Social Security Disability
Participation in the Ticket to Work Program Has Increased, but More Oversight Needed Gao ID: GAO-11-828T September 23, 2011This testimony discusses the Social Security Administration's (SSA) Ticket to Work and Self-Sufficiency Program (Ticket program). Created by law in 1999, the Ticket program was intended to assist disability beneficiaries in obtaining and retaining employment, and potentially bring about significant savings to the Disability Insurance Trust Fund by reducing or eliminating their benefits. Under the program, SSA provides each eligible beneficiary (ticket holder) with a ticket to obtain services from SSA-approved public or private providers, referred to as employment networks (EN), or from traditional state vocational rehabilitation agencies (VR). When the Ticket program was created, it was estimated that it had the potential to provide significant savings to the Social Security Trust Funds and Treasury. However, our prior work and the work of SSA's Office of the Inspector General and others has questioned the viability of the program due to low participation and costs that are not offset by beneficiaries returning to work and reducing dependency on benefits. In an effort to address these concerns, SSA revised its regulations in 2008 to attract more ticket holders and ENs. This testimony summarizes our report issued in May and focuses on (1) how participation of ticket holders and employment networks in the Ticket program has changed over time, (2) what is known about the range of service approaches used by employment networks, and (3) the policies and processes SSA has to evaluate employment networks and ticket holders to ensure program integrity and effectiveness.
In summary, we found that more ticket holders and ENs are participating in the Ticket program since SSA revised its regulations in 2008, but the overall participation rate remains low. SSA has not yet studied whether the 2008 changes have enabled more ticket holders to obtain employment and exit the benefit rolls. The number of ENs approved to serve ticket holders has increased; however, many ENs are not actively participating, and ticket payments have remained concentrated with only 20 ENs. These ENs provide a range of services, including assistance with job search and retention. But since the 2008 changes in regulations, an increasing number have used service approaches targeting ticket holders who are already working or ready to work, including simply passing back a portion of the payment from SSA. Finally, we found SSA lacks adequate management tools for evaluating ENs and ticket holders to ensure program integrity and effectiveness. For instance, SSA has not developed performance measures for contracted ENs to assess their success in helping assigned ticket holders obtain and retain employment and reduce dependence on disability benefits. Without such measures, we found multiple ENs communicating to ticket holders how to work part time and keep full disability benefits indefinitely, despite the fact that the ultimate goal of the program is to reduce dependence on benefits. In addition, ticket holders who show timely progress toward self-supporting employment are generally exempt from medical continuing disability reviews (CDRs) conducted to determine continued eligibility for benefits. However, SSA has not consistently monitored or enforced the requirements for timely progress and, therefore, ticket holders in the program have been exempt from CDRs for years regardless of whether they show progress in the program. Lack of systematic monitoring of timely progress has both program integrity and cost implications, such as the potential for ineligible beneficiaries to continue receiving benefits. In our May report, we made four recommendations to address these issues and enhance program oversight. SSA has already implemented one of these recommendations, developing performance measures for ENs, and has reported it is moving forward to implement another to track EN service approaches and assess their consistency with program goals. We will continue to monitor the agency's implementation of the other recommendations.
GAO-11-828T, Social Security Disability: Participation in the Ticket to Work Program Has Increased, but More Oversight Needed
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United States Government Accountability Office:
GAO:
Testimony:
Before the Subcommittees on Social Security and Human Resources,
Committee on Ways and Means, House of Representatives:
For Release on Delivery:
Expected at 9:00 a.m. EDT:
Friday, September 23, 2011:
Social Security Disability:
Participation in the Ticket to Work Program Has Increased, but More
Oversight Needed:
Statement of Daniel Bertoni, Director:
Education, Workforce, and Income Security Issues:
GAO-11-828T:
Chairmen Johnson and Davis, Ranking Members Becerra and Doggett, and
Members of the Subcommittees:
I am pleased to be here today to discuss the Social Security
Administration's (SSA) Ticket to Work and Self-Sufficiency Program
(Ticket program). Created by law in 1999, the Ticket program was
intended to assist disability beneficiaries in obtaining and retaining
employment, and potentially bring about significant savings to the
Disability Insurance Trust Fund by reducing or eliminating their
benefits.[Footnote 1] Under the program, SSA provides each eligible
beneficiary (ticket holder) with a ticket to obtain services from SSA-
approved public or private providers, referred to as employment
networks (EN), or from traditional state vocational rehabilitation
agencies (VR).[Footnote 2] When the Ticket program was created, it was
estimated that it had the potential to provide significant savings to
the Social Security Trust Funds and Treasury.[Footnote 3] However, our
prior work and the work of SSA's Office of the Inspector General and
others has questioned the viability of the program due to low
participation and costs that are not offset by beneficiaries returning
to work and reducing dependency on benefits.[Footnote 4] In an effort
to address these concerns, SSA revised its regulations in 2008 to
attract more ticket holders and ENs.
