\[Federal Register: May 20, 2008 (Volume 73, Number 98)\]

\[Rules and Regulations\]

\[Page 29323-29351\]

From the Federal Register Online via GPO Access \[wais.access.gpo.gov\]

\[DOCID:fr20my08-11\]

\[\[Page 29323\]\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Part IV

Social Security Administration

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

20 CFR Part 411

Amendments to the Ticket To Work and Self-Sufficiency Program; Final

Rule

\[\[Page 29324\]\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

SOCIAL SECURITY ADMINISTRATION

20 CFR Part 411

\[Docket No. SSA-2006-0092\]

RIN 0960-AF89

Amendments to the Ticket To Work and Self-Sufficiency Program

AGENCY: Social Security Administration.

ACTION: Final Rules.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

SUMMARY: We are revising our regulations for the Ticket to Work and

Self-Sufficiency Program (Ticket to Work program), which was authorized

by the Ticket to Work and Work Incentives Improvement Act of 1999. The

Ticket to Work program provides Social Security Disability Insurance

and disabled Supplemental Security Income beneficiaries expanded

options for access to employment services, vocational rehabilitation

services, and other support services. We are revising our prior rules

to improve the overall effectiveness of the program to maximize the

economic self-sufficiency of beneficiaries through work opportunities.

We have based these revisions on our projections of the future

direction of the Ticket to Work program, our experience using the prior

rules, and recommendations made by commenters on the program.

DATES: These final rules are effective July 21, 2008.

FOR FURTHER INFORMATION CONTACT: Dan O\'Brien, Office of Employment

Support Programs, Social Security Administration, 107 Altmeyer

Building, 6401 Security Boulevard, Baltimore, MD 21235-6401, e-mail to

<regulations@ssa.gov>, or telephone (410) 597-1632 for information about

these rules. For information on eligibility or filing for benefits,

call our national toll-free number 1-800-772-1213 or TTY 1-800-325-

0778, or visit our Internet site, Social Security Online,
[http://](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.socialsecurity.gov)

[www.socialsecurity.gov](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.socialsecurity.gov).

SUPPLEMENTARY INFORMATION:

Electronic Version

The electronic file of this document is available on the date of

publication in the Federal Register at
[http://www.gpoaccess.gov/fr/](http://www.gpoaccess.gov/fr/index.html)

[index.html](http://www.gpoaccess.gov/fr/index.html).

Background

These final rules amending the Ticket to Work program are based on

Notices of Proposed Rulemaking (NPRM) published in the Federal Register

on September 30, 2005 (70 FR 57222) and August 13, 2007 (72 FR 45191).

We explain the provisions of the final rules below. In the section

\`\`Public Comments,\'\' we summarize the public comments and explain
our

reasons for adopting or not adopting the recommendations made by the

commenters. The text of the final rules follows the Public Comments

section.

What Programs Are Affected by These Final Rules?

These final rules affect the Ticket to Work program. In the Ticket

to Work and Work Incentives Improvement Act of 1999 Congress explicitly

recognized that, while many people who receive disability benefits from

us want to work, and may have the potential to work, they face a number

of significant barriers that may prevent them from reaching their

goals. According to the authorizing legislation, Congress established

the Ticket to Work program to provide disability beneficiaries a real

choice in obtaining the services and technology that they need to find,

enter, and maintain employment by expanding the universe of service

providers. We published final regulations implementing the Ticket to

Work program on December 28, 2001 (66 FR 67370).

Under the Ticket to Work program, the Commissioner of Social

Security (the Commissioner) may issue tickets to Social Security

disability beneficiaries and to disabled or blind Supplemental Security

Income (SSI) beneficiaries under the programs under title II and title

XVI of the Social Security Act (Act). In this voluntary program, each

beneficiary who receives a ticket has the option of using his or her

ticket to obtain services from a provider known as an employment

network (EN) or from a State vocational rehabilitation (VR) agency. ENs

may choose to whom they provide services. When the beneficiary and an

EN or State VR agency agree to work together under the program, the EN

or State VR agency, without charge to the beneficiary, will provide

employment services, vocational rehabilitation services, and other

support services to assist the beneficiary in obtaining or regaining

and ultimately maintaining self-supporting permanent employment. If the

beneficiary achieves certain work outcomes, we will pay the EN or State

VR agency.

The title II and title XVI programs serve a diverse population of

individuals with disabilities. Our beneficiaries are people from

various age groups with different impairments, levels of education,

work experience, and capacities for working. While many cannot work at

all on a sustained basis, others may be able to work part-time or full-

time with reasonable accommodations, ongoing supports, or both. This

view is consistent with the assumptions underlying the Americans with

Disabilities Act. As we develop our comprehensive work opportunity

initiatives, we are also mindful that the unique needs of every

beneficiary cannot be met by one program.

These projects advance the President\'s New Freedom Initiative and

provide work incentives and opportunities earlier in the disability

determination process. The Ticket to Work program is an important part

of a comprehensive work opportunity initiative dedicated to helping

people with disabilities who want to work do so to their fullest

capabilities.

What Do We Mean by \`\`Final Rules\'\' and \`\`Prior Rules\'\'?

Even though these rules will not go into effect until July 21,

2008, for clarity we refer to the changes we are making here as the

\`\`final rules\'\' and to the rules that will be changed by these final

rules as the \`\`prior rules.\'\'

When Will We Start To Use These Final Rules?

We will start to use these final rules on their effective date of

July 21, 2008. We will continue to use our prior rules until the

effective date of these final rules. When these final rules become

effective, we will apply them to both new cases and pending cases. In

response to public comments on the September 30, 2005 NPRM, we explain

in Sec. 411.551 how we will apply the final rules on EN payment

systems to cases still pending under our prior rules. In addition, we

explain in Sec. 411.226 how we will apply the final timely progress

rules to individuals whose tickets were assigned under the prior rules.

Issues Addressed in These Final Rules

The Ticket legislation directs the Commissioner to periodically

review EN payment systems to ensure that they provide adequate

incentives for ENs to assist beneficiaries. Based in part on more than

three years experience administering the program, we proposed a number

of revisions to our prior rules in our September 30, 2005 NPRM and our

August 13, 2007 NPRM that we believed would significantly enhance

beneficiary choice and improve the likelihood that beneficiaries would

receive the most effective support.

State Participation and Beneficiary Choice

Our rules for the Ticket to Work program provide that a State VR

agency may participate in the program in one of two ways. On a case-by-

case basis, with respect to beneficiaries who have

\[\[Page 29325\]\]

a ticket, the State VR agency may participate either as an EN or

through the cost reimbursement payment system applicable under sections

222(d) and 1615(d) and (e) of the Act. Under our prior rules, if the

State VR agency elects to be paid under the cost reimbursement payment

system, the beneficiary\'s ticket must be assigned to the State VR

agency in order for that agency to be paid through that system. The

prior rules preclude further payment on the ticket if a State VR agency

has been paid under the cost reimbursement payment system.

Before we published the September 30, 2005 NPRM, we received many

comments that these policies under our prior rules do not allow

beneficiaries to take advantage of the full potential of the Ticket to

Work program. We agree with these comments and similar comments made in

response to the September 30, 2005 NPRM. As a result, we are making

changes in subparts B and F of our regulations to provide that a

beneficiary\'s ticket will not be assigned to a State VR agency if that

agency elects to be paid under the cost reimbursement payment system

(the VR cost reimbursement option). We provide in Sec. Sec. 411.135

and 411.140 of the final rules that, in this situation, the beneficiary

may assign the ticket to a different provider of services after the

State VR agency has closed his or her case.

We are making related changes in subpart C of our regulations to

provide that, when a beneficiary is receiving services from a State VR

agency that elects the VR cost reimbursement option, and has a ticket

which would otherwise be available for assignment, the beneficiary will

be considered to be \`\`using a ticket\'\' as described in that subpart
if

certain other requirements are met. This change will afford these

beneficiaries protection from the initiation of a continuing disability

review, irrespective of ticket assignment, provided all of the related

provisions regarding timely progress are met. We explain in Sec.

411.170(b) of the final rules when the period of \`\`using a ticket\'\'

will begin for a beneficiary who has a ticket that would otherwise be

available for assignment and who is receiving VR services pursuant to

an individualized plan for employment (IPE) where the State VR agency

has elected the VR cost reimbursement option. We explain that the

period of \`\`using a ticket\'\' will begin on the effective date of the

IPE or, if later, the first day the ticket would otherwise have been

assignable if the beneficiary had not been receiving services from the

State VR agency under the VR cost reimbursement option. We explain in

final Sec. 411.171 that, for a beneficiary for whom the State VR

agency has elected the VR cost reimbursement option, whose ticket has

not terminated and who continues to meet the timely progress

requirements, the period of \`\`using a ticket\'\' will end with the
close

of the 90-day period following the date the State VR agency closes the

beneficiary\'s VR case, unless the beneficiary assigns the ticket during

this 90-day period.

In a change from the NPRMs, we are incorporating two new terms,

\`\`VR cost reimbursement option\'\' and \`\`VR cost reimbursement
status,\'\'

in Subpart C of the final rules to better explain the rules on \`\`using

a ticket\'\' that apply to a beneficiary with a ticket who receives VR

services under an IPE from a State VR agency that has chosen the cost

reimbursement payment system. We define these terms in final Sec.

411.166, which contains a glossary of terms used in subpart C of our

regulations. We explain that \`\`VR cost reimbursement option\'\' means
an

arrangement under which a beneficiary\'s ticket is not assigned to the

State VR agency, but the beneficiary receives services under an IPE

where the State VR agency has chosen to receive payment under the cost

reimbursement payment system. We explain that the term \`\`VR cost

reimbursement status\'\' means the status of the beneficiary\'s ticket

under this arrangement. We also explain that this status begins when

the period of using a ticket begins as described in final Sec.

411.170(b) and this status ends when the State VR agency closes the

beneficiary\'s case. We are defining these terms in the final rules to

help simplify and clarify the provisions on using a ticket that relate

to beneficiaries in these cases. Since we use the term \`\`VR cost

reimbursement option\'\' in other subparts that we are amending in these

final rules, we are also adding the definition of that term to Sec.

411.115, which provides definitions of terms used in part 411.

We are also making changes in subpart F (State Vocational

Rehabilitation Agencies\' Participation). We removed the provisions of

the prior rules which indicate that payment may not be made under both

the cost reimbursement payment system and an EN payment system based on

the same ticket. We have clarified in Sec. 411.355(c) that a State VR

agency can receive payment only under the cost reimbursement payment

system when it serves a beneficiary who does not have a ticket that can

be assigned pursuant to Sec. 411.140. In other changes, we removed

prior Sec. 411.360 because it dealt with the phased implementation of

the Ticket to Work program, which has been completed. We also are

removing prior Sec. 411.370, rather than revising it, as we proposed

in our September 30, 2005 NPRM, because it would duplicate information

included in final Sec. Sec. 411.350 and 411.355. We have revised Sec.

411.385(a)(1) to remove the reference to the beneficiary\'s decision to

assign or reassign the ticket to the State VR agency. In a change from

the September 30, 2005 NPRM, we are retaining in these final rules that

part of prior Sec. 411.385(a)(1) which requires that the information

submitted to the program manager (PM) include a statement that an IPE

has been agreed to and signed. In final Sec. 411.390 and final Sec.

411.510, we explain that for beneficiaries already receiving services

from the State VR agency when they become eligible for a ticket, the

State VR agency can receive payment only under the cost reimbursement

payment system, unless both the beneficiary and the State VR agency

agree to have the ticket assigned to the State VR agency.

We also are making related changes to Sec. 411.585 that will allow

for payment to an EN under an EN payment system and payment to a State

VR agency under the VR cost reimbursement option with respect to the

same beneficiary in certain circumstances. Section 411.585 of our prior

rules provides that if we make payment to a State VR agency under the

cost reimbursement payment system with respect to a ticket, that

payment precludes payment under an EN payment system with respect to

the same ticket. The prior rules also provide that if we make payment

under an EN payment system, that payment precludes payment under the

cost reimbursement payment system with respect to the same ticket.

Final Sec. 411.585(b) states that if a State VR agency is paid by us

under the VR cost reimbursement option, such payment does not preclude

payment by us to an EN or to another State VR agency acting as an EN

under its elected EN payment system, and that a subsequent State VR

agency also has the choice of being paid under the VR cost

reimbursement option. In response to comments, new Sec. 411.585(c)

clarifies that if an EN or a State VR agency acting as an EN is paid by

us under one of the EN payment systems, that does not preclude payment

by us to a different State VR agency under the VR cost reimbursement

option. It also clarifies that the subsequent State VR agency also has

the choice of being paid under its elected EN payment system.

We believe that these changes will greatly expand beneficiary

choice of

\[\[Page 29326\]\]

ENs and enable beneficiaries to take advantage of a more effective

combination of services from both a State VR agency and an EN. For

example, the State VR agency could provide the initial, intensive

rehabilitation services, and an EN could follow up by providing the

ongoing support many individuals need to maintain their work efforts.

We will provide procedures regarding these issues in the Vocational

Rehabilitation Providers Handbook (chapter 12, also known as

Transmittal 17). This transmittal includes background information and

procedures for State VR agencies to follow regarding the Ticket to Work

program.

Employment Network Payment Systems

The rules for EN payment systems are set out in subpart H

(Employment Network Payment Systems) (Sec. Sec. 411.500 through

411.597). Section 411.597(a) of our prior rules states, \`\`We will

periodically review the system of payments and their programmatic

results to determine if they provide an adequate incentive for ENs to

assist beneficiaries to enter the work force, while providing for

appropriate economies.\'\'

We studied extensively the question of whether the prior Ticket to

Work program regulations provided an adequate incentive for ENs to

assist beneficiaries. As we discussed in the proposed rules (70 FR at

57224), an evaluation of the Ticket to Work program by Mathematica

Policy Research (MPR) in February 2004 found that despite aggressive

marketing of the Ticket to Work program to over 50,000 organizations,

only about 1,000 non-State providers had signed up as ENs and only a

few hundred were actively participating in the Ticket to Work program.

([http://www.mathematica-mpr.com/publications/PDFs/TTWinitialrpt.pdf](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.mathematica-mpr.com/publications/PDFs/TTWinitialrpt.pdf)).

Over time, fewer organizations have joined the Ticket to Work program

as service providers. The overall number of service providers in the

program remains low, with retention a major challenge. The financial

viability of some ENs remains uncertain as ENs report losing money on

Ticket to Work operations. These problems reduce the number of

organizations willing and able to serve as ENs and accept ticket

assignments.

Accordingly, we made changes to subpart H in order to create a

greater financial incentive for EN participation. We anticipate that

these changes will increase the number of ENs actively accepting

tickets. In response to public comments, we also added definitions of a

\`\`transition case\'\' and a \`\`reconciliation payment\'\' as
paragraphs (g)

and (h) of Sec. 411.500. Final Sec. 411.525 provides that the total

potential payment under the outcome-milestone payment system has been

increased from 85% under the prior rules to 90% of the total potential

payment under the outcome payment system under these final rules. By

increasing the total potential payment, we believe that we will

increase the incentive for small or undercapitalized providers to

participate as ENs in the program. In addition, Sec. 411.525 clarifies

that milestone payments must occur before the beginning of the outcome

period, and that once we begin making payments for a title XVI

beneficiary we will continue using the title XVI payment rates even if

the beneficiary later becomes eligible for disability insurance

benefits under title II.

As we also discussed in the proposed rules (70 FR 57225), the

Adequacy of Incentives (AOI) Advisory Group recommended a payment

approach which recognizes that the steps leading to maximizing self-

sufficiency are incremental and may be interrupted periodically. The

link to the AOI report is:
[http://www.dri.uiuc.edu/research/p03-08h/](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.dri.uiuc.edu/research/p03-08h/AOIFinal.pdf)

[AOIFinal.pdf](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.dri.uiuc.edu/research/p03-08h/AOIFinal.pdf).
Final Sec. Sec. 411.525 and 411.535 now provide a two-

phased milestone payment system and outcome payments that parallel the

steps beneficiaries take toward self-sufficiency.

Phase 1 is modeled on the nine-month trial work period (TWP)

provided for title II beneficiaries. Four milestones at different

points of employment retention will be paid when the beneficiary works

for a period of time with gross earnings at or above the trial work

earnings level. Phase 1 milestones are the only payments that will be

the same for both title XVI and title II beneficiaries, and these

payments will be based on the higher title II payment calculation base.

This change addresses the concerns that the initial phase is the most

expensive for the EN to provide services and that without equal

payments title XVI beneficiaries would have difficulty accessing Phase

1 services. The trial work earnings requirement (\$670/month in 2008)

represents a significant work and earnings milestone for beneficiaries,

as well as an attainable payment point for ENs. In response to public

comments that we not narrow our focus to prior services from the State

VR agency, we provide in Sec. 411.535(a)(1)(ii) that work activity

above the trial work earnings level in the 18 months prior to the first

ticket assignment on each ticket may preclude us from paying some or

all of the Phase 1 milestones. We also clarify in Sec.

411.535(a)(1)(iii) the circumstances under which we will not pay Phase

1 milestones if a beneficiary received services from a State VR agency

that elected the VR cost reimbursement option.

We also added a new rule, final Sec. 411.536, which provides that

we will pay an EN, or a State VR agency acting as an EN, for milestones

that were unpaid because the beneficiary\'s outcome payment period

begins.

Phase 2 requires a substantial achievement on the path toward full

self-sufficiency. The employment outcome triggering a Phase 2 milestone

payment is a month where the beneficiary\'s gross earnings equal or

exceed the substantial gainful activity earnings level (in calendar

year 2008, \$940). During Phase 2, we will make a maximum of 11 monthly

milestone payments with respect to a title II beneficiary and a maximum

of 18 monthly milestone payments with respect to a title XVI

beneficiary. We anticipate that some but not all beneficiaries will

progress to Phase 2, increasing work hours and earnings to above the

substantial gainful activity (SGA) level. As the AOI Advisory Group

recommended, we are encouraging the use of work incentives during both

Phase 1 and Phase 2 by making payments to ENs based on gross earnings

before adjustments for work incentives. We have provided for a greater

number of milestone payments with respect to title XVI beneficiaries as

part of our overall effort to equalize the monetary value of the

milestones payments that potentially can be made with respect to title

II and title XVI beneficiaries. Under our prior rules, the total value

of the four title XVI milestones is less than 60 percent of the total

value of the four title II milestones. However, under these final

rules, the total value of the title XVI milestones will be 98 percent

of the total value of the title II milestones. We anticipate that this

will provide an additional incentive for ENs to accept tickets from

title XVI beneficiaries. Final Sec. 411.540 provides the revised

payment amounts for milestone payments. For both title II and title XVI

beneficiaries, the payment amount for each milestone payment in Phase 1

will be 120 percent of the title II payment calculation base defined in

Sec. 411.500(a)(1). The payment amount for each milestone payment in

Phase 2 will be 36 percent of the respective title II or title XVI

payment calculation base. Final Sec. 411.545 provides the revised

payment amounts for outcome payments under the outcome-milestone

payment system, which is 36 percent of the respective title II or title

XVI payment calculation base. Final

\[\[Page 29327\]\]

Sec. 411.550 provides the revised payment rates for outcome payments

under the outcome payment system, which is 67 percent of the respective

title II or title XVI payment calculation base.

The final phase is the outcome payment period, during which

beneficiaries are not receiving Social Security disability benefits or

Federal SSI cash benefits because of work or earnings. Consistent with

the discussion above about milestones, we are leaving the title XVI

outcome period at 60 outcome payment months in order to equalize the

monetary value of the outcome payments and the total amount of all

payments that potentially can be made to an EN with respect to title II

and title XVI beneficiaries. Final Sec. 411.535(a)(3) provides that a

reconciliation payment, as described above, will be made equal to the

total amount of unpaid Phase 1 and Phase 2 milestones that had been

available at first ticket assignment, if the beneficiary does not

achieve all the Phase 1 and Phase 2 milestones prior to the beginning

of the beneficiary\'s outcome payment period. As previously noted, in

response to public comments on this provision, we added final Sec.

411.536 to explain how this reconciliation payment will be made.

