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48–192—PDF 2007

S. HRG. 110–804

BARRIERS TO WORK FOR INDIVIDUALS RECEIVING

SOCIAL SECURITY DISABILITY BENEFITS

HEARING

BEFORE THE

COMMITTEE ON FINANCE

UNITED STATES SENATE

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

JUNE 21, 2007

(

Printed for the use of the Committee on Finance

COMMITTEE ON FINANCE

MAX BAUCUS, Montana, Chairman

JOHN D. ROCKEFELLER IV, West Virginia

KENT CONRAD, North Dakota

JEFF BINGAMAN, New Mexico

JOHN F. KERRY, Massachusetts

BLANCHE L. LINCOLN, Arkansas

RON WYDEN, Oregon

CHARLES E. SCHUMER, New York

DEBBIE STABENOW, Michigan

MARIA CANTWELL, Washington

KEN SALAZAR, Colorado

CHUCK GRASSLEY, Iowa

ORRIN G. HATCH, Utah

TRENT LOTT, Mississippi

OLYMPIA J. SNOWE, Maine

JON KYL, Arizona

CRAIG THOMAS, Wyoming

GORDON SMITH, Oregon

JIM BUNNING, Kentucky

MIKE CRAPO, Idaho

PAT ROBERTS, Kansas

RUSSELL SULLIVAN, Staff Director

KOLAN DAVIS, Republican Staff Director and Chief Counsel

(II)

(III)

C O N T E N T S

OPENING STATEMENTS

Page

Baucus, Hon. Max, a U.S. Senator from Montana, chairman, Committee

on Finance ............................................................................................................ 1

Grassley, Hon. Chuck, a U.S. Senator from Iowa ................................................. 2

WITNESSES

Suter, Sue, Associate Commissioner for Employment Support Programs, Social Security Administration, Baltimore, MD .................................................... 4

Brown, Jim, SSDI beneficiary, Independent Advocate, Billings, MT .................. 5

Jensen, Allen, senior research staff scientist, Center for Health Services Research and Policy, George Washington University, Washington, DC .............. 7

Stapleton, Dr. David C., director, Cornell Center for Policy Research, Washington, DC ............................................................................................................. 9

ALPHABETICAL LISTING AND APPENDIX MATERIAL

Baucus, Hon. Max:

Opening statement ........................................................................................... 1

Brown, Jim:

Testimony .......................................................................................................... 5

Prepared statement .......................................................................................... 27

Bunning, Hon. Jim:

Prepared statement .......................................................................................... 31

Grassley, Hon. Chuck:

Opening statement ........................................................................................... 2

Jensen, Allen:

Testimony .......................................................................................................... 7

Prepared statement .......................................................................................... 32

Responses to questions from committee members ......................................... 56

Snowe, Hon. Olympia J.:

Prepared statement .......................................................................................... 63

Stapleton, Dr. David C.:

Testimony .......................................................................................................... 9

Prepared statement .......................................................................................... 65

Responses to questions from committee members ......................................... 74

Suter, Sue:

Testimony .......................................................................................................... 4

Prepared statement .......................................................................................... 83

Responses to questions from committee members ......................................... 93

COMMUNICATIONS

Goldstein, Marcie B. ................................................................................................ 103

Holy Trinity Parish, Bristol, NH ............................................................................ 106

National Council on Disability ............................................................................... 108

National Council on Independent Living ............................................................... 117

National Employment Network Association .......................................................... 125

Newton, Monica Nagle ............................................................................................ 132

Renshaw, Robin ....................................................................................................... 148

Steffy, Joseph ........................................................................................................... 151

Ticket to Work and Work Incentives Advisory Panel, Social Security Administration ................................................................................................................... 153

(1)

BARRIERS TO WORK FOR INDIVIDUALS

RECEIVING SOCIAL SECURITY

DISABILITY BENEFITS

THURSDAY, JUNE 21, 2007

U.S. SENATE,

COMMITTEE ON FINANCE,

Washington, DC.

The hearing was convened, pursuant to notice, at 10:07 a.m., in

room SD–215, Dirksen Senate Office Building, Hon. Max Baucus

(chairman of the committee) presiding.

Present: Senators Salazar, Grassley, Snowe, and Bunning.

OPENING STATEMENT OF HON. MAX BAUCUS, A U.S. SENATOR

FROM MONTANA, CHAIRMAN, COMMITTEE ON FINANCE

The CHAIRMAN. The hearing will come to order.

The Psalmist prayed, ‘‘Establish the work of our hands for us.

Yes, establish the work of our hands.’’ People have long known the

value of work, but for some reason when it comes to people who

are receiving Social Security disability benefits, the government

makes it hard for people to work. Today we examine those barriers

to work. What are they, and what can we do to eliminate them?

The Social Security Administration runs two programs for people

with disabilities: Social Security Disability Insurance, or SSDI,

which provides wage replacement income for people who have paid

payroll taxes and then suffer a disability; and Supplemental Security Income, or SSI, which provides payments to meet basic needs

for people with disabilities who have little or no income.

But the government has structured these programs so that they

discourage work. For example, in 2004 only 6 out of every 1,000

SSDI beneficiaries left the program to work. Why do so few people

go back to work? One barrier is fear. Some fear that they will lose

their health insurance coverage. Some fear that the government

will ask them to repay over-payments of benefits. Social Security

sometimes requires repayment because it does not have enough

staff to process earnings reports.

Some fear that it would take a long time to return to the program if their health worsened again. Some fear that the government might use a successful period of work against them if they

needed to return to the program.

Another barrier to employment is health. Applicants for SSDI or

SSI often have to wait several years before they can get on the program. SSI beneficiaries then get health coverage under Medicaid—

that is, in most States.

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But SSDI beneficiaries are eligible for Medicare only after waiting 2 more years on the program. During the time that people are

waiting for coverage, a medical condition can worsen, and that can

make it harder to return to work.

Another barrier to work is the lack of rehabilitation services.

State vocational rehabilitation agencies have limited openings, and

these agencies are not required to give Social Security disability

beneficiaries any priority.

The Ticket to Work program that Congress enacted in 1999 gives

beneficiaries a voucher to get rehabilitation services from approved

providers, but only 1 in every 61 of these tickets were assigned to

a service provider. Something is not working here.

Another barrier is the number and complexity of work incentives

in the law. Beneficiaries do not understand the rules, and beneficiaries face heavy documentation burdens.

The law creates barriers to work, with restrictions on earnings

and assets. For SSDI, after 9 months of working, if beneficiaries

earned more than $900 in a month, they lose their entire cash benefit. There is no gradual reduction in SSDI as there is in SSI.

And under SSI, the amount that a beneficiary can receive in

earnings or other benefits before losing SSI benefits has not been

changed since 1974. Beneficiaries can hold no more than $2,000 in

assets, and that has not changed since 1989. These asset limits

make it impossible to save for education that might help a beneficiary get a job.

There is so much here that we need to change. I look forward to

hearing recommendations from witnesses on how we can reduce

these barriers to employment. Let us recognize the value of work.

Let us remove barriers between beneficiaries and the workforce,

and let us make it easier for people with disabilities to establish

the work of their hands.

Senator Grassley?

OPENING STATEMENT OF HON. CHUCK GRASSLEY,

A U.S. SENATOR FROM IOWA

Senator GRASSLEY. Thank you very much, Mr. Chairman. Welcome to everybody.

I wanted to say ahead of time so everybody understood, if I was

not here very long, that in about 15 minutes I have to go participate in some other activity on the Hill that is scheduled, including

being on the floor.

We all know that in order to receive disability benefits under

current law, an individual must have a condition that prevents him

or her from working for at least a year.

From the perspective of most disability beneficiaries, the thought

of going back to work after spending 2 or 3 years convincing the

Social Security Administration that they cannot work might be a

frightening prospect.

Technically, the ability to work is defined as ‘‘engaging in Substantial Gainful Activity.’’ Under this definition, it is possible to

earn up to $900 a month, or $1,500 for the blind, and still remain

eligible for disability insurance benefits.

Under certain circumstances, it is possible to earn an unlimited

amount for a limited period of time, which is called a ‘‘trial work

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period.’’ Those receiving disability through the Supplemental Security Income program, SSI, are subject to different limits.

Despite the fact that persons receiving disability benefits can

work a limited amount without losing their benefits, very few beneficiaries choose to do so. For example, according to the latest available data, about 6 percent of SSI beneficiaries are reported as

working.

