Order Code RS22195
July 14, 2005
CRS Report for Congress
.Received through the CRS Web
Social Security Disability Insurance (SSDI)
and Medicare: The 24-Month Waiting Period
for SSDI Beneficiaries Under Age 65
Julie M. Whittaker
Analyst in Applied Microeconomics
Domestic Social Policy Division
Summary
Members of Congress frequently are asked to support legislation to alter or
eliminate the required 24-month waiting period before a Social Security Disability
Insurance (SSDI) beneficiary under 65 years of age may receive Medicare benefits. This
paper explains the required 24-month waiting period and its legislative history. The
report also provides information on other programs that may provide access to health
insurance during the required waiting period. It also briefly describes legislation
introduced in the 109th Congress (H.R. 2343, H.R. 2680, H.R. 2869, and S. 1217). This
report will be updated to reflect legislative activity.
The 24-Month Medicare Waiting Period for Social
Security Disability Recipients Under Age 65
Title XVIII of the Social Security Act provides that Social Security Disability
Insurance (SSDI) beneficiaries are eligible for Medicare hospital insurance (Part A).
Individuals are also eligible to purchase Medicare supplementary medical insurance (Part
B) or enroll in a Medicare Advantage plan (formerly known as a Medicare+Choice plan).
Starting in 2006, SSDI beneficiaries will also be eligible for voluntary prescription drug
benefits (Part D).1
Generally, SSDI beneficiaries under age 65 are eligible for Medicare coverage in the
month after they have received 24 months of SSDI benefits. Because of the five-month
waiting period from onset of the disabling condition for disabled individuals to be
qualified to receive SSDI benefits, this results in a total of 29 months after the onset of
1 The SSDI program provides benefits to insured disabled workers under the full retirement age
(and to some spouses, surviving disabled spouses, and children) in amounts related to the
disabled worker’s former earnings in covered employment. SSDI beneficiaries who are at least
65 years of age qualify for Medicare coverage on the basis of age.
Congressional Research Service ˜ The Library of Congress

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the disability before an individual is eligible for Medicare benefits. Thus, at the beginning
of the 30th month since the onset of the qualifying disability, SSDI beneficiaries become
eligible for Medicare coverage.
Exceptions to the 24-Month Waiting Period. For SSDI beneficiaries under
65 years of age, there are exceptions to the required 24-month waiting period for certain
diseases. Specifically, SSDI beneficiaries qualify for Medicare:
! after 24 months of receiving SSDI benefits (the general rule described
previously); or
! at the first month of receiving SSDI benefits if the beneficiary has
amyotrophic lateral sclerosis (ALS, or Lou Gehrig’s disease); or
! after the third month when a beneficiary has end-stage renal disease
(ESRD) or kidney failure; or
! in the month in which a beneficiary receives a kidney transplant.
The ALS exception went into effect July 1, 2001 as a result of P.L. 106-554. The ESRD
provision was part of Social Security Amendments of 1972, P.L. 92-603.
Other Persons Under Age 65 Who Are Eligible for Medicare Because of
a Disabling Condition. In addition to SSDI beneficiaries, other individuals who are
under age 65 may be eligible for Medicare on account of a disabling condition as
described below.
! Certain disabled local, state, and federal employees who do not receive
SSDI benefits may be eligible after the analogous waiting period.
! Disabled widows and widowers ages 50 to 65 (and disabled divorced2
widows and widowers ages 50 to 65) are eligible for Medicare after a
24-month qualifying period if they are receiving Social Security benefits
based on disability. For disabled widows/widowers, previous months of
eligibility for Supplemental Security Income (SSI) based on disability
may count toward the qualifying period.
! Certain dependent adult children of Medicare beneficiaries are eligible
for Medicare if they developed a permanent and severe disability before
age 22 and thus qualify for SSDI benefits based on a parent’s work
history. The two-year waiting period applies and starts when an
individual turns 18 (or when he or she is determined to be disabled if it
is after age 18).
! A spouse or child may be eligible for Medicare, based on a worker’s
record, if the spouse or child is on continuing dialysis for ESRD or has
a kidney transplant, even if no other family member participates in the
Medicare program.
Table 1 shows the number and percentage of persons under 65 years old who
received Medicare in July 2003 due to disabling condition. Of the 41 million Medicare
beneficiaries, approximately 6 million beneficiaries under the age of 65 received Medicare
on account of disability status. Almost 41% of disabled beneficiaries were between the
2 The duration of the marriage must have been at least 10 years.