Finally, both the AOI Advisory Group in its Final Report:

Recommendations for Improving Implementation of the Ticket to Work and

Self-Sufficiency Program (Regulatory and Administrative Changes) and

the Ticket to Work and Work Incentives Advisory Panel in its annual

reports to the President and Congress expressed concerns (available at

[http://www.dri.uiuc.edu/research/p03-08h/default.htm](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.dri.uiuc.edu/research/p03-08h/default.htm)
and
[http://](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.ssa.gov/work/panel/panel_documents/reports.html)

[www.ssa.gov/work/panel/panel_documents/reports.html](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.ssa.gov/work/panel/panel_documents/reports.html))
that prior

funding levels were inadequate to support the consumer-driven market-

based employment service model that Congress envisioned in the Ticket

legislation. The Ticket legislation established a maximum monthly

outcome payment of 40% of the national average disability benefit

payable under title II or title XVI, as appropriate, as the basis for

EN payments under the Ticket to Work program. The Ticket legislation

also requires us to periodically review this and other issues in order

to determine whether, as relevant here, the percentage \`\`provides an

adequate incentive for employment networks to assist beneficiaries to

enter the workforce, while providing for appropriate economies.\'\' The

40% rate has proved inadequate to attract sufficient ENs to the

marketplace to allow for adequate access to services and consumer

choice. Therefore, consistent with our authority in section

1148(h)(5)(A) of the Act, final Sec. 411.525 increases the overall

percentage from 40% to 67% in the outcome payment system.

We believe that we will increase the financial incentives for small

or undercapitalized providers to participate as ENs by offering a

combination of: (1) Increasing the percent of the payment calculation

base used to figure the payments; (2) reducing the differential between

outcome and outcome-milestone payments; (3) equalizing funding for

providing services to title II and title XVI beneficiaries; (4)

increasing milestone payments; (5) making payments earlier in the

return to work process; (6) recognizing that trial work level earnings

constitute initial efforts at self-sufficiency for many beneficiaries;

and (7) allowing beneficiaries to combine initial services provided by

VR with ongoing support services from an EN. We also believe that the

increased EN participation these changes will cause will improve

beneficiary access to services and choice of quality providers. Final

Sec. 411.566 provides that an EN may use outcome or milestone payments

to make payments to the beneficiary.

The revised payment rates are presented in charts I through III

using the 2008 payment calculation base.

Chart I.\--New Outcome-Milestone Payment Table

\[2008 figures for illustration only\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Title II amount of Title XVI amount of

Payment type Beneficiary earnings payment payment

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Phase 1 (120% of Title II PCB)

Milestone 1\...\...\...\...\...\...\.... \$335/mo. \$670/mo. x 3
\$1,177\...\...\...\...\..... \$1,177

mo. work in a 6-month

period.

Milestone 2\...\...\...\...\...\...\.... \...\...\...\...\...\...\.....
\$1,177\...\...\...\...\..... \$1,177

Milestone 3\...\...\...\...\...\...\.... \$670/mo. x 6 mo. work
\$1,177\...\...\...\...\..... \$1,177

in a 12-month period.

Milestone 4\...\...\...\...\...\...\.... \$670/mo. x 9 mo. work
\$1,177\...\...\...\...\..... \$1,177

in an 18-month period.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Total Phase 1 milestones\..... \...\...\...\...\...\...\.....
\$4,708\...\...\...\...\..... \$4,708

=================================================

Phase 2 (36% of PCB)\...\...\...\...\..... Gross Earnings\>SGA.
\...\...\...\...\...\...\.....

Title II milestones 1-11\...\...\...\.... \...\...\...\...\...\...\.....
\$353 x 11 = \$3,883 \...\...\...\...\...\...\.....

Title XVI milestones 1-18\...\...\...\... \...\...\...\...\...\...\.....
\...\...\...\...\...\...\..... \$203 x 18 = \$3,654

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Total Phase 1 + 2\...\...\...\...\.... \...\...\...\...\...\...\.....
\$8,591\...\...\...\...\..... \$8,362

=================================================

Outcome payments (36% of PCB)

Title II = 1-36\...\...\...\...\...\... monthly cash benefit \$353 x 36
= \$12,708 \...\...\...\...\...\...\.....

not payable due to SGA.

Title XVI = 1-60\...\...\...\...\..... Sufficient earnings for
\...\...\...\...\...\...\..... 203 x 60 = \$12,180

federal cash benefits

=\`\`0\'\'.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Total milestone and outcome \...\...\...\...\...\...\.....
\$21,299\...\...\...\...\.... \$20,542

payments.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Definitions and amounts: Payment Calculation Base (PCB)\--The

average title II disability insurance benefit payable under section 223

of the Social Security Act for all beneficiaries for months during the

preceding calendar

\[\[Page 29328\]\]

year; and the average payment of supplemental security income benefits

based on disability payable under title XVI (excluding State

supplementation) for months during the preceding calendar year to all

beneficiaries who have attained 18 years of age but have not attained

65 years of age. (2008 title II = \$981.17, title XVI = \$563.35).

Gross earnings requirements for Phase 1 are based on Trial Work

level amounts.

For Phase 1 milestones only, the payments are calculated for both

title XVI and title II beneficiaries using the higher title II payment

calculation base. All other payments are based on a percentage of the

Payment Calculation Base (PCB) for the respective program (title XVI or

title II). See Sec. 411.535 for a discussion of the circumstances

under which we will pay milestones.

Phase 1 milestones = 120% of PCB.

Phase 2 milestones = 36% of PCB.

Outcome payments (under the outcome-milestone payment system) = 36%

of PCB.

Earnings used to meet the first, second, or third Phase 1 milestone

may be counted again when determining if a later milestone is met,

provided the earlier earnings fall within the relevant time period for

meeting the later Phase 1 milestone (see 411.525(a)(2) for the relevant

time period for each milestone).

Chart II.\--New Outcome Payment System Table\--Title II and Concurrent

\[2008 figures for illustration only\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Title II amount

Payment type Beneficiary earnings of monthly Title II total

payment payments

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Outcome payments 1-36 (67% of PCB)\...\...\..... Monthly cash benefit
not \$657.00 \$23,652

payable due to SGA.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Chart III.\--New Outcome Payment System Table\--Title XVI Only

\[2008 figures for illustration only\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Title XVI

Payment type Beneficiary earnings amount of Title XVI total

monthly payment payments

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Outcome payments 1-60 (67% of PCB)\...\...\..... Earnings sufficient to
\`\`0\'\' \$377.00 \$22,620

out Federal SSI cash benefits.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Note: Outcome payment (outcome payment system) = 67% of PCB.

Individual payments are rounded to the nearest dollar amount.

2008 non-blind SGA level = \$940.

2008 Blind SGA = \$1570.

2008 TWP service amount = \$670.

Ticket Eligibility for Beneficiaries Whose Conditions May Medically

Improve

The Ticket to Work and Work Incentives Advisory Panel, in its July

26, 2001 report to the Commissioner, recommended that \`\`All SSI and

SSDI adult disability beneficiaries, including those with a Medical

Improvement Expected (MIE) designation, should be eligible to

participate in the Ticket program.\'\' (Available at
[http://www.ssa.gov/](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.ssa.gov/work/panel/panel_documents/reports.html)

[work/panel/panel_documents/reports.html](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.ssa.gov/work/panel/panel_documents/reports.html)).
(Note: The copy of the

report at this link is not the official report, but a \`\`duplicate

report\'\' that is \`\`similar\'\' to the original but which may contain

\`\`small differences.\'\') We agree and are making changes to the
ticket

eligibility rules set out in Sec. 411.125 under subpart B to allow

beneficiaries with an MIE designation to be eligible for a ticket

without first requiring a continuing disability review to be conducted.

\`\`Using a Ticket\'\' and Related Timely Progress Rules

Subpart C (Suspension of Continuing Disability Reviews for

Beneficiaries Who Are Using a Ticket) contains our rules on when a

beneficiary will be considered to be \`\`using a ticket\'\' under the

Ticket to Work program for the purpose of suspending the initiation of

a medical continuing disability review (CDR) as provided under section

1148(i) of the Act. The rules in subpart C also describe the timely

progress requirements which a beneficiary must meet to continue to be

considered \`\`using a ticket\'\' under the program.

In final Sec. 411.166, we explain that \`\`using a ticket\'\' means

that a beneficiary has assigned a ticket to an EN or a State VR agency

acting as an EN, or has a ticket in VR cost reimbursement status, and

the beneficiary is making timely progress toward self-supporting

employment. (As explained above, under these final rules, a

beneficiary\'s ticket is in VR cost reimbursement status when the

beneficiary has a ticket that would otherwise be available for

assignment and is receiving VR services under an IPE from a State VR

agency which has elected the VR cost reimbursement option.) Section

411.165 explains that we will not begin a CDR during the period in

which a beneficiary is \`\`using a ticket.\'\'

As in the prior rules, it is important that we continue to balance

our desire to define \`\`using a ticket\'\' in a way that minimizes the

disincentive for beneficiary participation that arises from the fear of

having benefits terminated upon return to work because of a medical

CDR, and our need to maintain the integrity of the disability programs

by ensuring that beneficiaries who have medically improved do not

continue to receive disability benefits for an undue length of time. We

believe these final rules as described below maintain that balance.

In final Sec. 411.180, we revised the timely progress guidelines

contained in our prior rules. As we proposed in the August 13, 2007

NPRM, we added educational or technical training requirements to

supplement the work requirements under the timely progress guidelines.

We revised the work requirements under the guidelines and the

documentation and other requirements for progress reviews to simplify

the process for determining whether a beneficiary is making timely

progress toward self-supporting employment. In addition, we eliminated

the \`\`initial 24-month period\'\' after ticket assignment during which
a

beneficiary is considered to be making timely progress if actively

participating in his or her employment plan. We

\[\[Page 29329\]\]

replaced this 24-month period with two successive 12-month progress

certification periods during each of which the beneficiary must

complete certain work requirements and/or educational or technical

training requirements in order to be considered to be making timely

progress until the next scheduled progress review.

We made changes from the guidelines proposed in the August 13, 2007

NPRM and included several important enhancements in final Sec.

411.180. We extended the period for a beneficiary to complete a

vocational or technical training program. In addition to the 4-year

degree program, we added a 2-year degree or certification program to

the guidelines. We also included obtaining a high school diploma or a

General Education Development (GED) certificate in the first 12-month

progress certification period as a part of the timely progress

guidelines. In addition, we provide in the final rules that a

beneficiary will be considered to have met the requirements for an

applicable progress certification period if the beneficiary completes a

certain percentage of the work requirement and a certain percentage of

the post-secondary education requirement or vocational or technical

training requirement for that progress certification period and the sum

of the two percentages equals 100 or more. We also added a variance

tolerance to provide a margin of flexibility in determining whether a

beneficiary has met certain timely progress requirements. Under the

variance tolerance, we will consider a beneficiary to have met the

requirement for completing a specified amount of post-secondary credit

hours in an educational degree or certification program or course

requirements in a vocational or technical training program under Sec.

411.180 in the applicable progress certification period if the

beneficiary\'s completion of credit hours or course requirements in that

period is within 10 percent of the specified goal.

As provided in final Sec. 411.180, the timely progress guidelines

for each 12-month progress certification period now reflect the

following concrete, incrementally obtainable goals.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

12-Month review High school diploma Degree or Technical, trade, or

period Work requirement or GED certification program vocational program

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

1st\*\...\...\...\...\.... 3 out of 12 months Obtained high school
Completed 60 percent Completed 60 percent

with trial work diploma or GED of full time course of full time course

period level certificate. load for 1 year. load for 1 year.

earnings.

2nd\...\...\...\...\..... 6 out of 12 months Completed 75 percent
Completed 75 percent

with trial work of full time course of full time course

period level load for 1 year. load for 1 year.

earnings.

3rd\...\...\...\...\..... 9 out of 12 months Completed a 2-year
Completed the

with substantial program or, for a 4- program.

gainful activity year program,

level earnings. completed an

additional academic

year of full time

study.

4th\...\...\...\...\..... 9 out of 12 months Completed an

with substantial additional academic

gainful activity year of full time

level earnings. study.

5th\...\...\...\...\..... 6 out of 12 months at Completed an

level precluding additional academic

Social Security and year of full time

Federal SSI cash study or completed 4-

benefits. year degree program.

6th\...\...\...\...\..... Work criteria are Completed 4-year

same for 5th and degree program.

subsequent 12-month

periods.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

In final Sec. 411.166(b), we modified the definition of \`\`timely

progress toward self-supporting employment\'\' to reflect that a high

school diploma or GED certificate obtained in the first 12-month

progress certification period counts as timely progress. In addition,

we added a definition of \`\`variance tolerance\'\' in Sec. 411.166(h).

In final Sec. 411.171, we made several changes from the provisions

of this section that were proposed in the September 30, 2005 NPRM. In

final Sec. 411.171(b), we deleted the references to prior Sec. Sec.

411.190 and 411.195 since we are removing these sections of the

regulations in these final rules. In final Sec. 411.171(c), we changed

the duration of the extension period from three months to 90 days to

conform to the change in the duration of the extension period provided

in final Sec. Sec. 411.166 and 411.220, discussed below. This change

to the duration of the extension period coincides with the 90-day

period described in final Sec. 411.150(b)(3) and incorporates the

provision that was proposed in paragraph (d) of this section in the

September 2005 NPRM, making the latter provision unnecessary. In

paragraph (d) of final Sec. 411.171, we explain when the period of

using a ticket may end for a beneficiary receiving services from a

State VR agency that has elected the VR cost reimbursement option.

Based on a public comment, as well as the foregoing change in final

paragraph (d), proposed paragraphs (e) and (f) of this section in the

September 30, 2005 NPRM have been removed in these final rules. In a

related change, cross-references to final Sec. 411.155(a)(4) and

(c)(8), on when the ticket terminates if an individual\'s outcome

payment period ends, have been added in final Sec. 411.171(a).

As we proposed in the August 13, 2007 NPRM, in final Sec. 411.166

and paragraphs (a) and (d)(2) of final Sec. 411.220, we changed the

duration of the extension period from three months to 90 days.

We removed prior Sec. Sec. 411.185, 411.190, 411.191, and 411.195.

The changes we are making to subpart C in these final rules make these

sections of the prior rules obsolete. In the final rules, we modified

the section heading of Sec. 411.192 and paragraph (a) of that section

to provide that a beneficiary may place his or her ticket in inactive

status if he or she is temporarily or otherwise unable to make timely

progress toward self-supporting employment during a progress

certification period.

In final Sec. 411.225, we revised the prior rule to explain that

any month during which a beneficiary\'s ticket is not assigned and is

not in VR cost reimbursement status will not count

\[\[Page 29330\]\]

towards the time limitations for the timely progress guidelines. Final

Sec. 411.180(b) includes a similar provision. This change is necessary

to take account of the situation provided for in these final rules,

where a beneficiary\'s ticket is not assigned, but the beneficiary has a

ticket that would otherwise be available for assignment and is

receiving services under an IPE from a State VR agency which has

elected the VR cost reimbursement option. As explained above, in this

situation, the beneficiary\'s ticket is considered to be in VR cost

reimbursement status.

In final Sec. 411.226, we explain how we will apply the revised

timely progress provisions to a beneficiary who assigned his or her

ticket prior to the effective date of these final rules. We describe

how we will determine which progress certification period a beneficiary

is in as of the date these final rules become effective. We explain

that we will not conduct a progress review at the end of that period,

but will conduct a progress review at the end of the beneficiary\'s next

12-month progress certification period. In final Sec. 411.226(b), we

explain that we will notify the beneficiary regarding the specific

timely progress requirements that will apply to him or her and when

they will begin to apply. In Sec. 411.226(d), we explain that tickets

assigned under the prior rules to State VR agencies that have chosen to

be paid for their services under the cost reimbursement payment system

will no longer be considered assigned beginning on the effective date

of these final rules. Instead, the ticket of a beneficiary in this

situation will be considered to be in VR cost reimbursement status. We

explain that a beneficiary in this situation may continue to be

considered \`\`using a ticket\'\' under the final rules in subpart C for

purposes of protection against the initiation of a continuing

disability review. We explain that the beneficiary may assign his or

her ticket after the State VR agency has closed his or her case.

Other Changes We Are Making

In subpart A, we are removing the prior Sec. 411.110, which

explains how we will implement the Ticket program, because we already

have implemented the program on a nationwide basis.

In Sec. 411.120, we clarify what information will be included on

the Ticket To Work document.

We are making several changes in subpart B (Tickets Under the

Ticket to Work Program). We revised Sec. 411.130 to clarify that we

will mail a ticket to the beneficiary when the beneficiary is eligible.

In final Sec. 411.140, we clarify in paragraph (a) that an individual

with a ticket who has been receiving services under an IPE from a State

VR agency which elected the VR cost reimbursement option may assign his

or her ticket during the 90-day period after the State VR agency closes

his or her case without having to meet the requirements of Sec.

411.125(a)(2). The individual may assign his or her ticket after this

90-day period, but only if he or she meets the requirements of both

paragraphs (a)(1) and (a)(2) of Sec. 411.125. We are making this

change in final Sec. 411.140(a) to make this provision consistent with

the similar rule for reassigning a ticket contained in final Sec.

411.150(b)(3), discussed below.

We revised the section heading of Sec. 411.145 to read \`\`When can

my ticket be taken out of assignment?\'\', and revised the provisions of

that section to indicate that, consistent with other sections of these

final rules, a State VR agency will have a ticket assigned to it only

if it elects to act as an EN. In a change from the September 30, 2005

NPRM, we added a provision to final Sec. 411.145(a) to provide that if

a beneficiary takes the ticket out of assignment, he or she will be

sent a notice regarding the change. We changed Sec. 411.150(a) to

clarify that in all cases the ticket must be unassigned before it can

be reassigned. We also revised Sec. 411.150(b)(3) concerning the

conditions under which a beneficiary may reassign a ticket even if the

beneficiary does not meet certain requirements of Sec. 411.125(a).

We also are making several changes in Sec. 411.155. We are

changing Sec. 411.155(a)(2) to state that, if a beneficiary is

entitled to widow\'s or widower\'s insurance benefits based on

disability, the ticket terminates in the month in which the beneficiary

attains full retirement age. We added Sec. Sec. 411.155(a)(4) and

(c)(8) to indicate that the ticket terminates in the month after the

month in which the beneficiary\'s outcome payment period ends.

We are making changes to three sections in subpart E (Employment

Networks). In Sec. 411.310, we added new paragraph (d) to provide that

one-stop delivery systems established under subtitle B of title I of

the Workforce Investment Act of 1998 (29 U.S.C. 2811 et seq.) may

participate in the Ticket to Work program as ENs without responding to

our request for proposal (RFP). In response to public comments, we

added new paragraph (e) to final Sec. 411.310 to provide that

organizations administering Vocational Rehabilitation Services Projects

for American Indians with Disabilities authorized under section 121 of

part C of title I of the Rehabilitation Act of 1973, as amended (29

U.S.C. 441), also may participate as ENs without having to respond to

our RFP. We explain that one-stop delivery systems and organizations

administering Vocational Rehabilitation Services Projects for American

Indians with Disabilities must enter into an agreement with us to serve

as an EN under the Ticket to Work program and must maintain compliance

with the rules that apply to ENs. We made corresponding changes in

final Sec. 411.315. We added new paragraphs (e) and (f) to final Sec.

411.315 to provide that one-stop delivery systems and organizations

administering Vocational Rehabilitation Services Projects for American

Indians with Disabilities must still enter into an agreement with the

Commissioner to be an EN and must maintain compliance with general and

specific selection criteria of this section and Sec. 411.305 to remain

an EN.

In paragraph (a) of final Sec. 411.325, we indicate that an EN

must report to the PM in writing each time it accepts a ticket for

assignment or no longer wants a ticket assigned to it.

In subpart F (State Vocational Rehabilitation Agencies\'

Participation), Sec. 411.365(a) is revised to remove the reference to

a letter we send to State VR agencies regarding implementation of the

Ticket to Work program.