It is suggested that we need to modernize the disability program

to reflect advances in medicine and technology. However, advances

in medicine and technology should make it easier for those receiving disability benefits to go back to work. It should not increase the

share of the population receiving disability benefits.

Improving Social Security Disability Insurance is obviously a

very important goal. A program as old as that program, needs to

be looked at constantly by Congress to see how it can be updated

and improved.

However, we must be careful to ensure that the legitimate desire

to encourage those receiving disability benefits to return to work

does not turn into an unsustainable policy of extending disability

benefits to those who are able to work well beyond the ‘‘Substantial

Gainful Activity’’ level.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you, Senator.

Now I will introduce our witnesses. I might say, the Senate’s

scheduling is sometimes very difficult to predict. On the floor today

there is an amendment to strike a major portion of the bill that

this committee reported out yesterday, and I will have to go to the

floor to defend the committee position around 10:35, around there

somewhere. I very much regret that I will not be able to be here

for most of the hearing.

However, Senator Salazar from Colorado has very kindly agreed

to chair the hearing, so I want you to know that everybody is going

to be hearing—I will be hearing, even though not personally, but

indirectly through Senator Salazar and my staff and others—everything you are saying, so do not feel that you are being shortchanged just because the Senate schedule is forcing me now to be

on the floor during most of this hearing.

Right now, I would like to introduce our witnesses. First, is Ms.

Sue Suter, who is Associate Commissioner for Employment Support

Programs at Social Security.

And it is a real honor to introduce Jim Brown from Montana.

Jim is on SSDI and he wants to work more, but there are some

restrictions that are preventing him from doing all that he wants

to do. Jim, thanks for coming here today. It is a great distance to

come from Montana, and thanks for explaining to this committee

what needs to be done so that you can do what you want to do,

that is, work. I know I need not tell you this, but the old Montana

spirit: just let ’er rip; say what is on your mind. But thank you

very much for coming.

We also have Mr. Al Jensen. Al Jensen is from George Washington University. Thank you, Mr. Jensen. Your reputation precedes you. You have done a lot of work in this area, and we thank

you very much for your contribution.

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The same with Dr. David Stapleton from Cornell. Thank you, Dr.

Stapleton, for all that you have done as well.

So let us begin with you, Ms. Suter. We would like to have each

person speak about 5 minutes. Your entire testimony obviously will

be included in the record, but if you could just summarize your

statement and hit the high points and let us know what you want

us to hear.

STATEMENT OF SUE SUTER, ASSOCIATE COMMISSIONER FOR

EMPLOYMENT SUPPORT PROGRAMS, SOCIAL SECURITY ADMINISTRATION, BALTIMORE, MD

Ms. SUTER. Thank you, Mr. Chairman and members of the committee. Thank you for the opportunity to discuss the Social Security Administration’s efforts to address the barriers that make it

difficult for beneficiaries with disabilities to return to work.

I come to you today as a person with a disability since age two,

and someone who has worked in the field for a number of years as

Director of the Illinois Department of Vocational Rehabilitation, Illinois Department of Public Aid, Illinois Department of Children

and Family Services, Commissioner of the Rehab Services Administration, and president of the World Institute on Disability. I very

much appreciate that you are highlighting this extremely complex

and critical issue.

Assisting beneficiaries with disabilities has been one of the most

challenging issues facing Social Security for over 50 years, and assisting individuals to take advantage of employment opportunities

remains one of our highest priorities.

Our efforts can generally be placed in two categories: employment services under the Ticket to Work program and the State Rehabilitation program, and Work Incentives for those who are ready

for employment and need assistance in transitioning off the disability rolls.

Congress established the Ticket program in 1999 to provide beneficiaries with disabilities choice in obtaining the services and support they need to find, enter, and maintain employment. The Commissioner issues a ticket to beneficiaries who have the option of

using the ticket to obtain services from an Employment Network

(EN) or from State VR agencies. Upon agreement with the beneficiary, the EN will supply without charge various employment

support services. When the beneficiary achieves certain work outcomes, we pay the provider. The Ticket program was implemented

in phases beginning in February of 2002, completing the roll-out in

September of 2004.

We have learned a number of lessons from the Ticket program

over the past few years and are changing accordingly. We are recruiting and establishing partnerships in developing successful

business models for Employment Networks and community providers. We have an outreach program for ENs in marketing and

outreach messages geared to beneficiaries and potential ENs.

We are providing information to beneficiaries via work incentive

seminars, bringing together beneficiaries, ENs, and other partners

on the community level. Ten events will be conducted this fiscal

year.

5

We know outreach is not enough. Changes are needed to increase

participation by both beneficiaries and ENs to improve outcomes.

In September of 2005, we published a Notice of Proposed Rulemaking (NPRM) proposing the kind of changes that would significantly enhance access and choice for beneficiaries and improve the

likelihood that they will return to work.

The proposed changes are intended to increase payment rates to

ENs to increase their participation, to better coordinate services

provided by State VR agencies and ENs, and to allow more beneficiaries to be eligible for the Ticket.

In addition to the Ticket program, there are a number of other

work incentives in place to assist individuals to venture into the

workforce. Generally, these provide for continued benefits and medical coverage while working or pursuing an employment goal. I

have explained these in detail in my written statement.

In addition to Employment Networks, the Ticket legislation also

established an infrastructure that encourages participation and collaboration, and we are working to increase this. We have Work Incentives, Planning, and Assistance (WIPA) grantees who are community-based organizations that assist beneficiaries to understand

the work incentives and how they affect their benefits.

These WIPAs are available as resources to ENs and other agencies that assist beneficiaries with disabilities to return to work.

Protection and Advocacy (P&A) grantees provide information, advice, advocacy, and other services to beneficiaries.

Within Social Security we have Work Incentive Liaisons (WILs)

who work at SSA field offices and receive special training on work

incentives. Working with other field office staff, WILs provide personal discussion on how various incentives can work for a specific

individual. In turn, the Work Incentive Liaisons are supported by

a network of area Work Incentives Coordinators. They assist WILs,

coordinate outreach, and help develop training.

In conclusion, Social Security is committed to assisting beneficiaries with disabilities who want to return to work. We will continue our efforts to improve and grow the Ticket Program and remove the barriers with our programs so that every beneficiary with

a disability has an opportunity to reach his or her fullest potential.

Thank you. I would be happy to answer any questions.

The CHAIRMAN. Thanks, Ms. Suter, very, very much.

[The prepared statement of Ms. Suter appears in the appendix.]

The CHAIRMAN. All right. Jim Brown, you are up.

STATEMENT OF JIM BROWN, SSDI BENEFICIARY,

INDEPENDENT ADVOCATE, BILLINGS, MT

Mr. BROWN. Mr. Chairman and members of the Committee, over

200 years ago Thomas Jefferson wrote of our inalienable rights:

that of life, liberty, and the pursuit of happiness.

At the time, however, the pursuit of happiness did not include

the blacks, the Native Americans, or women. It did not, and it still

does not, include the disabled. I want to discuss this right of the

pursuit of happiness, how the disabled are excluded, and the

changes necessary to include us in that right.

Now, the pursuit of happiness may mean great wealth, cars, big

houses, maybe the power and prestige of being a big mover and

6

shaker in the business world. But for others, it simply may be

enough to get by on in a little house with a white picket fence, a

swing set in the backyard where they watch their kids and

grandkids as they grow old together with the love of their life. But

whatever the vision, the vast majority of us disabled are left out.

I found this out after I broke my neck on a trip to Hungary. I

had no insurance and mounting medical bills, so I had to turn to

government assistance for help. I found out I had to sell all of the

cows that I had invested in since I was a young boy just to become

eligible for the Medicaid program. Medicare, which I had paid taxes

into, would not require that sort of a sacrifice, but then it would

not help for 2 more years.

When I tried going back to work, I found that my right to the

pursuit of happiness was gone. I wanted the prestige of working a

full-time job again, and modern technology would make that a possibility. But then I found if I made more than $900 a month, according

to Social Security I was no longer disabled. Regardless of how

much I would make, though, my hands and my legs still will not

work and I will still have those disability-related expenses.

Over the course of a lifetime, the personal care, adaptive equipment, and wheelchair-related expenses for a disabled person can

total well over $1 million more than what an able-bodied person

faces.

