TICKET TO WORK AND WORK INCENTIVES

ADVISORY PANEL

ANNUAL REPORT TO THE PRESIDENT AND CONGRESS

*April 2003*

Contents

[A Message from the Chair](#message)

[Executive Summary](#message)

[Background](#message)

[Introduction](#message)

[Implementation Issues](#message)

[Emerging Issues](#message)

[Public Meetings and Panel Activities](#message)

[References](#message)

[Appendixes](#message)

[A. The Panel](#message)

[B. Correspondence Relating to Work Incentive Specialist](#message)

[C. Executive Summary of the \$1 for \$2 Advice Report](#message)

[D. Advisory Letters to the President, Congress, and the Commissioner of
SSA](#message)

[E. Executive Summary of the AOI Advice Report](#message)

[]{#message .anchor}

A MESSAGE FROM THE CHAIR

On behalf of the Ticket to Work and Work Incentives Advisory Panel, it
is my privilege to issue our Third Annual Interim Report to Congress.
Our Report includes the findings, issues, conclusions and
recommendations of the Panel regarding implementation of the Ticket to
Work and Work Incentives Improvement Act by the Social Security
Administration and other Federal agencies whose programs have an effect
on the employment of people with disabilities. The Panel not only raises
a number of important issues in this Report, but also makes specific
recommendations to Congress.

It was a very active year for Ticket Program Implementation. Millions of
tickets were mailed out to beneficiaries and thousands of people
assigned their ticket to an employment network to receive services.
While the Panel is encouraged by this start, it should be noted that
these implementation activities have highlighted a number of the areas
of concern discussed in this Report. The Panel hopes that its discussion
of these issues and its recommendations will contribute to the success
of the programs created by the Act and, ultimately, to the increased
employment of people with disabilities.

It is my privilege to share with you this Annual Interim Report.

Respectfully submitted,

Sarah Wiggins Mitchell, Chair

EXECUTIVE SUMMARY

Calendar year 2002 marked the third year of implementation of the Ticket
to Work and Work Incentives Improvement Act (the Act). This legislation,
passed by a vote of 99 to 0 in the Senate and by an overwhelming
majority in the House of Representatives, represents a bipartisan shift
in the Nation\'s attitude about employment of people with disabilities
and the contributions they can make to our economy. During the third
year of implementation, millions of Social Security beneficiaries
received tickets, thousands redeemed them with an employment network
(EN), and thousands went to work using the Medicaid Buy-In Program and
other work incentives now available under the Ticket to Work and Work
Incentives Improvement Act and the Social Security Act.

Following an active and productive year of implementation, two
overarching themes have emerged. First, insufficient funding and
administrative resources have been dedicated to implementation of the
Ticket and other programs. When Congress authorized the Social Security
Administration (SSA) to administer the Ticket and other grant programs,
it did not provide additional administrative resources for SSA to
support the new duties and programs. Consequently, funding for these new
programs must compete with every other service priority for scarce
administrative dollars. Second, the Ticket to Work and Work Incentives
Improvement Act is a \"work in progress.\" The Panel recognizes that the
Ticket and related work incentive provisions are relatively new and
innovative programs for SSA, for participating ENs and State
rehabilitation agencies, and for beneficiaries. It was expected that
certain legislative and programmatic adjustments would be required as
implementation progresses. The Panel is recommending several such
adjustments throughout this report.

The Panel\'s most significant recommendations are summarized below.

*KEY PANEL RECOMMENDATIONS*

Funding and Resources

[The Panel recommends that Congress provide the financial resources and
direct SSA to establish a dedicated corps of trained, accessible, and
responsive work incentives specialists, as required by law, particularly
during the 7-year period of Ticket to Work and Work Incentives
Improvement Act start-up and evaluation.](#message)

[The Panel again recommends that Congress urge SSA to develop an
immediate, coordinated national marketing and public education campaign
to explain the array of programs available and those authorized under
the Ticket to Work and Work Incentives Improvement Act to beneficiaries,
their families, providers, and employers. Congress should earmark
appropriate funding levels and provide additional funding as
needed.](#rec02)

[The Panel recommends that Congress direct SSA to work closely with
other Federal and State systems to develop and implement a national
training plan and earmark appropriate levels of funding for both
internal and external level training programs. Congress should provide
the additional funds needed for training and technical assistance to
support the successful implementation of all of the programs and
projects authorized by the Ticket to Work and Work Incentives
Improvement Act.](#rec03)

Legislative and Programmatic Adjustments

[The Panel recommends that Congress direct SSA to immediately review the
EN payment system, to adjust and enrich it to enable ENs to serve
additional beneficiaries. Congress should also direct SSA to develop and
support adequate levels of training and ongoing technical assistance for
current and potential ENs.](#rec04)

[The Panel urges Congress to direct SSA to remove the restrictions on
the use of protection and advocacy grant funds in its forthcoming
regulations, particularly as the restrictions relate to assisting
beneficiaries with overpayments.](#rec05)

[The Panel recommends that Congress conduct a review and comparison of
the Ticket to Work and Work Incentives Improvement Act and other
relevant portions of the Social Security Act and the Rehabilitation Act
during the upcoming reauthorization of the Rehabilitation Act to ensure
that the various programs authorized by these laws operate in a positive
and complementary fashion. The Panel urges Congress to take appropriate
action to minimize conflict and eliminate adverse outcomes for
individuals who use these programs and projects that support their
employment efforts.](#rec06)

[The Panel reiterates its 2001 recommendation to Congress to authorize
benefits reduction that results in other than zero benefits not only as
a successful employment outcome but also as a reasonable way of accruing
additional savings to the Trust Fund.](#rec07)

BACKGROUND

*SUMMARY OF THE TICKET TO WORK AND WORK INCENTIVES IMPROVEMENT ACT OF
1999*

The Ticket to Work and Work Incentives Improvement Act, which was
enacted on December 17, 1999, is administered by the Social Security
Administration and the Department of Health and Human Services. It
increases beneficiaries\' choices for rehabilitation and vocational
services, removes barriers that require people with disabilities to
choose between health care coverage and work, and ensures that more
Americans with disabilities have opportunities to work and lessen their
dependence on public benefits. Different provisions of the law became
effective at various times, generally beginning 1 year after enactment.

*[Title I\--Ticket to Work and Self-Sufficiency and Related
Programs]{.underline}*

*Subtitle A\--Ticket to Work and Self-Sufficiency and Related Programs*

Most Social Security and Supplemental Security Income (SSI) disability
beneficiaries will receive a \"ticket\" that they can use to obtain
vocational rehabilitation, employment, or other support services from an
approved provider of their choice. This voluntary program is being
phased in nationally over 3 years. It establishes a program manager
(PM), employment networks (ENs), and payment systems; calls for a report
on the adequacy of incentives and the establishment of a dispute
resolution mechanism; provides for suspension of continuing disability
reviews (CDRs) for persons using the ticket; and establishes the Ticket
to Work and Work Incentives Advisory Panel.

*Subtitle B\--Elimination of Work Disincentives*

Subtitle B eliminates the work activity standard as a basis for review
of an individual\'s disability status and provides for expedited
reinstatement of disability benefits if the person does not continue
working.

*Subtitle C\--Work Incentives Planning and Outreach*

Subtitle C sets up the Work Incentives Outreach Program, including
external Benefits Planning Assistance and Outreach (BPA&O) programs and
the internal corps of Social Security experts on work incentives and
employment. It establishes a grant program for a protection and advocacy
(P&A) agency in each State to assist beneficiaries.

*[Title II\--Expanded Availability of Health Care Services]{.underline}*

Title II expands State options under Medicaid for workers with
disabilities. It calls for a General Accounting Office (GAO) study on
extending Medicare coverage for Social Security recipients and
establishes State infrastructure grant authority and demonstration
projects. It calls for a demonstration of coverage under Medicaid of
workers with potentially severe disabilities and allows disabled
beneficiaries to suspend Medigap coverage.

*[Title III\--Demonstration Projects and Studies]{.underline}*

Title III extends the disability insurance (DI) program demonstration
authority and calls for specific studies and reports, including a
demonstration study of a \$1 reduction in benefits for every \$2 earned.

Strategic Partners, Public and Private

Throughout the legislation, there are references to other government
agencies at the Federal, State, and local levels, and to private sector
service providers, all of whom are key partners with SSA in implementing
the Act. Effective collaboration among the following strategic partners
will be critical to the success of the Ticket Program.

*[Under Title I\--Ticket to Work and Self-Sufficiency and Related
Programs]{.underline}*

SSA has selected Maximus as the PM to recruit ENs in States. *SSA Field
Offices* administer the benefit programs. *Employment support
representatives* (ESRs) work within SSA to implement the Ticket Program
and other employment provisions. The *Ticket to Work and Work Incentives
Advisory Panel* provides advice to SSA, the President, and Congress on
the implementation of the Act. *P&A systems* in the States are funded by
SSA to help beneficiaries obtain information and advocacy support
related to employment services and dispute resolution. BPA&O programs
are funded by SSA and provide benefits counseling to beneficiaries.
State *vocational rehabilitation* (VR) agencies, funded by the
Rehabilitation Services Administration in the Department of Education
(ED), provide rehabilitation and a broad range of return-to-work
services for SSA beneficiaries. *Special education* at the State level
is funded through the Office of Special Education Programs in ED and
serves beneficiaries between the ages of 14 and 22 in school-to-work
transition programs. *One-Stop Employment Centers* at the local level,
funded through the Employment and Training Administration of the
Department of Labor (DOL), are specifically mentioned in the law as
potential ENs and may include State VR agencies as one-stop partners.
Other parts of DOL, such as the *Office of Disability Employment
Policy,* are involved in public policy decisions at the national level
that potentially affect beneficiaries returning to work.

*[Under Title II\--Expanded Availability of Health Care
Services]{.underline}*

The *Centers for Medicaid and Medicare Services* of the Department of
Health and Human Services (HHS) at the national level and State Medicaid
agencies are partners in providing increased medical coverage for
beneficiaries. Other Federal agencies- the *Administration on
Developmental Disabilities, the Maternal and Child Health Bureau,* and
the *Center for Mental Health Services,* also in HHS-fund programs to
provide advocacy, residential, and employment support services to
low-income SSA beneficiaries from specific beneficiary populations.

*[Under Title III\--Demonstration Projects and Studies]{.underline}*

SSA\'s *Office of Program Development and Research,* within the *Office
of Disability and Income Security Programs,* conducts or commissions the
mandated projects and studies. The *National Institute on Disability and
Rehabilitation Research* and the *Interagency Committee on Disability
Research* in ED, as well as the *Assistant Secretary for Planning and
Evaluation* in HHS, also undertake or coordinate research on Ticket
participants and other persons with disabilities.

*[Other Partners for Titles I, II, and III]{.underline}*

Include the *Section 8 Housing* program in the Department of Housing and
Urban Development (HUD) and the *Transit Subsidy Program* in the
Department of Transportation (DOT), which provide housing and
transportation benefits for SSA beneficiaries.

ANNUAL INTERIM REPORT TO CONGRESS

*Subtitle A of the Act states, in part,\
(f) The Ticket to Work and Work Incentives Advisory Panel\....\
(6) Reports. \...\
(A) Interim Reports. \--The Panel shall submit to the President and the
Congress interim reports at least annually.*

INTRODUCTION

This report covers issues that affect not merely the Ticket Program but
a variety of other important Federal and State programs affected by the
Ticket to Work and Work Incentives Improvement Act. These programs are
administered by the Social Security Administration (SSA), the U.S.
Department of Health and Human Services (HHS), the U.S. Department of
Education (ED), and the U.S. Department of Labor (DOL). They include the
Supplemental Security Income (SSI) and Social Security Disability
Insurance (SSDI) work incentive provisions, Vocational Rehabilitation
Act programs, Workforce Investment Act programs, and the new State
Medicaid Buy-In Program and the Medicaid Infrastructure Grants.

The passage of the Ticket to Work and Work Incentives Improvement Act in
1999 by a vote of 99 to 0 in the U.S. Senate and an overwhelming
majority in the U.S. House of Representatives represented a bipartisan
shift in the Nation\'s attitude toward employment of persons with
disabilities and the contributions they can make to our economy and
society. Through passage of this Act, Congress recognized that many
people with disabilities currently receiving Social Security disability
benefits desire to work. Congress acknowledged that many national
policies and procedures were disincentives and barriers to work,
preventing most people with disabilities from attempting to find jobs.
Congress also acknowledged that with the proper supports, many people
with disabilities would attempt to work, but that the required customer
service supports were not available to assist with the transition off
benefits. Finally, with the passage of the Medicaid and Medicare
provisions in the Act, Congress recognized the critical importance of
health care for individuals with disabilities who want to return to work
by creating and supporting opportunities for them to access and maintain
health care coverage.

Calendar year 2002 was an exciting year for individuals with
disabilities and advocates interested in the Ticket to Work and Work
Incentives Improvement Act programs. In January 2002, SSA released
implementing regulations to govern the Ticket Program. SSA appeared to
rely heavily on Panel and constituent input when drafting these
regulations. As of February 28, 2003, SSA had mailed out more than 3.5
million tickets to SSI and SSDI beneficiaries in 13 Phase One and 20
Phase Two States. The response from beneficiaries has exceeded
expectations. Although ticket distribution did not begin until February
2002, tens of thousands have called the national PM, Maximus, and their
local listed ENs for information. As of February 28, 2003, more than
13,000 beneficiaries have deposited their tickets, either with their
current State VR agency or with one of the many new EN providers.

Consumers have also had access to SSA\'s two new grant programs. As of
January 31, 2003, more than 47,000 beneficiaries had used the BPA&O
program for advice on how employment would affect their benefits. As of
November 30, 2002, more than 13,000 individuals had received services
ranging from information and referral to legal representation from the
Protection and Advocacy for Beneficiaries of Social Security (PABSS)
Programs, operated by State P&A agencies. The Panel is pleased to note
that SSA provided full funding for both these programs in FY 2002 and
continued the funding in FY 2003, as the Panel had urged. *(A list of
Panel members is contained in Appendix A.)*

States that have opted for the Medicaid Buy-In Program are now
positioned to address lack of access to health care as a barrier to
employment. Forty States are currently receiving the Medicaid
Infrastructure Grants (MIGs) authorized under the Ticket to Work and
Work Incentives Improvement Act, and 26 States now have operational
Medicaid Buy-Ins, enacted under the authority created by both the
Balanced Budget Act and the Ticket to Work and Work Incentives
Improvement Act. Almost 35,000 people with disabilities are working in
the 26 States participating in the Medicaid Buy-In Program. An
additional seven States are working to pass legislation to establish a
Medicaid Buy-In Program, but these programs are not yet up and running.

Additionally, SSA began drafting regulations to clarify implementation
issues related to the Ticket Program, including regulations to provide
for expedited reinstatement of benefits for disabled adult children,
disabled widows, and disabled widowers. SSA is also developing
regulations related to protection from payment cessation for
beneficiaries who participate in a vocational plan with an EN or State
VR agency, and protection from using work activity in determining
disability in the CDR process. Development of regulations likely will be
a significant SSA activity during 2003, with a number of Notices of
Proposed Rule Making (NPRMs) released throughout the year. The Panel
will continue to provide early input into the process and to review and
comment formally as the proposed regulations are developed.

IMPLEMENTATION ISSUES

The Panel received regular updates on implementation from SSA and
Centers for Medicare and Medicaid Services (CMS) officials and invited a
variety of experts to share their knowledge and opinions about the
implementation of the programs. The Panel also provided extensive
opportunities for public input during 2002 for Social Security
beneficiaries, employment services providers, advocates, and grantees.
Agency updates, expert briefings, research, and ongoing public comment
from beneficiaries, advocates, employment service providers, field
experts, and grantees have raised many implementation and policy issues.
As in 2001, updates, research, investigation, experts, public comment,
and Panel deliberations and discussion indicate that SSA is not
sufficiently funding or implementing key provisions of the statute in
accordance with congressional intent. The Panel is concerned that
unprecedented State budget shortfalls could significantly affect
implementation of both the health care provisions and the return-to-work
programs of the legislation and could greatly compromise the success of
all of the Ticket to Work and Work Incentives Improvement Act programs
and projects.

