Issue Brief #5:
Statewide Independent Living Council

What does it mean to have a disability in Colorado?

Poverty

The history of Colorado over the last century is a story of remarkable economic growth and development. However, the continued existence of poverty in our state is a stark indicator that there are individuals in our midst that remain on the margins of our society. Although all demographics are impacted by poverty, it is a particularly prevalent problem among those with disabilities in our state. The fact that there are a disproportionate amount of individuals with disabilities in Colorado impacted by poverty indicates that there remains a social, economic, and vocational gap between those with and without disabilities in our state.

The U.S Census Bureau uses a set of income thresholds that vary by family size and composition to determine who is living in poverty. Put simply, if a family’s total income is less than the family’s threshold, then that family, and every individual in it, is considered in poverty. The 2010 Poverty Income for a family of one is $10,830. Each additional family member raises this level by $3,740. These poverty guidelines are used to establish financial eligibility for various federal programs.

When evaluating poverty statistics for people with and without disabilities, Colorado fares better than the national average. The poverty rate among working age people (18-64) with disabilities in the US is 28.7% compared to 12.3% for people without disabilities. In Colorado, the poverty rate is 23.3% for people with disabilities and 9.5% for people without disabilities. Although the prevalence of poverty in Colorado is lower than the national average, people with disabilities remain much more likely to be living in poverty than people without disabilities.

A person with a disability living in Colorado is more than 2.4 times more likely to live in poverty than a person without a disability.

Poverty rates vary from region to region throughout the state. Likewise, the disparity in poverty prevalence between people with and without disabilities looks very different from one area to next. In urban areas of Colorado, a person with a disability is 2.7 times more likely to live in poverty than a non-disabled person. In rural areas, the disparity is often not as large. However, the degree of the disparity varies. For instance in Pueblo, a person with a disability is 2.3 times more likely to live in poverty than other residents, while in Craig a person with a disability is only 1.7 times more likely to meet the threshold. While the disparity between individuals with and without disabilities is not as severe, it should be noted that the overall prevalence of poverty is much higher in rural areas of the state. The highest rates of poverty among people with disabilities are in Pueblo (31.6%), Durango (23.9%), Greeley (25.1%), and Ft Collins (24%). It is the higher rates of poverty in the general population of these rural areas that make the relative rates of poverty for people with disabilities lower than the urban areas.

People with disabilities in urban areas are more likely to live in poverty relative to the general local population. In rural areas, more people, both disabled and non-disabled, live in poverty.

There are several federal, state, and local programs aimed at reducing poverty. While these programs have certainly improved the quality of life of recipients, they fall far short of eliminating poverty altogether. The primary anti-poverty program for children and working age adults with disabilities is Supplemental Security Income (SSI). The 2010 cap on the SSI monthly award is typically $674 per month. For a couple, the monthly award is usually capped at $1,011.

Total annual SSI income for 2010 is usually capped at $8,088 for a single person, 25% under the federal poverty threshold. For a couple the amount is $12,132, 17% under the federal poverty threshold.

In order to receive SSI, an individual must earn less than Substantial Gainful Activity (SGA), a threshold established by the Social Security Administration. For 2010, that threshold has been set at $1,000 a month for non-blind recipients. Earnings up to SGA, reduce SSI benefits on a sliding scale. Another criterion for SSI eligibility is a restriction on accumulating personal assets above $2,000 in worth. This requirement severely limits the ability of people disabilities dependent upon SSI to accumulate savings, retirement pensions, second cars, stocks, bonds, children’s college funds, inheritance, and material of high value such as jewelry, antiques, art, etc. Consequently, individuals on SSI are very limited in their ability to make the kind of investments necessary to rise out of poverty. Likewise, their lack of acquired assets leaves them very vulnerable to changing financial circumstances.

All too often, SSI recipients have no resources to manage a financial crisis and must rely on outside assistance to bridge gaps in emergency situations.

Given the limitations imposed by SSI eligibility, it would be financially beneficial for most recipients to gain employment and rise out of the program. However, often individuals with disabilities feel compelled to remain on SSI due to their reliance on Medicaid health insurance. Medicaid provides access to hospitals, physicians, pharmaceutical treatment, durable medical equipment, home health assistance, medical transportation, and nursing home care. Many individuals fear they may lose Medicaid eligibility should they make too much income. There are provisions in place that allow individuals to retain Medicaid even if their earned income rises above SGA. Many individuals with disabilities are not aware that these provisions are in place.

The fear that earned income will negatively impact vital benefits extends beyond just SSI and Medicaid eligibility. Section 8 Housing vouchers and food stamps are also linked to income. The more income earned by recipients, the greater the share of rent paid by the individual and the less food stamps awarded. Consequently, many individuals with disabilities living in poverty feel they are penalized should they gain paid employment.

Despite these fears, employment is the key to rising out of poverty. Individuals with disabilities often face many obstacles to employment that other individuals do not. Consequently, it is important that the state continues to fund programs aimed at helping individuals with disabilities develop job skills and secure employment. In addition, it would likely be beneficial for Colorado to look for ways to educate individuals with disabilities concerning how employment impacts vital benefits. Such an educational initiative could help ease fears and correct the misconceptions that make these individuals apprehensive about entering the workforce.

*2007 American Community Survey, U.S. Census

'Steve Gold Informational Bulletin #272

^ Statistics Describing the Population with Disabilities in Colorado: By County and CIL Catchment Area; Andrew J. Houtenville, Ph.D. September 2009. The generalities that can be drawn from the report as compiled by Dr. Houtenville are affected by the double count in the overlaying CIL area of the Denver Metro area and, to a lesser degree, the Colorado Springs/Pueblo area. That being said, the numbers and the percentages are adjusted to compare rural and urban impacts.

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Colorado SILC

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What does it mean to have a disability in Colorado?

Poverty