I wanted to work and to make my own money. I did not like the

feeling of having to go and be a beggar and to be a burden on society. I would have gladly given up my $600 Social Security check

that I was getting, but I was told I had to stay eligible in order

to get the Medicaid assistance for the personal care and other expenses that Medicare does not cover.

I went to work. I got a part-time job, but then I was disheartened when I learned that I would have to give all my earnings, $540 a

month, to Medicaid as a spend-down in order to retain my eligibility.

Still, I loved working with kids. I had a part-time job working

with kids, and I just could not even believe I was getting paid to

do that, so I kept at it. I was even more disheartened to learn later

though that I would have been better off if I had never worked, had

never paid into the Social Security system, since then I would be

eligible for SSI rather than the SSDI, that SSDI would have allowed me to make more money because the financial assistance

would have been gradual rather than the cut-off at $900, and I

would not have had a spend-down for the Medicaid assistance.

So, basically I could have a house, but with the $2,000 asset limit

I could not afford to pay any sort of a down payment, and I cannot

afford any sort of a car payment on the $540 that Medicaid says

is all I need to live on.

Basically, I face three choices: either I do not work and I let the

government take care of me through SSDI payments, Medicaid,

housing assistance, and food stamps; otherwise I could work parttime, but then give my paycheck to the government; or I must

somehow find a job with a $50,000 starting salary so I can pay my

own way. The first two options are very discouraging, and the last

is just totally unrealistic. There needs to be a fourth option.

7

It needs to be realized that a disability is a physical or a mental

condition, not an economic condition. I realize programs are designed the way they are to discourage people from getting on them,

but they do more to discourage those who truly need the help.

We need programs that will bridge the gap between the part- time job and that $50,000-a-year job, something that will cover the

extra $20,000 to $30,000 yearly disability-related expenses until we

can finally be promoted enough to where we are able to finally pay

our own expenses. The entire system would be better off if we were

at least working to help pay for it.

Honorable Senators, in Jefferson’s day the disabled rarely lived.

My condition, a broken neck, was a death sentence. If they did

then, they were shut away in homes and forgotten about. But now,

21st-century technology keeps us alive and healthy. We live independently. We can get out into the community.

We should not have to stay at home and stifle our abilities just

because something in our brains and our bodies does not work

quite right and we need an extra hand. These policies need upgrading so we can truly live, so we can live with hope and dignity, enjoying the right to the pursuit of happiness.

Honorable Senators, I urge you to leave a legacy and help change

these policies so we can all get access to that last inalienable right.

I thank you for the opportunity to speak with you on behalf of disabled people everywhere, and I will be happy to entertain any

questions. Thank you.

The CHAIRMAN. Thank you, Jim, so very, very much. Thank you.

[The prepared statement of Mr. Brown appears in the appendix.]

The CHAIRMAN. Mr. Jensen?

STATEMENT OF ALLEN JENSEN, SENIOR RESEARCH STAFF

SCIENTIST, CENTER FOR HEALTH SERVICES RESEARCH AND

POLICY, GEORGE WASHINGTON UNIVERSITY, WASHINGTON,

DC

Mr. JENSEN. Mr. Chairman, Senator Salazar, my name is Allen

Jensen. I am with George Washington University’s work incentives

project. You have a copy of my written testimony, which is presented by myself and on behalf of Bobby Silverstein.

We have worked together for the last 10 years, looking at possible ways to reduce some of these problems that have been described by Jim and in your opening statement, Mr. Chairman.

Of particular emphasis in our research was looking at the interrelationship between SSI, SSDI, Medicaid, and Medicare and trying to figure out how to make this system work better. As indicated

by Jim, there are certain areas where we do have pretty good work

incentives, but in others, it is very limited.

I want to just talk briefly about some of the key facts, and then

some basic themes, and then our recommendations.

First of all, looking at the SSDI and SSI programs, they are definitely programs of last resort. That is, the eligibility requirements

are very strict. Less than 55 percent of those who apply for benefits

actually receive benefits, and, of those who are denied, 40 percent

are out of work for a total of 3 years.

Many of those on SSDI, of course, cannot work even a limited

amount because of the extent of their disability. Studies have been

8

done that show, for a 15-year period, that only 50 percent of the

people with earnings in one year had earnings the following years.

So, their ability to work was very much intermittent. The whole

matter of risking working for a long time was very much the concern.

But there are a significant number of people, a significant minority of beneficiaries, like Jim and others, with mental disabilities

and other types of disabilities, who can work if they have the right

kind of supports and ongoing assistance as they attempt to work

and if there is adequate infrastructure at the Social Security Administration and within State and local governments to provide the

services that they need and to enable them to understand the work

incentives. Sue talked about the infrastructure that SSA is trying

to develop, to develop a way for people to understand the work incentives.

And so our recommendations are based upon the idea that you

should have something which provides security, that is simple to

understand, and is sustainable with an infrastructure at the State

and the Federal Government.

I think that our recommendations are based, again, on our experience with the SSI program and with the Medicaid buy-in program

which this committee authorized back in 1999, and prior to that,

1997.

We are suggesting targeted recommendations to reduce barriers

to employment. Here again, for much of the population, SSDI and

SSI is providing income assistance to enable them to live in the

community. As Jim talked about, many years ago, 50 years ago

when the SSDI program started, most people with disabilities were

in institutions.

So our recommendations. We suggest a continued attachment to

the SSDI and the SSI program and Medicaid once a person starts

to work and they have earnings, and as long as their disability continues.

We think this is an important part of the security and the ongoing assistance that is needed, that they have, in effect, a safety net

that they can return to if there is an exacerbation as far as either

physical or mental disability.

In the current program in SSDI, there are, in effect, continued

attachments, but they are time-limited. For people with disabilities, their disability is not time-limited.

I think that also on the SSI side, it is earnings-limited. So we

are suggesting that there be continued attachment to the program,

as long as their disability continues, including when they are in a

non-benefit status so they can return to benefits.

As Senator Baucus talked about in his opening statement, these

are not situations where you can easily get back on benefits, so

there is fear as far as returning to benefits.

The second part of our recommendation is related to that, the

idea of a gradual reduction in benefits that is now part of the SSI

program. Right now, in the SSI program, the first $85 for someone

only on SSI is disregarded, and then there is a gradual $1 reduction in benefits for every $2 of earnings.

This is a provision that has been in SSI since the program began

in 1974, and we think this is an important aspect of the work inVerDate 11-MAY-2000 15:19 Apr 22, 2009 Jkt 000000 PO 00000 Frm 00012 Fmt 6633 Sfmt 6633 48192.000 SFIN1 PsN: SFIN1
9

centives that are needed by people like Jim and others with disabilities.

There have been attempts to provide this type of a gradual reduction in SSDI benefits over the last 20 years. I have in my document here a CBO estimate from 1988 that talked about the projected cost, but we think we have devised a package of proposals

which would not have that type of cost.

There is also discussion in our written testimony regarding the

whole matter of rewarding work by allowing more savings, and we

are recommending that there be an increase in the SSI and Medicaid resources test.

The last thing I want to say is, we think, in order to make any

kind of improvements work, that there has to be a sufficient commitment of resources by the Social Security Administration and

support from the other agencies in the Federal Government and by

State and local government to have a program which can have an

accurate and timely adjustment of benefits as people work.

So I would say that what we are trying to do here is devise a

program that sustains people who cannot work, but at the same

time provide a system of work incentives that enables people who

can work to work up to their ability and not risk the loss of their

safety net of income assistance and health care.

Thank you very much.

Senator SALAZAR. Thank you, Mr. Jensen.

[The prepared statement of Mr. Jensen appears in the appendix.]

Senator SALAZAR. Dr. Stapleton?

STATEMENT OF DR. DAVID C. STAPLETON, DIRECTOR,

CORNELL CENTER FOR POLICY RESEARCH, WASHINGTON, DC

Dr. STAPLETON. Thank you. Thank you for inviting me here

today.

Like his two predecessors, the Social Security Administration’s

new Commissioner, Michael Astrue, is giving high priority to improving the unconscionably poor performance of the Social Security

Administration’s disability determination process.

I was involved in some of the Agency’s earlier efforts, and sad to

say, very little progress has been made over a period longer than

12 years.

I have become increasingly convinced that the problems with the

determination process are more a reflection of larger problems with

Federal disability policy than they are with poor process design,

poor management, or inadequate resources.