*Employment Support Infrastructure*

The Ticket to Work and Work Incentives Improvement Act states in
Subtitle C, Section 1149(a)(2)(C), that *\"the Commissioner shall
establish a corps of trained, accessible, and responsive work incentives
specialists within the Social Security Administration who will
specialize in disability work incentives under titles II and XVI . . .
.\"*

In its 2001 Annual Report to the President and Congress, the Panel
recommended that SSA implement this legislative mandate. Although SSA
has developed a plan to do so, the Panel still has very serious
concerns. During 2001, SSA conducted a pilot project placing 32 ESRs who
specialized in SSI and SSDI work incentives in local field offices. The
pilot resulted in a report (November 2001) recommending that the ESR be
established as a permanent position with the broadest possible
distribution nationwide. The evaluators reported that the model was
highly successful. The Panel communicated its strong support for
national implementation of the ESR model to SSA Commissioner Jo Ann
Barnhart on July 1, 2002.

However, the Panel has recently learned from the executive management of
SSA that the Commissioner adopted a plan to designate existing field
staff as work incentives specialists (WISs). The WISs would be delegated
work incentive responsibilities in addition to their existing duties,
allowing office managers to control the priority of work incentives
assignments. SSA plans initially to designate 102 current staff members
as WISs; SSA anticipates an increase to more than 600 by 2004 and more
than 1,200 in later years, depending on the demands of the
postentitlement workload. SSA is developing a system to give
postentitlement work a higher priority by giving WISs up to 2 weeks of
training and implementing a performance evaluation system that gives a
higher weight to postentitlement work. However, the performance
evaluation system will not be implemented until FY 2005. *(See Appendix
B for related Panel correspondence.)*

SSA\'s obligation to provide quality employment support services at the
field level has been long overlooked and ignored due to multiple
competing priorities for limited agency resources. Social Security
customers, their national advocates, rehabilitation providers, and State
service systems have registered harsh criticism and extensive complaints
for decades regarding the lack of adequate staffing and the consistently
inaccurate and misleading information that SSA field staff provide to
beneficiaries about employment. Beneficiaries, ENs, and P&A agencies
continue to testify that the information they receive from local SSA
offices is untimely and often inaccurate. This situation discourages
beneficiaries from attempting to work and will impair the success of any
return-to-work effort, including the Ticket Program. The American
Federation of Government Employees, National Council of SSA Field
Operations Locals, told the Panel that SSA\'s latest strategy of adding
the work incentives as collateral duties to that of employees already
overburdened with claims processing and other functions will make it
more difficult to address these employment issues. SSA is, in effect,
adding only an enhanced training component to a system that has already
proven ineffective.

SSA should update its policies and procedures to ensure that they
support beneficiaries\' efforts to work. According to the GAO,
concurrent beneficiaries of SSI and SSDI face significant obstacles to
obtaining accurate information about how a work attempt will affect
their benefits because SSA has not cross-referenced guidance on the DI
and SSI rules for concurrent beneficiaries. As a result, SSA officials
who collect employment information from concurrent beneficiaries may not
accurately collect information pertinent to both programs. Moreover, SSA
has not established a monitoring program to ensure that correct actions
are taken (GAO, 2002, p. 12).

**The Panel again recommends that a work incentives specialist or other
designated staff should be a single point of contact for beneficiaries
seeking work incentive information and that such staff should be
permanent SSA employees whose first priority is work incentives and
employment support duties. The Panel\'s position remains that all
interested beneficiaries should have reasonable access to a skilled,
full-time work incentive specialist, as defined and recommended in the
pilot project discussed above.**

The Panel believes that the performance evaluation system planned for
2005 will be implemented too late to be of much benefit to Ticket to
Work and Work Incentives Improvement Act programs. Furthermore, the
2-week training program planned by SSA is not sufficient to educate
staff in the complex interactions of the various SSA employment support
and work incentive programs.

SSA\'s position is that the number of WISs and the priority this work
will be given will be adjusted (or increased) based upon demand, but the
Panel is unaware of any plans to collect the data that will measure the
extent of such demand. For example, how will SSA measure whether
beneficiaries who contact SSA with work incentives questions receive
accurate information? What benchmarks will be used to measure whether
the WIS program is successful (e.g., a decrease in overpayments or an
increase in the number of appropriate and timely work CDRs)? The Panel
is concerned that all return-to-work efforts, particularly the Ticket
Program, will fail unless SSA provides timely, accurate, and meaningful
information about work incentives, earnings reporting, work CDRs, and
related issues to beneficiaries and providers.

**The Panel recommends that Congress provide the financial resources and
direct SSA to establish a dedicated corps of trained, accessible, and
responsive work incentives specialists, as required by law, particularly
during the 7-year period of Ticket to Work and Work Incentives
Improvement Act start-up and evaluation.**

**The Panel requests that Congress direct SSA to provide information on
the size and nature of the backlog of work incentives requests,
including work CDRs, earnings postings, overpayments, and other
employment-related postentitlement work, to inform the public and Panel
deliberations, and to develop realistic outcomes by which the success of
the program can be measured.**

**The Panel recommends that SSA conduct a thorough review of its
operational policies and procedures to ensure that outdated practices
are revised to support smooth implementation of the Ticket Program and
operation of other work incentives.**

*Public Education and Marketing of the Ticket Program*

In its 2001 Annual Report, the Panel urged Congress to direct SSA to
increase public awareness of the Ticket to Work and Work Incentives
Improvement Act legislation. The Panel recommended an immediate,
coordinated national marketing and public information effort to explain
the array of programs and work incentives authorized under the Act and
related legislation to the general public, providers, and employers.

SSA has conducted initial media events in a few Phase One and Phase Two
States and collaborated with Federal agencies, such as DOL, the HHS, and
ED, to educate targeted audiences about the program. However, the Panel
believes these efforts are grossly insufficient to truly market the
Ticket Program. There is no evidence of building a marketing capacity or
an infrastructure to support employment in the SSA budget request for FY
2004.

The Ticket to Work and Work Incentives Improvement Act represents a
significant cultural shift in the way our society views individuals with
disabilities and the way they view themselves. The SSI and SSDI programs
were founded upon the assumption that people with disabilities could not
be expected to work. The Act has radically altered this assumption.
*(See Definition of Disability section below.)* No longer are people
with disabilities expected to remain unemployed throughout their lives,
dependent upon cash benefits for subsistence. The passage of the Act was
a significant step toward the realization that, given proper supports,
many people with disabilities can be economically productive members of
society. The Panel believes that significant resources must be allocated
to public education and marketing to support this cultural shift.

Most SSI and SSDI beneficiaries currently believe that they cannot work.
When they applied for benefits, they accepted the cultural and
programmatic assumption that their inability to work is permanent. SSI
and SSDI beneficiaries are accustomed to relying upon disability
benefits to meet their basic needs for food, shelter, and medical care.
Many, especially those who are subject to periodic CDRs, live in
constant fear that these benefits will be taken away. In fact, millions
of beneficiaries who received tickets reported being afraid because they
thought their benefits were being eliminated.

Beneficiaries of SSA disability programs now can choose how and from
whom they access vocational rehabilitation, employment services, and
other supports. But based on public comment and Panel deliberations and
investigations, the Panel believes that most beneficiaries who receive a
ticket do not know what it is, what to do with it, or why it was sent to
them. Beneficiaries by the thousands are calling the PM and local ENs
for this basic information, placing a significant burden on the new
system.

Many employment and service agencies for people with disabilities have
become accustomed to counseling their clients to work, but only at
minimal levels to enable them to keep their SSI and SSDI benefits. These
agencies do not help their clients to aspire to higher wage, full-time
work. They often are unaware of the new work incentives that could allow
their clients to retain Medicaid benefits while giving up cash benefits,
and they are reluctant to encourage their clients to seek full-time
employment. Many of these agencies provide services for their clients
that are covered by Medicaid (e.g., residential or mental health
counseling services). They fear that clients who return to work will
lose their Medicaid coverage, resulting in a loss of these support
services that will hinder the clients\' ability to work and to live
independently.

The cultural shift reflected in the passage of the Act cannot be
realized without a similar shift among the attitudes of disability
service providers. The Panel continues to hear at public meetings that a
campaign to market the Ticket Program to beneficiaries, providers, and
employers is crucial to the program\'s success. The Panel is pleased
that Commissioner Barnhart supports the Panel\'s ideas. Early last year,
she voiced her commitment to work with the Panel to develop a
comprehensive campaign to educate beneficiaries and their families and
to market employment supports, work incentives, and the Ticket Program.
However, the Panel remains very concerned that SSA does not have a
national public education campaign in progress, nor has it established a
national social or business marketing plan for these new programs.

We are now in the third year of implementation of the work incentive
improvements, Medicaid Buy-Ins, BPA&O projects, and the Ticket Program.
Thousands of beneficiaries are using the work incentive provisions to
attempt work. But millions more are still afraid of attempting work
because they believe they will lose their cash and medical benefits,
which have been their only source of income. ENs, advocates, and
beneficiaries continue to testify that many who want to work do not
understand how to use SSA work incentives, the Medicaid Buy-In Program,
and the Ticket Program.

A marketing program must be targeted to three distinct constituencies:
beneficiaries and their families, potential ENs and other service
providers, and employers. Marketing to beneficiaries and their families
must address the fear of losing benefits and provide education about the
Ticket Program and other work incentives. Marketing to potential ENs and
other service providers must address these topics, as well as the
benefits of becoming an EN. And finally, marketing to employers must
address the benefits of becoming an EN and of turning to people with
disabilities as an untapped labor pool of productive employees.

**The Panel again recommends that Congress urge SSA to develop an
immediate, coordinated national marketing and public education campaign
to explain the array of programs available and those authorized under
the Ticket to Work and Work Incentives Improvement Act to beneficiaries,
their families, providers, and employers. Congress should earmark
appropriate funding levels and provide additional funding as needed.**

*Field Training and Technical Assistance*

The Federal training of beneficiaries and service providers about the
Ticket to Work and Work Incentives Improvement Act employment and health
support programs is very problematic. SSA is spending very little on
training (less than \$4 million a year) and only for two new grant
programs: the Benefits Planning Assistance and Outreach Program and the
Protection and Advocacy Benefits Support Program. In comparison, the
Rehabilitation Services Administration allocates tens of millions of
dollars for training State VR agency staffs and community-based
providers on rehabilitation policies and practices.

A number of public comments received by the Panel and the direct
experience of individual Panel members indicate that internal SSA field
office staff know little or nothing about the Ticket Program, work
incentives, or the other new programs and projects authorized by the
Act, such as the Medicaid Buy-Ins. Additionally, there is little
training and no ongoing technical assistance for ENs that want to
participate in the Ticket Program.

The Ticket to Work and Work Incentives Improvement Act calls for a
philosophical shift in providing employment supports for SSI and SSDI
beneficiaries who want to work. Federal, State, and private entities
must be partners in this effort for it to succeed. An intensive and
comprehensive training regimen for all of these partners is crucial. The
Panel believes the amount of resources dedicated to training and
technical assistance is grossly inadequate.

[]{#rec03 .anchor}**The Panel recommends that Congress direct SSA to
work closely with other Federal and State systems to develop and
implement a national training plan and earmark appropriate levels of
funding for both internal and external level training programs. Congress
should provide the additional funds needed for training and technical
assistance to support the successful implementation of all of the
programs and projects authorized by the Ticket to Work and Work
Incentives Improvement Act.**

*Consumer Choice of ENs*

The Panel is very troubled about the low numbers of consumers being
served by ENs and is concerned that sufficient numbers and types of ENs
may not be available to serve ticket holders. When it proposed the
Ticket Program, Congress anticipated that a large number of agencies,
including traditional providers\--such as State VR agencies, private
rehabilitation providers, and Projects with Industry Programs\--and
nontraditional providers\--such as employers, community colleges, and
vocational schools\--would become service providers under the Ticket
Program.

The PM (Maximus) has devoted significant effort to contacting and
recruiting potential ENs. Between program start-up and March 1, 2003,
Maximus has organized 50 Employment Network Outreach Conferences, and an
additional 41 are scheduled for the remainder of 2003. Maximus has
presented or exhibited at 173 conferences and projects, attending 53
conferences during 2002. Maximus has made approximately 200,000 contacts
by mail and telephone. Maximus has contacted in person almost 48,000
traditional and nontraditional employment organizations from the public,
private nonprofit, business, and education and learning sectors. To
date, 714 ENs have enrolled in the program. This is a good start, and
Maximus should be commended for its work so far. However, programmatic
changes may be required to increase the pool of ENs.

The Panel is concerned that few ENs are actively taking beneficiaries;
only 179 (25 percent) of the 714 ENs currently enrolled have accepted
tickets from consumers. And ENs that have accepted consumers are serving
very few. As of February 28, 2003, fewer than 1,800 individuals had
assigned tickets to an EN other than a State VR agency. There seems to
be little emphasis on encouraging beneficiaries to deposit their tickets
or on expanding services under the Ticket Program. Rather, ENs state
that they are taking a cautious approach and adopting a \"wait-and-see\"
attitude toward the Ticket Program.

A primary goal of the Ticket Program is to expand the universe of
service providers to include nontraditional service agencies and
employers, thus allowing real choices for people with disabilities. In
most localities true choice in providers is not yet a reality because so
few ENs are actually accepting tickets. This is causing two very serious
service problems. First, many ENs are swamped with requests for services
that they cannot meet because of limited resources or their inability to
provide the specialized services certain beneficiaries need. Handling
requests for information and determining who will be served is placing a
strain on EN staff and financial resources. Second, expectations of
savvy consumers who want to work are raised when they receive a ticket,
only to be dashed when they are again denied services, sometimes by more
than one EN.

Another problem is the lack of diversity in both geographic location and
specialization of ENs. Individuals representing disability groups that
require highly specialized services, as well as representatives of
cultural minorities, have testified that very few ENs are available to
meet their needs. Cultural and linguistic minority populations have a
higher percentage of people with disabilities, so it is essential to
recruit ENs with the cultural and linguistic expertise and capability to
serve these populations. Others have expressed grave concerns that there
are insufficient numbers of ENs in large metropolitan cities like
Chicago, with a naturally high concentration of people with
disabilities, or in rural areas where the numbers of beneficiaries are
too low for ENs to offer meaningful choices.

The Panel has received public testimony that few ENs represent new types
of providers such as employers or vocational schools. After review of
the current EN list, the Panel found that it consists primarily of State
VR agencies and the same for-profit and nonprofit agencies that provided
traditional rehabilitation services to individuals with disabilities
before the Ticket program was established. All of these problems could
be addressed by programmatic changes that have been suggested by ENs and
recommended by the Panel.

ENs have testified repeatedly that the payments specified under the
milestone payment system are not high enough to entice them to serve
individuals who need significant training or support under the Ticket
Program. SSI and SSDI beneficiaries often need extensive vocational or
job training to perform competitively in the marketplace. They may need
costly accommodations or long-term support services, such as supported
employment or personal assistance services.

**During the NPRM process, the Panel recommended that the first two
milestone payments be raised to assist ENs in covering these up-front
costs. Additionally, the Panel recommended that a milestone be added at
the completion of a signed return-to-work plan. This payment point would
provide some funds earlier in the process and encourage ENs to be more
aggressive in recruiting beneficiaries and to consider serving
individuals with greater support needs. The Panel also recommended that
SSA consider the immediate implementation of a second tier of the
milestone payment system. Such a system would provide individualized
milestones for beneficiaries who need ongoing support services or
high-cost accommodations. The Panel feels strongly that ENs would
significantly increase services under the Ticket Program if these
recommendations were adopted.**

The Panel has recently learned that SSA plans to examine restructuring
the entire EN payment system as part of the Adequacy of Incentives (AOI)
study. Congress included the AOI in the Ticket to Work and Work
Incentives Improvement Act to ensure that incentives were built into the
payment system for ENs to serve beneficiaries the Act defined as
\"difficult to serve.\" While the Panel lauds these efforts, it is
concerned that the payment system now being used appears to provide
inadequate incentives for ENs to aggressively enroll and serve even
those who are not considered difficult to serve.

The Panel believes that SSA should move quickly to develop enhancements
to the basic payment system to make it more functional for ENs. Waiting
the 2 years until the AOI study is complete to make changes will be
severely detrimental to the program; by then, many ENs and beneficiaries
may have given up on it. The Panel feels it is essential to lay a firm
foundation that effectively serves most beneficiaries, as well as to
make modifications to serve those deemed \"difficult to serve.\"

ENs have complained that the Ticket Program does not support services
for individuals who want to work but cannot work to a level that would
eliminate their cash benefits. *(See EN Payments for All Work Outcomes
section below.)* ENs offered other explanations for the low level of
acceptance of tickets: program complexity; lack of accurate, consistent,
and timely information from both SSA and the PM; lack of technical
assistance and training; and tension between the EN and the State VR
agency. Additionally, ENs testified that their cash-flow situations
require that they have up-front capital to pay for some of the services
beneficiaries need. Even with the milestone payment system, ENs do not
receive their first payment until after the beneficiary has been working
1 month\--which can be months and sometimes a year or more into an
individual rehabilitation or employment services program. Most ENs said
that they are not sufficiently capitalized to pay for expensive up-front
costs.