In subpart H (Employment Network Payment Systems), we are removing

the prior Sec. 411.530, which required that each outcome payment made

to an EN under the outcome-milestone payment system be reduced by an

amount equal to 1/60th of a milestone payment made to an EN with

respect to the same individual. These final rules remove this

requirement as one means of increasing the potential payment available

to an EN and, as required by Ticket legislation, ensuring that these EN

payment systems continue to provide adequate incentives for ENs to

assist beneficiaries.

In addition, we made several additional changes in subpart H

(Employment Network Payment Systems). We added a new Sec. 411.552 to

clarify that we will continue to make EN payments based on the title

XVI payment structure once we authorize an outcome or milestone payment

for a title XVI only beneficiary. If a title XVI beneficiary becomes

entitled to title II disability benefits before we authorize an outcome

or milestone payment we will make payments to the EN as if the

individual were a title II beneficiary. By authorizing a payment we

mean that we have performed the necessary actions to trigger a payment,

whether or not the

\[\[Page 29331\]\]

Treasury Department has issued the payment or the EN has received the

payment.

In final Sec. 411.555, we eliminated the requirement in (b)(2) to

adjust or recover an incorrect EN payment when the reason for the

incorrect payment is because of a retroactive determination or decision

SSA makes about an individual\'s right to benefits for the period of the

payment. We made changes to Sec. 411.555 to indicate that references

to ENs refer to State VR agencies acting as EN as well. We also changed

this section to reflect the difference in the number of outcome months

for title XVI and title II beneficiaries.

Final Sec. 411.575 explains that as primary evidence of the

beneficiary\'s work and earnings we will require an original pay stub or

an oral or written statement of monthly earnings from the employer or

the employer\'s designated payroll preparer. It also explains that in

lieu of primary evidence, we will accept two sources of secondary

evidence, such as State unemployment insurance records and a signed

beneficiary statement or federal or state tax returns. We also made two

clarifications. We clarify in Sec. 411.575(a)(2) that the request for

each milestone payment must include evidence that the milestone was

attained after ticket assignment and in Sec. 411.575(b)(2) that as

part of the payment request, we may require that the EN provide a

summary of the services provided as described in the IWP/IPE.

New final Sec. 411.581 explains the circumstances under which an

EN can receive milestone and outcome payments for months after a

beneficiary takes his or her ticket out of assignment.

Notice of Proposed Rulemaking

We issued two NPRMs proposing changes to our prior rules for the

Ticket to Work program. We published an NPRM in the Federal Register on

September 30, 2005 (70 FR 57222) and a second NPRM on August 13, 2007

(72 FR 45191). We provided the public 90 days in which to submit

comments on the first NPRM and 60 days in which to submit comments on

the second NPRM. The comment period for the first NPRM closed on

December 29, 2005, and the comment period for the second NPRM closed on

October 12, 2007.

We also held a series of town meetings in connection with the first

NPRM to obtain additional input on the changes proposed in that NPRM.

These meetings were open to the public and were announced in the

Federal Register on October 19, 2005 (70 FR 60748) and November 1, 2005

(70 FR 65871). They were conducted in Irvine, California on November 4,

2005; in Miami, Florida on November 16, 2005; in Hartford, Connecticut

on December 6, 2005; and in Des Moines, Iowa on December 14, 2005.

We received a combined total of 128 public comments on the

September 30, 2005 NPRM and the August 13, 2007 NPRM. The public

comments we received on the September 2005 NPRM are posted on our

Internet site at:
[https://s044a90.ssa.gov/apps10/erm/rules.nsf/](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=https://s044a90.ssa.gov/apps10/erm/rules.nsf/5da82b031a6677dc85256b41006b7f8d/9fe46866babbb19b8525708c006d230a!OpenDocument)

[5da82b031a6677dc85256b41006b7f8d/](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=https://s044a90.ssa.gov/apps10/erm/rules.nsf/5da82b031a6677dc85256b41006b7f8d/9fe46866babbb19b8525708c006d230a!OpenDocument)

[9fe46866babbb19b8525708c006d230a!OpenDocument](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=https://s044a90.ssa.gov/apps10/erm/rules.nsf/5da82b031a6677dc85256b41006b7f8d/9fe46866babbb19b8525708c006d230a!OpenDocument).

The public comments we received on the August 2007 NPRM are posted

on the Federal eRulemaking Portal at:
[http://www.regulations.gov](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.regulations.gov).

As we explain below, in these final regulations, we are making some

changes from the proposed rules in response to public comments received

on the NPRMs. We discuss the significant comments on the NPRMs and

respond to these comments below under \`\`Public Comments.\'\' Although
we

condensed, summarized, or paraphrased the comments, we believe that we

have expressed the views accurately and have responded to all of the

significant issues raised by the commenters that are within the scope

of the rulemaking.

In addition, some of the comments were about subjects that were

outside the scope of the rulemaking. Except as noted below, we have not

summarized and responded to these comments.

Public Comments

General

Many commenters endorsed the revision to Sec. 411.125 to extend

ticket eligibility to beneficiaries with an MIE designation. A number

of commenters supported our proposal to provide a phased payment system

that parallels the steps beneficiaries take toward self-sufficiency,

which will expand an EN\'s ability to provide employment services to

beneficiaries who have an initial goal to work part-time. Commenters

also supported our other proposals to make other changes to the EN

payment systems in order to increase EN participation, including

increasing outcome payments under the outcome payment system from 40%

of the payment calculation base to 67%, and increasing the total

payment for ENs electing the outcome-milestone payment system to 90% of

potential payments under the outcome payment system. Many commenters

also supported our proposal to encourage partnerships between State VR

agencies and ENs to provide long-term services to a beneficiary by

permitting the beneficiary to assign a ticket to an EN after receiving

VR services.

Other Models

Comment: A number of commenters suggested a model in which an EN

composed of friends and family members might be formed to assist a

beneficiary by making payments to service providers and coordinating

service provisions. Other commenters recommended that we consider the

feasibility of permitting the beneficiary to be his or her own EN

without seeking third party assistance.

Response: We have not adopted these comments. Section 1148(f)(1) of

the Act states that ENs serving under the Ticket to Work program shall

consist of an agency or instrumentality of a State (or a political

subdivision thereof) or a private entity, that assumes responsibility

for the coordination and delivery of services under the program to

individuals assigning tickets to the EN.

Retroactivity of These Revised Rules

Comment: A number of commenters recommended that these revised

rules be effective retroactively, e.g., made effective for payments to

ENs either from the date of their acceptance as an EN or from the

beginning of calendar year 2005.

Response: An agency may not make its rules retroactive without

appropriate legislative authority. The Act does not authorize us to

make these rules retroactive.

Transitioning to These Revised Rules

Transition Rules for EN Payment Cases

Comment: Many commenters asked how we will make the transition to

these new rules, i.e., how these new rules will apply to cases still

pending on the effective date of the new rules. For example, one

commenter noted that, if the new rules do not apply across the board to

existing cases, ENs will delay ticket assignments or job placements, or

otherwise jeopardize the benefits from this program for beneficiaries.

Commenters asked specifically whether ENs will be given the opportunity

to change their payment system election, in view of these revised

rules, and how we would transition existing cases to the new EN payment

systems.

Response: Final Sec. 411.515 allows an EN to change its elected

payment system once in each calendar year. We also added final Sec.

411.551 to explain how we will move payment cases from

\[\[Page 29332\]\]

the prior EN payment system\'s schedule of payments and rates to the EN

payment system\'s schedule of payments and rates in these final rules.

We will process any EN payment requests received for milestones or

outcomes that had been attained under our prior rules before we begin

processing payments attained beginning with the effective date of the

new rules. We will only accept payment requests for milestones or

outcomes attained before the effective date of the new rules until

March 31, 2009 or until the first payment is initiated under the new

rules. Section 411.551 explains that milestones under our prior rules

will be equated with Phase 1 milestones. For example, if a beneficiary

has attained milestone 1 under our prior rules, then the next milestone

to be achieved would be Phase 1 milestone 2 under the new rules (work

in three months within a six-month period with gross earnings in each

of the three months equal to a trial work period service month, i.e.,

\$670 in 2008).

If the beneficiary has attained all of the milestones under the

prior rules, the next milestone to be achieved would be the first Phase

2 milestone (a calendar month in which the beneficiary has worked and

has gross earnings from employment or net earnings from self-employment

that are more than the SGA earnings level).

The maximum number of outcome payments available to an EN for a

transition case will be computed as follows.

When the EN requests a payment for a milestone or outcome attained

in July 2008 or later, we will first compute the amount already paid or

that can be paid on any particular ticket for milestones or outcomes

attained before July 2008. Then, we will subtract this amount from the

total value of the ticket under the new rules for 2008. The total value

of the ticket is the sum of the payment amount of all payments

available under the EN\'s chosen payment system for 2008. See the

Outcome Milestone Payment System Table in Sec. 411.545(c) and the

Outcome Payment System Tables in Sec. 411.550 for the value of the

ticket in the year 2008 under each payment system for title II

beneficiaries or title XVI beneficiaries or beneficiaries concurrently

entitled under title II and title XVI. We then will divide this amount

by the applicable outcome payment amount (whether title II or title

XVI\) payable for 2008 and round the result in accordance with customary

rounding principles. The resulting number represents the number of

outcome payments available on this ticket. In no case can this number

exceed 60.

Timely Progress Transition Rules

Comment: Some commenters expressed concern that beneficiaries would

receive a progress review using the new timely progress guidelines

without having had advance notice of these guidelines and asked whether

we would transition individuals with tickets assigned prior to the

effective date of the final regulations to the new timely progress

guidelines.

Response: In response to these comments, we made changes to Sec.

411.226 in these final rules. We explain in the final rules that we

will not conduct a progress review at the conclusion of the

beneficiary\'s applicable 12-month progress certification period

determined under Sec. 411.226(a)(1) of these final rules. We explain

that we will conduct a progress review using the provisions of these

final rules at the conclusion of the beneficiary\'s next 12-month

progress certification period. We also added a provision that we will

send the beneficiary a notice explaining the specific timely progress

requirements that will apply to the beneficiary and when they will

begin to apply.

Subpart B\--Tickets Under the Ticket to Work Program

General

Comment: One commenter recommended an \`\`overlap\'\' procedure under

which \`\`ticket-in-use\'\' and \`\`ticket-assigned\'\' statuses could
overlap.

Under this proposal, once the VR client completed his or her

individualized plan for employment (IPE), the State VR agency would

advise the beneficiary that the ticket would be available for

assignment to an EN for job development and placement, and the

\`\`overlap\'\' period would begin with the State VR agency\'s approval,

once the EN has advised the PM that the ticket is assigned. Once the EN

has placed the beneficiary in a job, the 90 days required for case

closure by the State VR agency would begin running. As the beneficiary

works above SGA, the EN would subsequently become eligible for Phase 2

milestone payments, and the State VR agency would become eligible for

cost reimbursement.

One commenter noted that often State VR agencies contract with a

community-based organization to provide services at the outset of its

relationship with a beneficiary, and recommended that the regulations

recognize this by providing for a joint State VR agency/EN assignment.

Under this proposal, with the individual\'s permission, the State VR

agency and the community-based organization would be allowed to jointly

submit an IPE that lays out the initial cost reimbursable services as

well as the follow up services reimbursable to the EN by Phase 2 and

outcome payments. This proposal would encourage the State VR agency and

community-based organization to collaborate together in an efficient

manner to plan out several years of service and support. In addition,

this proposal would ensure that the VR client\'s supportive services can

continue uninterrupted and in a consistent manner with the same service

provider, if this is what the beneficiary chooses.

This commenter acknowledged that there may be some concern that

such a process provides the community-based organizations that contract

with State VR agencies an unfair advantage over other ENs in gaining

access to beneficiaries with tickets who want to assign their tickets

after working with a State VR agency who had chosen the cost

reimbursement option. However, if the process is set up similar to the

\`\`overlap\'\' system described above, all ENs could compete for a
joint

ticket assignment with the State VR agency. Those ENs who do not

currently contract with a State VR agency could establish a working

relationship with the State VR agency to create these joint plans for

services, and this process may encourage new collaborations between the

State VR agencies and the ENs. The individual would still be given the

option to change service providers after the State VR agency closes the

case. With this option, the individual\'s ability to choose service

providers is protected, and those beneficiaries who choose to allow

this joint submission process at the beginning will still have the same

rights as those who did not choose this route.

Response: We agree that coordination of services between a State VR

agency providing initial services and an EN providing ongoing support

services would be beneficial. We do not believe that Congress intended

the Ticket to Work program to make duplicate payments for services

provided under the Rehabilitation Act. Therefore, when a beneficiary

with a ticket receives VR services from a State VR agency which has

elected the VR cost reimbursement option, these rules provide that the

VR case must be closed by the State VR agency before the beneficiary

may assign a ticket to an EN. We are, however, encouraging joint

planning between the State VR agency and the EN selected by the

consumer to provide ongoing support services as early as

\[\[Page 29333\]\]

possible. In this way, when the VR case is closed, the transition to

ongoing supports under the Ticket to Work program will be seamless for

the beneficiary.

Section 411.140 When may I assign my ticket and how?

Comment: A number of commenters asked how we would know that a

person is a client of a State VR agency.

Response: We will use the procedures under Sec. 411.385 for the

State VR agency to notify the PM that an IPE has been signed so that we

can record that the beneficiary\'s ticket is in use so that we can

ensure that we will not initiate a continuing disability review.

Comment: One commenter recommended that the proposed rules be

amended to require a State VR agency that has chosen the cost

reimbursement payment system to notify a beneficiary upon case closure

of his or her right to assign the ticket to an EN for follow-up

services. Failure to provide this notice should constitute grounds for

denying payment under the cost reimbursement payment system. The

commenter indicated that the rules should also require the State VR

agency to notify us of the case closure. We should also provide the

beneficiary with a notice that his or her ticket is available for

assignment, so that the beneficiary will be aware of and take advantage

of this new process.

Response: We are not addressing the rules for the State VR

Reimbursement program in this regulation. However, we are working out a

process through which the State VR agency can efficiently inform the PM

when it closes a case for beneficiaries participating in the program.

We believe there are sufficient incentives built into the new payment

system to encourage State VR agencies to facilitate the connection to

an EN for ongoing support services. We also will publicize the

provisions of these new rules so that beneficiaries are aware of their

rights under these final rules.

Comment: A number of commenters suggested that it should be

feasible to allow for simultaneous EN and State VR services in

situations where the EN is not receiving any payments for services

being provided by a State VR agency and the services provided by the

State VR agency are not duplicating any services being provided by the

EN.

Response: We do not agree. We do not believe that Congress intended

to allow a beneficiary to be served simultaneously by a State VR agency

and an EN under the Ticket to Work program. We believe that these final

rules will provide incentives for beneficiaries to work with the State

VR agency when they are developing the IPE to consider the expanded

opportunities under the Ticket to Work program for receiving job

retention and other support services from an EN after the close of VR

services.

Comment: Another commenter noted that limiting the ability of State

VR agencies to take a ticket as an EN after it has served a beneficiary

and received cost reimbursement would seem to be an appropriate

approach in many instances. However, there are situations where this

may not be true. If there are no available ENs in an area and the State

VR agency is willing to provide the long term follow up, then

consideration should be given to allowing the State VR agency to

function as an EN. There may also be situations where the State VR

agency has unique expertise with certain populations that cannot be met

by other ENs. In these circumstances, the commenter recommended that

the VR agency should be permitted to function as an EN.

Response: We understand the concern expressed by this commenter and

we will carefully monitor the availability of ENs in all regions of the

country to ensure that we are not unduly restricting beneficiary

choice. While we are confident that the new payment system should

facilitate many additional ENs entering the program, we will make

necessary changes to our rules if our evaluation shows that the Ticket

to Work program is not serving our beneficiaries to the fullest extent

possible.

Comment: A number of commenters noted that proposed Sec.

411.140(a) stated that \`\`you may also assign your ticket during the
90-

day period your ticket is considered in use after State VR services

end\'\' and asked how we define \`\`end\'\' of VR services\--after
provision

of direct cost services or after case closure?

Response: For purposes of these rules, we consider VR services to

end when the VR case is closed by the State VR agency. We made changes

in final Sec. Sec. 411.140(a) and 411.171(d) to clarify that the 90-

day period discussed in these sections begins after the date the

beneficiary\'s case is closed by the State VR agency.

As we explain earlier in this preamble, we are also revising the

provision in proposed Sec. 411.140(a), referenced above, to indicate

that an individual may assign his or her ticket during the 90-day

period after his or her VR case is closed by a State VR agency that

elected the cost reimbursement option, without having to meet the

requirements of Sec. 411.125(a)(2). We are making this change in the

provision in these final rules to conform to the similar provision

contained in final Sec. 411.150(b)(3). Section 411.150(b)(3) provides

that an individual whose ticket is no longer assigned to an EN or State

VR agency acting as an EN, may reassign the ticket within 90 days of

the effective date the ticket was no longer assigned, without meeting

the requirements of Sec. 411.125(a)(2).

Subpart C\--Suspension of Continuing Disability Reviews for

Beneficiaries Who Are Using a Ticket

General

We received many public comments regarding the proposed changes to

the timely progress provisions described in the NPRM that was published

in the Federal Register on August 13, 2007. Most of these comments

concerned the educational requirements or the work requirements for

making timely progress toward self-supporting employment. We also

received comments on the changes to subpart C that were proposed in the

September 30, 2005 NPRM.

Section 411.180 What is timely progress toward self-supporting

employment?

Comment: The majority of commenters expressed support for the

proposal to include educational or vocational or technical training

requirements as part of the timely progress guidelines. However, based

on the view that obtaining a high school diploma or its equivalent,

such as a general education development (GED) certificate, increases an

individual\'s ability to obtain and maintain self-supporting employment,

some commenters suggested that we add language that incorporates a GED

as part of the timely progress guidelines.

Response: We agree with the commenters\' suggestion and have

incorporated it in these final rules. We have expanded the timely

progress requirements in Sec. 411.180(c)(1) of the final rules to

provide that an individual who obtains a high school diploma or a GED

certificate during the first 12-month progress certification period

will be considered to be making timely progress toward self-supporting

employment for the purpose of the progress review conducted at the end

of this 12-month period.

Comment: The majority of commenters suggested that we lower the

educational and vocational or technical training requirements for

making timely progress toward self-supporting employment. Some

commenters asked that we allow flexibility to combine the achievement

of work goals and

\[\[Page 29334\]\]

educational or vocational or technical training goals under the timely

progress guidelines. Several commenters also asked that we provide

beneficiaries with more time to complete educational or vocational or

technical training requirements because of their disability and other

factors that affect their ability to sustain heavy course loads.

Response: In response to these comments, we made changes in Sec.

411.180 to lower the educational requirements and the vocational or

technical training requirements from expecting the beneficiary to carry

a full-time course load in the first two years to carrying 60 percent

of a full-time course load in the first year and 75 percent in the

second year. This has the effect of lengthening the amount of time a

beneficiary has to complete a degree or certification program, or a

vocational or technical training program. We also provide that if a

beneficiary completes a certain percentage of the work requirement and

a certain percentage of the post-secondary education requirement or

vocational or technical training requirement in the applicable progress

certification period, and the sum of the two percentages equals 100 or

more, we will consider the beneficiary to have met the timely progress

requirements for purposes of the progress review conducted at the end

of the 12-month progress certification period. In addition, we included

a variance tolerance of 10 percent to make the requirements for

completing a specified amount of credit hours or course requirements

easier to achieve. These measures will increase the flexibility of

these provisions and give beneficiaries more time to gradually progress

toward their work or educational goals.

Comment: A few commenters suggested that we give credit toward

timely progress for Compensated Work Therapy, individuals in on-the-

job, supported employment and specialized training in a community

rehabilitation agency.

Response: We did not adopt this comment because the types of

programs the commenters suggested may not be indicative of work that

equates to trial work or SGA level earnings or training that typically

leads directly to increased and sustained earnings at these levels. We

will give credit for a post-secondary education program at an

educational institution as defined in Sec. 411.167, or for vocational

or technical training at a technical, trade or vocational school as

defined in Sec. 411.167. We also will give credit for a high school

diploma or a GED certificate obtained during the first 12-month

progress certification period.