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ages 55 and 64. More men (54.5%) than women (45.5%) received this benefit. The vast
majority (73.9%) were white.
Table 1. Persons Under Age 65 Who Receive Medicare on Account
of Disability, 2003
End stage
End stage
renal
renal
All disabled
disease only
All disabled
disease only
Age
Under 35
553,946
13,801
9.1%
0.2%
35–44
1,154,953
15,428
19.0%
0.3%
45–54
1,885,826
25,323
31.0%
0.4%
55–64
2,484,699
27,110
40.9%
0.4%
Sex
Men
3,311,265
44,736
54.5%
0.7%
Women
2,768,159
36,926
45.5%
0.6%
Race
White
4,495,109
37,913
73.9%
0.6%
All other races
1,571,271
43,551
25.8%
0.7%
Unknown race
13,044
198
0.2%
0.0%
Total
6,079,424
81,662
100.0%
1.3%
Source: The Congressional Research Service (CRS) tabulations from Annual Statistical Supplement, 2004,
Table 8.B5 Hospital Insurance and/or Supplementary Medical Insurance: Number of enrollees under age
65 who are disabled or have end stage renal disease, by program, age, sex, and race, July 1, 1980–2003,
selected years. Data downloaded on July 1, 2005 from
[http://www.ssa.gov/policy/docs/statcomps/supplement/2004/8b.html#table8.b5].
In 2001 (the most recent data year available), on average each of these (non-ESRD)
disabled beneficiaries used $4,462 in Medicare services, which was substantially less than
those (non-ESRD) individuals over the age of 65 used ($5,961). On average, an ESRD
beneficiary used $29,399 in Medicare services.3
Legislative History of SSDI Beneficiaries Medicare Eligibility
The Social Security Amendments of 1972, P.L. 92-603, extended Medicare to
disabled people who had been entitled to Social Security Disability Insurance (SSDI)
benefits for at least 24 consecutive months. The provision required the waiting period to
begin with the first month of SSDI entitlement, which is five months after the onset of the
disability.
Congressional Reasoning for the 24-Month Waiting Period. In 1971, the
House Committee on Ways and Means Report recommended extending Medicare
protection to the disabled and stated that the Committee felt it was “imperative to proceed
3 MEDPAC, A Data Book: Healthcare Spending and the Medicare Program, June 2004. See
[http://www.medpac.gov/publications/congressional_reports/Jun04DataBook_Entire_report_l
inks.pdf], pages 3-4.

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on a conservative basis.” The Report stated that the 24-month waiting period was
intended to:
... help keep the costs within reasonable bounds, avoid overlapping private health
insurance protection, particularly where a disabled worker may continue his
membership in a group insurance plan for a period of time following the onset of his
disability and minimize certain administrative problems that might otherwise arise...
Moreover, this approach provides assurance that the protection will be available to
those whose disabilities have proven to be severe and long lasting.4
A similar statement was included in the report to the Senate from the Committee on
Finance.
Changes to the Waiting Period Criteria. The Social Security Disability
Amendments of 1980, P.L. 96-265, permitted an individual becoming reentitled to SSDI
benefits to count the months of the earlier spell of disability in satisfying the 24-month
waiting period if the spell occurred within the previous five years (seven years for
disabled widow(er)s and those who were disabled since childhood). The amendments
also provided that if an individual was in a trial work period after the termination of the
SSDI benefits, and had not completed the 24-month waiting period, the months of the trial
work period could count toward satisfying the required waiting period for Medicare
eligibility.
Effective October 1, 2000, P.L. 106-170 (the Ticket to Work and Work Incentives
Improvement Act of 1999) extended Medicare Part A coverage to certain working former
SSDI beneficiaries for a total of 8.5 years.5
Programs That May Provide Health Insurance During the 24-
Month Waiting Period
Medicaid. Those SSDI beneficiaries who are poor may qualify for Supplemental
Security Income (SSI) benefits. Under SSI, disabled, blind, or aged individuals who have
low incomes and limited resources are eligible for benefits regardless of their work
histories.6 In most states SSI receipt will entitle a person to Medicaid benefits.7 Certain
working SSDI beneficiaries who had been receiving Medicaid benefits may be eligible
for a Buy-In Option allowing maintenance of Medicaid coverage.8 As of June 2005, 30
states provide this option (although Missouri will be discontinuing it shortly).
4 U.S. Congress, House Committee on Ways and Means, Report on H.R. 1, the Social Security
Amendments of 1972, H.Rept. 92-231, 92nd Congress, 1st session. (Washington: GPO, 1971), p.
67.
5 See CRS Report RL31157, Ticket to Work and Work Incentives Improvement Act of 1999:
Implementation Status, by Karen Tritz. (Hereafter cited as RL31157, Ticket to Work.)
6 See CRS Report RS20294, SSI Income and Resource Limits: A Fact Sheet, by April Grady.
7 See CRS Report RL31413, Medicaid: Eligibility for the Aged and Disabled, by Julie Stone,
p. 8.
8 RL31157, Ticket to Work.