The Panel is pleased that SSA has recognized the EN capitalization
problem and that SSA, through Maximus, is developing an EN
capitalization initiative. This initiative will provide resource tools
and training to assist current and prospective ENs in securing up-front
funding for employment services under the Ticket Program. While the
Panel appreciates this training initiative, the Panel feels that program
modifications, including changes in the milestone payment structure,
will be required to address this problem.

The Panel will host a national meeting to address milestone payments and
other issues related to the recruitment and effectiveness of employment
networks in the Ticket Program. The Panel will invite the participation
of knowledgeable providers, economists, Federal officials, researchers,
and others who are highly skilled in rehabilitation and return to work
to assist in identifying issues and developing possible solutions to
these and other problems ENs are experiencing.

**The Panel recommends that Congress direct SSA to immediately review
the EN payment system, to adjust and enrich it to enable ENs to serve
additional beneficiaries. Congress should also direct SSA to develop and
support adequate levels of training and ongoing technical assistance for
current and potential ENs.**

*Wage Reporting, Overpayments, and Return to Work*

In its 2001 Annual Report, the Panel expressed misgivings that SSA\'s
long-standing problems with overpayments will be exacerbated under the
Ticket Program as increasing numbers of beneficiaries return to work.
Although SSA has taken significant steps to address this problem during
the past year and has requested additional funds to reduce erroneous
payments, including CDRs and overpayments, the Panel is still concerned
that insufficient resources are being devoted to solving this problem.

The major concern is that SSA continues to impose arbitrary limits on
P&A services for beneficiaries. Specifically, SSA is prohibiting the use
of grant funds to represent a beneficiary against SSA on issues related
to overpayments. This means that beneficiaries who use Ticket programs
to return to work and receive overpayments from SSA that they wish to
appeal have no legal representation. P&A representatives have testified
that overpayments occur because SSA cannot process beneficiary wage
reports in a timely manner; SSA keeps sending benefit checks after the
beneficiary has accurately reported wages and is no longer eligible.

Several P&A and EN representatives as well as other national consumer
advocates have testified to the Panel and to Congress that beneficiaries
who receive overpayment notices are very likely to discontinue
employment. According to one P&A director, \"Our office receives several
calls each week from recipients who have been notified of work-related
overpayments. Some feel as if they are being punished for returning to
work. Others are afraid of losing their homes and assets. Yet others, in
tears, ask why the Government failed to do its job when the beneficiary
met their responsibilities for reporting.\"

In 2002, GAO reported that outstanding SSI debt and newly detected
overpayments for the year 2001 totaled \$4.7 billion (GAO, 2002). This
problem will only get worse as more beneficiaries attempt to work under
improved Medicaid systems, new work incentives, and other Ticket to Work
and Work Incentives Improvement Act programs and report their earnings
monthly. It must be addressed quickly and comprehensively for any of the
return-to-work programs to be effective.

In addition to creating a disincentive for beneficiaries, overpayments
present a particular problem for ENs under the Ticket Program. ENs that
return beneficiaries to work will not be paid if the beneficiaries are
still receiving cash benefit payments from SSA, even if these payments
are being made in error. This could prove to be a significant long-term
disincentive for ENs to participate in the Ticket Program.

Beginning in 2002, SSA is implementing new data management systems that
add new software tools for the collection of beneficiary work data
(e.g., tracking months of trial work period and substantial gainful
activity, pending CDRs, and expedited reinstatements). The Panel has
received testimony that implementation of these data systems has been
uneven and some of these systems are not mandatory for all field
offices. The Panel has also received reports of backlogs of CDRs caused
by work activity, the \"work CDR.\" The Panel has asked SSA for more
reliable estimates of the size of the work CDR backlogs because these
backlogs threaten timely EN payments. Timely processing of CDRs is cost
effective; SSA estimates \$9 in program savings for each \$1 invested in
CDRs.

While the Panel is pleased that SSA is making progress, it is still
concerned about the uneven and delayed implementation of these systems.
These new and, it is hoped, integrated systems are overdue and needed
now, during start-up of the Ticket Program and Ticket to Work and Work
Incentives Improvement Act implementation. The Panel is concerned that
implementation delays will result in continuing EN and beneficiary
frustration with poor customer service and eventual disillusionment with
the Ticket Program and other return-to-work programs and supports for
beneficiaries.

The Panel is also concerned that SSA is focusing on solving the problem
at the \"back end\" through administrative data systems. It is important
that SSA also correct the \"front end\" through provision of accurate
and timely information and good customer service to ENs and
beneficiaries about work incentives before beneficiaries enter the
workforce. Both strategies are critical to successful implementation of
the Ticket to Work and Work Incentives Improvement Act. *(See Employment
Support Infrastructure section above.)*

**The Panel recommends that Congress direct SSA to expedite the
development and implementation of these new systems supports and mandate
their use in every field office by November 2003.**

The Panel will continue to monitor and advise SSA on the critical issues
of overpayments, wage reporting, and postentitlement changes in
eligibility related to work.

*Protection and Advocacy Programs*

In its 2001 Annual Report, the Panel expressed concerns about how SSA
was implementing the Protection and Advocacy (P&A) Grant Program. The
Panel continued to receive public testimony in 2002 reiterating these
concerns.

The major concern is that SSA continues to impose arbitrary limits on
P&A services for beneficiaries and prohibit P&A programs from
representing consumers who return to work and receive overpayments from
SSA. P&A representatives have testified that overpayments occur because
SSA cannot process beneficiary wage reports in a timely manner; SSA
keeps sending benefit checks after the beneficiary has accurately
reported wages and is no longer eligible.

Additionally, overpayment calculations are often inaccurate because SSA
does not take into account the various work incentives built into the
SSI and SSDI programs in calculating the overpayment. Anxiety about
receiving an overpayment and lack of assistance to beneficiaries in
managing complex appeals processes has been a powerful disincentive to
work.

The Ticket to Work and Work Incentives Improvement Act defined the role
of P&As as providing *\"(1) information and advice about obtaining
vocational rehabilitation and employment services; and (2) advocacy or
other services that a disabled beneficiary may need to secure or regain
gainful employment.\"* The Panel believes that SSA\'s narrow
interpretation of the role of the P&A grantees does not conform to
legislative intent and will not permit them to provide the advocacy SSA
beneficiaries need to return to work.

The Panel has repeatedly asked SSA to eliminate the arbitrary limits
imposed on Protection and Advocacy grantees described above. In May
2002, the Panel held an Issues Roundtable of legal experts, consumer
advocates, and P&A administrators. The experts came to a similar
conclusion. They said that SSA\'s current interpretation is so narrow
that the P&As will be ineffective in protecting the rights of
beneficiaries and that the restrictions and limits should be removed.

SSA also prohibits the use of grant funds to address systemic issues
that may inhibit the work attempts of beneficiaries as a group (e.g.,
lack of accessible transportation alternatives or poor interagency
coordination in service provision). The P&A grantees may not have enough
resources to represent every beneficiary individually. However, if the
SSA restrictions were removed, the P&A grantees could maximize their
effectiveness by advocating for changes to systems that would positively
affect numerous beneficiaries. The legislative language is broad and
certainly does not exclude the activities that SSA is currently
prohibiting.

**The Panel urges Congress to direct SSA to remove the restrictions on
the use of protection and advocacy grant funds in its forthcoming
regulations, particularly as the restrictions relate to assisting
beneficiaries with overpayments.**

*Dispute Resolution Issues*

The Panel heard a number of concerns about the appeals process outlined
in the Ticket to Work and Work Incentives Improvement Act regulations in
cases of conflict between a consumer and an EN, or between an EN and the
PM. The review and appeals process for individuals receiving services
under Title I of the Rehabilitation Act differs significantly from the
appeals process under the Ticket to Work and Work Incentives Improvement
Act.

The Rehabilitation Act specifies the process for selecting a hearing
officer and timelines for each step of the hearing process. The appeals
process under the Ticket Program is much less specific and is
established by regulations. Another difference is that the relationship
between the consumer and the VR agency under the Rehabilitation Act is
not voluntary, because VR agencies are required to serve individuals
with severe disabilities who have a work objective. The relationship
under the Ticket to Work and Work Incentives Improvement Act is
voluntary, because the beneficiary chooses the EN and the EN chooses the
beneficiary. Legal rights protection is available to VR clients at the
application process, whereas it is available to ticket users only after
the individual plan has been developed and signed. The final difference
is that the review decision under the Rehabilitation Act is binding,
whereas the appeals decision under the Ticket to Work and Work
Incentives Improvement Act regulations is not.

These issues were discussed at the Expert Roundtable on Legal Issues
mentioned above. Roundtable participants felt that the different review
processes should be discussed with clients when they consider a decision
about where to take their ticket. The advantages of the appeals process
under the VR system may discourage clients from depositing their ticket
with a private EN rather than the State VR agency. The lack of an
appeals process when a beneficiary tries to deposit a ticket with an EN
and is denied the opportunity, potential cessation of services while the
individual goes through the appeal, and the nonbinding nature of the
Ticket to Work and Work Incentives Improvement Act review process are
especially problematic. The Panel wishes to bring these issues to the
attention of Congress, as future congressional action may be required to
resolve them. The Panel will continue to monitor dispute resolution
issues and will make more specific recommendations as the need arises.

At the legal issues roundtable, the Panel strongly recommended that SSA
establish a pilot program to use mediation as an integral part of the
dispute resolution process. SSA informed the Panel that it is initiating
this pilot program, and the Panel commends SSA for this effort. The
Panel will monitor SSA\'s implementation of this important pilot project
and keep Congress apprised of its progress.

*Relationship Between the State VR Agencies and the Ticket Program*

A number of troubling issues have surfaced regarding the State
vocational rehabilitation agencies and their relationship with the
Ticket Program. Panel members have concerns about the interrelationships
between State VR agencies and ENs and between State VR agencies and
consumers. High percentages of ticket holders are assigning their
tickets to State VR agencies, so the role VR agencies play in the Ticket
Program should be closely monitored. In fact, about 86 percent of
assigned tickets have been assigned to State VR agencies. This is to be
expected because of the financial resources available to State VR
agencies and the numbers of current VR clients who receive benefits:
more than 40 percent of the VR agencies\' caseload consists of SSI and
SSDI beneficiaries. Although about 57 percent of these cases are new
clients, it is unclear whether VR clients are being offered a true
choice in where they deposit their tickets.

SSA has issued guidance to the Rehabilitation Services Administration
(RSA) and the State VR agencies, based upon SSA\'s interpretation of the
Act, that any beneficiary who signs an individualized plan for
employment (IPE) automatically indicates that he or she has decided to
use the ticket to obtain services from the State VR agency. In other
words, the beneficiary automatically assigns the ticket to the VR agency
by signing the IPE. This is problematic because clients who receive SSI
or SSDI are eligible for VR services under Title I of the Rehabilitation
Act, whether or not they assign their ticket to the VR agency under the
Ticket to Work and Work Incentives Improvement Act. At least one State
has opted not to follow SSA\'s interpretation and requests that clients
who wish to assign tickets to that State\'s VR agency explicitly do so.

Some ENs report that State VR agencies are encouraging all potential ENs
to contract with the State VR agency to provide services to ticket
holders rather than accepting tickets themselves. The Panel has also
heard that some State VR agencies are developing cooperative agreements
with ENs that are more coercive than cooperative. Some of these
agreements seem to assume that the VR agency is the controller of the
ticket and place the EN in a secondary or support role. Further, the
Panel has received complaints and reviewed written evidence that some VR
agencies are telling consumers they cannot receive services through the
VR agency if they deposit their ticket with another EN.

Another concern is that State VR agencies are making only minimal
efforts to implement the Ticket Program. In fact, about 95 percent of
tickets assigned to VR agencies are designated for payment under the
traditional cost-reimbursement method. Although this is an option under
the Ticket legislation, the effectiveness of the Ticket Program is not
truly being tested because of the high percentage of tickets deposited
to VR agencies. These reports are anecdotal, and State VR policies and
practices regarding the Ticket Program are still emerging. Some State VR
agencies appear to be very open to cooperative approaches that encourage
choice. Others appear very closed. Practices at this early stage of
implementation are continuing to evolve and change. The Panel recognizes
the complexity of the relationship between State VR agencies and ENs,
with State VR agencies funded and mandated under Title I of the
Rehabilitation Act to serve all SSI and SSDI beneficiaries and ENs
having a choice of whom they accept for services.

SSA and Department of Education officials have held preliminary meetings
to address some of these concerns. Panel members also have met with
representatives of the State VR agencies to develop solutions that will
be mutually beneficial to the State agencies and the Ticket Program. The
Panel is urging SSA and RSA to conduct an in-depth analysis of these
various programs to identify conflicts between the Rehabilitation Act
and the Ticket to Work and Work Incentives Improvement Act. The Panel
plans to conduct a similar analysis itself and will provide its findings
to the relevant Federal agencies and to Congress. In addition, the
Panel\'s EN summit planned for May 2003 will explore best practices for
collaboration.

[]{#rec06 .anchor}**The Panel recommends that Congress conduct a review
and comparison of the Ticket to Work and Work Incentives Improvement Act
and other relevant portions of the Social Security Act and the
Rehabilitation Act during the upcoming reauthorization of the
Rehabilitation Act to ensure that the various programs authorized by
these laws operate in a positive and complementary fashion. The Panel
urges Congress to take appropriate action to minimize conflict and
eliminate adverse outcomes for individuals who use these programs and
projects that support their employment efforts.**

*EN Payments for All Work Outcomes*

During the past 20 years, Congress has adopted several work incentives
for SSI beneficiaries, including the Plan for Achieving Self Support
(PASS), Section 1619, and the \$1 for \$2 benefit offset. These work
incentives enable beneficiaries to retain Social Security and medical
benefits while working. For example, the \$1 for \$2 benefit offset
enables individuals to receive benefits while earning a monthly net
income of almost \$1,200. Many SSI beneficiaries must retain some level
of benefits in order to live independently in the community, either
because they will never earn enough income to be self-supporting or
because they use Medicaid funds to acquire personal assistance services
or adaptive equipment that they cannot obtain through private insurance.
Beneficiaries who use these work incentives may remain on cash benefits
longer than they would without the work incentives or may never entirely
leave the benefit rolls. Because ENs are paid outcome payments only when
the beneficiary receives zero cash benefits, they risk not receiving
payment for the services they provide. Consequently, ENs either will not
adequately inform clients about work incentives or will not serve
individuals who use the work incentives at all. Therefore, SSI
beneficiaries who need to retain partial cash benefits, particularly
those with developmental disabilities or mental health conditions,
cannot benefit from the Ticket Program.

The Panel raised this issue in its 2001 Annual Report to Congress and
continued to receive testimony related to this problem during 2002.
Beneficiaries who reduce their dependence on SSI benefits not only
reduce costs for the SSI program, but also return a portion of their
earnings in taxes and Federal Insurance Contributions Act payments. ENs
should have incentives to work with all beneficiaries who have some
earnings potential, regardless of whether they can earn enough to
completely leave the benefit rolls. The Panel has taken the position
that ENs should be eligible for some level of payment for helping
beneficiaries start or return to work if they can reduce their
dependence upon SSI. One solution to this problem is for SSA to develop
a payment schedule for ENs that assist beneficiaries in finding
employment that reduces but does not eliminate their SSI payment.

This solution would enable ENs to serve beneficiaries who must retain
cash and medical benefits and enable these beneficiaries to take full
advantage of SSI work incentives as well as the Ticket Program.

[]{#rec07 .anchor}**The Panel reiterates its 2001 recommendation to
Congress to authorize benefits reduction that results in other than zero
benefits not only as a successful employment outcome but also as a
reasonable way of accruing additional savings to the Trust Fund.**

The Panel is conducting an analysis to determine appropriate payment
levels for ENs that assist beneficiaries in reducing their dependence
upon cash benefits. This option will be more fully explored in the AOI
study. *(See Adequacy of Incentives Study section below.)* The Panel
will continue to consult with SSA as this study is developed.