Comment: Some commenters suggested using the Individualized Plan

for Employment (IPE) as a measure of timely progress and others

suggested we retain the prior rules for timely progress during the

initial 24-month period.

Response: We did not adopt these comments because they are

inconsistent with the goals we are trying to accomplish with the

revised timely progress guidelines. The IPE and IWP were essentially

used to determine whether a beneficiary was making timely progress

under the prior rules. We found that the initial 24-month period and

the use of the IPE or IWP goals as a measure of timely progress did not

always include specific enough rules to encourage the beneficiary to

make concrete strides toward self-sufficiency early enough in the

process. Furthermore, under the prior rules, the use of the IPE or IWP

for progress reviews was administratively burdensome to service

providers, who had to evaluate a beneficiary\'s goals and achievements

under the IPE or IWP in order to provide the PM with their assessment

as to whether the beneficiary was expected to meet the timely progress

guidelines for the next progress review period.

Comment: A commenter requested clarification on the type of

administrative records and educational documentation to be used to

determine whether a beneficiary is meeting the timely progress

guidelines.

Response: Social Security and SSI beneficiaries with disabilities

are required to report their work and earnings to us. ENs and State VR

agencies are also required to submit evidence of beneficiaries\'

earnings to support some types of payments under the Ticket to Work

program. The administrative records referred to in Sec. 411.200 are

our records that contain this information, including any Program

Manager (PM) records, which may include additional information such as

certification of educational accomplishments.

Concerning the educational documentation, if our records do not

show that the work or educational requirements have been met, we will

send a letter to the beneficiary asking him or her to provide

appropriate information about any work or educational progress made

during the period. If the beneficiary does not respond, we will contact

the EN or State VR agency. We plan to implement this part of the

process in a way that should not be burdensome to ENs or State VR

agencies. The PM will be accepting electronic notifications, and we

will work to make the process as efficient as possible.

Section 411.192 What choices do I have if I am unable to make timely

progress toward self-supporting employment?

Comment: Some commenters suggested that we allow beneficiaries with

significant disabilities who do not expect that they will ever meet the

timely progress requirements and whose medical conditions are not

likely to improve, the choice of opting out of having their ticket

being considered \`\`in-use\'\' with a VR agency. This would prevent the
PM

from requesting the beneficiary or the State VR agency to submit

information for purposes of progress reviews in situations where the

beneficiary isn\'t expected to meet the timely progress requirements and

where a medical CDR is a non-issue because medical improvement is

unlikely.

Response: In response to this comment, we modified Sec. 411.192 to

provide that a beneficiary may request to have his or her ticket placed

in inactive status if the beneficiary is temporarily or otherwise

unable to make timely progress toward self-supporting employment.

Comment: Some commenters requested that we clarify the role of the

VR Agencies in providing evidence of tickets in-use under the cost

reimbursement program and how to notify the PM when a beneficiary is

receiving services under an IPE.

Response: In order to extend CDR protection to beneficiaries, State

VR agencies will need to inform the PM when they initiate an IPE. In

addition, we will need to know when cases are closed so that we can end

the \`\`in-use\'\' period and make the ticket available for assignment.
We

intend to implement this part of the process in a way that will be

least burdensome to State VR agencies. The PM will be accepting

electronic notifications, and we will work to make the process as

efficient as possible. State VR agencies can continue using SSA Form

SSA-1365 if they are assigning a ticket and choosing to be paid under

an EN payment system rather than the cost reimbursement payment method.

Comment: A few commenters suggested we extend the 90-day period for

ticket assignment that begins after VR case closure by a State VR

agency which elected the VR cost reimbursement option so the ticket can

be available for assignment at any point after the VR case closure.

Response: The beneficiary can assign the ticket any time after the

VR case closure. We clarified in Sec. 411.140(a) of

\[\[Page 29335\]\]

the final rules that a beneficiary may assign the ticket during the 90-

day period after his or her case is closed by a State VR agency that

elected the VR cost reimbursement option, without meeting the

requirements of Sec. 411.125(a)(2). Also, if the beneficiary assigns

the ticket within the 90-day period, the medical CDR protection does

not lapse. Nevertheless, the beneficiary may assign the ticket at any

time as long as he or she remains eligible to participate in the Ticket

to Work program.

Section 411.171 When does the period of using a ticket end?

Comment: Proposed Sec. 411.171(e)(1) and (f)(1) discussed when the

period of using a ticket ended for a title II beneficiary (the 36th

month for which an outcome payment is made to an EN) or title XVI

beneficiary (the 60th month for which an outcome payment is made to an

EN). One commenter noted that the language in paragraphs (e)(1) and

(f)(1) of proposed Sec. 411.171 was not about \`\`the period of using a

ticket\'\' as much as it related to when the ticket actually terminated

and was no longer available for use with anyone. Therefore, the

commenter recommended that it was more appropriate to put the language

of these paragraphs into Sec. 411.155 (When does my ticket

terminate?).

Response: In response to this comment, we removed proposed Sec.

411.171(e) and (f) from these final rules. We have incorporated in

final Sec. 411.171(d) the discussion contained in proposed Sec.

411.171(e)(2) and (f)(2) concerning when the period of using a ticket

may end for a beneficiary receiving services from a State VR agency

electing the VR cost reimbursement option.

Comment: One commenter recommended that the clock for \`\`timely

progress\'\' be re-started to day 1 when the ticket-user assigns his or

her ticket with an EN after receiving services from a State VR agency,

because a beneficiary might find an EN unwilling to subsequently accept

a ticket for assignment if the beneficiary has already used up a

significant portion of the timely progress period during \`\`in-use\'\'

status with the State VR agency.

Response: We do not agree. We believe the new payment options

provide sufficient incentives for ENs to accept tickets regardless of

where the beneficiary is in the progress certification period. Timely

progress rules only limit CDR protections, not the assignability of the

ticket.

Subpart E\--Employment Networks

Section 411.310 How does an entity other than a State VR agency apply

to be an EN and who will determine whether an entity qualifies as an

EN?

Comment: Many commenters supported the decision to allow one-stop

delivery systems to participate as ENs without responding to the RFP.

While they supported making it easier for one-stop delivery systems to

become ENs, they still had concerns about whether or not the one-stop

delivery systems would be physically or programmatically accessible to

people with disabilities.

One commenter also suggested we include the Vocational

Rehabilitation Services Projects for American Indians with Disabilities

authorized under section 121 of part C of title I of the Rehabilitation

Act of 1973 in the Ticket to Work program which could benefit their

communities.

Response: In order for a one-stop delivery system to operate as an

EN and to remain an EN, they must enter into an agreement with us and

must maintain compliance with both general and specific selection

criteria found in Sec. 411.305 and Sec. 411.315. These sections

require the EN to be physically and programmatically accessible to

beneficiaries seeking services.

We amended final Sec. 411.310(e) so that organizations

administering Vocational Rehabilitation Services Projects for American

Indians with Disabilities authorized under section 121 of part C of

title I of the Rehabilitation Act of 1973 may participate in the Ticket

program without responding to the RFP. We made a corresponding change

to final Sec. 411.315(f) to indicate that they must enter into an

agreement with us and must maintain compliance with both general and

specific selection criteria found in Sec. Sec. 411.305 and 411.315.

Comment: Some commenters suggested we allow veterans programs under

title 38 of the U.S.C. to apply to become an EN.

Response: Section 1148(f)(1)(A) of the Act provides that an EN

serving under the Ticket to Work program shall consist of an agency or

instrumentality of a State (or a political subdivision thereof) or a

private entity. Therefore, federally-operated veterans programs under

title 38 of the U.S. Code are not eligible to participate as an EN.

However, their contractors may qualify.

Subpart F\--State Vocational Rehabilitation Agencies\' Participation

Section 411.385 What does a State VR agency do if a beneficiary who is

eligible for VR services has a ticket that is available for assignment

or reassignment?

Comment: Noting that proposed Sec. 411.385 continued to require

that a State VR agency submit the information prescribed in proposed

Sec. 411.385(a) in order for us to consider a beneficiary to be

\`\`using a ticket,\'\' a number of State VR agencies indicated that
this

requirement requires a substantial amount of time and resources, and

asked if this process could be simplified. Another commenter suggested

that we continue to use the form SSA-1365 (Agency Ticket Assignment

Form), but amend it so that it does not require the beneficiary\'s

signature and it indicates whether the form is being submitted for
\`\`in

use\'\' purposes or is a request for ticket assignment. Another
commenter

recommended that we give consideration to allowing State VR agencies to

submit a monthly list of beneficiaries being served in lieu of

providing a paper copy of the signed IPE, to reduce the burden of

collecting and submitting these copies.

Response: While these final rules still require the submission of

the information prescribed in Sec. 411.385, we are considering ways to

simplify the process under which State VR agencies will notify the PM

when an IPE is signed and the State VR agency has elected the VR cost

reimbursement option. The PM will accept electronic notifications. We

will work out an efficient means to allow the State VR agencies to

regularly provide the PM a listing of ticket holders who recently

signed an IPE.

Subpart H\--Employment Network Payment Systems

Comment: One commenter recommended simplification of the payment

systems to only one system, in order to streamline the administration

of the Ticket to Work program. The commenter suggested that the

outcome-milestone system would appear to cover the widest range of

possible employment situations.

Response: We are unable to limit the EN payment systems to payment

under only one system, because the Ticket legislation specifies in

section 1148(h) of the Act that the Ticket to Work program shall

provide ENs with a choice to be paid under either the outcome payment

system or the outcome-milestone payment system.

\[\[Page 29336\]\]

Comment: One commenter asked whether an EN could be compensated

under the Ticket to Work program if the extended services provided

following VR services are being funded from a different financial

source.

Response: Section 1148(b)(4) of the Social Security Act and Sec.

411.570 of our regulations prohibit an EN from requesting or receiving

compensation from the beneficiary for the services of the EN.

Otherwise, nothing in the Ticket to Work rules would preclude an EN

from seeking financial support for services being provided to a

beneficiary. We encourage ENs to seek financial support from other

sources for services provided to beneficiaries.

Section 411.515 Can the EN change its elected payment system?

Comment: Section 411.515(b) provides the opportunity for an EN to

make one change in its elected payment system at any time prior to the

close of the 12th month following the month in which the EN first

elects an EN payment system. One commenter noted that the 12-month

period seems to be a minimal level of flexibility, given that State VR

agencies can decide on a case-by-case basis whether to serve the

beneficiary as an EN. Another commenter suggested that as a strategy to

offer greater flexibility to ENs, we may want to consider allowing ENs

the option of choosing the outcome or the outcome-milestone payment

system on a case-by-case basis.

Response: We removed Sec. 411.515(c), which says that after the

year ends in which the beneficiary first elected a payment system, we

will offer the opportunity for each EN to make a change in its elected

payment system at least every 18 months. As revised, this section

clarifies that after an EN elects a payment system, the EN can make one

change in its elected payment system in each calendar year thereafter.

We believe an annual opportunity to change the payment system election

is reasonable and administratively prudent.

Section 411.525 What payments are available under each of the EN

payment systems? and Sec. 411.535 Under what circumstances will

milestones be paid?

Comment: Proposed Sec. 411.535(a)(3) provided that \`\`If the

beneficiary does not achieve all Phase 1 and Phase 2 milestones prior

to the beginning of the beneficiary\'s outcome period, then we will pay

the EN (or State VR agency acting as an EN) the final milestone payment

equal to the total amount of the remaining unpaid Phase 1 and Phase 2

milestones.\'\' A number of commenters expressed concern about this

provision. They noted that there might be unintended consequences from

providing this final milestone payment in a lump sum, which could

result in a financial disincentive to continuing serving a beneficiary

after the first year, if the lump sum was paid because the beneficiary

went to work and immediately left the benefit rolls, or might provide

an incentive for the State VR agency to choose the less-challenging

milestone payment system over the cost reimbursement payment system.

Another commenter noted that the proposed outcome-milestone payment

system could result in shifting too much of the Ticket to Work

program\'s value to the first couple months of employment, thus

diminishing a beneficiary\'s ability to negotiate for needed service

later in his or her efforts to return to work. The commenter

recommended that we review the lump sum milestone payment provision to

ensure that beneficiaries do not lose this protection. Commenters also

recommended withholding the lump sum payment for anywhere from 6 to 18

months into the outcome period.

Response: In response to these comments, we added Sec. 411.536 to

explain how we will make the reconciliation payment if the beneficiary

does not achieve all Phase 1 and Phase 2 milestones prior to the

beginning of the beneficiary\'s outcome period.

We will make a reconciliation payment to the EN once the

beneficiary achieves 12 outcome payment months. Congress intended that

milestone payments should lead to permanent employment. The

reconciliation payment will be equal to the total of all Phase 1 and 2

milestone payments which could have been payable with respect to a

ticket but that were not paid prior to the beginning of the outcome

payment period.

Comment: Proposed Sec. 411.535(a)(4) provided that if the State VR

agency already has received payment for services under the cost

reimbursement payment system, we would not pay Phase 1 milestones to an

EN. A number of commenters indicated that there are conditions under

which an EN should be paid for Phase 1 milestones if the State VR

Agency has received payment under cost reimbursement. They note that it

is important that ENs and State VR agencies not be put in a position of

\`\`competing for ticket holders.\'\' While understanding our fiscal

concern about paying for the same service twice, they still do not want

to discourage ENs from referring beneficiaries to the State VR agencies

for services or vice versa. One commenter requested that we attempt to

craft a rule that focuses on the beneficiary and the employment

outcomes they have achieved prior to ticket assignment and is not VR-

centric as in the NPRM.

Response: We agree that the rules in this regard should broadly

consider work before ticket assignment and not focus exclusively on

cases where a beneficiary received services from a State VR agency. The

intent of the Phase 1 milestone payments is to support the high costs

ENs frequently incur during the initial job acquisition phase of return

to work, e.g., job development and on-the-job training and support. In

developing these rules, we also wanted to address the concerns that the

ticket should not pay for employment results that have recently been

attained. We attempted to address this by revising Sec. 411.535,

\`\`Under what circumstances will milestones be paid?\'\' In that
section

we preclude payment of all Phase 1 milestones if the State VR agency

services, under the cost reimbursement option, ended in an employment

outcome before case closure. In addition, we limit payment of some or

all of Phase 1 milestones when the beneficiary had significant work

activity prior to ticket assignment.

Section 411.566 May an EN use outcome or milestone payments to make

payments to the beneficiary?

Comment: Proposed Sec. 411.566 provided that an EN could use

outcome or milestone payments to pay bonuses to beneficiaries. A number

of commenters expressed concern that this new section might lead to

expectation that an EN must make these payments to beneficiaries.

Beyond that, commenters noted a concern on how these bonus payments

would affect a beneficiary\'s benefits, e.g., by counting as unearned

income for title XVI beneficiaries.

Response: We changed the title of final Sec. 411.566 to \`\`May an

EN use outcome or milestone payments to make payments to the

beneficiary?\'\' and revised this section to remove references to these

payments as bonus payments. We must count income under our rules, but

we have work incentives outreach efforts to help beneficiaries plan for

how income affects them. In addition to work incentives specialist

within SSA, Sec. 1148 of the Act established Work Incentive Planning

and Assistance Organizations in communities across the country that

provide benefits planning and assistance to help beneficiaries

anticipate and plan for the effect of work and earnings and other

income,

\[\[Page 29337\]\]

such as the payments a beneficiary may receive from an EN, on their

benefits.

Section 411.582 Can a State VR agency receive payment under the cost

reimbursement system if a continuous 9-month period of substantial

gainful activity is completed after the ticket is assigned to an EN?

Comment: A number of commenters provided the example of a case in

which the State VR agency selects the traditional cost reimbursement

payment system using the form SSA-1365 and provides services to the

beneficiary that cost \$25,000. In this example, the beneficiary

completes the VR services and the case is closed. Three months later

the beneficiary assigns his or her ticket to an EN which chooses the

proposed outcome milestone payment and provides both job placement and

supported employment. The beneficiary is successful and his or her SSI

checks stop. The commenter asked if the State VR agency would get the

reimbursement of the \$25,000 plus administrative costs, and if the EN

would have the potential to receive the full value of the ticket.

Response: The State VR agency can receive cost reimbursement and

the EN can receive payments under its elected EN payment system with

respect to the same ticket. After VR case closure an EN can receive

Phase 2 milestone payments intended to support job retention and

outcome payments. However, in the situation described by this

commenter, the EN may be able to also receive Phase 1 milestones if the

beneficiary did not achieve a successful employment outcome before the

VR agency closed the case (see Sec. 411.535).

Comment: One commenter noted that the citation to 34 CFR 361.12 in

the proposed Sec. 411.582 is incomplete, and should be cited as 34 CFR

part 361 because VR services are provided pursuant to a number of

sections in part 361.

Response: We agree, and corrected this citation in the final Sec.

411.582.

Section 411.590 What can an EN do if the EN disagrees with our decision

on a payment request?

Comment: One commenter noted that while we proposed to revise Sec.

411.590(d), we also proposed to retain language commented on in the

past, i.e., \`\`While an EN cannot appeal our determination about an

individual\'s right to benefits, the EN may furnish any evidence the EN

has which relates to the issue(s) to be decided on appeal if the

individual appeals our determination.\'\' The commenter remains
concerned

that this sentence appears to encourage ENs to turn against

beneficiaries if the ENs are unsuccessful in disputes with us over

whether payments are due to the EN. The commenter believes that should

an EN lose its dispute with us, the only alternative we have offered is

for the EN to submit evidence against the beneficiary in the

beneficiary\'s claim for cash benefits. The commenter believes this

approach creates the potential for a serious conflict between the

beneficiary and the EN in a contractual arrangement where the

beneficiary needs to trust that the EN is working in the beneficiary\'s

best interest in job preparation, placement, and follow-up.

Response: As we noted in response to this concern expressed by a

number of commenters in the preamble to the prior regulations published

on December 28, 2001 (66 FR 67370, 67416), we do not want to create an

adversarial relationship between beneficiaries and ENs. For this

reason, we clearly state in Sec. 411.590(c) and (d) of the prior rules

that an EN cannot appeal a determination we make about a beneficiary\'s

right to benefits, but an EN may furnish evidence in support of the

EN\'s claim for payment.

Regulatory Procedures

Executive Order 12866

We have consulted with the Office of Management and Budget and have

determined that these final rules meet the criteria for an economically

significant regulatory action under Executive Order 12866, as amended.

Estimated Increases (+) and Decreases (-) in OASDI Benefits and Federal
SSI Payments Due to the Provisions of the Final Rule Under Consideration
for the

Ticket to Work Program, Fiscal Years 2008-18

\[In millions\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Fiscal year Totals

Provision
\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2008-13 2008-18

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Change due to proposed new EN

payment structure (including

State VR agencies):

OASDI benefit payments\...\.... \$1 \$7 \$29 \$93 \$154 \$233 \$290
\$342 \$376 \$405 \$421 \$517 \$2,351

Federal SSI payments\...\...\... 1 11 31 47 70 94 112 133 150 165 176
254 989

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Subtotal, OASDI and SSI.. 2 19 60 140 224 326 403 474 525 570 597 771
3,340

Change due to deferral of CDRs:

OASDI benefit payments\...\.... \...\.... \...\.... (1)\\ 2 5 12 21 32
44 58 76 20 251

Federal SSI payments\...\...\... - (1)\\ 1 2 3 4 5 5 5 6 5 10 36

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Subtotal, OASDI and SSI.. \...\.... (1)\\ 1 4 8 16 26 36 50 64 81 30 287

Change due to increase in work

activity among OASDI and SSI

beneficiaries:

OASDI benefit payments\...\.... \...\.... \...\.... \...\.... -3 -26 -71
-123 -178 -247 -305 -363 -99 -1,315

Federal SSI payments\...\...\... (2)\\ -7 -28 -60 -75 -106 -128 -146
-176 -183 -185 -276 -1,093

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Subtotal, OASDI and SSI.. (2)\\ -7 -28 -63 -101 -176 -251 -324 -422 -488
-548 -375 -2,408

Net total increase in outlays due

to proposed rule changes:

OASDI benefit payments\...\.... 1 7 29 92 134 174 189 195 173 158 134
438 1,288

Federal SSI payments\...\...\... 1 5 4 -11 -3 -8 -11 -8 -20 -13 -4 -12
-68

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Total, OASDI and SSI\..... 2 12 33 81 131 166 178 187 153 146 130 426
1,219

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

\\1\\ Increase of less than \$500,000.