My testimony summarizes our report issued in May[Footnote 5] and
focuses on (1) how participation of ticket holders and employment
networks in the Ticket program has changed over time, (2) what is
known about the range of service approaches used by employment
networks, and (3) the policies and processes SSA has to evaluate
employment networks and ticket holders to ensure program integrity and
effectiveness. To conduct this work, we analyzed SSA data on ticket
holder and EN participation, and reviewed SSA policies and procedures
for the program, and relevant federal laws and regulations. We also
interviewed representatives of 25 ENs, including 20 ENs among those
with the largest payments in fiscal years 2007 and 2009, as well as
disability advocacy organization and SSA officials. In addition, an
investigator from our Forensic Audits and Investigative Service team
contacted selected ENs, posing as a fictitious employer or relative of
a ticket holder to test for potential vulnerabilities in program
management and oversight. A more detailed explanation of our
methodology is available in our full report. Our work was performed in
accordance with generally accepted government auditing standards.
In summary, we found that more ticket holders and ENs are
participating in the Ticket program since SSA revised its regulations
in 2008, but the overall participation rate remains low. SSA has not
yet studied whether the 2008 changes have enabled more ticket holders
to obtain employment and exit the benefit rolls. The number of ENs
approved to serve ticket holders has increased; however, many ENs are
not actively participating, and ticket payments have remained
concentrated with only 20 ENs. These ENs provide a range of services,
including assistance with job search and retention. But since the 2008
changes in regulations, an increasing number have used service
approaches targeting ticket holders who are already working or ready
to work, including simply passing back a portion of the payment from
SSA. Finally, we found SSA lacks adequate management tools for
evaluating ENs and ticket holders to ensure program integrity and
effectiveness. For instance, SSA has not developed performance
measures for contracted ENs to assess their success in helping
assigned ticket holders obtain and retain employment and reduce
dependence on disability benefits. Without such measures, we found
multiple ENs communicating to ticket holders how to work part time and
keep full disability benefits indefinitely, despite the fact that the
ultimate goal of the program is to reduce dependence on benefits. In
addition, ticket holders who show timely progress toward self-
supporting employment are generally exempt from medical continuing
disability reviews (CDRs) conducted to determine continued eligibility
for benefits. However, SSA has not consistently monitored or enforced
the requirements for timely progress and, therefore, ticket holders in
the program have been exempt from CDRs for years regardless of whether
they show progress in the program. Lack of systematic monitoring of
timely progress has both program integrity and cost implications, such
as the potential for ineligible beneficiaries to continue receiving
benefits. In our May report, we made four recommendations to address
these issues and enhance program oversight. SSA has already
implemented one of these recommendations, developing performance
measures for ENs, and has reported it is moving forward to implement
another to track EN service approaches and assess their consistency
with program goals. We will continue to monitor the agency's
implementation of the other recommendations.
Background:
To be eligible for Disability Insurance (DI) or Supplemental Security
Income (SSI) benefits, an individual generally must have a medically
determined physical or mental impairment that (1) has lasted or is
expected to last at least 1 year or result in death and (2) prevents
the individual from engaging in substantial gainful activity
(SGA).[Footnote 6] Once an individual is receiving benefits, CDRs are
periodically conducted by SSA to determine if the individual has
medically improved to the point of being able to work and is no longer
eligible for benefits.[Footnote 7]
When an individual becomes eligible for DI or SSI benefits, SSA mails
a ticket to them. Generally, DI and SSI beneficiaries from 18 to 64
years old are eligible ticket holders and may choose whether or not to
use their tickets, and with which service providers. Likewise, SSA-
approved ENs can decide whether to serve an individual ticket holder.