*The Definition of Disability and Return to Work*

The definition of disability under the Social Security Act has been
under tremendous scrutiny during the last several years because of the
increasing number of applicants and the rising costs of Social Security
disability programs. GAO, the National Academy on Social Insurance
(NASI), and the Institute of Medicine (IOM), as well as SSA, have
conducted research and produced extensive reports on this issue. The
definition determines whether applicants for SSI or SSDI will be
eligible for cash benefits. To meet this definition, applicants must
show that they are unable to \"engage in substantial gainful activity by
reason of a medically determinable physical or mental impairment which
can be expected to result in death or which has lasted or can be
expected to last for a period of more than 12 months\....\" *(Sec.
233(d) of the Social Security Act).*

This definition was adopted during a time when individuals with
disabilities were not expected to work. However, a number of recent
developments support the ability of many people with disabilities to
enter the workforce or return to work: passage of the Americans with
Disabilities Act, increased funding for State VR programs, a shift from
a manufacturing to a service economy, advances in assistive technology,
changes in public attitudes about people with disabilities, and passage
of work incentives and the Ticket to Work and Work Incentives
Improvement Act. While the Panel is not prepared to address the broader
issues of disability definition, it recognizes the following important
paradox. Applicants for SSI or SSDI must prove that they are unable to
work because of their disability. Then they receive a ticket and other
information encouraging them to return to work. At best, these
conflicting messages leave beneficiaries confused; at worst,
beneficiaries become reluctant to pursue employment and risk losing
benefits. The Panel is aware of the significant impact of the definition
of disability as \"inability to work\" on Ticket to Work and Work
Incentives Improvement Act programs and will be receiving briefings from
a variety of experts. The Panel will deliberate on this topic during the
coming year.

*Youth Issues*

The Panel made strong recommendations regarding policy issues related to
SSI and SSDI beneficiaries who are under 18 years of age in its Advice
Report dated July 26, 2001. These issues continue to surface at Panel
meetings. The Panel received additional input in 2002 through public
testimony by consumers and advocates, issue papers, research reports,
staff briefings, teleconferences, committee recommendations, and Web
site commentary. The Panel focused it May 2002 meeting in New York on
youth issues. Specific policy concerns centered on youth access to the
Ticket to Work Program (e.g., whether beneficiaries between 16 and 18
years of age should have access to tickets, CDRs, and specific training
oriented to youth and parents).

To summarize, the Panel reaffirms its recommendation that 16- and
17-year-olds be allowed to participate in the Ticket Program. The Panel
felt very strongly that many young people with disabilities,
particularly poor and minority students or the 75 percent of students
who do not go on to college (National Institute for Work and Learning,
1996), would be positively affected by the opportunities the ticket
could provide. The Panel felt that denying youth the opportunity to
participate in the Ticket Program was a denial of the choice in
rehabilitation providers granted to others. Prohibiting youth
participation would send the wrong message and could encourage lifelong
dependency on benefits. Finally, the report pointed out that cost
estimates from the Office of the Actuary included the up-front costs of
providing services and ignored the cost savings that would occur if
these individuals went to work and stopped receiving benefits. In
addition to including 16- to 18-year-olds in the Ticket Program, the
Panel\'s Advice Report recommended that 18-year-old beneficiaries who
participate in the Ticket Program receive the same protection as other
ticket users receive from CDRs.

Although these recommendations have been discussed with Congress and the
administration, the provisions on youth participation in the Ticket
Program have not been changed.

**SSA has indicated that it intends to reconsider this issue in the near
future. The Panel applauds this intent and again recommends that
Congress direct SSA to expand the Ticket Program to youth aged to 16 to
18 years.**

SSA has informed the Panel that demonstration transition programs
targeted to help youth with disabilities find employment are also being
planned.

*Impact of State Budget Shortfalls on Ticket to Work and Work Incentives
Improvement Act Health Care Provisions*

The Panel is pleased that lack of health care as a barrier to employment
is beginning to be addressed. Forty States are currently receiving the
Medicaid Infrastructure Grants (MIGs) authorized under the Ticket to
Work and Work Incentives Improvement Act, and 26 States now have
operational Medicaid Buy-Ins. However, the Panel is concerned that
unprecedented State budget shortfalls are having a negative impact upon
the MIGs and buy-in programs authorized by the Act. The 26 Medicaid
buy-in States and the 40 States with MIGs are making significant
progress in addressing barriers to health care for working people with
disabilities. The Panel is concerned that current proposals for Medicaid
reform will undermine these efforts.

During a time of decreasing Federal and State tax revenues, States are
reporting significant increases in Medicaid costs due to rising
pharmaceutical prices and increases in Medicaid enrollment because of
job loss (Smith et al., 2002). Although CMS has not reported cutbacks in
States that have adopted a Medicaid Buy-In Program so far, the Panel is
concerned that States will, in the future, cut or curtail expansion of
Medicaid services or halt plans to adopt Ticket to Work and Work
Incentives Improvement Act health coverage provisions. For example,
during FY 2002, 45 States took action to reduce their Medicaid spending
growth, such as raising copayments and reducing prescription benefits.
At least 41 States say they are planning to take additional action
during FY 2003 (Smith et al., 2002). States that are looking into
adoption of a buy-in are engaging in a more deliberative process of
developing their proposals, including more detailed data about projected
populations to be covered, more specific cost-sharing approaches, and
targeting of buy-in programs toward higher wage earners to restrict
low-wage earners from participation.

This pattern is similar to the stance adopted by many States with regard
to the Demonstration Program to Maintain Independence under the Ticket
to Work and Work Incentives Improvement Act. Under this program, States
receive matching Federal dollars to extend Medicaid coverage to certain
working people with disabilities whose conditions are not yet severe
enough to qualify them for disability benefits. Only Mississippi and the
District of Columbia have opted to implement this demonstration program.

**The Panel recommends that Congress continue its current level of
funding for Medicaid programs. The Panel will continue to monitor State
budget shortfalls and their impact upon these provisions.**

*\$1 for \$2 Demonstration Project*

Section 302 of the Act requires the Commissioner to conduct
demonstration projects and compile other data to evaluate the
feasibility of providing a \$1 for \$2 benefit offset, similar to the
work incentives available under the SSI program. The legislation also
requires the Commissioner to take into account the advice of the Panel.
In August 2002, the Panel released an Advice Report entitled *Statutory
Requirements and Design Issues Related to SSDI \$1 for \$2 Benefit
Offset Research.* SSA has been in communication with the Panel regarding
the demonstration and has indicated its intent to implement many of the
Panel\'s report recommendations. SSA plans to initiate this
demonstration project early next year. *(See Appendix C for the
executive summary of the Advice Report on \$1 for \$2 benefit offset
research.)*

**The Panel supports a technical amendment to allow SSA to allocate
funds for multiple years to the entity conducting the demonstration.
This language was included in bills introduced in both the 107th and
108th Congresses, but the bills have not yet passed. The Panel will
continue to express its support for this amendment and work with
Congress to pass the technical amendment.**

PUBLIC MEETINGS AND PANEL ACTIVITIES

During 2002, the Panel held four quarterly public meetings and numerous
teleconferences. The Panel also held a full-day expert roundtable on
Legal Issues and Implications of the Ticket to Work and Work Incentives
Improvement Act on May 3, 2002, at which legal and policy experts and
consumer advocates discussed policy and implementation issues.
Additionally, the Panel held monthly conference call meetings of the
three committees established to research and prioritize issues, to
develop policy and implementation advice, and to plan the Panel\'s work.
The Panel provided opportunities for more than 10 hours of public
testimony and accepted ongoing written public comments on implementation
of the Act. The Panel also accepts comments and communicates with the
public via its Web site
([www.socialsecurity.gov/work/panel](http://www.socialsecurity.gov/work/panel)).
The Panel averaged 1,500-2,000 Web site hits per month over the last
year. For example, for the most recent quarter, the Panel\'s Web site
was visited a total of 5,762 times (1,958 in January, 1,992 in February,
and 1,812 in March). On February 11, 2003, the Panel held an awards
reception, which was attended by SSA Commissioner Barnhart, to honor the
outstanding work of Panel members whose terms have expired.

The Panel heard briefings and presentations from a number of experts at
its quarterly meetings. The Panel dedicated its May 2002 quarterly
meeting in New York City to issues of youth in transition and heard
presentations from young people with disabilities, nonprofit service
providers, and public agencies designed to serve this population. The
Panel\'s public quarterly meeting in August in Washington, D.C.,
highlighted presentations from State VR agencies and ENs with some
Ticket to Work and Work Incentives Improvement Act implementation
experience. Its November 2002 meeting in Albuquerque, New Mexico,
focused on marketing, technical assistance, and training, with
presentations from Fleishman-Hillard (a national marketing firm),
Virginia Commonwealth University, and the National Consortium for Health
Systems Development.

The Panel is pleased to report that numerous SSA and HHS officials from
Federal, regional, and local offices have attended and provided
implementation updates at its quarterly meetings. SSA has shown a high
level of interest in Panel recommendations, activities, and
deliberations; and its staff have participated at the public meetings,
in conference calls, in issue roundtables, and in numerous other Panel
activities. The Panel has begun a long-term dialogue with the Social
Security Advisory Board on disability program issues of common concern.
The Panel anticipates that this exchange of ideas will be beneficial for
both groups.

Panel members and their staff have met with and made presentations to
numerous Federal, State, consumer advocate, and private partners about
the Panel\'s ongoing work and the implementation of Ticket to Work and
Work Incentives Improvement Act programs and projects. Panel members and
staff have made presentations on the Panel\'s work and the Act\'s
programs to approximately 3,780 individuals representing 27 constituent
groups and organizations, including State systems and beneficiary and
consumer advocacy and provider groups and organizations. Panel members
have participated in a number of press conferences promoting the rollout
of the Ticket Program. Individual Panel members have also presented at
national, State, and local meetings and conferences for benefits
planners, advocates, rehabilitation providers, and employment networks.
Members have hosted meetings in their communities on the implementation
of the programs and the Panel\'s work, and they have hosted public
forums on Ticket to Work and Work Incentives Improvement Act
implementation. These include national and statewide work incentives
conferences in California, New Jersey, Minnesota, and New York; an
onsite visit to a Manhattan, New York, housing and jobs project for
homeless people with mental impairments; and presentations to national
disability advocate, provider, and consumer organizations. The Panel
office also maintains ongoing communication with all of the major
national disability organizations, national provider groups,
congressional offices, Federal and State officials, and other interested
constituents through its listserv announcements of Panel meetings and
activities, and through posting information and publications on its Web
site.

Finally, the Panel issued two Advice Reports during 2002 that provided
advice and recommendations to the Social Security Administration on SSA
research related to the AOI report and the \$1 for \$2 benefit offset
demonstration project. The Panel also issued seven advisory letters to
the President, Congress, and the Commissioner of Social Security on a
variety of program issues and concerns. *(These materials are contained
in Appendix D.)* Some responses or conclusions from these documents are
summarized below.

*Adequacy of Incentives to Serve People With the Most Severe
Disabilities*

The legislation mandates an AOI study to evaluate how the Ticket to Work
and Self-Sufficiency Program can be used to increase employment among
beneficiaries with significant disabilities. The Commissioner is
required to report to Congress on recommendations for a method or
methods to adjust payment rates to ENs to ensure the participation of
individuals in four specific groups: individuals who need ongoing
support and services; individuals who need high-cost accommodations;
individuals who earn a subminimum wage; and individuals who work and
receive partial cash benefits.

In June 2002, the Panel issued an Advice Report providing analysis and
recommendations regarding design of the AOI study. Due to delays in
issuing the tickets, the Panel continues to recommend that the deadline
for the AOI report to Congress be extended by the amount of time the
ticket rollout was delayed (13 months). Specifically, the Panel
recommended that Congress approve a technical amendment to adjust the
timeline for the AOI report so that it is due 49 months, rather than 36
months, after the enactment date. Implementation of the necessary
adjusted payment rates should occur as soon as practical following the
release of the AOI report, but no later than 1 year after its release.
Further, the Panel requested that Congress require preliminary progress
reports on the AOI study at 36 and 42 months after the date of enactment
of the law. The Panel also recommended that SSA convene an AOI Advisory
Team for ongoing technical support. The Panel was pleased to learn at
its quarterly meeting in February 2003 that SSA has created such a
group. *(See Appendix E for the Executive Summary of the Adequacy of
Incentives Advice Report.)*

*Responses to Advisory Letters*

The Panel has been pleased with SSA\'s responsiveness to its advisory
letters, including requests for information, dialogue, and in-depth
policy discussions regarding the implementation of the Ticket to Work
and Work Incentives Improvement Act and other work incentives issues.
Some of those positive interactions will be highlighted in this section,
as well as ongoing concerns about certain policies raised in the
letters.

During the period covered by this report, the Panel issued several
advisory letters regarding SSA\'s plans for \"establishing a corps of
trained, accessible, and responsive work incentives specialists within
the Social Security Administration,\" as required by Section 121(2) (C)
of the Ticket to Work and Work Incentives Improvement Act. The Panel,
the public, and the SSA field staff supported implementation of the
employment support representative (ESR) model that was piloted by SSA in
response to this requirement. SSA decided not to implement the ESR
model, but rather a different one involving work incentives specialists.
The Panel expressed its concern regarding its lack of involvement in the
decisionmaking process regarding these positions in an advisory letter
to Commissioner Barnhart on July 1, 2002.

In response to the Panel\'s inquiries and advice, SSA representatives
have since attended several Panel meetings to discuss SSA\'s plans on
this issue. Although the plans were thoroughly presented and SSA has
responded to the Panel\'s concerns, the Panel continues to hear from the
public and the SSA field staff that SSA\'s plans are inadequate. These
concerns (which were expressed in a letter to Deputy Commissioner
McMahon on January 27, 2003) include lack of adequate training for WISs
and whether the work incentive workload will be given priority for these
employees; lack of an appropriate measure of demand for work incentive
services; lack of work credit given for post-entitlement work until
2005; and lack of measurement capacity for the success of the new
position. The Panel will continue to work with SSA and Congress to
ensure that the corps of WISs established pursuant to the Ticket to Work
and Work Incentives Improvement Act meets the needs of people with
disabilities who go to work. *(See section on Employment Support
Infrastructure above.)*

The Panel also wrote to SSA expressing concern about its interpretation
of the 12-month rule as it relates to the Ticket Program. *(See letter
to Ken McGill, January 29, 2003.)* The 12-month rule states that
applicants are eligible for benefits only if their disability is
expected to last for 12 months or more. The Panel was concerned that
individuals who used tickets to gain employment after adjudication but
within 12 months would be deemed ineligible for benefits and thus lose
their opportunity to use the ticket. The Panel is pleased that SSA has
issued written guidance to the field staff stating that beneficiaries
would not lose eligibility in this situation.

The Panel also wrote several letters to the President and Congress
during this reporting period in support of the reauthorization of the
Work Opportunity Tax Credit (WOTC) and extending the WOTC to employers
that hire people with disabilities who have received vocational services
through an EN authorized by the Ticket to Work and Work Incentives
Improvement Act. Provisions to enact these recommendations have been
included in bills introduced in the 107th and the 108th Congresses, but
have not yet been passed. The Panel will continue to work with Congress
to ensure that this important tool is available to employers that hire
people with disabilities and those that participate in the Ticket
Program.

EMERGING ISSUES

The Panel continues to gather information and conduct reviews of the
Ticket Program, other Ticket to Work and Work Incentives Improvement Act
projects, and related Federal agency initiatives. This information comes
from a myriad of sources, including public testimony; reports from SSA,
CMS, and other Federal agencies; data analysis; research findings;
Federal investigations; public and private analysis and conference
presentations; hearings; testimony from beneficiaries, providers, and
grantees; and feedback from the Panel\'s listserv and Web site.
Following are some of the emerging issues the Panel is analyzing and
following closely:

-   The Panel has heard testimony that the Ticket Program is creating
    some unforeseen consequences that are becoming more pronounced with
    increasing State budget shortfalls. The Panel believes that Congress
    envisioned the Ticket Program as a freestanding program, not a
    replacement for other Federal and State programs. The Panel is
    concerned that some Medicaid, VR, or developmental disability
    agencies are planning to use Ticket Program payments as substitutes
    for their other public funds\--reserving their own funds for other
    programs, even though SSI and SSDI beneficiaries are clearly
    eligible for their programs. This situation is becoming increasingly
    problematic with rising State budget shortfalls.

