a Written Testimony by the
Council of State Administrators of Vocational Rehabilitation
Submitted in Conjunction with the March 18, 2004 Hearing
Before the House Social Security Subcommittee
March 31, 2004
Mr. Chairman, Mr. Matsui, and members of the House Social Security Subcommittee, thank you for holding a hearing on March 18, 2004, on the Social Security Administration’s Implementation of the Ticket to Work and Self-Sufficiency Program, authorized under the Ticket to Work and Work Incentives Improvement act of 1999. This written testimony is being submitted on behalf of the Council of State Administrators of Vocational Rehabilitation (CSAVR) in connection with that hearing.
The CSAVR is composed of the chief administrators of the State Vocational Rehabilitation (VR) agencies serving individuals with physical and mental disabilities in the states, District of Columbia, and the Territories. These agencies constitute the state partners in the State-Federal, public-private partnership referred to as the Public Vocational Rehabilitation (VR) Program.
CSAVR would like to take this opportunity to provide factual information that is contrary to some of the information included in the written testimony of Paul J. Seifert on behalf of the Consortium for Citizens with Disabilities (CCD) Work Incentives Implementation Task Force and Social Security Task Force. Mr. Seifert also provided verbal testimony during the March 18, 2004 hearing. As Mr. Seifert’s testimony noted, CCD is a coalition of nearly 100 national organizations advocating on behalf of people with physical, mental and sensory disabilities. It is notable that with approximately 40 of the CCD member organizations being actively involved in the two task forces that Mr. Seifert was reportedly representing, only eight (8) of those organizations signed on to Mr. Seifert’s testimony.
I am writing in response to the comments made in Mr. Seifert’s testimony under the heading State VR Agencies, ENs and Beneficiaries. Mr. Seifert’s written testimony states: “State VR agencies have developed stand alone, take it or leave it, one size fits all agreements for ENs in their states. These agreements all contain one common provision—the full and total repayment of all of VR’s costs out of the ENs ticket payment by an EN who refers a beneficiary to VR.” His testimony mentions two State VR agencies that have reportedly “required ENs to join the state VR agency’s Employment Network.”
It is widely known that the pool of employment networks participating in the Ticket program is very limited, a fact that severely limits the choices available to beneficiaries who are seeking services under the Ticket program. As of March 1st, only about 1,100 employment networks nationwide were under contract with SSA to provide services under the Ticket program. Of those, only about 35 percent (388 employment networks) have actually taken ticket assignments. Of the 7 million tickets mailed to beneficiaries as of March 1st, only 40,000 tickets have been assigned. With the limited number of employment networks actually taking tickets, approximately 90 percent of the tickets assigned to date are assigned to State VR agencies.
Several State VR agencies have taken steps to address the limited number of employment networks. For example, the VR agencies in Washington State and Oklahoma have used VR funds to assist in recruiting private providers to serve as employment networks.
Even with the passage of the ticket legislation, State VR agencies continue to contract with private providers on a fee-for-service basis. In many cases these contracts provide some of the critical up-front funding necessary for these providers to function as ENs and serve beneficiaries. In addition, some State VR agencies (e.g., Connecticut) have initiated agreements with private providers creating associations or consortiums of service providers to function as Employment Network Partnerships. This approach is an allowable alternative under the Ticket regulations and it provides another method for VR to support smaller and non-traditional service providers that want to become ENs and participate in the Ticket Program, i.e., providers that would not otherwise have been able to participate in the Ticket program due to the considerable up-front costs inherent in serving many beneficiaries. Such agreements create more choices for beneficiaries, and allow for improved collaboration and integration of services, potentially resulting in better employment outcomes for beneficiaries with disabilities. Mr. Seifert’s criticisms of these agreements clearly demonstrate his lack of understanding of these efforts.
CSAVR also takes exception with Mr. Seifert’s statement about State VR agencies developing stand alone, take it or leave it, one size fits all agreements for ENs in their states. Most State VR agencies have developed two types of agreements, one that creates a consortium of providers and VR has the ticket assignment, and one that spells out the “conditions under which services will be provided when an individuals is referred by an employment network to a State agency for services,” as required by law [Sec. 1148(c)(3)]. Admittedly, under the second type of agreement, most VR agencies have established one standard agreement to use with all ENs in the state. This is practice stems from a resource issue and a lack of guidance (i.e., beyond the Ticket regulations) on how to modify VR practices to accommodate the different approach to service provision inherent in the Ticket program. Even though VR has 90 percent of the ticket assignments, has had to train VR Counselors on the Ticket program and the new work incentives contained in the Ticket legislation, and has been constantly criticized for its good faith effort to implement the Ticket program, VR has received absolutely no additional funds to facilitate implementation of this program.