Ticket holders who assign their tickets and demonstrate "timely
progress" toward self-supporting employment, such as by fulfilling
minimum earnings or education requirements to be reviewed regularly,
are exempted from medical CDRs.[Footnote 8] This provision provides an
incentive for individuals to assign their tickets who otherwise might
not attempt to work out of fear that a medical CDR would cause them to
lose benefit eligibility. The ticket holder's ticket becomes
"assigned" once the ticket holder and EN decide to work together and
submit an individual work plan describing the services the EN will
provide. A ticket holder can unassign the ticket from the EN at any
time, sometimes switching to a different EN. When the ticket holder
has sufficient earnings, the EN becomes eligible for payments from
SSA.[Footnote 9] The EN can choose from two payment options: (1)
milestone-outcome payments that begin when the ticket holder achieves
a specified level of earnings and continue for a specified time after
the ticket holder no longer receives benefits due to earnings, or (2)
outcome-only payments that do not begin until the ticket holder is
entirely off benefits.
Due to low participation rates by both ticket holders and ENs, SSA
revised the Ticket program regulations in 2008.[Footnote 10] The
changes lowered the ticket holder earnings threshold that triggers
payments to ENs. Previously, ENs were not eligible for SSA payment
until a ticket holder had earnings at the SGA level or above. Now
there is a first phase of four $1,275 payments[Footnote 11] over a
ticket holder's first 9 months working at the trial work level, which
is below SGA and, in many cases, equates to part-time work.[Footnote
12] The EN is also eligible for a second phase of smaller monthly
payments when a ticket holder has earnings above the SGA level, and a
third and final phase of payments (the outcome phase) once a ticket
holder is earning above SGA and no longer receives disability
benefits. Another key change made in 2008 was to explicitly allow ENs
to use milestone or outcome payments to make payments directly to
ticket holders.
More Ticket Holders and Employment Networks Participating, but
Participation Rate Remains Low:
Ticket holders assigning their tickets to ENs increased from about
22,000 in fiscal year 2007, before the changes to program regulations,
to more than 49,000 as of July 2010.[Footnote 13] Despite the increase
in numbers, those assigning their tickets to ENs represented less than
1 percent of the approximately 12.1 million eligible ticket
holders[Footnote 14] as of July 2010.[Footnote 15] Representatives of
the private company SSA contracts with to conduct outreach told us
that while they are beginning to place more emphasis on increasing
ticket holder participation, their earlier recruitment efforts
prioritized increasing the supply of ENs. According to EN
representatives, ticket holder participation remains low due, in part,
to a lack of understanding and awareness of the program. Some
disability rights advocates and EN representatives said a fear of
losing benefits may also deter eligible ticket holders from
participating in the program, especially DI beneficiaries who, after a
9-month trial work period, face an immediate cessation of benefits in
a given month when earnings exceed SGA.[Footnote 16]
Although the number of ticket holders assigning their tickets has
increased since the 2008 changes, the extent to which more ticket
holders are returning to work and exiting the benefit rolls is
unknown. The law requires SSA to conduct ongoing independent
evaluations of ticket holders' employment outcomes, and SSA has
tentative plans to study exits from the benefit rolls under the
revised program regulations.[Footnote 17] Whether or not ticket
holders are able to leave the rolls has implications for the program's
cost-effectiveness and ultimately, its long-term viability. In
preliminary research examining the program prior to the 2008
regulatory changes, Mathematica found more exits from the rolls would
be needed to offset existing operational costs.[Footnote 18]
In our May report, we recommended that SSA prioritize and carry
through with a study of participating ticket holders' exits from the
rolls and the agency noted it has plans to study the effects of the
2008 changes on the Ticket program. However, prioritizing and carrying
through with their plans will be important going forward to determine
the extent to which ticket holders actually exit the rolls due to long-
term employment. Without it, an accurate and complete assessment of
the Ticket program's effectiveness cannot be made.