\\2\\ Reduction of less than \$500,000.

Notes:

1\. See covering memorandum and table 1 for details of the proposed
changes.

2\. Above estimates are consistent with the assumptions underlying the
President\'s FY 2009 Budget, and assume that a final regulation
establishing the

provisions of the proposed rule would become effective as of July 21,
2008.

\[\[Page 29338\]\]

3\. Totals may not equal sum of rounded components.

4\. SSI payments due on October 1st in fiscal years 2012, 2017 and 2018
are included in payments for the prior fiscal year.

As required by OMB Circular A-4 (available at
[http://](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf)

[www.whitehouse.gov/omb/circulars/a004/a-4.pdf](http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf)),
in Table 2, we have

prepared an accounting statement showing the annualized economic impact

of implementing the Ticket to Work program. All estimated impacts are

classified as transfers.

Table 2.\--Accounting Statement: Estimated Economic Impact of Provisions

To Enhance the Ticket to Work Program

\[Fiscal years 2008-2018 in 2008 dollars\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Category Transfers

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Annualized Monetized Transfers\.... \$98.8 million (7% discount rate).

\$102.6 million (3% discount rate).

From Whom To Whom?\...\...\...\...\.... From the Social Security trust
funds

and the general fund to SSA

beneficiaries.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Regulatory Flexibility Act

We certify that these final rules would not have a significant

economic impact on a substantial number of small entities because they

would primarily affect only individuals, and those entities that

voluntarily enter into a contractual agreement with us. Accordingly, a

regulatory flexibility analysis as provided in the Regulatory

Flexibility Act, as amended, is not required.

Federalism

We have reviewed these final rules under the threshold criteria of

Executive Order 13132, \`\`Federalism,\'\' and determined that they do
not

have substantial direct effects on the States, on the relationship

between the national government and the States, or the distribution of

power and responsibilities among the various levels of government.

These final rules will complement and enhance the existing State

vocational rehabilitation program.

Paperwork Reduction Act

We are revising our regulations for the Ticket to Work and Self-

Sufficiency Program (Ticket to Work program), which was authorized by

the Ticket to Work and Work Incentives Improvement Act of 1999. The

Ticket to Work program provides Social Security Disability Insurance

and Supplemental Security Income beneficiaries expanded options for

access to employment services, vocational rehabilitation services, and

other support services. We are revising our prior rules to improve the

overall effectiveness of the program to maximize the economic self-

sufficiency of beneficiaries through work opportunities. We have based

these revisions on our projections of the future direction of the

Ticket to Work program, our experience using the prior rules, and

recommendations made by a number of commenters on the program.

We published a Notice of Proposed Rulemaking on September 30, 2005

at 70 FR 57222 and solicited comments under the Paperwork Reduction Act

(PRA) on the public reporting requirements in Sec. Sec. 411.145(a),

411.190, 411.325(a), 411.140(d)(3), 411.365(a), 411.385, 411.390 and

411.575. We solicited comments on the burden estimate; the need for the

information; its practical utility; ways to enhance its quality,

utility, and clarity; and on ways to minimize the burden on

respondents, including the use of automated collection techniques or

other forms of information technology. None of the comments submitted

by the public on this regulation were related to these issues. On

November 23, 2005 OMB filed comment on the NPRM in accordance with 5

CFR 1320. In response to the comment, we clarified the reporting

requirement in Sec. 411.325(a), \`\`What reporting requirements are

placed on an EN as a participant in the Ticket to Work Program?\'\'

We published a second Notice of Proposed Rulemaking on August 13,

2007 at 72 FR 45191 and solicited comments under the PRA on the public

reporting requirements in Sec. Sec. 411.192(b) and (c), 411.200(b),

and 411.210. We solicited comments on the burden estimate; the need for

the information; its practical utility; ways to enhance its quality,

utility, and clarity; and on ways to minimize the burden on

respondents, including the use of automated collection techniques or

other forms of information technology. None of the comments submitted

by the public on this regulation were related to these issues.

As required by the PRA, we have submitted a clearance request to

OMB for approval. We will publish the OMB number and expiration date

upon approval. Requests for the Information Collection Request Package

should be directed to SSA through the SSA Reports Clearance Officer at

410-965-0454 or to <OPLM.RCO@ssa.gov>.

(Catalog of Federal Domestic Assistance Program Nos. 96.001, Social

Security\--Disability Insurance; 96.002, Social Security\--Retirement

Insurance; 96.004, Social Security\--Survivors Insurance; and 96.006,

Supplemental Security Income)

List of Subjects in 20 CFR Part 411

Administrative practice and procedure, Blind, Disability benefits,

Old-Age, Survivors, and Disability Insurance, Reporting and

recordkeeping requirements, Social Security, Supplemental Security

Income, Public Assistance programs, Vocational Rehabilitation.

Dated: February 6, 2008.

Michael J. Astrue,

Commissioner of Social Security.

Editorial Note: This document was received at the Office of the

Federal Register on May 12, 2008.

0

For the reasons set out in the preamble, we are amending subparts A, B,

C, E, F and H of part 411 of chapter III of title 20 of the Code of

Federal Regulations as set forth below:

PART 411\--THE TICKET TO WORK AND SELF-SUFFICIENCY PROGRAM

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1\. Revise the authority citation for part 411 to read as follows:

Authority: Secs. 702(a)(5) and 1148 of the Social Security Act

(42 U.S.C. 902(a)(5) and 1320b-19); sec. 101(b)-(e), Public Law 106-

170, 113 Stat. 1860, 1873 (42 U.S.C. 1320b-19 note).

Subpart A\--\[Amended\]

Sec. 411.110 \[Removed\]

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2\. Remove Sec. 411.110.

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3\. In Sec. 411.115, redesignate paragraph (s) as paragraph (t) and add

a new paragraph (s) to read as follows:

\[\[Page 29339\]\]

Sec. 411.115 Definitions of terms used in this part.

\* \* \* \* \*

\(s\) VR cost reimbursement option means an arrangement under which

your ticket is not assigned to the State VR agency but you do receive

services pursuant to an individualized plan for employment where the

State VR agency has chosen to receive payment under the cost

reimbursement payment system.

\* \* \* \* \*

Subpart B\--\[Amended\]

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4\. In Sec. 411.120, revise paragraphs (b) and (c) to read as follows:

Sec. 411.120 What is a ticket under the Ticket to Work program?

\* \* \* \* \*

\(b\) The left side of the ticket includes the beneficiary\'s name,

ticket number, claim account number, and the date we issued the ticket.

The ticket number is 12 characters and comprises the beneficiary\'s own

social security number, the letters \`\`TW,\'\' and a number (1, 2,
etc.)

in the last position signifying that this is the first ticket, second

ticket, etc., that the beneficiary has received.

\(c\) The right side of the ticket includes the signature of the

Commissioner of Social Security and provides a description of the

Ticket to Work program. The description of the program will tell you

how you may offer the ticket to an EN or State VR agency. The

description will also tell you how the EN provides services to you.

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5\. In Sec. 411.125, revise paragraphs (a)(1) and (a)(2)(ii)(C), and

remove paragraph (a)(3) to read as follows:

Sec. 411.125 Who is eligible to receive a ticket under the Ticket to

Work program?

\(a\) \* \* \*

\(1\) You are age 18 or older and have not attained age 65; and

\(2\) \* \* \*

\(ii\) \* \* \*

\(C\) Your monthly Federal cash benefits based on disability or

blindness under title XVI are not suspended (see subpart M of part 416

of this chapter for our rules on suspension of title XVI benefit

payments).

\* \* \* \* \*

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6\. Revise Sec. 411.130 to read as follows:

Sec. 411.130 How will we distribute tickets under the Ticket to Work

program?

If you are eligible to receive a ticket under Sec. 411.125, we

will send a ticket to you by mail.

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7\. Revise Sec. 411.135 to read as follows:

Sec. 411.135 What do I do when I receive a ticket?

Your participation in the Ticket to Work program is voluntary. When

you receive your ticket, you are free to choose when and whether to

assign it (see Sec. 411.140 for information on assigning your ticket).

If you want to participate in the program, you can take your ticket to

any EN you choose or to your State VR agency. You may choose either to

assign your ticket to an EN by signing an individual work plan (see

Sec. Sec. 411.450 through 411.470) or receive services from your State

VR agency by entering into and signing an individualized plan for

employment. If the State VR agency provides services to you, it will

decide whether to accept your ticket. If it accepts your ticket, you

will have assigned your ticket to the State VR agency and it will

receive payment as an EN. If the State VR agency decides to be paid

under the cost reimbursement payment system, you have not assigned your

ticket and you may assign your ticket after the State VR agency has

closed your case.

0

8\. In Sec. 411.140, revise the section heading, paragraph (a), the

introductory text of paragraph (d), paragraph (d)(3), and the first

sentence of paragraph (e) to read as follows:

Sec. 411.140 When may I assign my ticket and how?

\(a\) You may assign your ticket during a month in which you meet the

requirements of Sec. 411.125(a)(1) and (a)(2). You may assign your

ticket during the 90-day period after your case is closed by a State VR

agency that elected the VR cost reimbursement option (see Sec.

411.171(d)), without meeting the requirements of Sec. 411.125(a)(2).

You may assign your ticket to any EN which is serving under the program

and is willing to provide you with services, or you may assign your

ticket to a State VR agency acting as an EN if you are eligible to

receive VR services under 34 CFR 361.42. You may not assign your ticket

to more than one provider of services (i.e., an EN or a State VR

agency) at a time. You may not assign your ticket until after the State

VR agency has closed your case if you are receiving VR services

pursuant to an individualized plan for employment from a State VR

agency which has elected the VR cost reimbursement option. You also may

not assign your ticket to a State VR agency if that VR agency

previously served you and elected the VR cost reimbursement option and

closed your case.

\* \* \* \* \*

\(d\) In order for you to assign your ticket to an EN or State VR

agency acting as an EN, all of the following requirements must be met:

\* \* \* \* \*

\(3\) A representative of the EN must submit a copy of the signed IWP

to the PM, or a representative of the State VR agency, acting as an EN,

must submit the completed and signed form (as described in Sec.

411.385(a) and (b)) to the PM.

\* \* \* \* \*

\(e\) If all of the requirements in paragraph (d) of this section are

met, we will consider your ticket assigned to the EN or State VR agency

acting as an EN. \* \* \*

0

9\. Revise Sec. 411.145 to read as follows:

Sec. 411.145 When can my ticket be taken out of assignment?

\(a\) If you assigned your ticket to an EN or a State VR agency

acting as an EN, you may take your ticket out of assignment for any

reason. You must notify the PM in writing that you wish to take your

ticket out of assignment. The ticket will be no longer assigned to that

EN or State VR agency acting as an EN, effective with the first day of

the month following the month in which you notify the PM in writing

that you wish to take your ticket out of assignment. You will be sent a

notice informing you that your ticket is no longer assigned to that EN

or State VR agency. You may reassign your ticket under the rules in

Sec. 411.150.

\(b\) If your EN goes out of business or is no longer approved to

participate as an EN in the Ticket to Work program, the PM will take

your ticket out of assignment with that EN. The ticket will no longer

be assigned to that EN effective on the first day of the month

following the month in which the EN goes out of business or is no

longer approved to participate in the Ticket to Work program. You will

be sent a notice informing you that your ticket is no longer assigned

to that EN. In addition, if your EN is no longer willing or able to

provide you with services, or if your State VR agency acting as an EN

stops providing services to you because you have been determined to be

ineligible for VR services under 34 CFR 361.42, the EN or State VR

agency acting as an EN may ask the PM to take your ticket out of

assignment with that EN or State VR agency. The ticket will no longer

be assigned to that EN or State VR agency acting as an EN effective on

the first day of the month following the month in which the EN or State

VR agency acting as an EN makes a request to the PM that the ticket be

taken out of assignment.

\[\[Page 29340\]\]

You will be sent a notice informing you that your ticket is no longer

assigned to that EN or State VR agency acting as an EN. You may

reassign your ticket under the rules in Sec. 411.150.

\(c\) For information about how taking a ticket out of assignment may

affect medical reviews that we conduct to determine if you are still

disabled under our rules, see Sec. Sec. 411.171(c) and 411.220.

0

10\. In Sec. 411.150, revise the section heading, and paragraphs (a)

and (b)(3) to read as follows:

Sec. 411.150 Can I reassign my ticket?

\(a\) If you previously assigned your ticket and your ticket is no

longer assigned (see Sec. 411.145), you may reassign your ticket,

unless you are receiving benefit payments under Sec. 404.316(c), Sec.

404.337(c), Sec. 404.352(d) or Sec. 404.1597a of this chapter, or you

are receiving disability or blindness benefit payments under Sec.

416.996 or Sec. 416.1338 of this chapter (the provisions of paragraph

(b)(3) of this section notwithstanding). If you previously assigned

your ticket to an EN, you may reassign your ticket to a different EN

which is serving under the program and is willing to provide you with

services, or you may reassign your ticket to a State VR agency acting

as an EN if you are eligible to receive VR services under 34 CFR

361.42. If you previously assigned your ticket to a State VR agency

acting as an EN, you may reassign your ticket to an EN which is serving

under the program and is willing to provide you with services, or to

another State VR agency acting as an EN if you are eligible to receive

VR services under 34 CFR 361.42.

\(b\) \* \* \*

\(3\) You must meet the requirements of Sec. 411.125(a)(1) and (2)

on or after the day you and a representative of the new EN sign your

IWP or you and a representative of the State VR agency sign your IPE

and the required form. You may reassign your ticket within 90 days of

the effective date your ticket was no longer assigned, without meeting

the requirements of Sec. 411.125(a)(2).

\* \* \* \* \*

0

11\. In Sec. 411.155, revise paragraphs (a)(2) and (a)(3), add a new

paragraph (a)(4), remove the word \`\`or\'\' at the end of paragraph

(c)(6), replace the period at the end of paragraph (c)(7) with \`\`;

or\'\', and add a new paragraph (c)(8) to read as follows:

Sec. 411.155 When does my ticket terminate?

\(a\) \* \* \*

\(2\) If you are entitled to widow\'s or widower\'s insurance benefits

based on disability (see Sec. Sec. 404.335 and 404.336 of this

chapter), the month in which you attain full retirement age;

\(3\) If you are eligible for benefits under title XVI based on

disability or blindness, the month following the month in which you

attain age 65; or

\(4\) The month after the month in which your outcome payment period

ends (see Sec. 411.500(b)).

\* \* \* \* \*

\(c\) \* \* \*

\(8\) The month after the month in which your outcome payment period

ends (see Sec. 411.500(b)).

Subpart C\--\[Amended\]

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12\. In Sec. 411.165, revise the section heading and the second

sentence to read as follows:

Sec. 411.165 How does using a ticket under the Ticket to Work program

affect my continuing disability reviews?

\* \* \* However, we will not begin a continuing disability review

during the period in which you are using a ticket. \* \* \*

0

13\. Revise Sec. 411.166 to read as follows:

Sec. 411.166 Glossary of terms used in this subpart.

\(a\) Using a ticket means you have assigned a ticket to an

Employment Network (EN) or a State VR agency that has elected to serve

you as an EN, and you are making timely progress toward self-supporting

employment as defined in Sec. 411.180; or you have a ticket that would

otherwise be available for assignment and are receiving VR services

pursuant to an individualized plan for employment (IPE) and the State

VR agency has chosen to be paid for these services under the cost

reimbursement payment system, and you are making timely progress toward

self-supporting employment as defined in Sec. 411.180. (See Sec.

411.171 for when the period of using a ticket ends.)

\(b\) Timely progress toward self-supporting employment means you

have completed the specified goals of work and earnings, or completed

the specified post-secondary education credits at an educational

institution (see Sec. 411.167) in pursuit of a degree or certificate,

or completed specified course requirements for a vocational or

technical training program at an educational institution consisting of

a technical, trade or vocational school (see Sec. 411.167), or

completed a certain percentage of the work requirement and a certain

percentage of the post-secondary education requirement or vocational or

technical training requirement and the sum of the two percentages

equals 100 or more (see Sec. 411.180(c)), or obtained a high school

diploma or General Education Development (GED) certificate in the

applicable progress certification period as described in Sec. 411.180.

\(c\) Timely progress guidelines mean the guidelines we use to

determine if you are making timely progress toward self-supporting

employment (see Sec. 411.180).

\(d\) Progress certification period means any 12-month progress

certification period described in Sec. 411.180(b).

\(e\) Progress review means the reviews the PM conducts to determine

if you are meeting the timely progress guidelines described in Sec.

411.180. We explain the method for conducting progress reviews in Sec.

411.200.

\(f\) Extension period is a period of up to 90 days during which you

may reassign a ticket without being subject to continuing disability

reviews. You may be eligible for an extension period if the ticket is

in use and no longer assigned to an EN or State VR agency acting as an

EN (see Sec. 411.220).

\(g\) Inactive status is a status in which you may place your ticket

if you are temporarily or otherwise unable to make timely progress

toward self-supporting employment during a progress certification

period. See Sec. 411.192 for the rules on placing your ticket in

inactive status and on reactivating your ticket.

\(h\) Variance tolerance means the margin of flexibility whereby we

will consider you to have met the requirement for completing a

specified amount of post-secondary credit hours in an educational

degree or certification program or the course requirements in a

vocational or technical training program under Sec. 411.180 in the

applicable progress certification period if your completion of credit

hours or course requirements in this period is within 10% of the goal.

Figures representing the number of credit hours required for the first

and second progress certification periods as described in Sec. 411.180

will be rounded by dropping any fractions. Under the variance

tolerance, we also will consider you to have met the requirements in an

applicable progress certification period if you complete a certain

percentage of the work requirement and a certain percentage of the

post-secondary education requirement or vocational or technical

training requirement in the period and the sum of the two percentages

is within 10% of the goal. See Sec. 411.180(a) and (c).

\[\[Page 29341\]\]

\(i\) VR cost reimbursement option means an arrangement under which

your ticket is not assigned to the State VR agency but you do receive

services pursuant to an individualized plan for employment where the

State VR agency has chosen to receive payment under the cost

reimbursement payment system.

\(j\) VR cost reimbursement status means the status of your ticket

under the arrangement described in paragraph (i) of this section. The

period during which your ticket is in VR cost reimbursement status

begins on the date described in Sec. 411.170(b) and ends on the date

your case is closed by the State VR agency.

0

14\. Add Sec. 411.167 to read as follows:

Sec. 411.167 What is an educational institution or a technical, trade

or vocational school?

\(a\) Educational institution means a school (including a technical,

trade, or vocational school), junior college, college or university

that is: operated or directly supported by the United States; operated

or directly supported by any State or local government or by a

political subdivision of any State or local government; or approved by

a State agency or subdivision of the State, or accredited by a State-

recognized or nationally recognized accrediting body.

\(b\) Technical, trade or vocational school is an educational

institution that is approved by a State agency or subdivision of the

State or accredited by a State-recognized or nationally recognized

accrediting body to provide technical, trade or vocational training.

\(c\) State-recognized accrediting body means an entity designated or

recognized by a State as the proper authority for accrediting schools,

colleges or universities.

\(d\) Nationally recognized accrediting body means an entity

determined to be such by the U.S. Department of Education.

\(e\) Approval by a State agency or subdivision of the State includes

approval of a school, college or university as an educational

institution, or approval of one or more of the courses offered by a

school, college or university.

0

15\. Remove the undesignated center heading before Sec. 411.170.

0

16\. Revise Sec. 411.170 to read as follows:

Sec. 411.170 When does the period of using a ticket begin?

\(a\) The period of using a ticket begins on the effective date of

the assignment of your ticket to an EN or State VR agency under Sec.

411.140.

\(b\) If you have a ticket that would otherwise be available for

assignment and are receiving VR services pursuant to an individualized

plan for employment (IPE) and the State VR agency has elected the VR

cost reimbursement option, the period of using a ticket begins on the

later of\--

\(1\) The effective date of your IPE; or

\(2\) The first day your ticket would otherwise have been assignable

if you had not been receiving services from a State VR agency that

elected the VR cost reimbursement option.