Mr. Seifert’s testimony also claims that “these agreements all contain one common provision—the full and total repayment of all of VR’s costs out of the ENs ticket payment by an EN who refers a beneficiary to VR.” From state to state, the agreements addressing the “conditions under which services will be provided when an individuals is referred by an employment network to a State agency for services” have some commonalities and some significant differences. The only guidance on these agreements is found in the regulations governing the Ticket program. The applicable section of these regulations state that these agreements may include “a description of the financial responsibilities of each party to the agreement” [411.420(b)] and “the terms and procedures under which the EN will pay the State VR agency for providing services” [411.420(c)].
It is important to remember that State VR agencies must still abide by their own authorizing legislation (Title I of the Rehabilitation Act) and governing regulations (34 CFR Part 361), as well as regulations governing the use of VR funds found in the Education Department’s General Accounting Requirements (EDGAR) and the Office of Management and Budget’s guidance in A-87. Since any payment from SSA to VR, whether under the traditional cost reimbursement system or one of the EN payment systems, is classified as program income, State VR agencies must use all such payments to further the purposes of the public VR program. Based on VR’s understanding of the various requirements applicable to their use of VR funds and Section 411.420(c) of the Ticket regulations, most VR agencies have assumed that they should be seeking reimbursement when an EN receives compensation for successfully services a beneficiary that the EN referred to VR for services. When VR violates the regulatory requirements governing their use of VR funds, the State agency can be asked to pay back those funds. Without additional guidance or changes in applicable regulations, State VR agencies have been following these rules as they understand them. CSAVR feels it is inappropriate to criticize VR for abiding by it governing law and regulations
While State VR agencies must use any payments for SSA to further the purposed of the program, ENs have no restrictions on how they can use payments from SSA. In addition, ENs are permitted to deny services to a beneficiary if the EN believes the services are too costly or that the beneficiary will not return to work. The opposite is true for State VR agencies. Under the Rehabilitation Act, any Social Security disability beneficiary (whether ticket-eligible or not) who applies for services and is interested in going to work is presumed to be eligible for services from the State VR agency. VR cannot consider whether the beneficiary is assigning his/her ticket to VR or not, or whether the beneficiary is likely to work and earn enough to constitute Substantial Gainful Activity (SGA) and result in a discontinuation of cash benefits. This fact is largely responsible for the fact that 90 percent of the ticket assignments have gone to VR. In fact, CSAVR has heard that some beneficiaries have approached numerous ENs in an attempt to secure services under the Ticket program prior to going to VR for services.
In one place Mr. Seifert’s testimony faults VR agencies for delaying/failing to assign a beneficiaries ticket, resulting in the beneficiary being subjected to a Continuing Disability Review (CDR). In the next paragraph, Mr. Seifert’s testimony faults VR agencies for implementing the policy option allowed under SSA’s Transmittal 17 (TM 17). TM 17 makes a distinction between beneficiaries who were receiving VR services prior to being eligible to receive a ticket (referred to as “pipeline” cases) and beneficiaries who seek VR assistance after becoming eligible for a ticket (referred to as “new” cases). Beneficiaries classified as “pipeline” cases may choose: 1) to assign the ticket to the State VR agency; 2) to assign the ticket to an EN; or 3) not assign the ticket to any provider. VR can seek compensation under the traditional cost reimbursement system regardless of the beneficiary’s choice among these options. However, if the beneficiary decides not to assign his/her ticket to any provider, SSA may initiate a medical review. With regard to “new” cases, TM 17 states that a beneficiary’s signature on the individualized plan for employment (IPE) indicates that: 1) the beneficiary has decided to use the ticket to obtain services from the State VR agency, if the ticket is assignable; and 2) the State VR agency has found the beneficiary eligible for VR services. TM 17 goes on to say that a “State VR agency may not receive any payments from SSA in a new case if the beneficiary is not eligible to assign/reassign the ticket because the ticket is assigned to another VR/EN.”