-   The DOL One-Stop Programs and State systems (including developmental
    disability \[DD\] agencies) do not appear to be prepared to serve
    SSI/SSDI beneficiaries and may have little knowledge or
    understanding of Ticket to Work and Work Incentives Improvement Act
    programs and initiatives.

-   The Panel is concerned about the potential effect on beneficiaries
    of changes in the Medicaid program, particularly the structural and
    funding changes currently being proposed. The proposal would give
    States flexibility in implementing Medicaid programs and could
    enable States to implement community support programs, decreasing
    use of more costly nursing homes and other institutions. On the
    other hand, States may cut back Medicaid Buy-In programs,
    return-to-work programs, and other services they perceive as
    optional.

-   Large numbers of beneficiaries are assigning their tickets to State
    VR agencies, which do not have the funds to meet the additional
    up-front service costs. This is placing a significant strain on VR
    agencies\' Federal and State VR dollars and has caused some State VR
    agencies to create waiting lists for services.

-   The Panel will continue to monitor, research, and analyze these and
    numerous other issues in the coming months.

REFERENCES

General Accounting Office. 2001. *Social Security Administration: Status
of Achieving Key Outcomes and Addressing Major Management Challenges.*
01-778. Washington, D.C.

General Accounting Office. 2002. *Enhanced Procedures and Guidance Could
Improve Service and Reduce Overpayments to Concurrent Beneficiaries.*
02-802. Washington, D.C.

General Accounting Office. 2002. *Supplemental Security Income: Progress
Made in Detecting and Recovering Overpayments, But Management Attention
Should Continue.*02-849, September 16.
<http://www.gao.gov/cgi-bin/getrpt?GAO-02-849>

National Institute for Work and Learning. 1996. \"Study of
School-to-Work Initiatives,\" available at
<http://www.edu.gov/pubs/SER/SchoolWork/study4a.html>.

Smith, V., E. Ellis, K. Gifford, and R. Ramesh. 2002. *Medicaid Spending
Growth: Results From a 2002 Survey.* Washington, D.C.: Kaiser Commission
on Medicaid and the Uninsured.

APPENDIX A: THE PANEL

*MEMBERS OF THE PANEL*

Twelve individuals serve on the Panel: four appointed by the President,
four by the Senate and four by the House of Representatives. The
appointees represent a cross-section of experience and expert knowledge
as recipients, providers, veterans, employers and employees in the
fields of employment services, vocational rehabilitation and other
disability-related support services. Most are individuals with
disabilities or their representatives. Several have personal experience
as beneficiaries of Social Security.

**Katie Beckett,** 25 years old and in college in Iowa. Katie has been
an advocate all her life. She is also a HUGE professional wrestling fan,
as well as a fan of basketball-especially the WNBA and college hoops.
She has traveled quite a bit to Washington DC to speak before
policymakers about kids with special health care needs. She is a
co-founder of Kids as Self-Advocates (KASA) and former co-chair of the
KASA Board. The Senate appointed her for a 4-year term ending in 2006.

**Libby Child,** Manager, Integrated Disability Management Services for
Steelcase, Inc for 25 years before resigning in December 2002 to pursue
consulting, teaching and writing endeavors. She was responsible for the
fully integrated claims system where workers\' compensation, short-term
and long-term disability, permanent and total disability and compliance
with the Family Medical Leave Act is fully coordinated and managed
within Steelcase Inc. Since 1990, Ms. Child has lectured extensively
throughout the United States on the topics of workers\' compensation and
integrated disability management and continues to serve on many
disability related boards, commissions and councils nationally and in
the state of Michigan. She resides in Grand Rapids, MI. The President
appointed her to a 4-year term ending in 2006.

**Frances Gracechild,** Executive Director, Resources for Independent
Living, Inc., Sacramento, CA. She also serves as an instructor at
California State University at Sacramento and the president of Health
Access of California. She was re-appointed by the House of
Representatives to a 4-year term ending in 2006.

**Christine M. Griffin,** J.D., Executive Director, Disability Law
Center, Boston, MA. She is a Trustee for the Paralyzed Veterans of
America Spinal Cord Research Foundation and a member of the bar in
Massachusetts and Washington, DC. The Senate appointed her to serve a
4-year term ending in 2004.

**Jerome Kleckley,** M.S.W., C.S.W., Director, Hospital Services for the
Eastern Paralyzed Veterans Association, Jackson Heights, NY. As a Navy
veteran, he has been actively involved in veterans\' issues, serving as
an advocate for veterans with disabilities. The House appointed him to
serve a 4-year term ending in 2004.

**Bryon R. MacDonald,** Project and Policy Development Manager,
California Work Incentives Initiative (CWII), World Institute on
Disability, Oakland, CA. CWII combines community based public policy
development with health and benefits training, technical assistance and
web site applications. He provides state and national consulting,
training, and leadership on employment support, health care, and
benefits planning programs for persons with disabilities. The President
appointed him to serve a 4-year term ending in 2004.

**David Miller,** responsible for the overall strategic planning and
policy development for human service programs at Communication Services
for the Deaf in Sioux Falls, SD. Mr. Miller was formally the South
Dakota State Director of Rehabilitation Services and was responsible for
the administration of vocational rehabilitation, independent living,
personal attendant and disability determination services throughout the
state of South Dakota. Mr. Miller holds a masters degree in
rehabilitation counseling and has over 29 years of leadership experience
in the development and management of large public and private disability
programs. He was appointed by the Senate to a 4-year term ending in
2006.

**Sarah Wiggins Mitchell,** R.N., M.S.W., J.D., Chair, President, and
Executive Director, New Jersey Protection and Advocacy, Inc. She is a
member of the bar in New Jersey and Pennsylvania and has a background in
nursing and social work. The President appointed her to chair the Panel
for a 4-year term ending in 2004.

**Stephen L. Start,** Chief Executive Officer, Steve Start Inc. Spokane,
WA, a company that provides professional management, rehabilitation, and
residential services for people with disabilities, seniors, and
economically disadvantaged individuals. The House appointed him to serve
a 4-year term ending in 2004.

**Vincent Randazzo,** director of Public Policy for The Business
Roundtable, a Washington, D.C.-based association of chief executive
officers of leading U.S. companies. He previously worked for 10 years on
the staff of the Committee on Rules in the U.S. House of
Representatives, his last three years as the chief of staff, senior
floor expert and chief legislative strategist for the committee\'s
chairman, Rep. David Dreier of California. He is the parent of a child
with developmental disabilities. He was appointed by the Senate to
finish a 4-year term ending in 2004.

**Susan Webb,** M.B.A., S.P.H.R., Director, ABIL Employment Services.
She served on the Board of Directors of the National Council on
Independent Living as its Social Security Subcommittee chair. She is
also a former SSDI beneficiary who used program work incentives to
return to work. The House appointed her to serve a 2-year term ending in
2002.

**Torrey Westrom** lost his eyesight in a farm-related car accident in
1987, at age 14. He graduated from Bemidji State University in 1995 with
a B.A. in political science and a minor in business administration. In
1996 he was elected to the Minnesota House of Representatives and became
Minnesota\'s first elected blind state representative. He was re-elected
to his fourth term in November 2002 and continues to work on policy
issues ranging from training/employment opportunities for persons with
disabilities to transportation and agriculture issues. Additionally he
operates a small real estate management business. He was appointed by
the President to a 4-year term ending in 2006.

*RESPONSIBILITIES OF THE PANEL*

The Ticket to Work and Work Incentives Improvement Act of 1999, Public
Law 106-170 (the Act) established the Ticket to Work and Work Incentives
Advisory Panel (the Panel) within SSA on December 17, 1999. The Panel is
governed by the provisions of the Act; Public Law 92-463, as amended,
which sets forth standards for the formation and use of advisory
committees; and the General Services Administration (GSA) regulations on
the Federal Advisory Committee Act. The original charter establishing
the Panel was submitted to the GSA and filed with the Committee on Ways
and Means of the House of Representatives and the Committee on Finance
of the Senate on March 21, 2000; the charter was renewed in March 2002.
The Commissioner of the Social Security Administration swore in the
original members of the Panel on July 24, 2000.

Panel duties include advising the President, the Congress and the
Commissioner of Social Security on issues related to work incentives
programs, planning and assistance for individuals with disabilities and
the Ticket to Work and Self-Sufficiency Program. Operating procedures
governing the activities of the Panel have been developed and approved.
The Panel meets quarterly alternating locations between Washington, DC
and Ticket Program roll - out states to hear regional testimony. The
Panel transmits and Annual Interim Report on the implementation of the
Act to the President and Congress. This is the third such report. A
final report is due no later than December 17, 2007. The Panel
terminates on January 16, 2008, 30 days after the submission of its
final report.

APPENDIX B: CORRESPONDENCE RELATED TO WORK INCENTIVES SPECIALIST

July 1, 2002

Dear Commissioner Barnhart:

On behalf of the Ticket to Work and Work Incentives Advisory Panel (the
Panel), I am writing to express the Panel\'s strong and unanimous
support for the allocation of staffing and other resources to implement
the Employment Support Representative (ESR) position in SSA field
offices across the country. The Panel\'s strong support for
implementation of the ESR position was expressed by a unanimous vote at
our November 2001 quarterly public meeting, and again in statements by
the Panel in the February and May 2002 quarterly public meetings. Over
the last two years, the Panel carefully watched as the Agency tested the
ESR model and issued evaluation reports recommending implementation. We
were pleased with the findings of the reports and looked forward to
implementation of a permanent ESR corps. We believe the model was
thoughtfully designed and tested to provide long-needed and vital direct
services to SSDI beneficiaries and SSI recipients with disabilities
attempting return-to-work or first-time employment.

The Panel believes the ESR model would provide a critical service
designed to address the information and service needs of the Agency\'s
customers with disabilities who want to work. In addition, the ESR would
provide an important and vital service to SSA customers who want to use
the new Ticket to Work and Self -Sufficiency Program at this important
time of program start-up.

The Agency\'s obligation to provide quality employment support services
at the field level has been long overlooked and ignored. Social Security
customers and their national advocates, rehabilitation providers and
state service systems have registered harsh criticism and extensive
complaints for many, many years regarding the lack of adequate staffing
and the consistently inaccurate and misleading information that SSA
field staff provide to beneficiaries who attempt employment. As a
result, until the passage of the Ticket to Work and Work Incentives
Improvement Act, the Social Security Administration was viewed as a
major \"barrier\" to employment for people with disabilities. With the
passage of the Act and its focus on improving choice and services in
Section 121, came the promise of a new era in customer service for SSA
customers with disabilities who want to work. The ESR field position is
a key element in making the promise a reality.

In the past few days, a number of our Panel members have been contacted
about a decision memo submitted to you by Deputy Commissioner Gerry
dated June 3, 2002, and titled, Strategy to Implement the SSA Work
Incentives Specialist (WIS) Corps. Deputy Commissioner Gerry\'s memo
proposes a Work Incentive Specialist Corps as an alternative to the ESR
model. It is my understanding that this new proposal would use current
SSA field employees who would continue to process their regular
workloads. They would have the added support of a staff person who is
designated as part-time Work Incentive Specialist. This is very
problematic in that the field office personnel face huge workloads and
extensive backlogs in claims processing. There is no evidence that
workloads will decrease; in fact, the experts predict huge increases
over the next few years.

We do not believe this new proposal adequately responds to the
requirements in the Act for establishing an internal corps of experts to
address the need for accurate information and long ignored customer
service needs in employment supports and work incentives. In addition,
it is unresponsive to the findings and recommendations of both ESR
evaluation reports.

The Panel is greatly concerned not only with the proposal itself, but
also with the Agency\'s lack of consultation with the Panel in
developing such a proposal. As you know, the Ticket to Work and Work
Incentives Improvement Act in Section 121 directs the Commissioner as
follows:

\(1\) \"IN GENERAL \-- The Commissioner, [in consultation with the
Ticket to Work and Work Incentives Advisory Panel]{.underline} under
Section 101(f) of the Ticket to Work and Work Incentives Improvement Act
of 1999, [shall]{.underline} establish a community-based work incentives
planning and assistance program for the purpose of disseminating
accurate information to disabled beneficiaries on work incentives
programs and issues related to such programs.\" (emphasis added)

More specifically, under Section 121(2)(C), the Commissioner to directed
to:

\" . . . establish a corps of trained, accessible and responsive work
incentives specialists [within]{.underline} the Social Security
Administration who will specialize in disability work incentives under
titles II and XVI for the purpose of disseminating accurate information.
. .\" (emphasis added)

In closing, we urge you to consult with the panel before making any
further decisions on the Section 121 Work Incentives Outreach Program,
particularly with respect to establishing a corps of work incentives
specialists within SSA. We would be very pleased to meet with you to
discuss our concerns further. In the interim, please contact Marie P.
Strahan, executive Staff Director, at (202) 358-6419 with any questions.

Sincerely,

Sarah Wiggins Mitchell\
Chair

cc:

The Honorable President George W. Bush

The Honorable Max S. Baucus\
Committee on Finance

The Honorable Charles Grassley\
Chairman, Committee on Finance

The Honorable John Breaux\
Chairman, Social Security Subcommittee

The Honorable John Kyl\
Social Security Subcommittee

The Honorable Bill Thomas\
Chairman, House Ways and Means

The Honorable Charles Rangle\
House Ways and Means

The Honorable Clay Shaw\
Chairman, Social Security Subcommittee

The Honorable Robert Matsui\
Social Security Subcommittee

Martin Gerry, Associate Commissioner\
Office of Disability and Income Security Programs

Ken McGill, Associate Commissioner\
Office of Employment Support Programs

January 27, 2003

Linda McMahon\
Deputy Commissioner, Operations\
Social Security Administration\
107 Altmeyer Building\
6401 Security Blvd.\
Baltimore, MD 21235

Dear Deputy Commissioner McMahon:

On behalf of the Ticket to Work and Work Incentive Advisory Panel (the
Panel), I am writing to thank you for attending our recent quarterly
meeting in Albuquerque and for your helpful and candid comments to the
Panel. The Panel is very appreciative of your willingness to have an
exchange over implementation and operational issues as they relate to
the Ticket Program and other work incentive programs. As often happens,
our exchange has generated several suggestions and concerns. We would
prefer a written response, so that it could be considered by all Panel
members. On behalf of the Panel, I am also pleased to invite you to
discuss your response to this letter at the Panel\'s quarterly meeting
in Arlington, Virginia, on February 10-12.

Your proposal on the corps of work incentive experts involves using
current staff\--work incentive specialists and work incentive liaisons.
They would undertake employment support on a part-time basis, permitting
office managers to control staff assignments. Your statement indicates
that SSA would give post-entitlement work a higher priority by giving
work incentive specialists up to two weeks of training and by
implementing a performance evaluation system that gives a higher weight
to post-entitlement work. As you know Section 121 of the Ticket
legislation calls for \"a corps of trained, accessible, and responsive
work incentives specialists within the Social Security Administration.\"
The Panel believes that this language indicates not only the need to
give a higher priority to the post-entitlement workload, but also that a
corps of specialized experts, serving as single points of contact, is a
key element. With the language of the Ticket legislation in mind, the
Panel offers several suggestions to ensure that SSA will have a corps of
specialists suited to the post-entitlement workload, including issues
related to overpayments and EN payments. We believe that our comments
and suggestions are consistent with the framework you proposed involving
current staff and management control of staff assignments.

-   Although you indicated that the training for specialists would
    increase to two weeks, the Panel urges you to consider extending
    this training beyond two weeks based on the demonstrated success of
    the ESR pilot training model.

-   You stated that, although there would only be 102 work incentive
    specialists initially, you anticipate an increase to over 600 by
    2004, and over 1200 in later years, depending on the demands of the
    post-entitlement workload. The Panel interprets this to mean that
    the staff will be adjusted to meet the future post-entitlement
    workload, including work-related requests for services and backlogs.

-   The Panel recommends that the employment support workload be
    accorded the highest priority for work incentive specialists and
    that they work full time in this area when there is a substantial
    workload, but be available for other duties if and when their
    employment support workloads allow for additional responsibilities.
    This approach gives the office manager flexibility while assuring
    that the highest priority for work support specialists will be the
    tasks for which they are specially trained.

-   In your comments to the Panel you discussed the need to revise
    performance evaluations so that appropriate credit is given for
    post-entitlement work. The Panel has received information that
    implementation of this change in performance evaluations may be
    delayed until 2005. The Panel is concerned about the prospect of
    such a long delay, given the current backlog of work CDRs and the
    ongoing implementation of the Ticket Program that will require even
    more work CDRs and related work activities.