Although an increasing number of ENs are participating in the Ticket
program since the 2008 changes in regulations, many ENs are not
actively participating and SSA ticket payments have remained
concentrated with only 20 ENs. The number of ENs contracted by SSA
increased from 1,514 in fiscal year 2007 to 1,603 as of July 2010.
[Footnote 19] During this time, ENs accepting at least one ticket also
increased from 752 to 1,086. The majority of EN representatives we
interviewed said the regulatory changes provided greater incentive for
participation because ENs can now receive payments for ticket holders
with earnings earlier than before as well as for ticket holders with
part-time earnings. ENs receiving ticket payments from SSA more than
doubled, from 206 in fiscal year 2007 to 460 as of July 2010. Total
payments to ENs grew substantially, from $3.8 million in fiscal year
2007 to $13 million as of July 2010. Yet 20 ENs, or less than 2
percent of the total number accepting tickets in fiscal year 2009,
have received more than 70 percent of SSA's ticket payments in recent
years. Reasons why EN participation is not broader may be partly
attributable to costs. Even though SSA officials said the 2008
regulatory changes were intended to address the costs associated with
providing initial services, several EN representatives told us that
financing the upfront costs of providing services can be challenging,
and some said providing resource-intensive services, such as career
and personal counseling, could limit profitability.
Employment Networks Vary in Service Approaches, but Increasingly Focus
on the Employed or Ready to Work:
Those ENs receiving some of the largest payment amounts from SSA
provide a range of services, including assistance with job search and
retention. But since the 2008 changes in regulations, an increasing
number of ENs used service approaches targeting ticket holders who are
already working or do not need assistance in obtaining employment. For
example, since the 2008 regulatory changes, which explicitly allowed
ENs to pay ticket holders, an increasing number of ENs shared SSA
ticket payments with ticket holders who have sufficient earnings to
qualify the EN for payment.[Footnote 20] This "shared payment"
approach allows the EN to readily claim ticket payments while
providing no direct services because the ticket holder is already
working or able to find a job without assistance. This service
approach accounted for an increasing proportion of total ticket
payments made by SSA.[Footnote 21] In fiscal year 2007, 1 of the 20
ENs among those with the largest payment amounts used this approach
and received about $787,000 in SSA payments, or one-fifth of all
payments to ENs. In fiscal year 2009, 3 of the 20 ENs among those with
the largest payment amounts used this approach and received over $4
million, or nearly one-third of all payments to ENs.[Footnote 22] Two
of these ENs simply pass back 75 percent of SSA's ticket payment to
ticket holders and retain 25 percent for themselves; and the third
offers ticket holders $500 every 3 months.[Footnote 23]
Some disability rights advocates and EN representatives said that
since program rules do not allow ticket holders to serve as their own
ENs, this approach allows them to receive a Ticket program payment for
their efforts to find a job on their own. Some EN representatives also
said the payment may help a ticket holder meet needed work-related
expenses such as transportation, clothing, and child care, increasing
the likelihood he or she will keep a job. However, some disability
rights advocates and EN representatives said this approach only works
for ticket holders who can find employment on their own, and raises
questions about the value these ENs add to the program. For example,
one disability rights advocate said that it would be preferable for
SSA to give the ticket holder the entire payment directly, rather than
paying an EN a portion of the ticket payment to serve as a middleman.
Additionally, the representatives told us ticket holders may need
support after finding employment, such as counseling or help with a
disability-related relapse, but choose an EN using the shared-payment
approach because they are enticed by the financial incentive and do
not anticipate future difficulties. Further, according to one EN
representative, because these ENs do not provide a vocational
assessment of strengths, weaknesses, and aptitude, ticket holders may
end up in a job that is a poor fit, affecting their ability to retain
it and, ultimately, reduce dependency on benefits.
Long-term outcomes of ticket holders receiving shared payments
compared to those receiving support services is unknown, because SSA
does not assess the relative outcomes of ticket holders based on
services received. A senior SSA official said that the program must
balance the demands it places on ENs to provide services with
incentives for them to participate, and that Congress' intent was to
provide ticket holders with a choice of services. However, the
official acknowledged some concerns about the shared payment approach
because the program was not intended to provide a wage subsidy nor
assist those who can find employment on their own, but to provide
tangible employment-related services to those who can benefit most.