Since TM 17 does not specifically address the issue of a beneficiary who has a ticket that is assignable and chooses not to assign the ticket, it is unclear whether VR can seek cost reimbursement for the successfully serving these beneficiaries. Given the lack of clarity on this issue, the fact that the CDR protections are attached to ticket assignment, and the ongoing criticism of State VR agencies for implementing the “de-facto” ticket assignment spelled out in TM 17, some State VR agencies have implemented the de-facto assignment of tickets and others have not. CSAVR feels the critical issue in implementing the de-facto assignment of tickets is that beneficiaries are informed of the ticket’s assignment to VR and of the fact that they may be subjected to a CDR if the ticket is not assigned.
The CCD testimony referred to the situation in Florida where VR counselors were asked to go back through their case files and retroactively assign the tickets of every beneficiary who had received VR services after February 2002. The testimony claims this was done without notice to the beneficiary and regardless of whether the beneficiary had intended to assign the ticket to VR or not. CSAVR contacted the Florida VR agency to discuss this accusation. While Florida VR did go back through it case records to identify beneficiaries whose tickets might be assigned to VR under SSA’s policy interpretation in TM 17, the testimony does not reflect how VR undertook this process. VR’s instructions to the counselors undertaking this case review were to confirm that the beneficiary’s ticket was assignable and then to contact the beneficiary to notify him/her of VR’s plans to initiate ticket assignment.
The CCD testimony also refers one state where examples of a VR counselor’s failure to file “beneficiaries’ tickets” resulted in the “beneficiary” not being eligible for the CDR protections Congress included in the Ticket legislation. CSAVR was made aware of this situation in February. As far as we could ascertain, it was on beneficiary and one VR counselor who gave that beneficiary inaccurate information.
Given these two different examples of VR’s perceived failures with regard to ticket assignment, it is unclear what CCD wants VR to do. Should VR agencies assign tickets under TM 17 and afford beneficiaries the CDR protections inherent in ticket assignment, or should VR ignore the ticket assignment option spelled out in TM 17 and let beneficiaries suffer the consequence of not having access to the CDR protections associated with ticket assignment? The two ticket assignment situations cited in the CCD testimony provide an excellent example of one of the many dilemmas facing State VR agencies as they put forth good faith efforts to implement a program that is not producing the results expected and that has not resulted in a large pool of employment networks who are willing and financially able to take ticket assignments.
When the ticket legislation was signed into law on December 17, 1999, CSAVR feared that the Ticket program, being layered on top of an existing set of complex, flawed, and incompatible work incentive programs, would result in yet another failed SSA return-to-work initiative. What CSAVR did not foresee was that advocates and consumers who are angry about the Ticket program’s perceived failure (i.e., in terms of enlist significant numbers of private providers to function as ENs and influencing significant numbers of beneficiaries to seek employment through the Ticket program) would blame the Public VR program for these failures.
CSAVR believes it is too early to determine the success or failure of the Ticket program. Many of the problems associated with the perceived failure of the program stem from SSA’s interpretation of specific provisions in the ticket legislation. Unfortunately, the legislation left too many policy decisions up to SSA. If SSA were to revisit some of these policy interpretations and make changes in keeping with recommendations coming from groups like the Adequacy of Incentives Advisory Group, the Ticket program would likely result in more providers participating as ENs and more beneficiaries using their tickets to secure the services and supports needed to engage in employment and earn enough to get off cash benefits.
Martin Gerry, Deputy Commissioner for the Disability and Income Security Programs at SSA, also testified during the hearing. He talked about the success, however limited, of the Ticket program to date. Given that VR has 90 percent of the ticket assignments, CSAVR feels it is safe to say that most of this limited success can reasonably be attributed to the Public VR program.
CSAVR believes the ongoing attacks on VR for its good faith efforts to implement a new program within the confines of its existing legislative and regulatory requirements are unjustified and unwarranted. We should all be focusing on how to better serve beneficiaries with disabilities. If we can all focus on this common goal, we should be able to make the Ticket program a success.
CSAVR would like to thank the Chairman, Ranking Member and Members of the Social Security Subcommittee for the opportunity to submit written testimony on behalf of CSAVR in conjunction with the March 18th hearing on the Ticket to Work program. If you have any questions regarding this testimony, about VR’s efforts to implement the Ticket program, or about the Public VR program in general, please do not hesitate to contact Carl Suter, Executive Director of CSAVR, at (301) 654-8414.