0

17\. Revise Sec. 411.171 to read as follows:

Sec. 411.171 When does the period of using a ticket end?

The period of using a ticket ends with the earliest of the

following\--

\(a\) The last day of the month before the month in which the ticket

terminates as a result of one of the events listed in Sec. 411.155

(see Sec. 411.155(a)(4) and (c)(8) for when your ticket terminates if

your outcome payment period ends);

\(b\) The day before the effective date of a decision under Sec.

411.200 or Sec. 411.205 that you are no longer making timely progress

toward self-supporting employment;

\(c\) The last day of the 90-day extension period which begins with

the first day of the first month in which your ticket is no longer

assigned to an EN or State VR agency acting as an EN (see Sec.

411.145), unless you reassign your ticket within the 90-day extension

period (see Sec. 411.220 for an explanation of the 90-day extension

period); or

\(d\) If your ticket was in VR cost reimbursement status as described

in Sec. 411.166(j), the 90th day following the date the State VR

agency closes your case, unless you assign your ticket during this 90-

day period.

0

18\. In Sec. 411.175, revise the section heading and the first and

fourth sentences of paragraph (a) to read as follows:

Sec. 411.175 What if a continuing disability review is begun before

my ticket is in use?

\(a\) If we begin a continuing disability review before the date on

which your ticket is in use, you may still assign the ticket and

receive services from an EN or a State VR agency acting as an EN under

the Ticket to Work program, or you may still receive services from a

State VR agency that elects the VR cost reimbursement option. \* \* \*

However, if your ticket was in use before we determined that you are no

longer disabled, in certain circumstances you may continue to receive

benefit payments (see Sec. Sec. 404.316(c), 404.337(c), 404.352(d),

and 416.1338 of this chapter). \* \* \*

\* \* \* \* \*

0

19\. Remove the undesignated center heading before Sec. 411.180.

0

20\. Revise Sec. 411.180 to read as follows:

Sec. 411.180 What is timely progress toward self-supporting

employment?

\(a\) General. We consider you to be making timely progress toward

self-supporting employment when you show progress as described below

toward the ability to work at levels which will reduce your dependence

on Social Security disability benefits or SSI benefits. We will also

consider you to be making timely progress when you obtain a high school

diploma or GED certificate in the first 12-month progress certification

period, or if you show progress as described below toward obtaining an

educational degree or certificate or vocational or technical training

that will enhance your ability to return to work. In addition, if you

complete a certain percentage of the work requirement and a certain

percentage of the post-secondary education requirement or vocational or

technical training requirement in the applicable progress certification

period under the guidelines below, and the sum of the two percentages

equals 100 or more, we will consider you to have met the timely

progress requirements for purposes of the progress review conducted at

the end of the 12-month progress certification period. For example, if

you complete 33.3 percent of the work requirement during the first 12-

month progress certification period as described in paragraph (c)(1)(i)

of this section (i.e., one month of work with earnings equal to or

greater than the amount representing a trial work service month), and

complete 66.7 percent of the requisite credit hours in an educational

program during this period as described in paragraph (c)(1)(iii) of

this section (i.e., 40 percent of the post-secondary credit hours that

are considered to represent an academic year of full-time study), we

will consider you to have met the timely progress requirements for

purposes of the progress review conducted at the end of the first 12-

month progress certification period. In addition, we will apply the

variance tolerance described in Sec. 411.166(h) in determining whether

you have met the requirements in paragraph (c)(1)(iii), (iv) or (v),

paragraph (c)(2)(ii), (iii) or (iv), paragraph (c)(3)(iii) or (v),

paragraph (c)(4)(ii) or (iii), or paragraph (c)(5)(ii) or (iii) of this

section.

\[\[Page 29342\]\]

\(b\) 12-month progress certification periods. The first 12-month

progress certification period begins with the month following the month

in which you first assigned your ticket, or with the month beginning

after the date described in Sec. 411.170(b) if you have a ticket that

would otherwise be available for assignment and are receiving VR

services under an IPE from a State VR agency which has chosen the VR

cost reimbursement option. Any subsequent 12-month progress

certification period will begin with the month following the end of the

previous 12-month progress certification period. In computing any 12-

month progress certification period, we do not count any month during

which\--

\(1\) Your ticket is not assigned to an EN or State VR agency acting

as an EN and is not in VR cost reimbursement status (as described in

Sec. 411.166(j)); or

\(2\) Your ticket is in inactive status (see Sec. 411.192).

\(c\) Guidelines. We will determine if you are making timely progress

toward self-supporting employment by using the following guidelines:

\(1\) During the first 12-month progress certification period, you

must be making timely progress as follows:

\(i\) You must have worked in at least three months within this 12-

month period and have earnings in each of those three months that are

equal to or greater than the amount representing a trial work service

month (see Sec. 404.1592(b) of this chapter); or

\(ii\) You must have obtained a high school diploma or GED

certificate within this 12-month period; or

\(iii\) You must have been enrolled in a two- or four-year degree or

certification program at an educational institution and have completed

60 percent of the post-secondary credit hours that are considered to

represent an academic year of full-time study in the program by the end

of this 12-month period; or

\(iv\) You must have been enrolled in a vocational or technical

training program at an educational institution consisting of a

technical, trade or vocational school and have completed 60 percent of

the course requirements that are considered to represent a year of

full-time study in the program by the end of this 12-month period; or

\(v\) You must have completed a percentage of the required number of

months of work and earnings described in paragraph (c)(1)(i) of this

section and a percentage of the specified amount of post-secondary

credit hours or course requirements required under paragraph

(c)(1)(iii) or (iv) of this section within this 12-month period so that

the sum of the two percentages equals 100 or more.

\(2\) During the second 12-month progress certification period, at

the conclusion of 24 months of ticket use, you must be making timely

progress as follows:

\(i\) You must have worked in at least six months within this 12-

month period and have earnings in each of those six months that are

equal to or greater than the amount representing a trial work service

month (see Sec. 404.1592(b) of this chapter); or

\(ii\) You must have been enrolled in a two- or four-year degree or

certification program at an educational institution and have completed

an additional 75 percent of the post-secondary credit hours that are

considered to represent an academic year of full-time study in the

program by the end of this 12-month period; or

\(iii\) You must have been enrolled in a vocational or technical

training program at an educational institution consisting of a

technical, trade or vocational school and have completed an additional

75 percent of the course requirements that are considered to represent

a year of full-time study in the program by the end of this 12-month

period; or

\(iv\) You must have completed a percentage of the required number of

months of work and earnings described in paragraph (c)(2)(i) of this

section and a percentage of the specified amount of post-secondary

credit hours or course requirements required under paragraph (c)(2)(ii)

or (iii) of this section within this 12-month period so that the sum of

the two percentages equals 100 or more.

\(3\) During the third 12-month progress certification period, at the

conclusion of 36 months of ticket use, you must be making timely

progress as follows:

\(i\) You must have worked in at least nine months within this 12-

month period and have gross earnings from employment (or net earnings

from self-employment as defined in Sec. 404.1080 of this chapter) in

each of those nine months that are more than the SGA threshold amount

specified in Sec. 404.1574(b)(2) of this chapter; or

\(ii\) You must have completed the course work and earned a degree or

certificate from a two-year degree or certification program at an

educational institution by the end of this 12-month period; or

\(iii\) You must have been enrolled in a four-year degree or

certification program at an educational institution and completed

additional post-secondary credit hours that are considered to represent

an academic year of full-time study in the program by the end of this

12-month period; or

\(iv\) You must have been enrolled in a vocational or technical

training program at an educational institution consisting of a

technical, trade or vocational school and have completed the course

requirements of the program by the end of this 12-month period; or

\(v\) You must have completed a percentage of the required number of

months of work and earnings described in paragraph (c)(3)(i) of this

section and a percentage of the specified amount of post-secondary

credit hours required under paragraph (c)(3)(iii) of this section

within this 12-month period so that the sum of the two percentages

equals 100 or more.

\(4\) During the fourth 12-month progress certification period, at

the conclusion of 48 months of ticket use, you must be making timely

progress as follows:

\(i\) You must have worked in at least nine months within this 12-

month period and have gross earnings from employment (or net earnings

from self-employment as defined in Sec. 404.1080 of this chapter) in

each of those nine months that are more than the SGA threshold amount

specified in Sec. 404.1574(b)(2) of this chapter; or

\(ii\) You must have been enrolled in a four-year degree or

certification program at an educational institution and completed

additional post-secondary credit hours that are considered to represent

an academic year of full-time study in the program by the end of this

12-month period; or

\(iii\) You must have completed a percentage of the required number

of months of work and earnings described in paragraph (c)(4)(i) of this

section and a percentage of the specified amount of post-secondary

credit hours required under paragraph (c)(4)(ii) of this section within

this 12-month period so that the sum of the two percentages equals 100

or more.

\(5\) During the fifth 12-month progress certification period, at the

conclusion of 60 months of ticket use, you must be making timely

progress as follows:

\(i\) You must have worked in at least six months within this 12-

month period and have earnings in each of those six months that

preclude payment of Social Security disability benefits and Federal SSI

cash benefits; or

\(ii\) You must have been enrolled in a four-year degree or

certification program at an educational institution and either

completed additional post-secondary credit hours that are considered to

represent an academic year of full-time study in the program or

completed the course work and earned a degree or

\[\[Page 29343\]\]

certificate from the program by the end of this 12-month period; or

\(iii\) You must have completed a percentage of the required number

of months of work and earnings described in paragraph (c)(5)(i) of this

section and a percentage of the specified amount of post-secondary

credit hours required under paragraph (c)(5)(ii) of this section within

this 12-month period so that the sum of the two percentages equals 100

or more.

\(6\) During the sixth 12-month progress certification period, at the

conclusion of 72 months of ticket use, you must be making timely

progress as follows:

\(i\) You must have worked in at least six months within this 12-

month period and have earnings in each of those six months that

preclude payment of Social Security disability benefits and Federal SSI

cash benefits; or

\(ii\) You must have completed the course work and earned a degree or

certificate from a four-year degree or certification program at an

educational institution by the end of this 12-month period.

\(7\) During all subsequent 12-month progress certification periods,

you must have worked in at least six months within the 12-month period

and have earnings in each of those six months that preclude payment of

Social Security disability benefits and Federal SSI cash benefits.

Sec. 411.185 \[Removed\]

0

21\. Remove Sec. 411.185.

Sec. 411.190 \[Removed\]

0

22\. Remove Sec. 411.190.

Sec. 411.191 \[Removed\]

0

23\. Remove Sec. 411.191.

0

24\. Add Sec. 411.192 to read as follows:

Sec. 411.192 What choices do I have if I am unable to make timely

progress toward self-supporting employment?

\(a\) If you report to the PM that you are temporarily or otherwise

unable to make timely progress toward self-supporting employment during

a progress certification period, the PM will give you the choice of

placing your ticket in inactive status or, if applicable, taking your

ticket out of assignment with the EN or State VR agency acting as an

EN. The choice of placing your ticket in inactive status applies

whether your ticket is assigned or in VR cost reimbursement status (as

described in Sec. 411.166(j)).

\(b\) You may place your ticket in inactive status at any time by

submitting a written request to the PM asking that your ticket be

placed in inactive status. Your ticket will be placed in inactive

status beginning with the first day of the month following the month in

which you make your request. You are not considered to be using a

ticket during months in which your ticket is in inactive status.

Therefore, you will be subject to continuing disability reviews during

those months. The months in which your ticket is in inactive status do

not count toward the time limitations for making timely progress toward

self-supporting employment.

\(c\) You may reactivate your ticket and return to in-use status if

your ticket is still assigned to an EN or State VR agency acting as an

EN. You may also reactivate your ticket and return to in-use status if

you have a ticket which would otherwise be available for assignment,

you were receiving services under an IPE from a State VR agency which

chose the VR cost reimbursement option, and your VR case has not been

closed by the State VR agency. You may reactivate your ticket by

submitting a written request to the PM. Your ticket will be reactivated

beginning with the first day of the month following the month in which

the PM receives your request. The progress certification period will

resume counting from the last month of in-use status, and the next

progress review will be due when the progress certification period has

been completed. Earnings from work, obtaining a high school diploma or

GED certificate, or completion of post-secondary education credits in a

two- or four-year degree or certification program or course

requirements in a vocational or technical training program, as

described in Sec. 411.180, during the period your ticket is in

inactive status may be counted toward meeting the requirements for the

next progress review.

\(d\) You may take your ticket out of assignment under Sec.

411.145(a) at any time.

Sec. 411.195 \[Removed\]

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25\. Remove Sec. 411.195.

0

26\. Revise Sec. 411.200 to read as follows:

Sec. 411.200 How will the PM conduct my progress reviews?

The PM will conduct a progress review at the end of each 12-month

progress certification period.

\(a\) The PM will first review the available administrative records

to determine if you completed the work requirements as specified in

Sec. 411.180 in the applicable progress certification period.

\(b\) If the administrative records do not indicate that you met the

work requirements, the PM will contact either you or your EN or State

VR agency to request additional information to determine if you

completed the work requirements or have met the educational or training

requirements as specified in Sec. 411.180 in the applicable progress

certification period.

\(c\) If the PM finds that you completed the work requirements or met

the educational or training requirements as specified in Sec. 411.180

in the applicable progress certification period, the PM will find that

you are making timely progress toward self-supporting employment. On

the basis of that finding, we will consider you to be making timely

progress toward self-supporting employment until your next scheduled

progress review.

\(d\) If the PM finds that you did not complete the work requirements

or meet the educational or training requirements as specified in Sec.

411.180 in the applicable progress certification period, the PM will

find that you are not making timely progress toward self-supporting

employment. If the PM makes such a finding, the PM will send a written

notice of the decision to you at your last known address. This notice

will explain the reasons for the decision and inform you of the right

to ask us to review the decision. This decision will be effective 30

days after the date on which the PM sends the notice of the decision to

you, unless you request that we review the decision under Sec.

411.205.

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27\. In Sec. 411.210, revise paragraph (b), the heading of paragraph

(c), and the fourth sentences of both paragraphs (c)(1) and (c)(2) to

read as follows:

Sec. 411.210 What happens if I do not make timely progress toward

self-supporting employment?

\* \* \* \* \*

\(b\) Re-entering in-use status. If you failed to meet the timely

progress guidelines for a 12-month progress certification period and

you believe that you have now met the applicable requirements for that

progress certification period as described in Sec. 411.180, you may

request that you be reinstated to in-use status. In order to do so, you

must submit a written request to the PM asking that you be reinstated

to in-use status and you must provide evidence showing that you have

met the applicable requirements for the progress certification period.

The PM will decide whether you have satisfied the applicable

requirements for the progress certification period and may be

reinstated to in-use status. If the PM determines you have met the

applicable requirements for the progress certification period, you will

be

\[\[Page 29344\]\]

reinstated to in-use status, provided that your ticket is assigned to

an EN or State VR agency acting as an EN or in VR cost reimbursement

status (as described in Sec. 411.166(j)). See paragraph (c) of this

section for when your reinstatement to in-use status will be effective.

The month after you are reinstated to in-use status, your next 12-month

progress certification period will begin.

\(c\) Decisions on re-entering in-use status. (1) \* \* \* If the PM

decides that you have satisfied the requirements for re-entering in-use

status (including the requirement that your ticket be assigned to an EN

or State VR agency acting as an EN or in VR cost reimbursement status),

you will be reinstated to in-use status effective with the date on

which the PM sends the notice of the decision to you. \* \* \*

\(2\) \* \* \* If we decide that you have satisfied the requirements for

re-entering in-use status (including the requirement that your ticket

be assigned to an EN or State VR agency acting as an EN or in VR cost

reimbursement status), you will be reinstated to in-use status

effective with the date on which we send the notice of the decision to

you.

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28\. In Sec. 411.220, revise the first sentence of paragraph (a),

revise paragraph (d)(2), remove paragraph (e), and redesignate

paragraph (f) as paragraph (e) to read as follows:

Sec. 411.220 What if my ticket is no longer assigned to an EN or

State VR agency?

\(a\) If your ticket was once assigned to an EN or State VR agency

acting as an EN and is no longer assigned, you are eligible for an

extension period of up to 90 days to reassign your ticket. \* \* \*

\* \* \* \* \*

\(d\) \* \* \*

\* \* \* \* \*

\(2\) Ends 90 days after it begins or when you assign your ticket to

a new EN or State VR agency, whichever is sooner.

\* \* \* \* \*

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29\. In Sec. 411.225, revise paragraphs (b) and (c), and remove

paragraph (d) to read as follows:

Sec. 411.225 What if I reassign my ticket after the end of the

extension period?

\* \* \* \* \*

\(b\) Time limitations for the timely progress guidelines. Any month

during which your ticket is not assigned and not in VR cost

reimbursement status (as described in Sec. 411.166(j)), either during

or after the extension period, will not count toward the time

limitations for the timely progress guidelines.

\(c\) If you reassign your ticket after the end of the extension

period. If you reassign your ticket after the end of the extension

period, the period comprising the remaining months in the applicable

12-month progress certification period will begin with the first month

beginning after the day on which the reassignment of your ticket is

effective under Sec. 411.150(c).

0

30\. Add Sec. 411.226 to read as follows:

Sec. 411.226 How will SSA determine if I am meeting the timely

progress guidelines if I assign my ticket prior to July 21, 2008?

\(a\) If you assigned your ticket to an EN or State VR agency prior

to July 21, 2008, we will determine which 12-month progress

certification period in Sec. 411.180 you are in as of July 21, 2008

using the rules in paragraph (a)(1) of this section. We will not

conduct a progress review at the end of that progress certification

period. We will conduct a progress review at the end of your next

progress certification period as explained in paragraph (a)(2) of this

section.

\(1\) We will consider you to be in the first or a subsequent 12-

month progress certification period under Sec. 411.180 as of July 21,

2008\. We will determine your applicable 12-month progress certification

period and the number of months remaining in that period as of July 21,

2008 by counting all months during which your ticket was assigned and

in use during the period\--

\(i\) Beginning with the month following the month in which you first

assigned your ticket under the rules in effect prior to July 21, 2008;

and

\(ii\) Ending with the close of June 2008.

\(2\) We will use the timely progress guidelines in Sec. 411.180(c)

beginning with your next 12-month progress certification period. At the

conclusion of that progress certification period, we will conduct a

progress review to determine whether you are making timely progress

toward self-supporting employment using the guidelines in Sec.

411.180(c) that apply in that period.

\(b\) Prior to the conclusion of your applicable 12-month progress

certification period determined under paragraph (a)(1) of this section,

we will send you a notice telling you that we will not conduct a

progress review at the end of that progress certification period, and

that we will conduct a progress review at the conclusion of your next

12-month progress certification period using the guidelines in Sec.

411.180(c). We will tell you in the notice when this next 12-month

progress certification period will begin and will describe the specific

timely progress guidelines you must meet in this 12-month period.

\(c\) Subsequent 12-month progress certification periods will follow

the rules in Sec. 411.180.

\(d\) If, on June 30, 2008, your ticket is in use and assigned to a

State VR agency which chose to be paid for services it provides to you

under the cost reimbursement payment system, your period of using a

ticket may continue under the rules in this subpart, including the

rules in paragraphs (a), (b) and (c) of this section. While your ticket

may still be considered in-use for the purpose of the suspension of

continuing disability reviews, it will no longer be considered assigned

to that State VR agency effective July 21, 2008. You may assign your

ticket after the State VR agency has closed your case.

Subpart E\--\[Amended\]

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31\. In Sec. 411.310, add paragraphs (d) and (e) to read as follows:

Sec. 411.310 How does an entity other than a State VR agency apply to

be an EN and who will determine whether an entity qualifies as an EN?

\* \* \* \* \*

\(d\) One-stop delivery systems established under subtitle B of title

I of the Workforce Investment Act of 1998 (29 U.S.C. 2811 et seq.) may

participate in the Ticket to Work program as ENs and do not need to

respond to the RFP. However, in order to participate in the Ticket to

Work program, the one-stop delivery system must enter into an agreement

with the Commissioner to be an EN and must maintain compliance with

general and specific selection criteria as described in Sec. 411.315

in order to remain an EN.