After reviewing the draft of our May report, the agency posted new
requirements that ENs provide a minimum level of services and
periodically assess ticket holders' need for additional services.
[Footnote 24]
SSA also does not compile data on the shared payment approach or any
other service provision trends to inform its management and oversight
of the program, or to tailor its guidance to ENs. For example,
although SSA compiles information on certain types of service
providers, such as mental health providers, as part of its efforts to
recruit specific providers, it does not obtain comprehensive
information on services provided by all ENs. Moreover, while service
providers applying to become ENs must indicate which services they
intend to provide in a checklist on the application form, and approved
ENs must update this information on their annual periodic outcome
report to SSA, the checklist does not include shared payments. In our
May report we recommended that SSA adopt a strategy for compiling and
using data on trends in EN service provision to determine whether
service approaches, such as sharing SSA ticket payments with ticket
holders, are consistent with program goals of helping ticket holders
find and retain employment and reduce dependency on benefits. SSA
agreed with our recommendation and officials said they will take steps
to identify EN service approaches and assess their consistency with
program goals.
SSA Lacks Adequate Management Tools for Evaluating Employment Networks
and Ticket Holders to Ensure Program Integrity and Effectiveness:
SSA has not developed EN performance measures to assess their success
in helping assigned ticket holders obtain and retain employment and
reduce dependence on disability benefits. Without performance
measures, SSA is unable to systematically evaluate EN performance, and
ultimately determine whether ENs should be allowed to remain in the
program. The Ticket law directs SSA to develop performance measures
for quality assurance in the provision of services by ENs, and gives
SSA the authority to terminate EN contracts for inadequate
performance.[Footnote 25] Internal control standards for the federal
government also stress the use of performance measures for proper
stewardship of and accountability for government resources, and for
achieving effective and efficient program results.[Footnote 26]
Lack of performance measures may send the wrong message to ENs, whose
staff may be unclear about program goals and send mixed messages to
ticket holders about expected outcomes. Of the 25 ENs we interviewed,
representatives of 15 said SSA had not adequately articulated
performance expectations for serving ticket holders. SSA's EN handbook
does state the ultimate goal of the program is to reduce dependence
and, whenever possible, eliminate reliance on benefits. Yet, an EN,
which had the fourth-largest payment amount from SSA in fiscal year
2009, stated in its last three annual periodic outcome reports that
100 percent of its ticket holders placed in jobs had earnings of less
than $10,000 per year--equating to less than the SGA level, if
earnings were accrued regularly over the course of 12 months. In fact,
this EN's recorded phone message states that DI ticket holders can
work part time indefinitely without reducing SSA benefits, and its Web
site says most of its positions are designed so ticket holders stay
below income thresholds for benefit cutoff. With assistance from our
investigative staff, we found multiple ENs among those with the
largest payment amounts communicating through their Web sites,
recorded phone messages, or in our discussions with representatives
that as long as DI ticket holders' earnings stay below the SGA level,
they can keep full disability benefits (see Fig. 1 for excerpts of
calls our investigative staff made to ENs posing as the brother of a
ticket holder to learn about the Ticket program and the services
provided by the ENs). While full-time employment may be unattainable
for certain ticket holders and one key program official told us that
part-time employment is acceptable under the 2008 regulations, the
official said it should be a starting point, not an end goal.
Nonetheless, our review indicates some ticket holders are being
coached by ENs, including some of those with the largest payment
amounts, to work only part time so as not to jeopardize their benefits.
Figure 1: Transcript Excerpts of Calls with Employment Networks on
Working Indefinitely Without Losing Benefits, September and October
2010:
[Refer to PDF for image: illustration]
A GAO investigator phoned multiple ENs on behalf of a fictitious
brother, who was portrayed as a ticket holder,to learn about the
Ticket program and the services provided by the ENs. Below are
excerpts from three calls in which EN representatives told the caller
that a DI ticket holder may collect full monthly benefits indefinitely
as long as he remains under SGA earnings level, despite the fact that
the ultimate goal of the Ticket program is to reduce dependence on
benefits.
