Title I of the Ticket to Work and Work Incentives Improvement Act of 1999 ( P.L. 106-170 ) established the Ticket to Work and Self-Sufficiency program (hereinafter referred to as the Ticket to Work or Ticket program), which is administered by the Social Security Administration (SSA). The purpose of this program is to enhance work incentives for Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) beneficiaries . The legislation created a "ticket" system to expand choices in the numbers and types of providers that SSDI and SSI beneficiaries may choose to assist them in receiving employment services. The legislation also expanded Medicare and Medicaid coverage for individuals with a disability who are working or could work. Most notably, the Ticket to Work program created a market for public and private providers of support services known as employment networks (ENs) to which Social Security disability beneficiaries can voluntarily assign their tickets in exchange for a range of employment support services. The goal of the Ticket program is to reduce dependence on disability benefits and help Social Security disability beneficiaries enter or reenter the workforce. ENs would then be eligible to receive payments from SSA based on ticket holders achieving employment "milestones" or outcomes. This report provides an overview of how the Ticket to Work program operates and addresses several issues related to the Ticket program. First, it provides a brief background on the SSDI and SSI programs and a legislative history on how the Ticket program evolved. Second, this report provides an in-depth explanation on the various components and regulations of the Ticket to Work program in its current form and prior to major regulatory changes in July 2008. Third, it examines other work incentive programs created by Ticket to Work legislation and concludes with a discussion on the issues surrounding implementation of the Ticket program. SSA administers two disability programs, SSDI and SSI, Titles II and XVI of the Social Security Act respectively. SSDI is an insurance program for workers and their dependents for which benefits are paid to individuals who have a disability and have worked and made contributions to the U.S. Social Security system. Individuals who collect SSDI also become entitled to coverage under the Medicare health insurance program (Title XVIII of the Social Security Act) after a 24-month waiting period. SSI is a means-tested disability program for low-income individuals who are aged, blind, or disabled and have limited resources. In general, individuals are eligible for SSI if their countable income falls below the federal benefit rate (FBR) and they have countable resources of less than $2,000 for an individual. In most states, beneficiaries who collect SSI are automatically entitled to coverage under the federal-state Medicaid health insurance program (Title XIX of the Social Security Act). Individuals are considered to have a disability if they meet the definition established under the Social Security Act. Disability is defined as the inability to engage in any "substantial gainful activity" (SGA) due to a medically determinable physical or mental impairment that is expected to last for at least 12 months or result in death. SGA is defined in federal regulations as paid work involving significant and productive physical or mental duties. For 2014, the monthly SGA thresholds are $1,800 for individuals who are blind and $1,070 for individuals with other disabilities. SGA limits are adjusted annually to reflect growth in average wages. In 2013, approximately 12.2 million beneficiaries collected monthly SSDI or SSI benefits. Together these two programs represent the largest disability benefit system in the nation, with combined federal expenditures of approximately $146.8 billion in 2013. Although both SSDI and SSI include a number of work incentives and offer rehabilitation services to individuals with a disability, the number of people who leave the benefit rolls to work (i.e., engage in SGA) is very small. In 2012, 0.4% of SSDI beneficiaries actually left the disability rolls because of work. The small incidence of return-to-work has been partially attributed to the built-in disincentives of the SSDI and SSI programs. Because eligibility depends upon proving an inability to work, recipients risk losing both cash benefits and health insurance coverage if they successfully attempt to work. Prior to the passage of Ticket to Work legislation, policy makers and advocates for individuals with disabilities had long argued that work incentives under the law were complex and difficult to understand. Some contended that several reasons for the high rate of unemployment among beneficiaries included confusing rules, arcane procedures, and disincentives built into the Social Security disability programs. Advocates noted surveys showed that most working-age people with disabilities want to work and maintained that the numerous federal regulations and program rules have the effect of discouraging otherwise qualified and eager job seekers with disabilities from seeking employment. Return-to-work legislation subsequently became the subject of several legislative proposals, congressional hearings, and a major component of the