\(e\) Organizations administering Vocational Rehabilitation Services

Projects for American Indians with Disabilities authorized under

section 121 of part C of title I of the Rehabilitation Act of 1973, as

amended (29 U.S.C. 741), may participate in the Ticket to Work program

as ENs and do not need to respond to the RFP. However, in order to

participate in the Ticket to Work program, the organization

administering the project must enter into an agreement with the

Commissioner to be an EN and must maintain compliance with general and

specific selection criteria as described in Sec. 411.315 in order to

remain an EN.

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32\. In Sec. 411.315, add paragraphs (e) and (f) to read as follows:

Sec. 411.315 What are the minimum qualifications necessary to be an

EN?

\* \* \* \* \*

\(e\) One-stop delivery systems established under subtitle B of title

I of the Workforce Investment Act of 1998

\[\[Page 29345\]\]

(29 U.S.C. 2811 et seq.) are qualified to be ENs. A one-stop delivery

system must enter into an agreement with the Commissioner to be an EN

and must maintain compliance with general and specific selection

criteria of this section and Sec. 411.305 in order to remain an EN.

\(f\) Organizations administering Vocational Rehabilitation Services

Projects for American Indians with Disabilities authorized under

section 121 of part C of title I of the Rehabilitation Act of 1973, as

amended (29 U.S.C. 741), are qualified to be ENs. An organization

administering such a project must enter into an agreement with the

Commissioner to be an EN and must maintain compliance with general and

specific selection criteria of this section and Sec. 411.305 in order

to remain an EN.

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33\. In Sec. 411.325, revise paragraph (a) to read as follows:

Sec. 411.325 What reporting requirements are placed on an EN as a

participant in the Ticket to Work program?

\* \* \* \* \*

\(a\) Report to the PM in writing each time the EN accepts a ticket

for assignment or the EN no longer wants a ticket assigned to it;

\* \* \* \* \*

Subpart F\--\[Amended\]

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34\. Revise Sec. 411.350 to read as follows:

Sec. 411.350 Must a State VR agency participate in the Ticket to Work

program?

A State VR agency may elect, but is not required, to participate in

the Ticket to Work program as an EN. The State VR agency may elect on a

case-by-case basis to participate in the Ticket to Work program as an

EN, or it may elect to provide services to beneficiaries under the VR

cost reimbursement option. (See Sec. 411.115(s) for a definition of

the VR cost reimbursement option.)

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35\. In Sec. 411.355, revise the section heading, the third sentence of

the introductory text of paragraph (a), and the last sentence of

paragraph (c), and remove paragraph (d) to read as follows:

Sec. 411.355 What payment options does a State VR agency have?

\(a\) \* \* \* On a case-by-case basis, the State VR agency may

participate either\--

\* \* \* \* \*

\(c\) \* \* \* When serving a beneficiary who does not have a ticket

that can be assigned pursuant to Sec. 411.140, the State VR agency may

seek payment only under the cost reimbursement payment system.

Sec. 411.360 \[Removed\]

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36\. Remove Sec. 411.360.

0

37\. In Sec. 411.365, revise the section heading and paragraph (a) to

read as follows:

Sec. 411.365 How does a State VR agency notify us about its choice of

a payment system for use when functioning as an EN?

\(a\) The State VR agency must send us a letter telling us which EN

payment system it will use when it functions as an EN with respect to a

beneficiary who has a ticket.

\* \* \* \* \*

Sec. 411.370 \[Removed\]

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38\. Remove Sec. 411.370.

0

39\. In Sec. 411.385, revise the introductory text of paragraph (a) and

paragraph (a)(1) to read as follows:

Sec. 411.385 What does a State VR agency do if a beneficiary who is

eligible for VR services has a ticket that is available for assignment

or reassignment?

\(a\) Once the State VR agency determines that a beneficiary is

eligible for VR services, the beneficiary and a representative of the

State VR agency must agree to and sign the individualized plan for

employment (IPE) required under section 102(b) of the Rehabilitation

Act of 1973, as amended (29 U.S.C. 722(b)). The State VR agency must

submit the following information to the PM in order for the

beneficiary\'s ticket to be considered in use:

\(1\) A statement that an IPE has been agreed to and signed by both

the beneficiary and a representative of the State VR agency;

\* \* \* \* \*

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40\. Revise Sec. 411.390 to read as follows:

Sec. 411.390 What does a State VR agency do if a beneficiary to whom

it is already providing services has a ticket that is available for

assignment?

If a beneficiary who is receiving services from the State VR agency

under an existing IPE becomes eligible for a ticket that is available

for assignment, the State VR agency must submit the information

required in Sec. 411.385(a) to the PM. We require this information in

order for the beneficiary\'s ticket to be considered in use. If a

beneficiary who is receiving services from the State VR agency under an

existing IPE becomes eligible for a ticket that is available for

assignment, the State VR agency is limited to the cost reimbursement

payment system, unless both the beneficiary and the State VR agency

agree to have the ticket assigned to the State VR agency.

Subpart H\--\[Amended\]

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41\. In Sec. 411.500, revise paragraphs (b), (c), (e), and (f) and add

paragraphs (g) and (h) to read as follows:

Sec. 411.500 Definitions of terms used in this subpart.

\* \* \* \* \*

\(b\) Outcome Payment Period means a period of 36 months for a title

II disability beneficiary or a period of 60 months for a title XVI

disability beneficiary who is not concurrently a title II disability

beneficiary, not necessarily consecutive, for which Social Security

disability benefits and Federal SSI cash benefits are not payable to

the beneficiary because of the performance of substantial gainful

activity (SGA) or by reason of earnings from work activity. The outcome

payment period begins with the first month, ending after the date on

which the ticket was first assigned to an EN (or to a State VR agency

acting as an EN), for which such benefits are not payable to the

beneficiary because of SGA or by reason of earnings from work activity.

The outcome payment period ends as follows:

\(1\) For a title II disability beneficiary (including a concurrent

title II/title XVI disability beneficiary), the outcome payment period

ends with the 36th month, consecutive or otherwise, ending after the

date on which the ticket was first assigned to an EN (or to a State VR

agency acting as an EN), for which Social Security disability benefits

and Federal SSI cash benefits are not payable to the beneficiary

because of earnings from work activity (except as provided for in Sec.

411.551).

\(2\) For a title XVI disability beneficiary who is not concurrently

a title II disability beneficiary, the outcome payment period ends with

the 60th month, consecutive or otherwise, ending after the date on

which the ticket was first assigned to an EN (or to a State VR agency

acting as an EN), for which Federal SSI cash benefits are not payable

to the beneficiary by reason of earnings from work activity (except as

provided for in Sec. 411.551).

\(c\) Outcome Payment System is a system providing a schedule of

payments to an EN (or a State VR agency acting as an EN) for each

month, during an individual\'s outcome payment period, for which Social

Security disability benefits and Federal SSI cash benefits are not

payable to the individual because of work or earnings.

\* \* \* \* \*

\(e\) Outcome Payment Month means a month, during the beneficiary\'s

outcome payment period, for which Social

\[\[Page 29346\]\]

Security disability benefits and Federal SSI cash benefits are not

payable to the beneficiary because of work or earnings.

\(f\) Outcome-Milestone Payment System is a system providing a

schedule of payments to an EN (or State VR agency acting as an EN) that

includes, in addition to any outcome payments which may be made during

the individual\'s outcome payment period, payments for completion by a

title II or title XVI disability beneficiary of up to four Phase 1

milestones; and up to eleven Phase 2 milestones for a title II

disability beneficiary or a concurrent beneficiary or up to eighteen

Phase 2 milestones for a title XVI disability beneficiary who is not a

concurrent title II disability beneficiary.

\(1\) Phase 1 milestones are based on the beneficiary achieving a

level of earnings that reflects initial efforts at self-supporting

employment. They are based on the earnings threshold that we use to

establish a trial work period service month as defined in Sec.

404.1592(b) of this chapter. We use this threshold amount as defined in

Sec. 404.1592(b) of this chapter in order to measure whether the

beneficiary\'s earnings level meets the milestone objective.

\(2\) Phase 2 milestones are based on the beneficiary achieving a

level of earnings that reflects substantial efforts at self-supporting

employment. They are based on the earnings threshold that we use to

determine if work activity is SGA. We use the SGA earnings threshold

amount in Sec. 404.1574(b)(2) of this chapter. We use the SGA

threshold amounts in order to measure whether the beneficiary\'s gross

earnings level meets the milestone objective.

\(g\) Transition case is a case where milestones or outcomes had been

attained before July 21, 2008 (that is, the work required to meet such

a milestone or outcome had been completed by that date). Section

411.551 explains how subsequent payments will be made to the EN (or

State VR agency acting as an EN) on a transition case.

\(h\) Reconciliation payment is a final payment equal to the

milestone payments that are unpaid when the beneficiary enters the

outcome payment period before all the milestone payments are paid (see

Sec. Sec. 411.525(c) and 411.536).

0

42\. Revise Sec. 411.505 to read as follows:

Sec. 411.505 How is an EN paid?

An EN (including a State VR agency acting as an EN) can elect to be

paid under either the outcome payment system or the outcome-milestone

payment system. The EN will elect a payment system at the time the EN

enters into an agreement with us. (For State VR agencies, see Sec.

411.365.) The EN (or State VR agency) may periodically change its

elected EN payment system as described in Sec. 411.515.

0

43\. In Sec. 411.510, revise paragraph (c) to read as follows:

Sec. 411.510 How is the State VR agency paid under the Ticket to Work

program?

\* \* \* \* \*

\(c\) If a beneficiary who is receiving services from the State VR

agency under an existing IPE becomes eligible for a ticket that is

available for assignment, the State VR agency is limited to the cost

reimbursement payment system, unless both the beneficiary and the State

VR agency agree to have the ticket assigned to the State VR agency (see

Sec. 411.390).

0

44\. In Sec. 411.515, revise paragraph (b) and remove paragraph (c) to

read as follows:

Sec. 411.515 Can the EN change its elected payment system?

\* \* \* \* \*

\(b\) After an EN (or a State VR agency) first elects an EN payment

system, the EN (or State VR agency) can choose to make one change in

its elected payment system in each calendar year (January-December)

thereafter. The first EN payment system election constitutes the only

election an EN may make for that calendar year.

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45\. In Sec. 411.525, revise the section heading, paragraphs (a)(1)(i),

(a)(2), (b) and (c), and add paragraphs (d) and (e), to read as

follows:

Sec. 411.525 What payments are available under each of the EN payment

systems?

\(a\) \* \* \*

(1)(i) Under the outcome payment system, we can pay up to 36

outcome payments to the EN (or State VR agency acting as an EN) for a

title II disability beneficiary (including a concurrent title II/title

XVI disability beneficiary). We can pay up to 60 outcome payments to

the EN (or State VR agency acting as an EN) for a title XVI disability

beneficiary who is not concurrently a title II disability beneficiary.

For each month during the beneficiary\'s outcome payment period for

which Social Security disability benefits and Federal SSI cash benefits

are not payable to the beneficiary because of the performance of SGA or

by reason of earnings from work activity, the EN (or the State VR

agency acting as an EN) is eligible for a monthly outcome payment.

Payment for an outcome payment month under the outcome payment system

is equal to 67% of the payment calculation base for the calendar year

in which such month occurs, rounded to the nearest whole dollar (see

Sec. 411.550).

\* \* \* \* \*

\(2\) Under the outcome-milestone payment system:

\(i\) We can pay the EN (or State VR agency acting as an EN) for up

to four Phase 1 milestones attained within the required earnings period

for a title II or title XVI disability beneficiary who has assigned his

or her ticket to the EN (or State VR agency acting as an EN). The first

Phase 1 milestone is met when a beneficiary has worked in a month and

earned at least 50% of the amount of earnings considered to represent a

trial work period service month as defined in Sec. 404.1592(b) of this

chapter. The second Phase 1 milestone is met after a beneficiary has

worked for three months within a six-month period and has gross

earnings in each of those three months equal to or greater than a trial

work period service amount as defined in Sec. 404.1592(b) of this

chapter. The third Phase 1 milestone is met after a beneficiary has

worked for a total of six months within a twelve-month period and had

gross earnings in each of those six months equal to a trial work period

service amount as defined in Sec. 404.1592(b) of this chapter. The

fourth Phase 1 milestone is met after a beneficiary has worked a total

of nine months within an 18-month period and had gross earnings in each

of those nine months equal to a trial work period service amount as

defined in Sec. 404.1592(b) of this chapter and the EN has

substantially completed the services agreed to in the IWP/IPE,

including any amendments. Earnings used to meet the first, second or

third Phase 1 milestone may be counted again when determining if a

later Phase 1 milestone is met, provided the earlier earnings fall

within the relevant time period for meeting the later milestone.

\(ii\) We can also pay the EN (or State VR agency acting as an EN) up

to eleven Phase 2 milestones achieved by a title II disability

beneficiary (including a concurrent title II/title XVI disability

beneficiary) or up to eighteen Phase 2 milestones achieved by a title

XVI disability beneficiary (who is not concurrently a title II

disability beneficiary) who has assigned his or her ticket to the EN

(or State VR agency acting as an EN). A Phase 2 milestone is met for

each calendar month in which the beneficiary has worked and has gross

earnings from employment (or net earnings from self-employment as

defined in Sec. 404.1080 of this chapter) in that month that are more

than the SGA

\[\[Page 29347\]\]

threshold amount as defined in Sec. 404.1574 of this chapter.

\(iii\) We pay available milestone payments in sequence except when

the beneficiary\'s outcome period begins before the beneficiary has

achieved all Phase 1 and Phase 2 milestones. Example: The individual,

in the first month of employment after assigning the ticket, earns

above the SGA level. Despite having exceeded trial work period level

earnings and earned above the SGA level as required for Phase 2

payments in paragraph (a)(2)(ii) of this section, based on the

individual\'s earning we would pay the EN the sequentially available

milestone, which in this case would be Phase 1, milestone 1.

\(iv\) In addition to the milestone payments, monthly outcome

payments can be paid to the EN (or State VR agency acting as an EN)

during the outcome payment period.

\(b\) The outcome-milestone payment system is designed so that the

total payments to the EN (or the State VR agency acting as an EN) for a

beneficiary are less than the total amount that would have been paid if

the EN were paid under the outcome payment system. Under the outcome-

milestone payment system, the total payment to the EN (or the State VR

agency acting as an EN) is about 90% of the total that would have been

potentially payable under the outcome payment system for the same

beneficiary.

\(c\) Except as provided in Sec. 411.536 (reconciliation payments)

the milestones for which payments may be made must occur prior to the

beginning of the beneficiary\'s outcome payment period.

\(d\) We will pay an EN (or State VR agency acting as an EN) to which

the beneficiary has assigned a ticket for milestones or outcomes

achieved only in months prior to the month in which the ticket

terminates (see Sec. 411.155). We will not pay a milestone or outcome

payment to an EN (or State VR agency acting as an EN) based on a

beneficiary\'s work or earnings activity in or after the month in which

the ticket terminates.

\(e\) If a title XVI disability beneficiary becomes entitled to title

II benefits after we authorize the first milestone or outcome payment,

we will continue to calculate the EN payments using title XVI payment

calculation base under the outcome payment system on the basis of

paragraph (a)(1)(i) and under the outcome-milestone payment system on

the basis of paragraph (a)(2). This applies even if the title XVI

eligibility is subsequently terminated and the person becomes only a

title II beneficiary.

Sec. 411.530 \[Removed\]

0

46\. Remove Sec. 411.530.

0

47\. In Sec. 411.535, revise the section heading and paragraph (a) to

read as follows:

Sec. 411.535 Under what circumstances will milestones be paid?

(a)(1)(i) Under the outcome-milestone payment system, an EN (or a

State VR agency acting as an EN) can earn up to four Phase 1 milestone

payments for serving beneficiaries whose gross earnings were less than

the trial work level in each of the 18 months before the ticket was

first assigned to an EN. All work and earnings counted toward reaching

the four Phase 1 milestones must occur after the ticket is assigned and

before the beginning of the beneficiary\'s outcome payment period (see

Sec. 411.500(f)) except as provided in Sec. 411.536 (reconciliation

payments).

\(ii\) Significant work activity prior to ticket assignment will

limit the availability of Phase 1 milestone payments. The PM will make

this assessment of work activity prior to the first ticket assignment

on each ticket, irrespective of the EN\'s chosen payment system, in

order to determine how many milestone payments may be available for

serving an individual in the Ticket to Work program. The first Phase 1

milestone payment is not available to be made to an EN if the

beneficiary has worked above the trial work level in the calendar month

prior to the first ticket assignment on each ticket in the Ticket to

Work program. The second Phase 1 milestone payment is not available if

the beneficiary has worked above the trial work level in three of the

six months prior to the first ticket assignment on each ticket in the

Ticket to Work program. The third Phase 1 milestone is not available if

the beneficiary has worked above the trial work level in six of the

twelve months prior to the first ticket assignment on each ticket in

the Ticket to Work program. The fourth Phase 1 milestone is not

available if the beneficiary has worked above the trial work level in

nine of the 18 months prior to the first ticket assignment on each

ticket in the Ticket to Work program.

\(iii\) If a beneficiary had a ticket that otherwise was available

for assignment and chose to receive services under an IPE from a State

VR agency that elected the VR cost reimbursement option, payment of

Phase 1 milestones to an EN or a different VR agency acting as an EN

with respect to the same ticket is precluded if the State VR Agency

that elected the VR cost reimbursement option achieved an employment

outcome (as described in 34 CFR 361.56) before case closure. An EN or a

different VR agency acting as an EN can be paid Phase 2 milestones as

described in paragraph (2) of this section with respect to this ticket.

\(2\) Under the outcome-milestone payment system, an EN can receive

up to eleven Phase 2 milestone payments for work by a title II

disability beneficiary (including a concurrent title II/title XVI

disability beneficiary), or up to eighteen Phase 2 milestone payments

for work by a title XVI disability beneficiary. Earnings prior to the

first assignment of the ticket in the Ticket to Work program are not

taken into account when determining whether sufficient earnings exist

for payment of Phase 2 milestones.

\(3\) If the beneficiary\'s outcome payment period begins before the

beneficiary has achieved all Phase 1 and Phase 2 milestones, then we

will pay the EN a final payment in accordance with Sec. 411.536

(reconciliation payments) to account for unpaid milestone payments that

had been available when the ticket was first assigned.

\* \* \* \* \*

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48\. Add Sec. 411.536 to read as follows:

Sec. 411.536 Under what circumstances can we make a reconciliation

payment under the outcome-milestone payment system?

When the beneficiary\'s outcome payment period begins before the

beneficiary has attained all Phase 1 and Phase 2 milestones, we will

pay the EN (or a State VR agency acting as an EN) a reconciliation

payment. The reconciliation payment will equal the total amount of the

milestone payments that were available with respect to that ticket,

when the ticket was first assigned, but that have not yet been paid.

The reconciliation payment will be based on the payment calculation

base for the calendar year in which the first month of the

beneficiary\'s outcome period occurs, rounded to the nearest whole

dollar. The payment will be made after an EN has qualified for 12

outcome payments. Where multiple ENs had the ticket assigned at some

time, the PM will apply the rule under Sec. 411.560 to determine the

allocation of the reconciliation payment.

0

49\. Revise Sec. 411.540 to read as follows:

Sec. 411.540 How are the payment amounts calculated for each of the

milestones?

\(a\) For both title II disability beneficiaries and title XVI

disability beneficiaries, the payment amount for each of the Phase 1

milestone payments is equal to 120% of the payment

\[\[Page 29348\]\]

calculation base for title II (as defined in Sec. 411.500(a)(1)) for

the calendar year in which the month of attainment of the milestone

occurs, rounded to the nearest whole dollar.

\(b\) The payment amount for each of the Phase 2 milestones:

\(1\) For title II disability beneficiaries (including concurrent

title II/title XVI disability beneficiaries) is equal to 36% of the

payment calculation base as defined in Sec. 411.500(a)(1) for the

calendar year in which the month of attainment of the milestone occurs,

rounded to the nearest whole dollar;

\(2\) For title XVI beneficiaries (who are not concurrently title II

disability beneficiaries) is equal to 36% of the payment calculation

base as defined in Sec. 411.500(a)(2) for the calendar year in which

the month of attainment of the milestone occurs, rounded to the nearest

whole dollar.