Yes, increased funding and procedural improvements could improve the process, but I believe the process will continue to be very

problematic in the absence of successful transformative change to

Federal disability policy. I fear that efforts to transform disability

policy will take a back seat to efforts that focus on improving the

determination process.

Because of time limits, I am going to limit my remarks to the Social Security Disability Insurance program, but different remarks

along the same vein apply to SSI and other programs.

It is critical to preserve SSDI for those workers whose physical

or mental impairments really prevent them from permanently

earning a substantial sum under any reasonable circumstance.

10

The SSDI program has become unduly burdened because it is

trying to meet the needs of significant numbers of workers with

disabilities who would be better served by a program that helps

them continue to be self-sufficient through work. Current programs

serving that purpose are inadequate, and as a result many turn to

SSDI for lack of better alternatives. It is a last resort.

Last summer, the Social Security Advisory Board outlined an appealing structure for a 21st-century disability program. This structure includes SSDI as part of an income support program for those

who are unable to attain a reasonable standard of living through

work for very long periods, or permanently.

The structure also includes two other critical components. The

board calls the second component, which is parallel to the income

support benefit, a transitional program that would help participants achieve or continue productive and fulfilling lives rather

than becoming highly dependent on public benefits, through individualized programs involving various combinations of rehabilitation services, job restructuring, assistive devices, specific health

and related services, short-term income support, and perhaps even

longer-term earnings subsidies.

The third component of the Advisory Board’s structure is a common entry system into the two parallel systems, which the board

calls triage assessment. Workers with disabilities would be encouraged to enter triage assessment early, even while they are still employed.

The process would be designed to quickly identify those with very

short-term challenges, or with challenges that can readily and reasonably be addressed by their employers, those who are clearly unable to contribute substantially to their own support under any

reasonable circumstances for a year or longer, and those in the

gray area in between, which I believe is quite large.

The first group would not receive additional services, the second

would enter SSDI, and the last would enter the transitional program. Some of the latter group would later enter SSDI, but only

after their efforts to pursue their aspirations under the new program were not sufficiently successful.

A draft report written by Bryon MacDonald and Megan O’Neil of

the World Institute on Disability also recommends a new program

that would parallel SSDI and would serve many workers who

might otherwise exit the labor force and enter SSDI. They call it

Employment Support Insurance.

There are many differences in the details of the Advisory Board’s

recommendations and those of the World Institute report, but I

think the large area of common ground in these two reports is

much more important than the differences.

Each calls for a single employment support program or system

separate from SSDI that helps people with disabilities achieve or

sustain economic independence as soon as they believe they need

help, and before they become heavily reliant on long-term income

supports.

Such a program could theoretically both improve the lives of people with disabilities and reduce the burden of disability programs

on taxpayers. Current policies waste the considerable productive

11

capabilities of people with disabilities and undermine their ability

to support themselves.

Further, although people with disabilities receive many services

under the current system, these services are delivered in a very inefficient manner because financial responsibility is highly fragmented. A well-designed program would help participants make

good use of their productive capabilities and might achieve considerable efficiencies through financial and service integration.

I think there is some hope that we can achieve those lofty goals.

In the submitted testimony, I talk about a program that is a pilot

program in the U.K. called Pathways to Independence, which has

shown real promise in reducing the number of people with disabilities who enter their long-term benefit rolls, on the order of 14 percent.

To finish, though, I want to place my remarks in the context of

what you have heard from the other speakers. Mr. Brown’s story

clearly illustrates the harm done by current disability policies,

about the poverty trap that they create for people who could, with

some assistance, contribute much more to their own support and

to our society.

Both Ms. Suter and Mr. Jensen have talked about efforts to help

people who are already on the SSDI and SSI rolls increase their

earnings, and reduce their dependence on income support. I am involved in some of those efforts myself, and in general I think they

are headed in the right direction, but at a pace that is frustratingly

slow.

These efforts can potentially help Mr. Brown, given his history,

but they are also complementary in many ways with a separate

work support program like the sort I have very briefly described.

Such a work support program would be designed to help people

like Mr. Brown continue their pursuit of happiness as soon as they

experience a potentially disabling condition, so they would never be

trapped in poverty and never become so highly dependent on public

support.

Such a program also has the potential to address the induced demand problem, the increase in applications and awards for SSDI

and SSI that SSA’s actuaries and the Congressional Budget Office

predict will occur if we replace the SSDI cash cliff with a gradual

benefit offset.

Finally, if the new program achieves sufficient success over a

very, very long period of time, SSA would no longer need to put

such effort into helping SSDI beneficiaries return to work because

the only beneficiaries left in the program would be those who could

not provide substantial support for themselves through work under

any reasonable circumstances.

I urge this committee, other government leaders, and advocates

for people with disabilities to promote in general the efforts that

are going on, but to pay increasing attention and give very high

priority to efforts that would, in fact, reduce the premature exit of

workers from the labor force and onto SSDI.

Thank you.

[The prepared statement of Dr. Stapleton appears in the appendix.]

Senator SALAZAR. Thank you. Thank you, Dr. Stapleton.

12

Let me first, in a matter of introduction as to why I am sitting

here as opposed to Senator Baucus or Senator Grassley, we have

been working very hard for a long time on a major energy package,

and that package came out of this committee this week and is on

the floor of the Senate.

Within probably an hour or so, there will be a vote that will determine the outcome of this very, very important work for this committee. Otherwise, it would be Senator Grassley who would be

chairing this committee, or Senator Baucus. So, they are working

on very important work for our Nation right now.

Let me also just join Senator Baucus in welcoming the witnesses,

and thank you for sharing your expertise with all of us. And, in

particular, Jim, for your coming across the country all the way

from Billings, MT to share your personal story.

There is nothing that tells a story better than someone who has

to live through the program the way that you have had to live

through the programs that we are talking about here today. So, we

appreciate all of you, but we also appreciate you for your courage

and your strength in being here today.

Let me also note that we have been joined by Senator Snowe,

who is an expert on some of these issues. So, after my 5 minutes,

I will turn it over to her for her set of questions.

The Social Security disability programs serve a critical purpose.

They give Americans with disabilities an income that they are prevented from earning on their own, as well as access to health care

many of them would otherwise receive through their employer.

These programs help millions of Americans. Over 8.6 million

Americans today are enrolled in SSDI and 7.3 million in SSI. A

critical goal of these programs is to help Americans with disabilities transition back to the workplace. Unfortunately, these programs have been less than successful—and that is an understatement—in this regard.

Return-to-work rates for individuals in the SSDI program are

less than 1 percent. Less than 1 percent. For individuals receiving

SSI, the rate is only 7 percent. I think that those statistics tell a

story that should concern each and every one of us.

Our largest return to work programs, Ticket to Work and Plans

for Achieving Self-Support, have shown little success, frankly. Ticket to Work has a participation rate of less than 2 percent, and the

PASS program has shown a less than 1⁄2 of 1 percent participation

rate.

We all have to ask the questions, why are these rates so low and

what are the solutions to dealing with these low rates of return to

work? In my own experience, the vast majority of individuals with

disabilities who are physically able to work want to return to work,

but do not seek employment out of fear of losing their disability

benefits that they so depend on.

Return to work programs are not the only problems that exist

with respect to SSDI and SSI. My office in Colorado assists hundreds of people in Colorado as they apply for these disability benefits and work their way through the appeals process. In fact, it is

one of the top three issues that my office in Colorado is contacted

about on an annual basis.

13

Recently, this committee held a hearing on how to best address

the backlog in Social Security disability claims, and I look forward

to working with my colleagues to address this, and other, critical

matters.

Toward that end, I am looking forward to hearing more from the

witnesses as I ask some questions that Senator Baucus asked me

to ask on behalf of the committee.

I will begin by asking the first of those questions, which is, we

know the reality of the problems that we face with the system, so

I will ask a question of each one of the witnesses, that is essentially this.

So we have your statements for the record, and I know how hard

you worked in preparing those statements. They obviously will be

reviewed by staff and will be reviewed by the Senators themselves.

But the question that I would ask each of you, and, if you could

just take a minute or so to think about this, if you were to point

out the two most important things that we as a committee could

do to address these challenges that we face with the disability

issues we are talking about this morning, what would they be? The

two most important ones. And because of the limit on time, if you

will just take a minute in answering the question.