Clinton Administration's comprehensive strategy to increase employment among individuals with disabilities. On March 18, 1998, President William J. Clinton established the Presidential Task Force on the Employment of Adults with Disabilities (PTFEAD). This Cabinet-level task force was charged with conducting an extensive public policy review with the goal of increasing the employment of individuals with disabilities and addressing other barriers to work among adults and young people with disabilities. PTFEAD produced a series of reports that analyzed existing federal programs and policies to determine and track changes that would be necessary to remove barriers to work, address issues surrounding health insurance coverage, and analyze employment outcomes of programs focused on youths with disabilities. Ultimately, PTFEAD's recommendations prompted the Clinton Administration to seek full funding in the FY2000 budget request for Ticket to Work programs. Along with several initial cosponsors in the 106 th Congress, Senator James M. Jeffords introduced the Work Incentives Improvement Act of 1999 ( S. 331 ) on January 18, 1999, and on March 18, 1999, Representative Rick Lazio introduced the Ticket to Work and Work Incentives Improvement Act of 1999 ( H.R. 1180 ). Ticket to Work legislation garnered broad bipartisan and bicameral support. A conference report incorporating both bills into H.R. 1180 was passed by the House on October 19, 1999, by a vote of 418 to 2 and by the Senate on November 19, 1999, on a 99 to 1 vote. President Clinton signed H.R. 1180 into law on December 17, 1999, which became P.L. 106-170 . Specifically, the legislation authorized (1) "tickets" or vouchers to beneficiaries to give them increased choice of rehabilitation providers and access to services needed to obtain and retain employment, (2) payments to employment service providers based on ticket holder achieving certain employment "milestones" or outcomes, (3) SSA demonstrations to test different approaches to removing barriers to employment for Title II (SSDI) beneficiaries, and (4) options for states to adopt a Medicaid "buy-in" program to allow beneficiaries to maintain health coverage after returning to work and a continuation of Medicare coverage to certain beneficiaries who are working. On December 13, 1999, the Congressional Budget Office (CBO) produced final scoring on the budgetary effects of H.R. 1180 as passed by the House and Senate. CBO estimated modest gains in Social Security beneficiaries' future participation in the proposed expanded network of employment support services, beyond the services that were primarily offered by state VR agencies. Overall, by FY2009, CBO projected that the Ticket to Work program (Title I of H.R. 1180 ) would reduce direct spending by $53 million and $32 million for the SSDI and SSI programs, respectively, through the combination of payments to ENs and the avoidance of payments to beneficiaries whose benefits would be suspended or terminated due to earnings from work. The Ticket to Work and Self-Sufficiency program was designed to address several barriers to work for individuals with disabilities through greater access to healthcare and a broader pool of employment service providers or ENs. Under the program, SSA provides eligible SSDI and SSI beneficiaries with a "ticket" that can be used as a voucher to obtain VR, employment and other support services from an approved EN or state VR agency. ENs are responsible for assisting ticket recipients with entering or re-entering the workforce. The program is currently administered by two contracted program managers (PMs) who report to SSA administrators. Initial regulations for the implementation of the Ticket program were published in the Federal Register on December 28, 2001, and the program was phased in nationally over a three-year period beginning in 2002. The program was initially available for eligible beneficiaries in 13 states and was extended to all states by September 2004. In an effort to provide greater financial incentives to ENs and expand Ticket eligibility to a greater number of beneficiaries, the Ticket program underwent a number of regulatory adjustments in July 2008. Among other changes, the new rules modified the payment schedule for ENs and allowed disability beneficiaries with medical conditions that were expected to improve to also participate in the Ticket program. These beneficiaries had been previously excluded. Table A -1 in Appendix A shows a side-by-side comparison of the key components of the Ticket to Work program that were subject to the July 2008 regulatory changes and new provisions that were implemented. According to SSA regulations, a "ticket" is a document that is issued to an eligible beneficiary that authorizes payment by SSA to an EN or state VR agency that provides employment services, vocational rehabilitation, and other support services to the beneficiary. Participation in the program is voluntary and the beneficiary chooses when and whether to assign his or her ticket to an EN. An example of a ticket is shown in Figure 1 . All individuals with disabilities who are between the ages of 18 and 64 are considered eligible for a ticket if they are receiving federal SSDI or SSI cash benefits and are in current pay status.