Call #1:
EN representative:’ So this is a service where it‘s funded by the
government, and it‘s services of–-you know-–to the community where
they help people with disability find part-time work.Because if they –
if you get any full-time work, then you know, they‘re gonna cut you
off. So we‘re not offering you full-time work. We‘re helping you find
part-time work.“
Call #2:
EN representative: ’What‘s important for your brother to know is that
right now, as of 2010,he can go out, work any job that he wants so
long as he stays under the $1,000a month, he gets his cake and eat[s]
it too. He gets the – he gets his wages, and he gets his full SSDI
benefit, and the medical, and everything that goes along with it. And
that can – that can go from today until your brother retires, or
whatever.“
Call #3:
EN recording: ’As long as SSDI recipients remain under those earning
limits and their disability does not improve, they can work part time
and continue to collect their full monthly SSDI check indefinitely.“
Source: GAO and employment networks.
Note: For the full transcripts of these calls, see [hyperlink,
http://www.gao.gov/products/GAO-11-324].
[End of figure]
Near the conclusion of our audit work, SSA officials told us that they
were considering future updates to address EN performance
expectations. We recommended that SSA move forward to develop EN
performance measures consistent with the requirements of the Ticket
law. SSA agreed with this recommendation and published performance
measures[Footnote 27] that SSA intends to enforce when data are
available in early 2012.
SSA also has not consistently monitored or enforced the timely
progress of ticket holders who assign their tickets to ENs and VRs in
order to assess whether they should continue to be exempt from medical
CDRs--a key tool for assessing continuing eligibility for benefits.
While timely progress by ticket holders is a regulatory
requirement,[Footnote 28] in 2005, SSA instituted a moratorium on
enforcing this requirement and essentially suspended the reviews of
timely progress for several years. However, SSA has acknowledged in
the preamble to its program regulations and in a 2005 internal memo
the importance of reviewing timely progress to ensure ticket holders
who have medically improved and no longer meet SSA's disability
requirements do not receive benefits and its disability programs do
not incur unwarranted costs. Further, without reviews of timely
progress, representatives of some ENs we interviewed said some ticket
holders "park" their tickets to get the CDR exemption, for example, by
assigning their ticket with no interest in obtaining EN services or
reducing their dependence on benefits. Resuming timely progress
reviews, they said, would be a positive motivator for ticket holders
to engage in EN services essential to obtaining and retaining
employment and, ultimately, reducing dependence on benefits.
During the course of our review, in November 2010, representatives of
the Ticket program manager (a private company contracted to conduct
much of the day-to-day operations, including timely progress reviews)
reported they began limited resumption of timely progress reviews,
mailing out requests for information on timely progress (the first
step in the review process) to roughly 4,900 of the 19,000 ticket
holders, or about 26 percent, due for review in November 2010. Given
that at the time of our review SSA estimated between 13,000 to 22,000
ticket holders will be due for timely progress reviews each month
during the first year of resumption, there is potential for a
significant backlog in such reviews. Further, SSA and program manager
representatives told us they will rely on ticket holder and EN self-
reported information to assess progress and determine who will
continue to receive a CDR exemption, and that they do not intend to
independently verify this information against employment records or
education documentation. In our past work, we have found that reliance
on self-reported information alone can lead to overpayments of SSA
benefits.[Footnote 29]
Accordingly, we recommended that SSA develop a strategy to both ensure
that progress reviews of ticket holders are completed promptly and
ensure the accuracy of information received. Since our report was
issued, SSA has reported they are reducing the backlog of reviews. In
addition, SSA has stated that the agency will review a random sample
of beneficiaries' cases to check the accuracy and reliability of
information compiled when making timely progress review decisions. We
welcome such reviews, but continue to be concerned that SSA may not
have reliable information on the front end to make timely progress
determinations. Given that these reviews are intended as a key
integrity tool--to ensure exemptions from CDRs for beneficiaries are
appropriate--we continue to believe that SSA needs a more strategic
approach to ensure promptness and accuracy.
Chairmen, Ranking Members, and Members of the Subcommittees, this
concludes my prepared statement. I would be happy to answer any
questions that you may have at this time.