The Panel has received public comment about a substantial work CDR
backlog in field offices, including the special disability workload. To
inform the exchange over resources needed for post-entitlement work we
ask you to provide information on the size and nature of this work
backlog, indicating whether the current backlog is typical of recent
years. If the backlog can be broken down between Title II and Title XIV,
that would also be helpful.

You have urged the Panel to focus on outcome effectiveness (getting the
post-entitlement work done timely) rather than process evaluation
(designating a specific number of ESRs devoted full time to employment
support). However, you did note that in the case of the PASS cadre,
specialization seems to have worked and would be continued. In our
November exchange we asked how we might expect to measure success in
completing the post-entitlement workload. You indicated that these
measures had not been worked out as yet, but that we might expect to see
work reports handled expeditiously and a vast improvement in
overpayments a year down the road. Do these still seem like appropriate
measures? What additional measures should be used to evaluate outcomes?

As you may know, the Panel enthusiastically received the briefing on the
new MRTW system. This system appears to be a critical step in automating
post-entitlement work. Is it correct that the system will be
online\--mandatory and universal in all offices\--by November, 2003?

On behalf of the Panel I again want to thank you for your ongoing
efforts in implementing the Ticket Program and for your attention to
issues we raised in November and in this letter. We understand that it
is critical to forge a partnership with the dedicated public servants at
SSA who actually implement the Ticket Program. If you have questions
regarding this letter, please contact Marie Strahan, Executive Director
for the Advisory Panel, or me.

Sincerely,

Sarah Wiggins Mitchell, Chair

cc:\
JoAnne Barnhart\
Commissioner of Social Security

Martin Gerry\
Deputy Commissioner,\
Office of Disability and Income Security Programs

Social Security Office of Operations

February 26, 2003

Ms. Sarah Wiggins Mitchell\
Chair, Ticket to Work and\
Work Incentives Advisory Panel\
400 Virginia Avenue, SW Suite 700\
Washington DC 20024

Dear Ms. Wiggins Mitchell:

First let me say how much I appreciated the opportunity to present our
strategy for supporting employment support programs, and participate in
an open exchange of ideas, at the Ticket to Work Incentives Advisory
Panel Quarterly Meeting in Albuquerque last November. I also want to
thank you for allowing time on your agenda during the February meeting
to clarify issues raised subsequent to our discussion in Albuquerque. As
you are aware, last November, I outlined a proposed strategy for
providing work incentive support services. The Commissioner has now
agreed with my approach and we are proceeding, in the most efficient
manner possible, to institute a technically proficient workforce with a
designated corps of experts for work incentive related activities.

I\'ve noted you continue to express concern about our ability to provide
staff that is both accessible and responsive. Granted, this a new
approach for us and there is no baseline for determining what
constitutes proportionate coverage in each individual state. But let me
assure you, Operations as a whole is placing a renewed emphasis on
employment support programs, and I am committed to providing sufficient
coverage to ensure ease of access and effective management of employment
support services and workloads.

As you know, we plan to designate a corps of part-time experts in
incremental phases, assess the outcome of each phase and expand the
number of experts as needed. Within this calendar year, we intend to
provide two to three specialists per Ticket State for up to a total of
168 specialists. Keep in mind we will exercise some flexibility for
states requiring more or fewer specialists.

Your letter mentions Section 121 of the Ticket Regulation and implies
that our strategy may not be in conformance with the regulation. We
firmly believe that our implementation strategy meets the letter and
intent of the regulation and goes a step further. In addition to
providing designated, trained, accessible and responsive experts, we are
leveraging our resources by promoting a cultural change and broadening
the knowledge of our entire workforce, which lends itself to increased
public trust.

As you are aware, training is an integral part of our Work Incentives
Support Implementation Plan and we are developing a new training
strategy which encompasses the entire Operations\' workforce. We are
developing customized training plans to address the training needs
specific to Management, Work Incentive Liaisons (WILs), Work Incentive
Specialist (WISs) and all position types involved in work
incentive-related workloads and activities. A series of meetings and
conference calls are underway to determine the scope, content and
tailored presentation of materials to accommodate each component\'s role
in the administration of employment support programs.

I want to respond to your specific concern about work measurement. While
we agree with the importance of having identifiable work credit for
every action we take, and we are working on developing a work
measurement system to accomplish that, work credit does not insure that
a workload will not get backlogged. Employees who process various
workloads take their signals about what is a priority from management.
They will spend time on what is identified and focused on as a priority
by the manager. A critical part of our Work Incentives Support Plan is
to create a culture where there is technical expertise, awareness and
focus on this workload by virtually all employees and leaders at every
level.

To specifically address your concern regarding continuing disability
review (CDR) backlogs, let me say that based on a snapshot of a manual
inventory, the field office work CDR pending caseload as of January 2003
is comparable to the subject caseload pending in January 2002. However,
I am personally involved in efforts that are underway and have dedicated
Operations\' resources to implement a fully integrated eWorkCDR system
(formerly known as the MRTW/PC-CDR/DCF), and designed to improve
automated controls and processing of medical and work CDRs, by the end
of this calendar year. The implementation of eWorkCDR will combine the
intake and decision-making processes, eliminating redundant keying and
creating a single repository for work and medical CDR workload
management and control information. National implementation will
significantly reduce, if not completely eliminate, paper handoffs and
provide a single system for viewing, updating and processing work
reporting activities conducted by our field and 800 Number offices,
regional and central office components and the Ticket Project Manager.
Experience has shown us that improved controls and automation of
paper-driven procedures inherently lead to processing efficiencies.

In closing, I want you to know that I appreciate your concerns, but ask
that you keep in mind that I must focus on a balanced approach that
includes all workloads. Significant shifts in resources to benefit a
specific initiative almost always result in a negative effect on other
operational priorities. My goal is to maintain a balance by effectively
managing the work incentive workloads, without impacting other
Operations\' priorities and emerging workloads.

Sincerely,

/s/

Linda S. McMahon\
Deputy Commissioner for Operations

APPENDIX C: EXECUTIVE SUMMARY AND RECOMMENDATIONS OF THE \$1 FOR \$2
ADVICE REPORT

In this report, the Ticket to Work and Work Incentives Advisory Panel
(the Panel) provides advice to the Commissioner of Social Security on
the most effective designs for demonstrations and other research
associated with a proposal for a \$1 for \$2 benefit offset under the
Social Security Disability Insurance (SSDI) program. The \$1 for \$2
benefit offset is intended to eliminate the \"cash cliff\" associated
with the SSDI program, thereby encouraging work and providing savings to
the Trust Fund. A demonstration is authorized in Section 302 of the
Ticket to Work and Work Incentives Improvement Act of 1999 (the Ticket
Act). The Ticket Act requires the Commissioner to conduct demonstration
projects and compile other data to evaluate the \$1 for \$2 proposal. It
also requires the Commissioner to take into account the advice of the
Panel (Title III, Section 302 (b) (1)).

This advice report is based on relevant documents and testimony,
including several Social Security Administration (SSA) reports
considering SSA\'s draft evaluation plan for the \$1 for \$2 program. In
addition, the report is based on an Experts Roundtable held in
Washington, D.C., on November 16, 2001, and on public comments made
before and after the roundtable. The Panel gratefully acknowledges the
expert advice of Robert Moffitt, Ph.D., who drafted earlier versions of
this report.

This report discusses both demonstration methodologies and
nondemonstration methodologies. By demonstration methodology, we mean a
methodology that uses random assignment to place current beneficiaries
into treatment and control groups and measures the effects of the
program by comparing outcomes for individuals in the groups. By
nondemonstration methodology, we mean a methodology that involves a
particular data set that is available or can be gathered, together with
a statistical methodology that uses the data set to generate estimates.

*Panel Recommendations*

*Panel Recommendation 1: \$1 for \$2 Demonstration for Current
Beneficiaries*\
The Panel endorses the intent of the SSA, consistent with the Ticket
Act, to use a demonstration methodology to evaluate the effect of a \$1
for \$2 benefit offset in encouraging current beneficiaries to earn more
and exit the SSDI program, as well as to evaluate associated outcomes
and budgetary costs.

*Panel Recommendation 2: Employment Supports*\
The Panel recommends that the following employment supports be in effect
for both the treatment and control groups throughout the duration of the
demonstration:

-   Access to local community-based benefits planning services (or their
    reasonable equivalent).

-   Access to local community-based protection and advocacy services (or
    their reasonable equivalent).

-   Access to responsive local work incentive specialists (or their
    reasonable equivalent) within SSA.

-   Access to ongoing, understandable information on the treatment and
    its interaction with other programs and services administered by
    SSA.

*Panel Recommendation 3: Disregard Level for the \$1 for \$2 Current
Beneficiaries Demonstration*\
The Panel recommends that the indexed Substantial Gainful Activity (SGA)
amount be used as the disregard, consistent with the principle that
beneficiaries should be held harmless relative to the current SSDI
program. The Panel encourages SSA to pursue options to encourage work
and reduce costs consistent with this principle.

*Panel Recommendation 4: Sample Size for the Exit and Work Incentives
Demonstration*\
The Panel endorses the proposal by SSA to use 5,000 individuals in each
treatment group and in each control group for the demonstration.

*Panel Recommendation 5: Accounting Period*\
The Panel recommends a monthly accounting period for the demonstration
projects. To simplify accounting for both the beneficiaries and SSA, the
accounting system should be consistent with that used for the
Supplementary Security Income (SSI) program.

*Panel Recommendation 6: Deferring the Induced Entry Evaluation*\
The Panel recommends that SSA undertake the current beneficiary
demonstration on the \$1 for \$2 benefit offset, deferring the induced
entry evaluation. This alternative was raised in the Tuma report dated
November 5, 2001. After lengthy deliberation with experts and
beneficiaries, the Panel thinks this approach is cautious and cost
effective. The Panel further recommends that SSA request a technical
amendment from Congress to permit a delay in the evaluation of induced
entry.

*Panel Recommendation 7: Induced Entry Evaluation Proposal*\
The Panel recommends that, when SSA decides to undertake the evaluation
of induced entry, it seek at least five independent designs from outside
experts and organizations, each proposing the most cost-effective
methodology (either demonstration or nondemonstration) to measure
induced entry.

SSA should report the proposed designs to the Panel so that the Panel
can compare them with SSA\'s draft recommendation involving the National
Survey of Health and Activity (NSHA) as the data set and a structured
statistical modeling approach to translate the data into induced entry
estimates. This comparison will permit the Panel to make a more informed
judgment on nondemonstration and demonstration evaluation alternatives
in providing its advice to SSA. Further, the Panel recommends that SSA
seek a technical amendment from Congress to permit SSA to implement
either a demonstration or a nondemonstration methodology in studying
induced entry associated with the \$1 for \$2 benefit offset.

*Panel Recommendation 8: Other Studies, Including Studies of the
Determinants of Return to Work*\
The Panel recommends that SSA\'s Office of Policy (OP) follow and report
on parallel research projects across the country that inform on
determinants of return to work and related issues, and incorporate
relevant findings into SSA research on the \$1 for \$2 benefit offset or
on topics related to Section 302 in general.

APPENDIX D: ADVISORY LETTERS TO THE PRESIDENT, CONGRESS, AND THE
COMMISSIONER OF SSA

January 7, 2002

Jo Anne Barnhart\
Commissioner of Social Security Administration\
6401 Security Boulevard\
Room 900\
Baltimore, MD 21244

Dear Commissioner Barnhart:

I am writing on behalf of the Ticket to Work and Work Incentives
Advisory Panel (the Panel) to encourage you to provide full funding for
the Ticket to Work and Work Incentives Improvement Act\'s SSA grant
programs. Specifically they are the Benefits Planning, Assistance and
Outreach grant program and the Protection and Advocacy grant program.
These two programs are authorized in the statute at \$23 million and \$7
million, respectively.

The panel is aware that the Senate Committee on Appropriations in Senate
Report 107-84 encouraged the Agency to fund both of these grant programs
at their authorized level for fiscal year 2002. It is the opinion of the
Panel, and of the advocates and consumers who worked for the passage of
the Ticket legislation, that the funding amounts authorized in the
statute are the minimum needed for the initial implementation of these
essential direct-service grant programs. We expect the funding amount
for these programs will increase as the Ticket, the Medicaid Buy-In and
the Workforce Investment Act programs continue to roll out and expand.

It is our understanding that the Social Security Administration (the
Agency) has funded the Protection and Advocacy grants program for FY2002
at \$5 million, a 30% reduction from the authorized \$7 million level.
This is also 30% less than the State designated Protection and Advocacy
agencies thought they would receive based on last year\'s mid-year
funding. The new funding cycle should have begun on December 1, 2001 but
grants were awarded effective January 1, 2002, with no provision for
funding the State P&A agencies for the month of December 2001. Further,
we are concerned that the Benefits Planning, Assistance and Outreach
funding may also be cut in the next round of awards. The reduced amount
of funding for the Protection and Advocacy programs, coupled with the
uncertainty in funding for the Benefits Planning, Assistance and
Outreach grantees, sends a message to beneficiaries, their families and
advocates that the Agency may not be serious about the successful
implementation of the Ticket Act programs.

These two programs were designed to provide long needed and critical
benefits planning and advocacy services directly to SSI recipients and
SSDI beneficiaries. For many years beneficiaries with disabilities have
expressed great fear and uncertainty about the loss of critical health
care and use of the current work incentives with regard to employment
and return to work attempts. Beneficiaries of the two programs have
testified to Congress that they need accurate and timely information and
advocacy services for several reasons. One, such assistance is needed so
that beneficiaries might better manage and cope with a confusing and
complicated array of Federal, State and local benefits programs,
employment supports and health related services. And two, it will
provide direct help to beneficiaries in working with the wide array of
public and private rehabilitation providers in the new Ticket Program.
In fact, each State and locality will have a very different set of
benefits, services, providers and systems, requiring local and
client-specific advice, information and advocacy; advice, information
and advocacy that these local and state grant programs are uniquely
designed to deliver.

The Panel members recognize that this is a very difficult budget year
for all Federal programs and we want to assure you that the Panel is
supportive of the new spending needed for security and public safety. At
the same time, we believe the new Ticket to Work and Work Incentives
Improvement Act programs have the potential to greatly improve the
quality and availability of rehabilitation, employment supports and
health services for millions of Americans with disabilities. In keeping
with this, Panel members view their advisory role very seriously and ask
you to provide us with a formal response to this letter as soon as
possible.

Marie Strahan, the Panel\'s Executive Director, or I, are available at
(202) 358-6430, to address any questions or concerns that you may have.
We look forward to a continued partnership with you and the Agency staff
to ensure the successful implementation and operation of these important
new programs.

Sincerely,

Sarah Wiggins Mitchell

cc:

The Honorable William M. Thomas\
Chairman, Committee on Ways and Means\
House of Representatives

Martin Gerry\
Deputy Commissioner\
Office of Disability and Income Security Programs

The Honorable Max S. Baucus\
Chairman, Committee on Finance\
United States Senate

Ken McGill\
Associate Commissioner\
Office of Employment Support Programs

March 1, 2002

President George W. Bush\
The White House\
1600 Pennsylvania Avenue\
Washington, DC 20500

Dear Mr. President:

I am writing on behalf of the Ticket to Work and Work Incentives
Advisory Panel (the Panel) to express our strong opposition to the
deletion of specific funding for two employment programs for Americans
with disabilities in your proposed 2003 Budget. Under the Department of
Education\'s proposed budget for the programs and projects administered
by the Rehabilitation Services Administration (ID code:
91-0301-0-10506), \$38.2 million for Supported Employment (00.10) and
\$22.1 million for Projects with Industry (00.09) have been merged into
the general funding for the traditional vocational rehabilitation
program. This merger will likely result in the virtual elimination of
these two major long-standing national programs, programs that have been
successful in serving people with the most significant disabilities and
thus the greatest need. We are particularly concerned because we believe
many beneficiaries of Supplemental Security Income (SSI) and Social
Security Disability Income (SSDI) will be denied employment services if
these two programs are eliminated. These programs do not duplicate
services provided by the basic state vocational rehabilitation program.