Ms. Suter, we will begin with you.

Ms. SUTER. I think the two most important things, and you have

heard today, are to bring the two programs closer together in terms

of work incentives and how they are administered, the Supplemental Security Income (SSI) and Disability Insurance (DI) programs: to look at the whole issue of employment supports and

health care in terms of supports for people going back to work, and

then from our perspective, to extend the demonstration authority

to make that permanent for the SSDI program.

Senator SALAZAR. All right. So bringing the two programs together, employment support and health care during the transition,

and then continuing on with the demonstration projects.

Mr. Brown?

Mr. BROWN. Yes. Actually, we have a group, Voices for Work,

that met in Atlanta and discussed a lot of these issues. They are

all Social Security beneficiaries. We did a poll among our group

and had agreed that the number one recommendation was that we

needed to raise the SGA amount, the Substantial Gainful Activities, because the amounts of that are so low, we are forced to work

only part-time in order to be eligible for the medical benefits that

we still need.

All those costs are so high that there is just no way to afford that

on a normal income, so we need that help. So, it would sure be

helpful if we raised the amount so we could go to work full-time.

Also, to allow us to work and maintain those health care benefits. If there was a way to bridge that gap between our part-time

and our full-time employment, then we would have the benefits of

insurance through the companies that we would be working for

then, where that would take over and pay a lot of those until we

could get to where we afforded our other personal care and that

sort of thing that private insurances do not cover.

Senator SALAZAR. Thank you, Mr. Brown.

Mr. Jensen?

14

Mr. JENSEN. I think I want to follow up on what Sue and Jim

have talked about: increase the similarities between the SSI and

SSDI programs. That is a key part of our recommendations, that

is, you have in the SSI program a gradual reduction in benefits as

people have earnings, and then you also have the ability—in Montana I think it is $27,000—to stay attached to Medicaid, and also

if you have your earnings reduced you can return to SSI. So, it is

a continued attachment and a gradual reduction.

Those are kind of the basic core of the work incentives in SSI.

If SSDI was similar to that, then I think that we would be able

to have people like Jim work up to a higher amount and not lose

their health care protection under Medicaid. But also, as you

talked about, as you increase your earnings and you move toward

full-time employment, you are more likely to have employer-based

health insurance.

Senator SALAZAR. All right.

Mr. JENSEN. So I think that is what we are learning in that regard.

Senator SALAZAR. Thank you, Mr. Jensen.

Dr. Stapleton?

Dr. STAPLETON. Yes. Two things. One, I have already indicated.

That is, I think this committee really needs to pay attention to efforts to design and develop a front-end program, a transitional program, or an employment support program that is separate from

SSDI and one that would help people with disabilities as soon as

they experience disability and help them avoid getting on SSDI in

the first place.

The second, though, is related to a remark I made about the frustratingly slow efforts for reform of the disability programs themselves, and specifically SSDI. I have to disclose, as I did in my written remarks, that I have been involved very substantially in these

efforts, including currently working on the design of the benefit offset demonstration which came out of the one-for-two demonstration

that was authorized by Congress under the Ticket Act in 1999.

Also, I have been involved in evaluation of Ticket to Work.

Senator SALAZAR. So you know a lot about it. So what is your

second recommendation?

Dr. STAPLETON. Yes. So my recommendation is, I cannot tell you

a lot about what we have been doing, but I can tell you that it has

been very slow. I think this committee needs to take actions, whatever actions it can, to move the process along more quickly.

Senator SALAZAR. So you are urging us to act.

Dr. STAPLETON. Right. Right.

Senator SALAZAR. I appreciate that very much.

Senator Snowe?

Senator SNOWE. Thank you very much, Mr. Chairman. I thank

all our witnesses here today. In just listening to the testimony, and

obviously being familiar with some of the problems that are challenging the disability programs, it makes me think about how logical it would be to have these programs work to the benefit of those

who are disabled and want to go back to work. These programs

should produce a win-win situation and not be so challenging and

complicated and bureaucratic for the beneficiaries.

15

As you probably know, back in 1999 we attempted to fix this program with the Ticket to Work program—Ticket to Work with incentives like health care. Obviously, based on the results of that program since it became law, it truly has not worked.

So far few beneficiaries have taken advantage of this program.

In fact, according to the CRS report, only 1.7 percent of the eligible

SSDI and SSI beneficiaries have participated in Ticket to Work

programs since its inception.

So I would like to start with you, Ms. Suter. Can you explain to

me, what are the problems? We obviously should be learning by example. This program has been in place for roughly 8 years. And we

should be able to learn from our experience and address those

problems. So, please, can you tell me, why are there so few people

involved? Why are so few using this program?

Ms. SUTER. Thank you, Senator. We certainly agree that the

numbers are very low. We have put programs in place, and we are

improving the program. I think you have heard a good example

today of some of the challenges in the program. We have to, number one, alleviate the fears. We send a very mixed message to individuals with disabilities.

On the one hand, we say, if you need cash assistance or medical

help, you have to prove you cannot work. And then we say—and

this is in the big picture—oh, by the way, you can work. So we

have to work with individuals, with beneficiaries to alleviate that

fear. We have four things in place to be able to do that.

We have a new proposed Ticket regulation that looks at some of

the EN payment structure and encourages more outreach. It also

gets to Jim’s point about how we need to include more people who

can work part-time, or want to work part-time and gradually return to work. We have included that in the new regulations.

We are doing much more aggressive outreach and marketing,

where we have 104 programs out in the country to provide benefits

planning and assistance to beneficiaries to help them navigate this

very, very complex system.

We also have protection and advocacy agencies out in the country

to work with individuals. We are doing messaging for beneficiaries

and potential Employment Networks on how to get involved in the

program, and how to use the program.

We are having local work incentive seminars where we bring in

people who have received a Ticket and they are scared and they do

not know about the program because it is so complex. We bring

them in to a community provider, a community partner who has

credibility with that individual and we talk to them about the work

incentives and we link them up with partners in the community.

Getting a Ticket in the mail from us saying, ‘‘Here is your Ticket,’’ after we have put people through what we put them through,

is not good enough. So we know we have to get people at the community level with people that they trust.

Finally, the partnerships. We have improved our business process, the red tape in paying Employment Networks. So, we have

four aggressive things that we are doing to improve the program

and to increase the numbers. We want to increase the numbers as

well.

16

Senator SNOWE. Well, are there changes that Congress should

work on with respect to this program? Do you have any specific

changes in the statute?

Ms. SUTER. I think that I mentioned before the extension of the

demonstration authority. That is how we look at some of these

transitional and early interventions. I think what you could do is

support us in terms of the Ticket regulation coming out.

Again, we have been frustrated—everybody has been frustrated—with the pace of this. But I think with these measures that

we have in place, I think we can address a number of these issues.

Senator SNOWE. Do you have enough staff?

Ms. SUTER. As I think you know very well, our resources in Social Security are spread extremely thin. We can always use more

resources. I think, from my perspective in terms of return to work,

it is not an either/or issue.

Of the issues that affect people with disabilities on a daily basis,

as Jim has pointed out, the backlog is very important. You should

not have to wait long to find out if you are eligible.

By the same token, you should be able to have the supports you

need to return to work. So, we are spread very thin in the Agency

and, as I said, resources are always helpful. You all have been extremely supportive of that, and we appreciate that very much.

Senator SNOWE. Well, the reason why I asked about the staff is

because, obviously in the President’s budget, it was significantly

under-funded. Senator Kerry and I, along with Senator Baucus and

more than 40 Senators, have written to the Appropriations Committee, as well as the Budget Committee during the budget process, for an additional $430 million for administrative costs. This

amount is essentially the minimum that is required in order to address these disability claims and the backlog.

Right now in the State of Maine it takes an average of 469 days

to deal with a specific claim in the backlog. Additionally, the average claimant could wait as long as 3 years for the resolution of a

claim. These are disturbing numbers, to say the least, for those

who certainly need the support of the Agency. We have to do better, and we have to figure out, what is it going to require to

produce better results?

I realize that more money and more staffing overall are needed

to address the problems here. It will also take the commitment to

making sure that this program can work and serve the people it

is intended to serve.

It is unacceptable for waiting times to exceed 3 years. The more

than half a million disability claims that have been in the system

and the backlog simply do not make sense.

