and-one-half years including the 9 month trial work period.  During this time the beneficiary pays no premium for the hospital insurance portion of Medicare (Part A), although as usual, premiums are due for the supplemental medical insurance portion (Part B).  If the individual’s employer is large enough to have more than 100 employees, it is required to offer health insurance to individuals and spouses with disabilities, and Medicare will be the secondary payer.  For smaller employers who offer health insurance to persons with disabilities, Medicare will remain the primary payer.

Indefinite Access to Medicare

Even after the eight-and-one-half year period of extended Medicare coverage has ended, working individuals with disabilities can continue to receive benefits.  At this point the individual will have to pay the premium for Part A as well as the premium for Part B.[v]  The amount of the Part A premium will depend on the number of quarters of work in which the individual or his spouse have paid into Social Security.   Individuals whose income is low, and who have resources under $4,000 ($6,000 for a couple), can get help with payment of these premiums under a state run buy-in program for Qualified Disabled and Working Individuals.