The timing of your budget proposal also is of great concern. This is the
first year roll out of the Ticket to Work and Self-Sufficiency Program
(The Ticket Program). Additionally, we are in the early implementation
stage of a variety of other programs and projects mandated by the Ticket
to Work and Work Incentives Improvement Act of 1999, Public Law 106-170.
The deletion from your budget of such vital programs as Supported
Employment and Projects with Industry could very well undermine the
return-to-work efforts of large numbers of Social Security beneficiaries
and the successful implementation of these new programs.

The Ticket Program is predicated on SSI and SSDI beneficiaries having a
choice of employment networks to go to for employment services. Over 182
public and private community-based Supported Employment and Projects
with Industry (PWI) grantees across the country have demonstrated a
credible track record of success with the very individuals the Ticket
Program is designed to serve. Many have been successfully serving this
population for over twenty (20) years. Eliminating these two important
programs would severely diminish choice for all beneficiaries.

The elimination of dedicated funding for these programs will also
negatively impact the Ticket Program\'s access to employers. A direct
partnership with local businesses is an important aspect of the programs
in question; a partnership designed to help employers meet their need
for qualified, dependable employees. At the same time, these programs
provide a vital service to employers by helping them to identify jobs
that match the skills and qualifications of current and prospective
employees with disabilities. Supported employment programs specifically
address the needs of individuals with the most significant disabilities
seeking to gain and maintain work. They provide essential on-site
supports to the employee and the employer. People with disabilities who
would not have been served effectively under a traditional vocational
rehabilitation service system have been successfully served through
supported employment programs. We understand that many state vocational
rehabilitation agencies oppose the merger of this funding as well. They
recognize the importance of targeted funding to assure appropriate
services for persons with the most significant disabilities.

Targeted grant programs like Projects with Industry and Supported
Employment should be preserved at the Federal level to help ensure that
appropriate services continue to be available at the community level.
This can only enhance the roll out of the Ticket Program because it will
expand the number and variety of employment networks available to
beneficiaries. We do not seek additional funding for these programs but
ask that they be funded at 2002 levels. We urge you to reconsider your
position on this matter and, in doing so, strengthen even more your
efforts to return citizens with disabilities to the American workforce.

Sincerely,

Sarah Wiggins Mitchell, Chair

cc: Robert Pasternak, Assistant Secretary\
Office of Special Education and Rehabilitative Services

Jo Anne Barnhart, Commissioner\
Social Security Administration

House Ways and Means - Subcommittee on Social Security

House Education and Workforce Committee

Senate Finance Committee

Senate Health, Education, Labor and Pensions Committee

April 11, 2002

The Honorable Clay Shaw\
Chairman, Social Security Subcommittee\
House Ways and Means Committee\
Room 316 Rayburn House Office Building\
Washington DC 20515

Dear Chairman Shaw,

I am writing on behalf of the Ticket to Work and Work Incentives
Advisory Panel to express our strong support for the reauthorization of
the Work Opportunity Tax Credit (WOTC). The Panel also urges Congress to
extend the Work Opportunity Tax Credit to employers who hire people with
disabilities who have received vocational services through an Employment
Network authorized by the Ticket to Work and Work Incentives Improvement
Act of 1999 (TWWIIA).

The WOTC has been an important tool in helping people with disabilities
and other people most in need of employment opportunities. Because
people with disabilities often require an initial investment and
training by employers, the WOTC is one way to encourage employers to
make that investment. In tax year 2000, nearly 371,000 employers took
advantage of the WOTC.

Expanding the WOTC to allow employers who hire individuals referred by
an Employment Network under TWWIIA is necessary to ensure that people
with disabilities have an equal opportunity to join the workforce.
TWWIIA was designed to increase the choices available to consumers when
selecting providers of vocational services for people with disabilities.
If employers cannot claim the WOTC for employees with disabilities who
received services through Employment Networks, people using a ticket to
obtain vocational services through the private sector rather than the
public vocational rehabilitation system will be at a disadvantage when
they look for a job. Extending the WOTC to cover people participating in
the Ticket to Work Program will reinforce the principle of choice that
is fundamental to this program.

The WOTC is an important tool in the effort to assist people with
disabilities in becoming self-sufficient. We believe that reauthorizing
and extending the WOTC to employers who hire people with disabilities
who use a Ticket through the Ticket to Work Program to obtain vocational
services will help many people with disabilities obtain employment.

Your consideration of these comments from the Ticket to Work and Work
Incentives Advisory Panel is appreciated.

Sincerely,

Sarah Wiggins Mitchell\
Chair

cc: The Honorable Max s. Baucus\
Chairman, Senate Finance Committee

Mr. William Mea\
Deputy Assistant Secretary for Policy\
Office of Disability Employment Policy\
Department of Labor

Commissioner Joanne Barnhart\
Social Security Administration

September 04, 2002

Honorable E. Clay Shaw, Jr., Chairman\
U.S. House of Representatives\
Committee on Ways and Means\
SubCommittee on Social Security\
Washington, DC 20515

Dear Chairman Shaw:

I am writing on behalf of the Ticket to Work and Work Incentives
Advisory Panel (the Panel) in response to the questions raised in your
August 2, 2002 letter to the Panel. I want to thank you for inviting me
to testify on behalf of the Panel at the July 11th hearing. We are ever
mindful of the Subcommittee\'s interest in our work and appreciative of
your continued support for the Panel\'s role in the implementation of
the programs and projects under the Ticket to Work and Work Incentives
Improvement Act (the Act).

Attached you will find our initial response to the important disability
policy questions posed by the Subcommittee. However, at this time the
Panel would like to refrain from providing full answers to a few of the
larger policy questions on the definition and offer to do a little more
work on these issues. Over the next few months we plan to host public
forums of experts and policy-makers to discuss some of these questions
in the context of our work on the work incentives, the Ticket Program
and other employment support programs currently operating at the
Federal, state and local community level. As you know, these programs
and systems are connected and intertwined both in terms of the policy
implications and in the beneficiary\'s experience of them. Changes in
any one program can greatly impact the benefit structure, operation and
implementation of another. The Panel would like to conduct a more
in-depth analysis on some of the larger issues and have an opportunity
to look at the data from the other public and private-sector programs
before attempting to provide answers. We will talk with experts and look
at the recent experience of other countries, as well as other models in
this country, such as workers\' compensation and private insurance
models.

Thank you for the opportunity to consider these important policy
questions. The Panel shares your concern for the solvency and relevance
of today\'s Social Security Disability Insurance program. Again, the
Panel has not addressed many of your questions because of our focus on
implementation of the Ticket to Work and Work Incentives Improvement Act
programs and projects. However, we look forward to our continued work
with the Subcommittee and we hope to be of assistance to you in your
efforts to improve the effectiveness, efficiency and long-term stability
of this critical benefit program for Americans with disabilities and
their families.

If you have any questions with regard to this letter or any other work
of the Panel, please contact our Executive Director, Marie Strahan, at
(202) 358-6430.

Sincerely,

Sarah Wiggins Mitchell, Chair

cc: President George W. Bush

The Honorable Charles Grassley\
Committee on Finance

The Honorable Max S. Baucus\
Chairman, Committee on Finance

The Honorable John Kyl\
Social Security Subcommittee

The Honorable John Breaux\
Chairman, Social Security Subcommittee

The Honorable Robert Matsui\
Social Security Subcommittee

The Honorable Charles Rangel\
House Ways and Means

Tommy Thompson, Secretary\
U.S. Department of Health and Human Services

The Honorable Bill Thomas\
Chairman, House Ways and Means

JoAnne Barnhart\
Commissioner of Social Security

**QUESTIONS FROM SUBCOMMITTEE ON SOCIAL SECURITY:**

**1. You suggested categorizing disability beneficiaries according to
whether they would be considered \"hard-to-serve\" for employment
services. Would you explain this more, including what criteria you would
suggest SSA use to determine whether someone would be
\"hard-to-serve\"?**

As specified in the Act, under the Ticket Program, employment network
providers may be paid at an adjusted rate for persons who would not
otherwise be served. The term \"hard-to-serve\" is a term of art that
has been used to conveniently refer to the four groups specified in the
Ticket Act for further study. This study will evaluate employment
network payments and the need for higher payments for certain types of
beneficiaries, that is, to provide greater incentives to serve these
individuals. The Act identifies the groups for study as: individuals
with a need for ongoing support and services, individuals who need
high-cost accommodations, individuals who earn a sub-minimum wage, and
individuals who work and receive partial cash benefits.

Panel members have clearly pointed out that it is not the individual\'s
disability that makes them \"hard-to-serve\" but rather the payment
structure and required employment outcomes detailed in the regulation
and statute that makes it difficult for providers to serve them under
this particular program. Our systems and services for returning
individuals with disabilities to work are very advanced in the U.S. and
literature shows clear success in assisting individuals with the most
severe disabilities requiring high cost accommodations in returning to
work\--they are not hard to serve. However, the severity of an
individual\'s impairment may not allow them to work to full time or
above substantial gainful activity levels. While other
employment-related legislation values work at any level, the Ticket
Program regulations clearly require that an individual must no longer be
receiving a cash benefit in order for an employment network to begin
receiving payments. The Adequacy of Incentives study was mandated to
assist the Social Security Administration in determining who those
individuals are and adjusting the payment rates appropriately.

The Act calls for the study of the four groups, a report to Congress on
the findings of the study and an adjustment of the payment rates based
on the findings of the study. The Panel submitted an advice report to
the Commissioner last month on the design of the Adequacy of Incentives
study. The knottiest problem facing researchers is how to determine
which ticket-holders will belong to these four groups for study
purposes, using the information available to them from SSA
administrative files and SSA\'s survey of ticket-holders. *(See our
report, Design Issues Relating to the Adequacy of Incentives Study, June
18, 2002.)*

In my recent testimony on the definition of disability and the
disability determination process, I made a closely related point.
Specifically, after the study and report to Congress and the
establishment of adjusted rates, program administrators will face the
task of defining which disability applicants will be eligible for the
adjusted rate tickets. It would be inappropriate to try to define the
criteria at this time. These decisions should be made after the Adequacy
of Incentives study findings and report to Congress. The study is
currently in a design phase but all aspects of the Ticket evaluation,
including this study, are delayed at least 18 months. The AOI report
will, hopefully, provide the Congress with the data and policy analysis
with which to develop sound criteria. Such criteria should be applied
during the disability determination process. Since beneficiaries are to
receive their tickets at the time of award of benefits, the question of
who receives a ticket that has a higher payment rate becomes a question
that has serious policy and workload implications for the definition of
disability, claims processing and Ticket implementation.

**2. We all know that quality research is one of the most important
aspects in developing any policy, and especially in determining whether
changes are necessary, which changes to make, and how to evaluate them.
Could you comment on SSA\'s research plans regarding disability,
including how effective it is, whether they are undertaking the research
they should and whether they are able to do this?**

The Panel has focussed primarily on research related to the Ticket
Program. The single most important research related to the Ticket Act is
the evaluation of the Ticket Program. Good progress was made on the
design of the evaluation but the change in Administration has delayed
the submission of the design to the research community for
implementation. Such delays have significant scientific costs since it
is easier to evaluate a program if data are collected both prior to and
after its rollout. Specifically, the contracting timetable recently
announced by SSA would imply that we could not compare return-to-work
for ticket holders and non-ticket holders. Several aspects of the
evaluation design are time sensitive in this regard and hence delaying
the start of the evaluation until the next fiscal year will threaten its
successful completion. Delay in the Ticket evaluation also causes delay
in the \"Adequacy of Incentives\" report since these two research
projects are intertwined. Our Panel has provided detailed comments to
SSA on both its Ticket Evaluation and AOI proposals and urged SSA to
carry these projects out as quickly as possible.

Congress also required the Social Security Administration to evaluate
the consequences of changes in the work incentives in the SSDI program.
Our Panel has spent considerable time on this issue. *(See our report,
Statutory Requirements and the Design Issues Related to SSDI \$1 for \$2
Benefits Offset Research, August 2002.)* Our Panel endorsed the
demonstration design proposed to us by the SSA to estimate induced work.
But we suggested more consideration before implementing the
demonstration design proposed to us by the SSA to estimate induced
entry. We believe it is critical to understand both these issues prior
to implementation of any change in the current SSDI work incentives. It
may be, however, that the cost of both these demonstrations will be
high. SSA recently announced that it is proposing another approach to
the \$1 for \$2 demonstration project.

SSA has offered to meet with Panel members and Panel staff in order to
provide more detailed information and clarification on any changes to
the Ticket evaluation, including the timetable, as well as SSA\'s new
proposal on a \$1 for \$2 demonstration project. The Panel will evaluate
whether the changes in SSA\'s research plans incorporate the Panel\'s
recommendations from its advice reports. The Panel also sees this as a
means of forging a positive working relationship with researchers at
SSA.

**3. You talk about how early intervention, perhaps even as early as
when an individual is still working, will minimize services needed and
maximize continued employment. We know that beginning 2008, the
Disability Insurance Trust Fund outlays will exceed income. Does the
Panel believe that the costs of providing early outreach will result in
savings in the long run through less people coming onto the rolls or
coming on to the rolls at a later point in time? Is there research to
back this up? What would be the costs? Would more people apply for
benefits just to obtain these services?**

The Panel has not conducted a review of this topic and it has not been
raised in public comment as a topic of great concern, however we have
received some public comment on the subject. We are aware of promising
studies on early intervention in the workers compensation system and in
the private disability insurance arena. Historically, medical and
vocational rehabilitation professionals (rehabilitation medicine,
vocational counselors, physical therapists, occupational therapists,
etc.) support vocation and therapeutic rehabilitation intervention
directly after acute care for injury, illness or adult onset of any type
of impairment with a strong emphasis on vocational and return-to-work
aspects of intervention.

The Act directs the Commissioner to develop experiments and
demonstration projects, one of which examines earlier referral for
rehabilitation. This project is being referred to as an early
intervention project although it is unclear whether the definition used
for this project would be consistent with the traditional definition of
early intervention in the field of rehabilitation. We are not sure
whether this project will review current research or evaluate cost
savings. As indicated above, the Panel plans to review and discuss this
and other disability research and demonstration project plans with the
officials from the newly reorganized Office of Disability and Income
Security Programs this month.

**4. The SSA is faced with a potential problem about how to assess
whether an individual would be able to perform any work \-- part of the
criteria for assessing disability. It now uses the Dictionary of
Occupational Titles to help assess whether an individual is able to work
\-- but, this source has not been updated since 1991, and the Department
of Labor does not plan to update it again. Instead, they have created a
replacement, called the O\*NET \-- but this does not contain all the
detail about the physical or mental demands of any particular job. What
recommendations would you make for SSA to solve this problem?**

The Panel has not specifically investigated or deliberated on this
issue. It is our understanding that the SSA\'s Office of Disability and
Income Support Programs, Office of Disability, has been working with the
Department of Labor officials to address this issue. There are many
other physical and mental capacities assessment techniques used
historically in the field of rehabilitation and return to work to assess
functional limitations of people with disabilities.

**5. Some have suggested that the \$780 substantial gainful activity
(SGA) amount for disability is too low to be able to provide an
individual with any of the basic necessities, and that it should be
raised to the level provided for individuals who are blind, which is
\$1,300. What do you think is the right amount that an individual should
be able to earn before he or she cannot receive benefits?**

The Panel was very pleased in the changes made to the rules governing
Substantial Gainful Activity (SGA) in December of 2000 requiring the SGA
levels be updated regularly based on a real figure in the economy (the
National Average Wage Index). This will take place without new
regulations or legislation each time SGA should be adjusted. Beyond that
the Panel has not discussed the disparity between SGA for the blind and
the SGA for other recipients of disability benefits, nor have we taken
an official position. The Panel recognizes that changes to the SGA
amount could have profound implications for the Ticket to Work Program
and the amount of work income a ticket holder must make before an
Employment Network (EN) can receive payment. The Panel has often
discussed whether ENs might have a disincentive to serve beneficiaries
who are blind due to the fact they must earn significantly more in order
for an EN to receive payment. It is impossible to predict this type of
EN behavior in this early stage of implementation of the Ticket Program.
Thus, the full Panel has not taken an official position on this issue
either.

