After a couple of years spent hacking away at disability budgets, the Trump administration faces a new challenge: Is it willing to save the ABLE program?
If we don’t see more people open up ABLE accounts in the near future, disability advocates warn, the program won’t last much longer.
What Is the ABLE Program?
The ABLE program is a relatively new federal program designed to help people with disabilities save money. ABLE accounts are tax-free savings accounts that hold up to $100,000 (with an annual contribution limit of $15,000) without risking government benefits, on which millions of individuals with disabilities depend.
Established under the Achieving a Better Life Experience (ABLE) Act of 2014, the program is run in 37 states and accepts out-of-state applications.
The drawback: Accounts are only available to people whose disabilities developed before age 26. That leaves out everyone with a condition that occurred later in life, including multiple sclerosis, paralysis, and injuries sustained in military service.
In a letter sent to Congress this month, the 159-strong Consortium for Citizens with Disabilities proposed increasing the cutoff age to 46. This measure, known as the ABLE Age Adjustment Act, would multiply the number of people granted this important opportunity for financial stability.
Without doing so, it’s not just individuals who lose out, the letter stated; “the entire ABLE program nationwide is in jeopardy.”
Why Is the ABLE Program at Risk?
According to the National Association of State Treasurers, which represents ABLE’s state administrators, the program needs an estimated 390,000 accounts by June 2021 to reach “bare bones sustainability.”
This is mainly due to the costs of account maintenance. At an average of $50 per account, program managers need 390,000 accounts to reach total annual program fees of $19 Million.
Yet only 17,000 accounts were open nationwide by the end of 2017, and that’s “much, much lower than anyone expected,” said Heather Sachs, policy and advocacy director at the National Down Syndrome Congress.
“The disability community has been told for decades ‘don’t put money in your loved one’s name,’ so there’s a lot of skepticism out there,” Sachs said. “We’re doing a lot of education, but the bottom line is that the biggest chance of bringing up the number of accounts to sustainability is to increase the pool.”
ABLE’s Unprecedented Potential to Improve Quality of Life
Historically, individuals with disabilities could report no more than $2,000 in cash savings to remain eligible for Social Security, Medicaid, and other public benefits.
Taking benefits out of the equation and increasing contributions to $15,000 is, of course, a significant change. And unlike trusts, ABLE accounts give their owners control over their money. For the first time, the government seems to recognize the disability community’s right to independence and their significant costs of living.
And it’s not just conditions with late onsets that rack up hundreds of thousands of dollars. People with cerebral palsy (and other injuries), caused by medical errors or doctor mistakes at birth, need support over an entire lifetime. Personal support, employment support, accessible housing and transportation, assistive devices, and healthcare expenses are just a few of many setbacks their families tackle to ensure they live life to the fullest.
The government’s willingness to cover these costs is a start, but Congress promised years ago to account for onset of disability past age 26, according to the Consortium’s letter. If it continues to cap eligibility now? Well, then we can only assume ABLE is another ploy to keep disability budgets tight.
Given the rate of adoption so far, experts think it “unlikely” that ABLE accounts will increase fast enough to meet the program’s 3-year goal. Yet disability advocates press on, optimistic that their united effort will help pass the ABLE Age Adjustment Act before the close of 2018.