Acknowledgments:
For further information regarding this testimony, please contact
Daniel Bertoni at (202) 512-7215 or bertonid@gao.gov. In addition,
contact points for our Offices of Congressional Relations and Public
Affairs may be found on the last page of this statement. Individuals
who made key contributions to this testimony are Jeremy Cox, Cady
Panetta, and Kristen Jones. Other staff who contributed includes Susan
Aschoff, James Bennett, Paul Desaulniers, Luann Moy, Margeaux
Randolph, Wesley Sholtes, Vanessa Taylor, and Craig Winslow.
[End of section]
Footnotes:
[1] The Ticket to Work and Work Incentives Improvement Act of 1999.
Pub. L. No. 106-170, § 101, 113 Stat. 1860, 1863-73 (codified as
amended at 42 U.S.C. § 1320b-19).
[2] Administered by the Department of Education since 1973, the
Vocational Rehabilitation program provides funds to states to offer
employment services ranging from treatment of impairments to job
counseling and placement. 29 U.S.C. §§ 721 and 731. Under SSA's
Vocational Rehabilitation Reimbursement Program, established before
the Ticket program, SSA reimburses VRs for costs of providing services
to a beneficiary when the beneficiary has earnings above an
established threshold over the course of 9 months. 42 U.S.C §§
422(d)(1) and 1382d(d). With the establishment of the Ticket program,
VRs can choose to be paid under either the EN payment system or the
traditional cost-reimbursement system.
[3] It was estimated that if an additional one-half of 1 percent of
disability beneficiaries went back to work, and ceased benefits, the
savings to the Social Security Trust Funds and Treasury would total
$3.5 billion over their working lives. Pub. L. No. 106-170, §
2(a)(12), 113 Stat. 1860, 1863.
[4] GAO, Social Security Administration: Better Planning Could Make
the Ticket Program More Effective, [hyperlink,
http://www.gao.gov/products/GAO-05-248] (Washington, D.C.: March
2005); SSA Office of the Inspector General, Ticket to Work and Self-
Sufficiency Program Cost Effectiveness, A-02-07-17048 Audit Report,
(Washington, D.C., August 2008); and Craig Thornton, Work Activity and
Use of Employment Supports Under the Original Ticket to Work
Regulations. Can the Ticket to Work Program Be Self-Financing?
Mathematica Policy Research, forthcoming.
[5] GAO, Social Security Disability: Ticket to Work Participation Has
Increased, but Additional Oversight Needed, [hyperlink,
http://www.gao.gov/products/GAO-11-324] (Washington, D.C.: May 2011).
[6] 42 U.S.C. §§ 416(i) and 1382c(a)(3). Under thresholds set annually
by SSA, individuals were considered engaged in SGA if they had
earnings in 2010 above $1,000 per month for nonblind beneficiaries and
$1,640 per month for blind beneficiaries.
[7] DI beneficiaries are allowed a 9-month trial work period during
which their benefits continue regardless of how much they earn. Upon
completion of the 9-month trial work period, DI beneficiaries move
into a 36-month re-entitlement period (extended period of eligibility)
in which their monthly cash benefit ceases except in months in which
earnings are less than SGA. DI recipients whose earnings are above SGA
after they complete the 36-month period should, under program rules,
stop receiving benefits and be removed from the disability rolls. In
contrast, SSI benefits are reduced by $1 for every $2 of earned income
exceeding $65 per month until benefits reach zero. If SSI
beneficiaries receive no benefits for 12 consecutive months due to
earned income, they are removed from the disability rolls.
[8] The Ticket law mandated that during any period for which an
individual is using, as defined by SSA, a ticket, SSA may not initiate
a CDR. 42 U.S.C. § 1320b-19(i). In its program regulations, SSA
defines "using" a ticket as making "timely progress toward self-
supporting employment," and outlines specific requirements a ticket
holder must meet in order to demonstrate timely progress and obtain or
maintain CDR exemption. 20 C.F.R. § 411.166 (2010).
[9] 42 U.S.C. § 1320b-19(h). SSA makes payments to ENs for DI
beneficiaries through the Federal Disability Insurance Trust Fund and
to ENs for SSI beneficiaries through appropriations from general
revenues. 42 U.S.C. §§ 401(b) and 1381.
[10] SSA-RFQ-11-0010J, Employment Networks for the Ticket to Work and
Self-Sufficiency Program.
[11] These payment amounts are for 2010.