0

50\. Revise Sec. 411.545 to read as follows:

Sec. 411.545 How are the outcome payments calculated under the

outcome-milestone payment system?

The amount of each monthly outcome payment under the outcome-

milestone payment system is calculated as follows:

\(a\) For title II disability beneficiaries (including concurrent

title II/title XVI disability beneficiaries), an outcome payment is

equal to 36 percent of the payment calculation base as defined in Sec.

411.500(a)(1) for the calendar year in which the month occurs, rounded

to the nearest whole dollar;

\(b\) For title XVI disability beneficiaries (who are not

concurrently title II/title XVI disability beneficiaries), an outcome

payment is equal to 36% of the payment calculation base as defined in

Sec. 411.500(a)(2) for the calendar year in which the month occurs,

rounded to the nearest whole dollar.

\(c\) The following chart provides an example of how an EN could

receive milestone and outcome payments:

Outcome-Milestone Payment Table

Chart I\--New Outcome-Milestone Payment Table

\[2008 figures for illustration only\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Beneficiary

Payment type earnings Title II amount of payment Title XVI amount of
payment

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Phase 1 (120% of Title II PCB)

Milestone 1\...\...\...\...\.... \$335/mo. \$670/mo.
\$1,177\...\...\...\...\...\...\..... \$1,177

x 3 mo. work in a

6-month period.

Milestone 2\...\...\...\...\.... \...\...\...\...\...\...
\$1,177\...\...\...\...\...\...\..... \$1,177

Milestone 3\...\...\...\...\.... \$670/mo. x 6 mo.
\$1,177\...\...\...\...\...\...\..... \$1,177

work in a 12-

month period.

Milestone 4\...\...\...\...\.... \$670/mo. x 9 mo.
\$1,177\...\...\...\...\...\...\..... \$1,177

work in an 18-

month period.

¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤

Total Phase 1 \...\...\...\...\...\...
\$4,708\...\...\...\...\...\...\..... \$4,708

milestones.

¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤

Phase 2 (36% of PCB)\...\...\..... Gross Earnings\>SGA

Title II milestones 1-11\...\.... \...\...\...\...\...\... \$353 x
11=\$3,883

Title XVI milestones 1-18\...\... \...\...\...\...\...\...
\...\...\...\...\...\...\...\...\..... \$203 x 18 = \$3,654

¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤

Total Phase 1 + 2\...\...\.... \...\...\...\...\...\...
\$8,591\...\...\...\...\...\...\..... \$8,362

¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤¤

Outcome payments

(36% of PCB).

Title II = 1-36\...\...\...\... Monthly cash \$353 x 36 = \$12,708

benefit not

payable due to

SGA.

Title XVI = 1-60\...\...\..... Sufficient 203 x 60 =
\$12,180\...\...\.....

earnings for

federal cash

benefits = \`\`0\'\'.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Total milestone and \...\...\...\...\...\...
\$21,299\...\...\...\...\...\...\.... \$20,542

outcome payments.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Definitions and amounts: Payment Calculation Base (PCB)\--The

average title II disability insurance benefit payable under section 223

of the Social Security Act for all beneficiaries for months during the

preceding calendar year; and the average payment of supplemental

security income benefits based on disability payable under title XVI

(excluding State supplementation) for months during the preceding

calendar year to all beneficiaries who have attained 18 years of age

but have not attained 65 years of age. (2008 title II = \$981.17, title

XVI = \$563.35).

Gross earnings requirements for Phase 1 are based on Trial Work

level amounts.

For Phase 1 milestones only, the payments are calculated for both

title XVI and title II beneficiaries using the higher title II payment

calculation base. All other payments are based on a percentage of the

Payment Calculation Base (PCB) for the respective program (title XVI or

title II). See Sec. 411.535 for a discussion of the circumstances

under which we will pay milestones.

Phase 1 milestones = 120% of PCB.

Phase 2 milestones = 36% of PCB.

Outcome payments (under the outcome-milestone payment system) = 36%

of PCB Earnings used to meet the first, second, or third Phase 1

milestone may be counted again when determining if a later milestone is

met, provided the earlier earnings fall within the relevant time period

for meeting the later Phase 1 milestone (see 411.525(a)(2) for the

relevant time period for each milestone).

0

51\. Revise Sec. 411.550 to read as follows:

Sec. 411.550 How are the outcome payments calculated under the

outcome payment system?

The amount of each monthly outcome payment under the outcome

payment system is calculated as follows:

\(1\) For title II disability beneficiaries (including concurrent

title II/title XVI disability beneficiaries), an outcome payment is

equal to 67% of the payment calculation base as defined in Sec.

411.500(a)(1) for the calendar year in which the month occurs, rounded

to the nearest whole dollar;

\(2\) For title XVI disability beneficiaries (who are not

concurrently title II/title XVI disability beneficiaries), an outcome

payment is equal to 67% of the payment calculation base as defined

\[\[Page 29349\]\]

in Sec. 411.500(a)(2) for the calendar year in which the month occurs,

rounded to the nearest whole dollar.

Chart II.\--New Outcome Payment System Table\--Title II and Concurrent

\[2008 figures for illustration only\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Title II amount Title II total

Payment type Beneficiary earnings of monthly outcome

outcome payment payments

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Outcome payments 1-36 (67% of PCB)\...\...\..... Monthly cash benefit
not \$657.00 \$23,652

payable due to SGA.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Chart III.\--New Outcome Payment System Table\--Title XVI Only

\[2008 figures for illustration only\]

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Title XVI

amount of Title XVI total

Payment type Beneficiary earnings monthly outcome outcome

payment payments

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Outcome payments 1-60 (67% of PCB)\...\...\..... Earnings sufficient to
\`\`0\'\' \$377.00 \$22,620

out Federal SSI cash benefits.

\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\-\--

Note: Outcome payment (outcome payment system) = 67% of PCB

Individual payments are rounded to the nearest dollar amount.

2008 non-blind SGA level = \$940.

2008 Blind SGA = \$1570.

2008 TWP service amount = \$670.

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52\. Add Sec. 411.551 to read as follows:

Sec. 411.551 How are EN payments calculated for transition cases

pending on July 21, 2008?

A Transition case is a case where a ticket had been assigned and

milestones or outcomes had been attained as of June 30, 2008 (that is,

the individual has completed the necessary work to trigger a milestone

or outcome payment before July 21, 2008 regardless of whether the

payment has actually been made). We will pay outcome and milestone

payments at the rate in effect when the work leading to such outcome or

milestone is attained. Since milestone and outcome payments are

numbered and attained in sequence, the EN must request the final

payment for which it expects payment under the prior rules before we

can determine the number of the milestone or outcome payment that

represents the first payment after July 21, 2008. In addition, for

cases on which an EN has attained an outcome payment before July 21,

2008 we must know the sum of the amount paid on the ticket before we

can determine the remaining amount that can be paid in outcome payments

on the ticket. Therefore, with respect to a ticket, we will only accept

payment requests for milestones or outcomes attained under the prior

rules until March 31, 2009 or until we make the first payment on the

ticket under Sec. 411.525. Payments to an EN (or State VR agency

acting as an EN) after July 21, 2008 on a transition case will be made

as follows:

\(a\) The four milestones under the prior rules will be equated with

the four Phase 1 milestones available under the rules after July 21,

2008\. For example, if a beneficiary had attained milestone 1 under our

prior rules (1 month above the gross SGA level, e.g., \$940 in 2008),

then the next milestone to be achieved would be Phase 1 milestone 2

under these rules (work in three months with gross earnings in each of

these months equal to a trial work period service month, e.g., \$670 in

2008).

\(b\) If the beneficiary had attained all four of the milestones

under the prior rules, the next milestone to be achieved would be the

first Phase 2 milestone (a calendar month in which the beneficiary has

worked and has gross earnings from employment or net earnings from

self-employment that are more than the substantial gainful activity

threshold level, e.g., \$900 in 2007).

\(c\) The maximum number of outcome payments available to an EN with

respect to a ticket for a transition case will be computed as follows:

\(1\) First, we will compute the total dollar amount already paid or

payable with respect to a ticket, including all outcome and milestone

payments.

\(2\) Then, we will subtract the total dollar amount already paid

from the total value of the ticket under the new rules for the year

when these rules take effect. The total value of the ticket will be

calculated based on the elected payment system for the beneficiary,

i.e., the outcome or the outcome-milestone payment system, and on the

appropriate payment calculation base for either a title II disability

beneficiary (including a concurrent title II and title XVI disability)

or a title XVI disability beneficiary (see Sec. Sec. 411.500 and

411.505). For accounting purposes, we will use the payment calculation

base for 2008 and assume that all payments could be earned in that year

in calculating the total value of the ticket.

\(3\) We then will divide this amount by the applicable outcome

payment amount (whether title II or title XVI) payable for 2008 and

round the result in accordance with customary rounding principles. The

resulting number represents the number of outcome payments available to

be paid with respect to the ticket. In no case can this number exceed

60\.

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53\. Add Sec. 411.552 to read as follows:

Sec. 411.552 What effect will the subsequent entitlement to title II

benefits have on EN payments for title XVI beneficiaries after they

assign their ticket?

If a beneficiary is only eligible for title XVI benefits when we

authorize the first milestone or outcome for which an EN can be paid,

but the beneficiary later becomes entitled to title II benefits, we

will continue to make payments as though the beneficiary were only a

title XVI beneficiary, up to the maximum number of milestone and

outcome payments payable for that ticket for title XVI beneficiaries.

If a beneficiary who is eligible for title XVI disability benefits

becomes entitled to title II disability benefits before we authorize

the first milestone or outcome payment, we will make payments to the EN

pursuant to the rate, payment calculation base and number of payments

available for title II beneficiaries, as described in this subpart.

0

54\. Revise Sec. 411.555 to read as follows:

\[\[Page 29350\]\]

Sec. 411.555 Can the EN keep the milestone and outcome payments even

if the beneficiary does not achieve all outcome months?

\(a\) Yes. The EN (or State VR agency acting as an EN) can keep each

milestone and outcome payment for which the EN (or State VR agency

acting as an EN) is eligible, even though the title II beneficiary does

not achieve all 36 outcome months or the title XVI beneficiary does not

achieve all 60 outcome months.

\(b\) Except as provided in paragraph (c) of this section, payments

which we make or deny to an EN (or a State VR agency acting as an EN)

may be subject to adjustment (including recovery, as appropriate) if we

determine that more or less than the correct amount was paid. This may

happen, for example, because we determine that the payment

determination was in error or because of an allocation of payment under

Sec. 411.560.

\(c\) If we determine that an overpayment or underpayment to an EN

has occurred, we will notify the EN (or State VR agency acting as an

EN) of the adjustment. We will not seek an adjustment if a

determination or decision about a beneficiary\'s right to benefits

causes an overpayment to the EN. Any dispute which the EN (or State VR

agency) has regarding the adjustment may be resolved under the rules in

Sec. 411.590(a) and (b).

0

55\. Revise Sec. 411.560 to read as follows:

Sec. 411.560 Is it possible to pay a milestone or outcome payment to

more than one EN?

It is possible for more than one EN (including a State VR agency

acting as an EN) to receive payment based on the same milestone or

outcome. If the beneficiary has assigned the ticket to more than one EN

(or State VR agency acting as an EN) at different times, and more than

one EN (or State VR agency) requests payment for the same milestone,

outcome or reconciliation payment under its elected payment system, the

PM will make a determination of the allocation of payment to each EN

(or State VR agency acting as an EN). The PM will make this

determination based upon the contribution of the services provided by

each EN (or State VR agency acting as an EN) toward the achievement of

the outcomes or milestones. Outcome and milestone payments will not be

increased because the payments are shared between two or more ENs

(including a State VR agency acting as an EN).

0

56\. Revise Sec. 411.565 to read as follows:

Sec. 411.565 What happens if two or more ENs qualify for payment on

the same ticket but have elected different EN payment systems?

We will pay each EN (or State VR agency acting as an EN) according

to its elected EN payment system in effect at the time the beneficiary

assigned the ticket to the EN (or the State VR agency acting as an EN).

0

57\. Add Sec. 411.566 to read as follows:

Sec. 411.566 May an EN use outcome or milestone payments to make

payments to the beneficiary?

Yes, an EN may use milestone or outcome payments to make payments

to a beneficiary.

0

58\. In Sec. 411.575, revise the introductory text; paragraph (a)(1)

introductory text; and paragraphs (a)(1)(i), (a)(2), (b)(1)

introductory text, (b)(1)(ii), and (b)(2); and add paragraph (c) to

read as follows:

Sec. 411.575 How does the EN request payment for milestone or outcome

payment months achieved by a beneficiary who assigned a ticket to the

EN?

The EN (or State VR agency acting as an EN) will send its request

for payment, evidence of the beneficiary\'s work or earnings, and other

information to the PM. In addition, we or the PM may require a summary

of the services provided as described in the IWP/IPE.

\(a\) Milestone payments. (1) We will pay the EN (or State VR agency

acting as an EN) for milestones only if\--

\(i\) The outcome-milestone payment system was the EN\'s (or State VR

agency\'s) elected payment system in effect at the time the beneficiary

assigned a ticket to the EN (or the State VR agency acting as an EN);

\* \* \* \* \*

\(2\) The EN (or State VR agency acting as an EN) must request

payment for each milestone attained by a beneficiary who has assigned a

ticket to the EN (or State VR agency acting as an EN). The request must

include evidence that the milestone was attained after ticket

assignment and other information as we may require to evaluate the EN\'s

(or State VR agency\'s) request. If the EN is requesting payment for

months after the ticket is no longer assigned to it, the payment

request shall include evidence that the services agreed to in the IWP/

IPE were provided and those services contributed to the employment

milestones or outcomes that the beneficiary attained in months after

the ticket had been assigned to the EN. We do not have to stop monthly

benefit payments to the beneficiary before we can pay the EN (or State

VR agency acting as an EN) for milestones attained by the beneficiary.

\(b\) Outcome payments. (1) We will pay an EN (or State VR agency

acting as an EN) an outcome payment for a month if\--

\* \* \* \* \*

\(ii\) We have not already paid for 36 outcome payment months for a

title II disability beneficiary (or a concurrent title II/title XVI

disability beneficiary), or paid for 60 outcome payment months for a

title XVI disability beneficiary who is not concurrently a title II

disability beneficiary, on the same ticket; and

\* \* \* \* \*

\(2\) The EN (or State VR agency acting as an EN) must request

payment for outcome payment months. In its initial request, the EN (or

State VR agency acting as an EN) must submit evidence of the

beneficiary\'s work or earnings (e.g., a statement of monthly earnings

from the employer or the employer\'s designated payroll preparer, or an

unaltered copy of the beneficiary\'s pay stub). After we have started

paying outcome payments to an EN (or State VR agency acting as an EN)

based on evidence of the beneficiary\'s earnings, the EN (or State VR

agency) must provide documentation of the beneficiary\'s continued work

or earnings in such a manner or form and at such time or times as we

may require. Exception: If the EN (or State VR agency) does not

currently hold the ticket because it is assigned to another EN (or

State VR agency), the EN (or State VR agency) must request payment, but

is not required to submit evidence of the beneficiary\'s work or

earnings. However, if the payment request is for work the beneficiary

attained in a month in which the EN no longer held the ticket, the

payment request should include evidence that the services agreed to in

the IWP/IPE were provided and those services contributed to the

beneficiary\'s work.

\(c\) Evidence requirements for payment. As primary evidence, we

require original pay slips, or oral or written statements from an

employer or the employer\'s designated payroll preparer. In lieu of

primary evidence, we accept two sources of secondary evidence, such as

photocopies of pay slips, a signed beneficiary statement, State

unemployment records or federal/state tax returns. The evidence must be

clear and legible and include the beneficiary\'s name, gross earnings or

net earnings from self employment, pay date and pay period of wages or

monthly net earnings of self-employment earnings.

\[\[Page 29351\]\]

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59\. Revise Sec. 411.580 to read as follows:

Sec. 411.580 Can an EN receive payments for milestones or outcome

payment months that occur before the beneficiary assigns a ticket to

the EN?

No. An EN (or State VR agency acting as an EN) may be paid only for

milestones or outcome payment months that are achieved after the month

in which the ticket is assigned to the EN or State VR agency acting as

an EN (except as provided for in Sec. 411.536).

0

60\. Add a new Sec. 411.581 to read as follows:

Sec. 411.581 Can an EN receive milestone and outcome payments for

months after a beneficiary takes his or her ticket out of assignment?

Yes. If an individual whose ticket is assigned to an EN (or State

VR agency acting as an EN) takes his or her ticket out of assignment

(see Sec. 411.145), the EN (or State VR agency) can receive payments

under its elected payment system for milestones or outcome payment

months that occur after the ticket is taken out of assignment, provided

the ticket has not terminated for any of the reasons listed in Sec.

411.155. The PM will make a determination about eligibility for a

payment based upon the contribution of services provided by an EN

toward the achievement of the outcome or milestones. See Sec. 411.560

for situations in which payment may be made to more than one EN or

State VR agency based on the same milestone or outcome.

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61\. Add a new Sec. 411.582 to read as follows:

Sec. 411.582 Can a State VR agency receive payment under the cost

reimbursement payment system if a continuous 9-month period of

substantial gainful activity is completed after the ticket is assigned

to an EN?

Yes. If a State VR agency provides services to a beneficiary under

34 CFR part 361, and elects payment under the cost reimbursement

payment system under subpart V of part 404 (or subpart V of part 416)

of this chapter, the State VR agency can receive payment under the cost

reimbursement payment system for services provided to the beneficiary

if all the requirements under subpart V of part 404 (or subpart V of

part 416) of this chapter and Sec. 411.585 are met even when these

requirements are met after the ticket has been assigned to the EN. The

EN can be paid during this period in accordance with Sec. Sec. 411.525

and Sec. Sec. 411.535.

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62\. Revise Sec. 411.585 to read as follows:

Sec. 411.585 Can a State VR agency and an EN both receive payment for

serving the same beneficiary?

Yes. A State VR agency and an EN can both receive payment for

serving the same beneficiary, but the ticket can only be assigned to

one EN, including a State VR agency acting as an EN, at a time. It also

cannot be assigned to an EN and placed in the VR cost reimbursement

status at the same time.

\(a\) A State VR agency may act as an EN and serve a beneficiary. In

this case, both the State VR agency acting as an EN and another EN may

be eligible for payment based on the same ticket (see Sec. 411.560).

\(b\) If a State VR agency is paid by us under the VR cost

reimbursement option, such payment does not preclude payment by us to

an EN or to another State VR agency acting as an EN under its elected

EN payment system. A subsequent VR agency also may choose to be paid

under the VR cost reimbursement option.

\(c\) If an EN or a State VR agency acting as an EN is paid by us

under one of the EN payment systems, that does not preclude payment by

us to a different State VR agency under the VR cost reimbursement

option. The subsequent State VR agency also may choose to be paid under

its elected EN payment system.

Sec. 411.587 \[Removed\]

0

63\. Remove Sec. 411.587.

0

64\. In Sec. 411.590, revise paragraph (d) to read as follows:

Sec. 411.590 What can an EN do if the EN disagrees with our decision

on a payment request?

\* \* \* \* \*

\(d\) Determinations or decisions we make about a beneficiary\'s right

to benefits may cause payments we have already made to an EN (or denial

of payment to an EN) to be incorrect, resulting in an underpayment or

overpayment to the EN. If this happens, we will make any necessary

adjustments to future payments (see Sec. 411.555). See Sec.

411.555(c) for when we will not make an adjustment in a case in which

an overpayment results from a determination or decision we make about a

beneficiary\'s right to benefits.) While an EN cannot appeal our

determination about an individual\'s right to benefits, the EN may

furnish any evidence the EN has which relates to the issue(s) to be

decided on appeal if the individual appeals our determination.

\[FR Doc. E8-10879 Filed 5-19-08; 8:45 am\]

BILLING CODE 4191-02-P