**6. Do you think it is time to view disability in the context of
short-term and long-term? If so, why? What would be the advantages? If
not, why not? What would be the drawbacks?**

Although the topic has not been discussed by the Panel, we are aware
that it has serious implications for all aspects of the Disability
Insurance program, including the various Social Security, Medicaid and
Medicare programs and projects called for in the Ticket to Work
legislation. For this reason, it is important to note that the
successful integration of the work incentives, health care supports,
other public and private services and supports and the Ticket Program
could very well achieve the same objectives as a short-term disability
program. That is, it will shorten periods on the benefit rolls compared
to current experience, resulting in program savings. We could achieve
the same objectives using an array of services and a voluntary service
system, producing a positive outcome for all. In contrast, a short-term
disability program would rely on a bureaucratic, and arguably
subjective, decision process about who qualifies for short-term
benefits. An integrated employment supports model and Ticket Program
uses self-selection by motivated beneficiaries. This voluntary mechanism
may prove to be quite efficient, given that the population with
disabilities is so heterogeneous in terms of disability type and
residual capacity and given the high mortality rates experienced by this
population.

November 4, 2002

Honorable E. Clay Shaw, Chairman\
Subcommittee on Social Security\
U.S. House of Representatives\
Committee on Ways and Means\
B316 Rayburn House Office Building\
Washington, DC 20515

Dear Chairman Shaw,

The Ticket to Work and Work Incentives Advisory Panel appreciates the
recent opportunity to provide testimony before the Subcommittee
regarding the Social Security Disability Programs\' Challenges and
Opportunities. We have received your follow up questions of October 17,
2002 and submit the following in response.

Where possible the answers reflect specific recommendations in the
Panel\'s reports and discussions on the general topics relevant to your
questions. In some cases, we are unable to answer the question at this
point because we have not yet had an opportunity to gather the data
needed nor reach a conclusion on the issue. However, in order for the
hearing record to be complete, we are submitting our response for your
consideration at this time. To aid in clarity of this response, we have
separated the five questions as follows:

**1. In the opinion of the Advisory Panel, what made the Employment
Support Representatives (ESR) pilot so successful? What are the key
features that would need to be continued in whatever alternative
structure the Social Security Administration (SSA) develops to meet the
mandate in the law?**

The Panel believes the ESR pilots were successful because they
identified and trained work incentive specialist within SSA to assist
beneficiaries and their advocates in making informed choices about
returning to work and the use of existing work incentives. Local SSA
offices have not historically demonstrated great expertise in this area.

The Panel believes the key features that need to continue in any
structure SSA develops should follow the specifics outlined in the
Statute.

The Ticket to Work and Work Incentive Improvement Act states in Subtitle
C, Section 1149(a)(2)(C), **\"the Commissioner shall establish a *corps
of trained, accessible,* and responsive work incentives specialists
within the Social Security Administration who will *specialize in
disability work incentives* under titles II and XVI\....\"**

The Panel also strongly believes national implementation of the ESR
position is key to the successful implementation of the programs and
work incentives improvements under the Act. It is also critical to
improving customer service for beneficiaries who attempt to work and
report earnings or attempt to use any of the current work incentives in
the SSI and SSDI programs. The Panel\'s position is that all interested
beneficiaries across the country should have reasonable access to work
incentive specialists who are dedicated to this task full-time.

**2. You indicated the Panel believes the resources allocated to public
education, training and marketing of the Ticket program are
insufficient. What specific recommendations has the Panel made to SSA on
educating the public, conducting better training, and improving the
program marketing? How does the Panel plan to assist in these efforts?**

In its recent annual report the Panel specifically recommended that SSA
dedicate extensive increases in budget to develop outreach, training and
technical support in the areas of SSA\'s disability and return to work
programs and work incentive provisions, as well as, other Federal
benefit programs and work incentive provisions administered by agencies.
Based on public comment, the Panel is convinced that most beneficiaries
who will receive a ticket do not know what it is, what to do with it, or
why it has been sent to them. In recent public forums, White House staff
and senior SSA executives have acknowledged the need for an outreach
campaign to market the Ticket Program, not only to beneficiaries but
also to employers and providers. An immediate, coordinated public
information campaign to explain the provider and employer opportunities,
and beneficiary choices and protections under the Ticket Program, is
crucial. The Panel is concerned SSA has not allocated sufficient
resources for this effort. Given the potential impact of the Ticket Act
Programs on the lives of individuals with disabilities and other
stakeholders, and the amount of information needed to ensure the
effectiveness of these programs, adequate resources must be allocated to
training and technical support on national, regional, State and local
levels. Readily available, accurate information is key to helping people
with disabilities return to work.

The Panel is an advisory body with a very limited staff allotment and
budget. As such, it does not foresee the ability to assist SSA directly
in these efforts. However, the Panel does continue to publicize the
programs on our Web site,
[www.ssa.gov/work/panel](http://www.ssa.gov/work/panel), and to continue
to work very closely with the Agency and the Congress in expanding
efforts in these areas.

**3. You expressed concern that there are not enough service providers,
in terms of both geographic location and specialization. What specific
recommendations have you made to SSA to remedy this situation?**

As the roll out of the Tickets continues, this issue is just beginning
to emerge. The Panel first heard complaints about capacity and
specialization at its August 2002 meeting. Apparently there has been a
much greater response to the Ticket roll out than ENs had anticipated.
Many ENs reported being overwhelmed with the volume of calls and
contacts from beneficiaries who had received their Ticket. The Panel is
very concerned with building service provider capacity and will continue
to investigate this issue.

**4. Is the Panel addressing the issue of obtaining up-front capital for
employment networks in need? Have you made suggestions to SSA?**

The Panel is concerned about this issue as a result of testimony
received at its most recent meeting in August 2002 but it has not, as
yet, made any suggestions to the Social Security Administration.

**5. Would you tell us more about why the Panel believes ticket
eligibility should be expanded to those under 18 and those whose
conditions are expected to improve?**

First, the Panel recommended that 16- and 17-year-old beneficiaries
should be eligible to participate in the Ticket Program. The Panel takes
the position that making transition-aged youth ineligible for the Ticket
Program sends the wrong message to youth and could encourage lifelong
dependence on benefits. The Panel believes short-term costs were the
primary reason youth were excluded, however, the long-term benefits to
young beneficiaries and long-term program savings could far outweigh the
short-term costs. Numerous studies have found the sooner someone begins
receiving employment services, the more likely the person will be to go
to work. Delaying the onset of those services, even by a short time,
makes it substantially less likely that the individual will ever work or
even attempt to work.

Second, the Panel takes issue with SSA\'s assumption that because
beneficiaries with Medical Improvement Expected (MIE) designations have
medical conditions expected to improve in a relatively short time, they
could be expected to return to work without the services under the
Ticket Program. Currently, few beneficiaries with the MIE designation
are leaving the rolls voluntarily to return to employment. In addition,
on average, only 16 percent of beneficiaries with this designation are
ceased for medical improvement after their initial continuing disability
review (CDR). A substantial number of beneficiaries (51,044 in 1999, for
example) will therefore be denied this important benefit for up to 2
years on average, based on what the Panel believes is a faulty
assumption.

The Panel also believes the decision to exclude beneficiaries with the
MIE designation was based primarily on short-term cost considerations
which may have failed to take into account the long-term savings to the
programs that could be realized through early intervention. The Panel
remains convinced that beneficiaries with the MIE designation will
benefit significantly from participation in the Ticket Program and
should be included.

We greatly appreciate your interest in the Panel\'s views on Social
Security Disability Programs\' Challenges and Opportunities. We look
forward to continued involvement with the Subcommittee on these and
other Social Security disability concerns. Thank you again for this
opportunity. If you need any further information or clarification,
please contact Marie Strahan of our staff at 202-358-6419.

Sincerely,

Sarah Wiggins Mitchell, Chair

CC:\
Ticket to Work and Work Incentives Advisory Panel\
Marie P. Strahan\
JoAnne Barnhart\
Martin Gerry\
Kenneth McGill

APPENDIX E: EXECUTIVE SUMMARY AND RECOMMENDATIONS OF THE AOI ADVICE
REPORT

The purpose of the Panel\'s Advice Report is to provide analysis and
recommendations regarding design of the Adequacy of Incentives Study
authorized by the Ticket to Work and Work Incentives Improvement Act of
1999. The Adequacy of Incentives Study was mandated by Congress to
evaluate how the Ticket to Work and Self-Sufficiency Program can be used
to increase employment among those with significant disabilities. The
Commissioner is required to report to Congress on recommendations for a
method or methods to adjust payment rates to Employment Networks to
ensure the participation of individuals with disabilities in four
specific groups. The Commissioner must implement the necessary adjusted
payment rates prior to full implementation of the Ticket to Work and
Self-Sufficiency Program. The statute requires that the Panel be
consulted during the development and evaluation of the study.

This Advice Report is based on relevant documents, including reports
from an Experts Roundtable and public testimony coordinated and convened
by the Design and Evaluation Committee of the Work Incentives Advisory
Panel in Washington, DC, on July 27, 2001. In addition, this Advice
Report is based on related research on employment of people with
significant disabilities and targets the four groups in the disability
population noted in the Adequacy of Incentives provision of the
legislation who are likely to be \"involuntary nonparticipants.\" These
four groups are individuals with a need for ongoing support and
services, individuals who need high-cost accommodations, individuals who
earn a subminimum wage, and individuals who work and receive partial
cash benefits.

Summarized in this Advice Report are a report by the Social Security
Administration (Working Paper 003, *Design of the Study of the Adequacy
of Incentives for the Ticket to Work Program,* Huynh and O\'Leary, July
14, 2001); key points from the July 27, 2001, Experts Roundtable; and
Panel and Experts Roundtable recommendations that will provide a
framework for additional research related to the Adequacy of Incentives.
The points offered in this Advice Report are intended to support and
enhance, not supplant, the overall proposal described by the Social
Security Administration\'s Office of Policy in Working Paper 003 and
discussed at the Experts Roundtable.

*Panel Recommendations*

The 13 recommendations offered here include recommendations from the
Panel related to the ongoing process for the Adequacy of the Incentives
Study. They are followed by recommendations from the Experts Roundtable
on nine specific issues raised by the Social Security Administration
(SSA) and/or the Panel.

*Design Process of the Study*

**Panel Recommendation 1:** An ongoing structure must be established for
review of emerging information, analysis of trends, and creation of
recommendations regarding modification of incentives and making use of
multiple evaluation methods.

**Panel Recommendation 2:** The Social Security Administration should
convene an Adequacy of Incentives Advisory Team, similar to the team of
consultants approach being used under the \$1 for \$2 research, for
ongoing technical support for the Adequacy of Incentives Study,
specifically related to the four targeted groups. This group should
consist of diverse individuals who have research background, knowledge,
and/or expertise in the successful employment of individuals in the four
groups. This group could include, but not be limited to, the experts
identified by the Panel for the Adequacy of Incentives Expert
Roundtable. These experts would be charged to further develop
recommendations from the Experts Roundtable for serious consideration by
the Social Security Administration. At least two members of the Adequacy
of Incentives Advisory Team should become members of the Technical
Evaluation Support Group, the technical group advising Social Security
Administration on overall Ticket evaluation, to ensure coordination of
the two research efforts.

**Panel Recommendation 3:** Given the impact of this and other studies
the Office of Policy conducts on the lives of people with disabilities
and their families, the Office of Policy should develop a policy and
practice for incorporating the input and experiences of consumers, their
families, and/or their representatives as it develops new research
designs, including the Adequacy of Incentives Study.

**Panel Recommendation 4:** As the Ticket to Work and Self-Sufficiency
Program is implemented, the Social Security Administration should
provide to the Panel, Congress, and the President ongoing interim
reporting on the participation of members of the four targeted groups in
the Ticket to Work and Self-Sufficiency Program.

**Panel Recommendation 5:** The Panel recommends that Congress approve a
technical amendment to require the Social Security Administration to
provide to the Panel, Congress, and the President ongoing interim
reporting on the participation of members of the four targeted groups in
the Ticket to Work and Self-Sufficiency Program.

**Panel Recommendation 6:** Ongoing data collected and outcomes
determined for the Adequacy of Incentives Study should be included in
the Social Security Administration\'s overall Ticket evaluation
research.

**Panel Recommendation 7:** Due to delays in issuing the tickets, the
deadline for the Adequacy of Incentives Report to Congress should be
extended by the amount of time the ticket rollout has been delayed (13
months). The Panel recommends that Congress approve an amendment to
adjust the timeline for the Adequacy of Incentives Report so that it is
due 49 months, rather than 36 months, after the enactment date.
Implementation of the necessary adjusted payment rates should occur as
soon as practical following the release of the Adequacy of Incentives
Report but no later than 1 year after its release. Further, the Panel
requests preliminary progress reports on the Adequacy of Incentives
Study at 36 and 42 months after the date of enactment of the law.

*Identifying the Four Groups*

**Panel Recommendation 8:** While there is a need to take advantage of
what is known about the diagnostic categories with high proportions of
those most likely to fall into one of the four groups relative to work
capability, the Social Security Administration, in addition to
diagnostic data, should use other information, such as survey
information, information on earnings, onset date, and medical
improvement assessments. SSA should also go to outside data sources,
such as those identified in Expert Roundtable Recommendation 1 (below),
to identify members of the four target groups.

*Survey Methodology*

**Panel Recommendation 9:** The Social Security Administration has
proposed a survey to supplement its administrative data, improving its
ability to target the four groups. If the survey uses a telephone
protocol, the protocol should include two other elements. First, there
should be face-to-face home interviews if the phone survey fails for a
given respondent, except for cases of incorrect phone numbers, empty
residences, and so on. Second, if the potential respondent\'s disability
prevents effective participation in the survey, the interviewer should
use as a proxy another individual who knows the respondent well and,
preferably, who has communicated on the respondent\'s behalf in the
past, such as a parent, spouse, sibling, or supervisor in a group home.
Members of the Adequacy of Incentives Advisory Team (see Panel
Recommendation 2) should review the interview protocol used by the
contractor conducting the survey.

*Supplementary Research*

**Panel Recommendation 10:** Recognizing the need for research to
supplement what can be studied using Social Security administrative
data, SSA has proposed a program of supplementary research. It has
solicited the suggestions of the Panel for possible research topics to
supplement the research using SSA data. The Panel recommends the
following:

-   Review existing research on the four groups or related groups,
    including relevant behavioral demonstrations and field experiments.

-   Conduct or commission new research on these groups using State data
    or other Federal data.

-   Conduct or commission new research related to Employment Networks
    and other providers.

-   Review and consider best practices of successful programs relating
    to employment of those with significant disabilities.

-   Review best practice systems of results-based funding and/or
    individual milestones payments.

-   Conduct or commission a review of supported employment literature,
    research, and best practices.

-   Conduct or commission ongoing demonstration projects, modeling, and
    evaluation of the effectiveness of alternative incentives
    identified.

*Employment Networks*

**Panel Recommendation 11:** SSA should identify the data elements that
Employment Networks (ENs) should collect on whom they serve and do not
serve from the four functional groups identified in the statute. The
data should include descriptions of why a ticket is accepted or is not
accepted on the basis of the EN\'s perception of cost, degree of
difficulty, or lack of expertise on the part of the EN to provide the
necessary services. SSA should use a sampling of ENs rather than
requiring all ENs to collect the data. SSA should pay the ENs to offset
the administrative burden of management information system design.

**Panel Recommendation 12:** SSA should conduct or commission
qualitative research, including interviews and focus groups as
appropriate, to assess the adequacy of current incentives to large and
small providers, including community rehabilitation programs.
Information and recommendations should be collected regarding the amount
and timing of payments and other factors that affect potential
participation in the Ticket Program and integrated community employment
at minimum wage or higher levels for individuals in the four groups.

*Various and Diverse Populations*

**Panel Recommendation 13:** SSA should ensure that the data collected
include attention to national demographics such as rural and urban
settings, minority representation, and socioeconomic conditions across
the country.

*Contact Information*

Ticket to Work and Work Incentives Advisory Panel

Social Security Administration\
400 Virginia Avenue, SW, Suite 700\
Washington, DC 20024\
Phone at (202) 358-6430\
Fax at (202) 358-6440\
E-mail to <TWWIIAPanel@ssa.gov>\
Website:
[www.socialsecurity.gov/work/panel](http://www.socialsecurity.gov/work/panel)

*Advisory Panel Staff*

Marie Parker Strahan, Executive Director\
Shirletta Banks\
Kristen M. Breland\
Lisa D. Ekman\
Gordon Richmond\
Bernard Wixon

Anyone requiring materials in alternative formats, information regarding
this document or the Ticket to Work and Work Incentives Advisory Panel
should contact the Panel staff. Records are kept of all Panel
proceedings and are available for public inspection under the Federal
Advisory Committee Act by appointment at the Panel office.

Social Security Administration\
Ticket to Work and Work Incentives Advisory Panel\
SSA Pub. No.\
April, 2003