[12] Some phase 1 payments to an EN are limited if the ticket holder
earned above the trial work level in the 18 months prior to ticket
assignment. 20 C.F.R. § 411.535(a)(1)(i) (2010).
[13] Overall ticket holder participation, including tickets used with
VRs participating in the cost-reimbursement system or assigned to ENs,
increased from about 266,000 in fiscal year 2007 to more than 318,000
in July 2010. Our review was generally limited to ENs and VRs paid as
ENs, and did not focus on VRs paid through the cost-reimbursement
system.
[14] All numbers referring to eligible ticket holders are as of the
last day of the fiscal year.
[15] As of July 2010, those assigning their tickets to ENs represented
two-fifths of 1 percent of eligible ticket holders, compared to one-
fifth of 1 percent in fiscal year 2007 before the regulatory changes.
As of July 2010, 2.6 percent of eligible ticket holders used their
tickets with VRs participating in the cost-reimbursement system or
assigned their tickets to ENs, an increase from 2.1 percent in fiscal
year 2004.
[16] While SSI beneficiaries experience a gradual reduction in
benefits based on how much they earn above SGA, DI beneficiaries,
following their trial work period, experience what is referred to as a
"cash cliff" in which they lose all benefits in a given month upon
reaching SGA. One EN representative said this creates an incentive for
DI beneficiaries enrolled in the Ticket program to find work with
wages below SGA. 20 C.F.R. § 404.1592(a) (2010).
[17] Pub. L. No. 106-170, § 101(d)(4), 113 Stat. 1869, 1875-76
(codifed at 42 U.S.C. § 1320b-19 note).
[18] Craig Thornton, Work Activity and Use of Employment Supports
Under the Original Ticket to Work Regulations. Can the Ticket to Work
Program Be Self-Financing? Mathematica Policy Research, forthcoming.
Mathematica's draft report estimated SSA spent approximately $34.1
million in fiscal year 2008 to run the Ticket program, including costs
of contracts SSA issued to organizations that operate key Ticket
program components.
[19] In fiscal year 2004 (the first year all 50 states participated in
the Ticket program), 1,286 ENs had contracts.
[20] Some milestone payments may not be available to an EN if, during
the 18 months prior to the ticket holder assigning the ticket, the
ticket holder worked and had earnings equal to or above the trial work
level amount.
[21] In addition to the shared payment approach that targets ticket
holders already working, two "employer-driven" service approaches that
target ticket holders who are ready to work have also accounted for a
greater share of SSA payments to ENs among those with the largest
payment amounts: an EN employs ticket holders itself, or an EN
primarily works with employers so as to develop and identify jobs for
ticket holders, similar to a staffing agency. See GAO-11-324 for more
information about these approaches.
[22] Although our review was limited to those ENs receiving among the
largest payments in fiscal years 2007 and 2009, through our EN
interviews and background review of the EN directory, we identified
several other ENs using the shared payment approach.
[23] According to a representative from the third EN, it also provides
some ticket holders with benefit planning assistance, although we did
not independently verify the services ENs reported providing in our
interviews.
[24] Solicitation Number: SSA-RFQ-11-0010J.
[25] 42 U.S.C. § 1320b-19(d)(5) and (6).
[26] GAO, Internal Control Standards: Internal Control Management and
Evaluation Tool, [hyperlink, http://www.gao.gov/products/GAO-01-1008G]
(Washington, D.C.: August 2001).
[27] Solicitation Number: SSA-RFQ-11-0010J.
[28] Ticket holders who assign their tickets are generally required to
make timely progress toward self-supporting employment. 20 C.F.R. §
411.180 (2010). A ticket holder who does not meet the timely progress
requirements is no longer exempt from medical continuing disability
reviews. 20 C.F.R. § 411.210(a) (2010).
[29] GAO, Supplemental Security Income: SSA Could Enhance Its Ability
to Detect Residency Violations, [hyperlink,
http://www.gao.gov/products/GAO-03-724] (Washington, D.C.: July 29,
2003) and GAO, Benefit and Loan Programs: Improved Data Sharing Could
Enhance Program Integrity, [hyperlink,
http://www.gao.gov/products/GAO/HEHS-00-119] (Washington, D.C.: Sept.
13, 2000).
[End of section]
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