We have to figure out how we can make the system better for

those like Mr. Brown, who have gone through such an ordeal. The

income limits are something else that we need to address. It should

be a win-win in that sense, and working and receiving support

from the government when you are disabled should not be mutually exclusive goals.

Thank you, Mr. Chairman.

Senator SALAZAR. Thank you, Senator Snowe, for those excellent

questions and comments.

17

This is a question to Mr. Jensen. Mr. Jensen, under current law,

SSDI beneficiaries lose all of their cash benefits when they earn

over $900 a month. They also lose their Medicare benefits after

about 8 years. The $900 a month is commonly referred to as the ‘‘cash cliff.’’

You have come up with a proposal to try to address the cash cliff.

Can you describe how your proposal eliminates the cash cliff, and

what are the other significant features of your proposal?

Mr. JENSEN. We propose that, first of all, our first priority, our

first option would be that you have a gradual reduction beginning

at that SGA, that cash cliff. As I talked about a moment ago, during the past 20 years, the actuaries and CBO have indicated that

that would be a costly provision. We do not necessarily agree with

that estimate they have made.

We have come up with another option which, in effect, here

again, tries to deal with the matter of making similar the SSI and

SSDI programs so that people would have, in effect, a choice: they

can stay with the current program which helps a lot of people and

they could work up to the SGA, or they could decide they are going

to go this other approach, which says that we will have a beginning

reduction of benefits at one-half of the SGA amount. But the tradeoff then is that they would stay continually attached to the SSDI

program and they could come back onto the program.

We are also suggesting that the SSI Initial Earned Income Dis- regard, which is now $85 before you have the reduction, that that

be increased up to that half of SGA. That has not been increased

since 1974, when the SSI benefit level was about $150.

So we think that increasing that amount—if you just had a COLA on the initial disregard, it would be more like $250. So that

is the basic approach that we are using, to say that if you believe

you can sustain work—and this is a choice people can make on a

periodic basis.

This does not necessarily simplify the program, but it, in effect,

would require a certain level of resources for Social Security—and

in answer to the question to Sue Suter, yes, Social Security needs

more resources. You cannot starve, in effect, the work incentive

program and have people working. You are going to have

over-payments and those kinds of concerns.

That is the basic approach that we have in our program, which

we think would result—and we have made estimates based on experience in the SSI program—that perhaps 150,000 to 300,000 people, we think, on SSDI would have substantial earnings if we did

that.

In the experience in the SSI program, in any one month there

are 330,000 people who have earnings. I think that that is a very

significant number. A number of those people, like 75,000 in any

one month, are not receiving any SSI. They are just still connected

to the SSI program, but they are getting Medicaid.

One thing that was not talked about is, while the Social Security

Administration has jurisdiction over the Ticket program and the

things that Sue talked about, there is another important provision

in the 1999 legislation, the Ticket law that you talked about, Senator Snowe, and that is the Medicaid buy-in program. The State of

Maine has such a program.

18

There are about 75,000 people, mainly SSDI people, who are receiving Medicaid without the kind of spend-down that Jim has to

deal with. Just a personal anecdote. About 10 days ago, I was

called by a young man in Utah, whom I think has the same kind

of disability that Jim has. He got on the Medicaid buy-in program.

He has decided that, in spite of his severe disabilities, he can, in

fact, go ahead and lose his SSDI and stay on Medicaid.

Now, that is not a high percentage of people on Medicaid buyin, but there are some there who can do that. So the Medicaid buyin—I do not know how many you have on the program in the State

of Maine; Colorado does not have such a program, Senator. So, that

would be complementary to, in effect, the gradual reduction approach and the Initial Earned Income Disregard. So that is it, in

summary.

There are other details in there as far as our approach, but the

idea of trying to make these programs more similar so that you do

not have to have a cast of thousands out there explaining it.

You may still have to have a cast of thousands. You still have

people who help people on income taxes and you have Turbo Tax

and so forth, and you are still going to have some assistance as far

as people understanding what their options are.

Senator SALAZAR. Well, thank you very much.

Mr. JENSEN. But it is clear, and I think that is important.

Senator SALAZAR. We thank you very much for your report and

your recommendations. I will be asking Allen Jensen and Sue, and

Jim questions on the work incentives when it is back to me in just

a second.

Senator Snowe?

Senator SNOWE. Mr. Jensen, can you tell me about the lack of

benefit counseling services? To what extent has that affected the

program’s ability to operate? Has that been a major barrier for

many individuals? Ms. Suter, do you want to speak to that as well?

Mr. JENSEN. Benefits counseling is helpful. But I think we have

to recognize that the number of people out there, the number supported by Social Security, is still rather limited.

There are things that are going on that build on what the Federal Government is doing, in a number of States they, in effect, are

having a benefits information network so that all the provider

agencies, like independent living centers and rehabilitation providers that are connected with State rehabilitation agencies, have

people who are trained, who can help with the benefits counseling

and work incentives counseling.

What you need to do is place in all the agencies that are dealing

with people with disabilities who want to work, some level of

knowledge so that the disabled can have an understanding of work

incentives.

The support from the Social Security Administration is where the

disabled have access to the highest-trained people. Those who know

less about it, but at least have some basic understanding, can be

complementary to the Federal support as well. This type of support

is something that should be promoted, beginning with the SSI work

incentives.

Senator SNOWE. It seems to me that the first step in this process

is to encourage and help people participate in the program.

19

Mr. JENSEN. Yes. You have a good network in Maine. They are

trying to coordinate with the vocational rehabilitation agencies, the

independent living centers, and the medical center there in Maine.

Senator SNOWE. I am interested in what you said about the Medicaid buy-in and how that has worked for people, because in Maine

it has been very effective.

Mr. JENSEN. Yes.

Senator SNOWE. The Medicaid buy-in program helps people who

otherwise would not be able to purchase any health insurance, by

allowing them to purchase insurance through the Medicaid program. I can see where it helps those who are disabled to go off of

SSI, for example, and helps them obtain the full income and benefits of working.

Mr. Brown, did you participate in the Ticket to Work program?

Mr. BROWN. Actually, I got a Ticket to Work, and I did not have

any clue what it was supposed to be. I didn’t know if I just handed

it to some employer. But I finally went and asked a vocational rehabilitation person and was informed that it really did not apply

to me whatsoever, because they said that all it would do was ensure that I wouldn’t be medically evaluated while I was searching

for work. They said that I wouldn’t be reviewed anyway, because

it’s pretty obvious to anybody that I do have a disability. So, the

Ticket really did not apply in my situation.

Senator SNOWE. Well, Ms. Suter, are they sent out just to everyone? After hearing Mr. Brown’s situation, are they just sent out?

Are there no explanations with the tickets or are they tailored to

those they are distributed to? What is the basis for doing that?

Ms. SUTER. By law, the Ticket is sent out to most beneficiaries

who come on the rolls between ages 18 and 65. When we send the

Ticket out to individuals, and this gets back to what I talked about

before, we include information on our 800 number, our program

manager, Maximus, and how you can find out more about the Ticket. We include information about resources there in the community

that you can talk to through the 800 number. So, we provide that

information.

As Mr. Brown said, though, what we found out and what we are

doing now is, it is not good enough to just send out a letter and

send out a Ticket. There needs to be that linkage on the community level. That is why, as Allen mentioned, we have the work incentives planning organizations. We have 104 throughout the country.

Those organizations work with Ticket holders to say, this is what

the Ticket is about, these are the work incentives, how can we help

you reach your goal? They are community organizations.

There are also a lot of individuals working for WIPAs who have

disabilities, and some of whom have been beneficiaries and are now

working. So, we know we have to do that high touch with beneficiaries to get them involved in the program.

Senator SNOWE. Do you support raising the income level? Have

you indicated that earlier?

Ms. SUTER. We have had a lot of good suggestions from beneficiaries, from the Ticket panel. We are certainly happy to look at

all of those suggestions.

20

Senator SNOWE. I mean, is that something that the Congress—

for example, would the administration be opposing it?

Ms. SUTER. No. I think this administration would be open to

looking at all the recommendations.

Senator SNOWE. Great. Thank you, Mr. Chairman.

Senator SALAZAR. Thank you, Senator Snowe.

This is a question to each of the panelists. With the reality that

many of the incentives for SSDI and SSI programs are very complex, that reality creates serious complexity for the beneficiaries

and others involved in the program.

