Stephanie O. Joy, Esq.
School Loans News: Disabled with "Medical Improvement Not Expected" - DOE and SSA working together .
As a matter that is near and un-dear to my heart, school loans have driven the best-of-the-intendeds (however ill-informed young people we once were) into a life of involuntary servitude and indenture. It is not the fact of a debt that is ultimately troubling, we all have free will and generally should be accountable for our choices. However, it is the violation of expectations of transparency, conflicts of interest, arms length contracting, and full disclosures that have caused the ruination of so many American lives in pursuit of what was once coined, "higher education." (That descriptor is clearly up for debate in modern times, but that is a different chat for another day.)
The Department of Education announced in August, 2021 that 323,000+ SSDI or SSI recipients who also happen to be student loan borrowers will have their debts discharged. The blessed discharge involves those whose disabilities stem from the kinds of medical impairments that are not expected to improve, aka "Medical Improvement Not Expected," or MINE.
I expect that the reasoning behind what I think is a sound policy is that there is a very remote, if at all possible, chance that these folks burdened with their very severe medically limiting impairments will ever have the benefit of improving, much less improving enough to successfully garner a simple, sedentary, unskilled minimum or other paying job on a sustained basis. It is also my understanding that the MINE categorization occurs only after the consideration of likelihood of pertinent improvements in medicine, time-frames, ages, etc. MINE is not a category liberally doled out. IMO: If a borrower is never going to be able to earn income (in theory, derived from that expensive education), there is no purpose in continuing to lay that undefeatable burden on his shoulders until death do they part. The financial stress of exorbitant school loan debt that far exceeds the income power generated by that debt is a very health-sucking toxicity to even those not disabled - so the removal of same from those that will never be able to crawl out from under it due to disabilty, seems like a no-brainer to me.
End Result: This MINE discharge avenue already existed and was used by many. However, previously, a person had to be aware of that and be able to apply for it, affirmatively. The federal DOE and the SSA will share data to make such discharge automatic - a beautiful change that follows the intent of the policy. A borrower may opt out of the discharge, but since it is non-taxable unlike other forgiveness-of-debt, I expect opting out will be unusual.