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Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA,
P.L. 99-272). Title X of the Consolidated Omnibus Budget Reconciliation Act of 1985
(COBRA, P.L. 99-272) requires employers who offer health insurance to continue
coverage for persons who would otherwise lose coverage due to a change in work or
family status. Coverage generally lasts 18 months but, depending on the circumstances,
can last for longer periods.9 If the Social Security Administration (SSA) makes a
determination that the date of an individual’s onset of disability occurred during the first
60 days of COBRA coverage or earlier, the employee (and the employee’s spouse and
dependents) is eligible for an additional 11 months of continuation coverage. This is a
total of 29 months from the date of the qualifying event (which must have been a
termination or reduction in hours of employment). This provision was designed to provide
a source of coverage while individuals wait for Medicare coverage to begin.
Other Programs. SSDI beneficiaries may qualify for other government programs
including Veterans’ programs for hospital and medical care.10
Costs of the 24-Month Medicare Waiting Period
Some SSDI Beneficiaries Die Within 24-Months. According to recent
research based on new SSDI beneficiaries in 1995 who qualified upon their own work
record, 11.8% died within the waiting period, 2.1% recovered, and 86.1% became entitled
to Medicare.11 The study estimated hypothetical Medicare costs for the first 24 months
of SSDI entitlement to be $10,055 in 2000 dollars per person.12 Costs varied substantially
by diagnostic group and by whether the person died or recovered during the waiting
period. On average, beneficiaries who died during the waiting period were estimated to
cost $25,864, whereas those who recovered were estimated to cost $1,506.
Medicare Costs. One study suggested that eliminating the 24-month Medicare
waiting period would cost $5.3 billion13 while another study estimated the cost at $8.7
billion.14 The differences in the estimates are because: (1) the $5.3 billion used 2000
dollars while the $8.7 billion is in 2002 dollars: (2) the $5.3 billion estimate is for only
9 See CRS Report RS30626, Health Insurance Continuation Coverage Under COBRA, by Heidi
Yacker. While some SSDI beneficiaries may continue to work, current employer-sponsored
health insurance is generally not available because of the limited earnings and limited work hours
of this group.
10 See CRS Report RL32548, Veterans’ Medical Care Appropriations and Funding Process, by
Sidath Panangala.
11 Gerald F. Riley, “The Cost of Eliminating the 24-Month Medicare Waiting Period for Social
Security Disabled-Worker Beneficiaries,” Medical Care, vol. 42, no. 4 (Apr. 2004), pp. 387-394.
(Hereafter cited as Riley, The Cost of Eliminating the 24-Month Medicare Waiting Period.)
12 Ibid. (Persons with ESRD were excluded because their waiting period was only three months
as were managed care enrollees). Costs were inflation adjusted to year 2000 dollars by using the
Hospital Input Price Index for Part A and the Medicare Economic Index for Part B.
13 Riley, The Cost of Eliminating the 24-Month Medicare Waiting Period.
14 Stacy Berg Dale and James M. Verdier, Elimination of Medicare’s Waiting Period for
Seriously Disabled Adults: Impact on Coverage and Costs, The Commonwealth Fund, Issue
Brief, July 2003, [http://www.cmwf.org/publications/publications_show.htm?doc_id=221569].

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SSDI beneficiaries that qualified under their own work record while the $8.7 billion
estimate includes disabled adult children and disabled widow(er)s; and (3) each used
substantially different estimation methodologies. Neither of these estimates include the
cost of the prescription drug benefit that starts in January 2006.
Medicaid Cost Savings. In 2002, approximately 40% of SSDI beneficiaries in
the Medicare waiting period were enrolled in Medicaid. One study estimated that the
federal government would save $2.5 billion in Medicaid if the 24-month waiting period
was eliminated; however, these federal Medicaid savings would more than be offset by
the aforementioned cost increases to the Medicare program. Additionally, the states
would realize $1.8 billion in Medicaid savings if the waiting period was eliminated.15
Legislative Activity for 109th Congress
The elimination of the 24-month waiting period has been of sustained interest to
Congress. Congressional concern about whether to provide Medicare benefits during the
first two years of SSDI benefits continues to be centered around the following:
! the expected prohibitive cost;
! the difficulty in administration because many SSDI beneficiaries qualify
retroactively;
! creating unintended economic incentives that would encourage
enrollment and discourage work; and
! unintentionally crowding out private insurance markets.
Many bills have been introduced in the last three sessions of Congress to alter or
eliminate the 24-month waiting period. Four bills have been introduced in the 109th
Congress.
! H.R. 2343 would provide for the elimination of the 24-month waiting
period for SSDI beneficiaries to become eligible for Medicare.
! H.R. 2680 would eliminate the 24-month waiting period for terminally
ill individuals to be eligible for Medicare benefits.
! S. 1217 and H.R. 2869 would allow for a gradual reduction in the waiting
period. For 2006, the waiting period would be 18 months; each
subsequent year would have an additional two month reduction in the
waiting period until 2015 when there would be no waiting period. The
bills would also require that a list of conditions that are fatal without
medical treatment be compiled; persons with those conditions would be
exempt from the waiting period immediately.
15 Ibid.

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