Do you think that the work incentives for these programs should

be simplified, and if so, how? Why do we not start with Dr.

Stapleton and we will just go across. If you will take a minute each

or so.

Dr. STAPLETON. Sure. I agree that complexity is a huge problem.

I think what often happens, and this clearly happened with Ticket,

is we add on new things to things that are already complex, and

they make the new things more complicated than you would think

they should be.

So, I would definitely encourage reforms in the line of making

SSI more similar to SSDI in terms of its work incentive provisions.

I think that is a very good idea.

Senator SALAZAR. All right.

Mr. Jensen?

Mr. JENSEN. Well, as I indicated, I think the idea of having a

similar SSI and SSDI program so that you have a gradual reduction in both programs, as compared to a cash cliff in one and reductions after $85 in the other, the idea that you can have a continued

attachment back—sounds like a broken record here—to the cash

benefit program if your work attempt fails, if those could be in both

programs, I think it would be something that would say, if you are

getting Social Security benefits, then you are going to be able to

have this kind of protection if you try to work.

You are going to have differences as far as from State to State

in Medicaid. That is a State-run program. Even the Medicaid buyin programs are different from State to State.

Senator SALAZAR. Thank you, Mr. Jensen.

Mr. JENSEN. I think the idea of similarities would be a——

Senator SALAZAR. So those similarities would deal with the complexity, in large part, is what you are saying?

Mr. JENSEN. That is right.

Senator SALAZAR. All right.

Mr. Brown?

Mr. BROWN. Yes. I definitely think they need to be simplified.

Senator SALAZAR. How would you do it?

Mr. BROWN. What is that?

Senator SALAZAR. How should it be simplified?

Mr. BROWN. Well, for one, people who are working need to be

able to learn the rules and be able to tell you what is going on. One

thing we had discussed was like a one-stop program where you

could go in and find out how the rules that are out there would affect each different program you are on. Like, I go to Social Security

and they have told me that, well, this is how it will affect your—

well, they will not even give you a definite answer.

21

They say this may affect your Social Security in this way, but

then that may affect your Medicaid, and we do not know anything

about that. So then I go to Medicaid, and they say, well, it might

happen in this way, but we do not know if that will then affect

your Social Security benefits. So if people knew all the regulations

for each program and they would not be offsetting one another.

Senator SALAZAR. So there is a lot of confusion.

Mr. BROWN. There is a lot of confusion out there.

Senator SALAZAR. The complexity creates confusion.

Mr. BROWN. Exactly.

Senator SALAZAR. Ms. Suter?

Ms. SUTER. I agree, we need to simplify the program. I think as

Dave mentioned, I think building on the work incentives has complicated it. We have an infrastructure in place with our area work

incentives in the field, our work incentives programs. I think that

anything we could do to bring the two programs together would be

a big help in simplifying it.

Senator SALAZAR. All right.

Our colleague, Senator Bunning, has joined us on the committee,

and so I will turn it over to him for his questions.

Senator Bunning?

Senator BUNNING. First of all, I would like for my statement to

be put into the record. Thank you.

Senator SALAZAR. Without objection.

Senator BUNNING. Thank you.

[The prepared statement of Senator Bunning appears in the appendix.]

Senator BUNNING. Ms. Suter, when I was chairman of the Social

Security Subcommittee in the House of Representatives, I worked

very hard on what finally became the Ticket to Work Act. I was

not successful in passing it in the House. Or I was, but the Senate

stopped it. Then when I got over here in 1998 in the Senate, Senator Kennedy and Senator Jeffords and a few others took my work

and passed that bill. So, it has been in effect since 1998 or 1999.

What have you done to implement the Ticket to Work Act, and

why in the world has it not worked? Because all of the things that

you have talked about here today were covered by the Ticket to

Work Act.

Ms. SUTER. Senator, as you know, we completed rolling out the

program in 2004. We agree that the numbers are very low, the participation numbers from beneficiaries and Employment Networks.

We are learning a number of things about the program, the complexity of reaching out to beneficiaries. We are instituting a number of new things to improve the program.

Given what you have heard here today, we have proposed new

regulations that address the participation rate for Employment

Networks that do a better job of partnerships between State vocational rehabilitation agencies that will make it more attractive for

beneficiaries and offer more choices.

We have new initiatives in place to better do outreach and marketing. We have targeted mailers going out. We have community

organizations that are working individually with Ticket holders.

So, we have a number of things that we are doing.

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We have de-bureaucratized the Employment Networks, the payments to Employment Networks so there is less red tape, and we

are working on developing the partnerships.

Senator BUNNING. Did the Ticket to Work Act not protect those

who tried and fell off the wagon, and tried again and fell off and

were not able to maintain their employment for at least 36

months?

Ms. SUTER. Yes. That is part of the program.

Senator BUNNING. That is part of the program.

Ms. SUTER. Yes.

Senator BUNNING. And does the Social Security system realize

that—this was in 1997—for every person that we got working, we

saved $3 billion over a period of time? For every 1 percent, excuse

me, of the disabled who went to work, we saved about $3 billion

for the Social Security system so that they could take care of more

people. Is the Social Security system aware of that?

Ms. SUTER. Yes.

Senator BUNNING. They are?

Ms. SUTER. Yes.

Senator BUNNING. It is beyond my comprehension that something that was passed in 1998, 1999, and it is now 2007, and you

are still not making it work. You are rewriting regulations.

I was told by a very good friend of mine, who happened to be the

vice chairman of the Social Security Committee when I was chairman, who came to the Social Security system and worked there for

quite a long time—she is doing something else now—that there

was no intent at the Social Security system to ever make the Ticket to Work program work. Is that true or false?

Ms. SUTER. That is false.

Senator BUNNING. Then why has it not worked?

Ms. SUTER. I think, for a number of reasons, Senator. I have

been in the program 3 years. I have seen the former Commissioner

was, and this Commissioner is, very committed to making the program work. Again, I think it gets back to, we have to alleviate the

fears for the mixed messages we send to individuals, that you can

work and there is the potential to work.

We have to put in place, and we have put in place, an infrastructure in the community to work with individuals on an individual

basis to show them how the Ticket can assist them in the benefits

of trying work. That is a slow process. We have learned a number

of things from what we have seen in the program. We have learned

a number of things from the Ticket panel.

Senator BUNNING. The Social Security system has never come

back to the Congress of the United States and asked for any additional help. Never. Now, if you need help legislatively and you do

not have enough tools to work with, why have you not come back

to us?

Ms. SUTER. Senator, I have mentioned some things today that

would assist us. I think we are going to continue. I think this committee has been very good about getting the resources for Social Security, for the whole gamut, whether it is the backlog or return to

work. As you know, our resources are spread very thin. More resources are always helpful.

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Senator BUNNING. The backlog has quadrupled since I was there.

I mean, you want to talk about backlog, the backlog was in the

hundreds of thousands at that time, 200,000, I believe. The backlog

just continues to get bigger and bigger and bigger because we get

less and less people approved.

There is more bureaucracy in running the SSDI and SSI programs than ever before. You kind of have to really want to make

it happen if you want to take care of those disabled people who are

on this program.

Go ahead.

Senator SALAZAR. Thank you, Senator Bunning. Thank you for

your excellent questions and observations, that there has not been

a lot of progress. In fact, there has been a decline in terms of dealing with some of these issues that have been on the table for a very

long time.

A question, Jim, for you. Some people believe that many employers have a bias against hiring individuals with disabilities. They

also believe that many employers fear the cost of accommodations

for workers with disabilities, and fear that if the employee with

disabilities joined the group health care insurance plan, costs to the

business and premiums to its employees would rise significantly.

Have you had an employer refuse to hire you or ask inappropriate questions regarding your medical condition? Have you experienced discrimination or disparate treatment in the workplace?

Mr. BROWN. For the most part, the jobs that I have found, the

two or three part-time jobs that I have worked at, were good. But

there have been others, for example, when I was working with one

of the after-school programs, they did refuse to give me a promotion to director of one of the programs, and it was totally a

disability-related thing because I was not able to do CPR on a kid.

They said that just in case one of the other workers did not show

up, if I was going to be the only one, they did not want me there

alone with the kids because of that. At the same time, they always

had more than one person working there. Just because of the liability of having one person alone with the kids, you want to have

somebody there as a witness.

