Repeat After Me: ‘SSI Is Not Social Security’

SSI is a federal welfare program that has absolutely nothing to do with Social Security other than the fact that it happens to be managed by the Social Security Administration. Popartic/Shutterstock

If I had a million dollars, I'd buy commercial time at the upcoming Super Bowl and run an ad that would say, in big bold letters, “SSI is not Social Security.” I have written dozens of past columns about this topic.

But I’ve just got to do so again. It seems to me that just about everyone in this country confuses the Supplemental Security Income (SSI) program with the Social Security program. To clarify, let’s start with some background.

I’m sure everybody knows what Social Security is. You get a Social Security number, you work, you pay Social Security taxes, and one day you and possibly some of your dependents collect Social Security retirement benefits. Or you become disabled before reaching retirement age and you and possibly some of your dependents get Social Security disability benefits. Or you die and your widow or widower and/or minor children collect Social Security survivor benefits.

But only a small percentage of Americans really know what Supplemental Security Income is. To introduce it, here is a short history lesson. Back before the early 1970s, there were hundreds of different welfare programs in the country. Sometimes states administered welfare programs. At other times, counties had their own welfare programs. And in some places, cities or other jurisdictions had their own welfare programs. It was a mess.

Some officials in the Nixon administration had a good idea. They decided to federalize and standardize this hodgepodge of welfare programs into one national program. But then they had two bad ideas.

The first bad idea: They gave this new program to the Social Security Administration to run. On the one hand, I suppose it made sense. The Social Security Administration had a network of field offices around the country, and it had the computer infrastructure necessary to manage a big, national government benefits program. On the other hand, they messed up a nice, clean government operation used to dealing mostly with grandpas and grandmas and saddled it with the task of running a big, messy welfare system.

And their second bad idea was the name. Some people somewhere in the Nixon administration decided to call the new program Supplemental Security Income. I understand what they were trying to do.

They wanted to remove the negative connotations of the word “welfare” from the minds of potential program beneficiaries. But this act of political correctness has led to problems ever since.

So they called the new program Supplemental Security Income, and they gave the program to the Social Security Administration to run. And almost everyone back then in the 1970s, and almost everyone still today, got the impression that Supplemental Security Income is some kind of supplemental Social Security benefit.

It’s not. SSI is a federal welfare program that has absolutely nothing to do with Social Security other than the fact that it happens to be managed by the Social Security Administration. SSI payments are funded out of general tax revenues—not Social Security taxes.

Gosh, how I wish they would have called SSI something like the Federal Welfare Program. And gosh, how I wish they would have created a new federal agency to run it and called it something like the Federal Welfare Benefits Administration.

Anyway, here are some examples just from this week’s emails that give you an idea of all the confusion caused by the misnamed program.

Q: In a recent column, you wrote that people getting Social Security Income are getting welfare. I beg to differ. Social Security is NOT welfare. How could you say that?

A: You misunderstood what I wrote. The column you refer to was explaining the Supplemental Security Income program. SSI is a federal welfare program that is managed by the Social Security Administration. And in that column, I said that many people confuse SSI with Social Security. And I specifically wrote that lots of folks (obviously including you) mistakenly think that SSI stands for Social Security Income. It does not. To repeat, SSI stands for Supplemental Security Income, which is a welfare program.

Q: In a past column, you said that someone getting disability benefits (and this is a direct quote) “could inherit a million dollars and still be eligible for disability benefits.” I recently inherited a lot less than that (about $100,000), and it got me into all kinds of trouble with my SSI disability. I’m jumping through lots of hoops now trying to keep my benefits.

A: You misunderstood what I wrote. In that past column, I was referring to someone getting Social Security disability benefits. Social Security is not a welfare program. You could be a millionaire and still get Social Security, whether it’s a retirement benefit, a disability benefit, or a survivor benefit.

But you are not getting Social Security disability. You are getting SSI disability. And to repeat, SSI is a welfare program. And as a general rule, someone who inherits $100,000 doesn’t need welfare. I’m not a real expert on the SSI program, but you may be able to set up something called a “special needs trust” that lets you keep your SSI checks. Those may be the “hoops” you are trying to jump through.

And here is one final tidbit that further shows how these two programs can get confused. The Social Security disability program is frequently referred to as SSDI, which stands for Social Security disability insurance. And the SSI disability program is usually called SSID.

So finally, repeat after me. SSI is a welfare program. It is not a Social Security program. SSI does not stand for Social Security Income. It stands for Supplemental Security Income.