Then there was another occasion when I applied for a job and

went to a first interview, and I had not mentioned anything about

a disability. They right away were saying, well, we would have to

make some accommodations because the restrooms are not accessible, and we do not know what we would do about that. I would

have had to go around through a back garage door to get into the

building to start with.

Anyway, I went to a second interview and it ended up, they

never called back. I kept calling to see what the status was on it,

and they would not ever give me an answer on whether they were

hiring or not. I finally had seen the position re-advertised, so I gave

up on it and assumed it was.

Senator SALAZAR. Do you think this happens, Jim, with respect

to the general disabled population? Do you think your experiences

are happening with other people?

Mr. BROWN. Yes, I do. I am sure that there are ones who are discriminated against because of that. I even put it in my letters that

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I am in a wheelchair, like when I am applying for something, and

people have told me not to.

But I told them, well, I think people are pretty quick and they

are going to pick up on it right away that I am. [Laughter.] So if

they want to discriminate against me, they might as well do it in

the letter instead of wasting my time to go to the interview.

Senator SALAZAR. Well, thanks a lot for your testimony on that

issue, Jim.

Let me try to get Ms. Suter and Dr. Stapleton in on this. It is

with respect to the fear of reapplying for SSDI. Beneficiaries may

fear that if they leave the SSDI or SSI programs because of work,

they will have a difficult time obtaining reinstatement of SSDI or

SSI benefits.

Given the number of work incentives that allow beneficiaries to

return to benefit payment status, such as the incentives under current law or expedited reinstatement under both SSDI and SSI, are

these well-founded fears, or are they based on beneficiaries’ limited

knowledge of these work incentives? What is SSA doing to provide

better information to these beneficiaries? Ms. Suter, and then Dr.

Stapleton.

Ms. SUTER. I do think that that fear is out there. As you mentioned, we do have the expedited reinstatement process. In one of

our messages out to beneficiaries, our local work incentive seminars, we talk about expedited reinstatement.

So we let people know about that and get the word out. I think

the idea that you do not have to reapply and that you can try going

to work and not be penalized for that, I think is an extremely important message to get out there.

Senator SALAZAR. Dr. Stapleton?

Dr. STAPLETON. I do not have specific expertise on expedited reinstatement and that specific fear. I do know that there is a very

high level of distrust among beneficiaries about anything that Social Security does that tries to support them in going back to work.

I think that has been a big issue for Ticket to Work. People get

these Tickets in the mail and they think SSA is trying to get them

off the rolls, and they do not want to have anything to do with it.

I think uncertainty about what the government is going to do and

how things are going to change is a really big problem.

Senator SALAZAR. Thank you.

Senator Bunning?

Senator BUNNING. Yes. This goes to the heart of the problem, because I sincerely believe that there is a mistrust with the disabled

community that Social Security is trying to help them, other than

give them paid benefits.

Could it be that the disabled beneficiaries do not use the Ticket

to Work to go back to work because they are disabled? In other

words, is it better for me to stay off that and just collect rather

than try to go back to work and succeed? Because there are so

many built-in safeguards in Ticket to Work that the beneficiaries

should not be frightful, at least for 3 years, because there is protection out there for 3 years in this bill, or in the current law.

I would like to get, Dr. Stapleton, your opinion of that, too. According to what you just said, you think that they mistrust the SoVerDate 11-MAY-2000 15:19 Apr 22, 2009 Jkt 000000 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 48192.000 SFIN1 PsN: SFIN1
25

cial Security system so much so that they think that the Ticket is

a bad deal.

Dr. STAPLETON. I think that may be too strong a way to put it.

But think about Jim’s case for a minute. He did not know a lot

about the Ticket when he found out about it, and I do not think

he got very good advice.

But it sounded to me from his testimony that his biggest issue

was the Medicaid. He could not afford to lose his Medicaid. To use

the Ticket most productively requires you to earn enough so that

you do get off the rolls. Well, if he got off the rolls he would lose

his Medicaid.

Senator BUNNING. But he would get it back if he fell off the ability to work. We find out that people do fall off the ability to continue working over a long period of time.

Dr. STAPLETON. Well, maybe you should ask Jim to speak to

that. My guess is, his expenses for the assistance that he gets from

Medicaid would just overwhelm his earnings and just make it not

worthwhile.

Senator BUNNING. Jim, is that true?

Mr. BROWN. Yes, it is. My expenses are somewhere between

$20,000 to $30,000, even closer to $30,000 when I include things

like transportation, those kinds of costs. It is just so much that I

cannot do it on a full-time job.

Senator BUNNING. Well, then maybe one of the solutions, legislative solutions, is that you would not lose Medicaid, that you would

continue to get Medicaid even if you were working and earning.

That is one of the things that we may have to look at, because

we think it is important, not only for you personally in your personal self-worth, the fact that you want to contribute and that you

can contribute, that maybe Medicaid should not be even in the

equation. We could take a real look at that law the way it is written presently and make sure that Medicaid never falls out. Would

that make a difference?

Mr. BROWN. It would. I had wondered about that even before I

heard about the Medicaid buy-in, why we could not use that, even

if we paid as much as a normal insurance policy and we are still

covered by that for the personal care and some of the adaptive

equipment that we have to have to be able to live our daily lives.

Then we could go to work and have that and be paying into that,

and be paying taxes. We would also be healthier and all that, with

the mental aspects of working and the pride that goes along with

that. That would be wonderful.

Senator BUNNING. Mr. Jensen, this is the last question I will ask.

You talked about Medicaid buy-in extensively in your testimony

and said that about 75,000 individuals are currently participating

in the program. Can you give us a sense of who these people are?

How critical is the buy-in program in getting them back to work?

Mr. JENSEN. In the surveys that have been done by the States

that had Medicaid buy-in programs, when I evaluate the program,

it has certainly showed up as saying, I could not work unless I had

the Medicaid buy-in program. So I think that this has been a very

important element of the work incentive. As I indicated, there are

38 States that have it.

26

It turns out that I will be working with the State of Montana,

one of the 13 jurisdictions that does not have a buy-in program,

and I imagine I will see Jim again out in Montana as we work on

that.

So I think there are a number of people in the buy-in who have

certainly increased their earnings, they have more disposable income, but they are also afraid of going over that SGA limit as far

as that is concerned. So, if you do not have to spend down—Jim

talked about in his testimony that, in order to get Medicaid, he had

to spend down to, now, $550 under the medically needy program.

If he did not have to do that, and even if he kept below the SGA,

he would have a lot more disposable income.

So I think that it has been an important step to provide the continued Medicaid for people on SSDI who cannot now receive it, because there is not the kind of work incentive we have on the SSI

side that Congress put in place.

So I would say that it is successful. There are still people who

fear going over the SGA, but there are a number of people—I think

before you came in I talked about the phone call from the gentleman in Utah who has decided to stay on buy-in and leave his

SSDI. So that has been what he has needed. But that is not going

to be for a high percentage, but it certainly is for some of them.

Most States in the Medicaid buy-in have a higher asset test. It

is now $2,000 for SSI. Almost all the States, in the discretion by

the State legislatures, have said we need to have that higher and

allow people to accumulate some resources. So, I think that is the

other step.

It is proving also that that is not a budget buster, to have a higher resources test in those programs. Here again, it was $1,500 in

1974; now, 33 years later, it is $2,000. That $500 increase was

made over a 5-year period in the middle of the 1980s. It is time

to make some changes on that as a work incentive, too.

Senator BUNNING. Thank you, Mr. Chairman.

Senator SALAZAR. Thank you very much, Senator Bunning.

As you can tell, this is a very important issue for this committee.

It is an important issue for both Senator Baucus and Senator

Grassley, Senator Bunning, Senator Snowe, all the members of this

committee.

We have a vote that is coming up in a few minutes, so we are

going to adjourn the hearing. There are a number of other questions that we have of you, so what we will do is, we will send you

those questions. If you would respond to those questions, we would

appreciate it so they could be made a part of the record.

[The questions appear in the appendix.]

Senator SALAZAR. As I said earlier, your written submissions

here today will be made a part of the record. Ms. Suter, Mr. Brown,

Mr. Jensen, Dr. Stapleton, we thank you very much for your testimony today. We thank you for helping us try to fix this problem

that faces us with Social Security and people with disabilities.

The hearing is adjourned.

[Whereupon, at 11:36 a.m., the hearing was concluded.]

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