Statement of John Coburn, Staff Attorney, Health and Disability Advocates, Chicago, Illinois

Testimony Before the Subcommittee on Social Security
of the House Committee on Ways and Means

March 18, 2004

Chairman Shaw and Members of the Committee--

I thank you for the opportunity to share our organization’s recommendations on how to improve the Ticket to Work program. I work for the Health & Disability Advocates, a national policy and advocacy group headquartered in Chicago, Illinois.   The Health & Disability Advocates (HDA) is the convener of the Midwest Employment and Training Partnership (Partnership).  The Partnership currently has roughly 80 active members and is comprised of employment and training providers and state Vocational Rehabilitation agencies (VR) that are participating as Employment Networks (ENs) in the Social Security Administration’s (SSA) Region V, which includes Illinois, Indiana, Michigan, Minnesota, Ohio and Wisconsin.  Also participating in the Partnership are the SSA-funded Benefits Planning Assistance & Outreach (BPAO) and Protection & Advocacy for Beneficiaries of Social Security (PABSS).

Today I am going to share with you policy recommendations developed by the Partnership.  I will also talk to you about the Chicago Ticket to Work Pilot, a project that our organization has developed to demonstrate a more integrated and responsive payment model for Employment Networks. 

As you might suspect, our first policy recommendation is to enhance the payment system for Employment Networks.  You will hear from many today about the need to change the payment structure, so I will not dwell on this in my testimony.   The Partnership fully endorses the recommendations of the Adequacy of Incentives Advisory Group for structuring the payment system on gross wages, with some payment upon job placement, and allowing payment for partial self-sufficiency.  It is our belief that you will never get adequate participation from employment and training providers outside of the traditional state vocational rehabilitation model without changing the current payment system.   The current payment structure provides no financial incentives for providers to become active ENs.  Until the Ticket Work Program payment structure is on par with how state vocational rehabilitation services are funded and how services under the Workforce Investment Act are funded, the Ticket to Work Program will always be subpar. 

As our second policy recommendation, the Partnership strongly recommends that SSA change how it compensates state VR under the Ticket to Work Program.  The current SSA policy – explained in SSA Transmittal 17 – often only allows cost reimbursement to state VR agencies on those cases in which individuals have assigned their Ticket to that state VR agency.   We believe that this policy is directly contrary to the intent of Congress and the authorizing statute. 

State VR agencies rely on a projected amount of SSA reimbursements as a base for their annual budgets.  As a result of Transmittal 17, many state VR agencies have been put into the position of having to aggressively seek Tickets from beneficiaries just to meet their annual budget.  This creates an employment and training services environment where state VR is given little or no encouragement, nor reward, for creating innovative partnerships with other employment training service providers or the private sector. 

The numbers bear this out – there are 3,978 (10%) beneficiaries participating in a system that Congress intended to create, a system that is designed to assist beneficiaries in leaving the Social Security roles.  The other 36,972 (90%) beneficiaries are potentially (and most likely) participating in the pre-TTWWIIA cost reimbursement system, a system that does not base payment upon assisting a beneficiary in leaving the roles.  If this continues, TWWIIA will never come close to reaching its goal of doubling the number of beneficiaries leaving the Social Security roles because of employment.

Our next policy recommendation is that the SSA immediately address the inadequacy of its work reporting system to eliminate problems with overpayments.  The work reporting system must be drastically improved to assure the maintenance of up-to-date records on work history.  If it does not improve, Employment Networks can face significant payment delays.  It only takes a few experiences with payment delays and complications for a service provider to decide continued participation in the Ticket to Work Program is not worth it.  In addition, problems with this work reporting system continue to discourage beneficiaries from seeking employment, which diminishes interest in seeking services from the Ticket to Work Program.  

The Partnership recognizes that SSA is working toward modernizing the current work reporting system and that this will take time.  Prior to achieving full modernization, the Partnership believes SSA can make minor operation changes to improve EN claims administration.  We suggest that SSA give the recently re-tooled Work Incentives Liaisons in the local SSA offices the specific job duty of maintaining ticket participant’s work activity.  Upon assignment of a ticket, the EN should be notified of the name and contact information of the local Work Incentive Liaison assigned to that ticket holder’s case.  With this information, the EN could follow up with the local Work Incentive Liaison if payment is not made in a timely manner.  The Partnership also recommends that SSA provide payment on EN claims with proper documentation within 30 days of submission.   

The last recommendation I will share with you today deals with the lack of technical assistance and support available to those Employment Networks currently trying to make a success of the Ticket to Work program.  Since launching the Midwest Employment and Training Partnership in June of 2003, HDA has received an overwhelming number of requests for training or technical support from employment service providers on topics ranging from the Ticket to Work Program regulations to building a service model that ensures successful and financially feasible participation in the Ticket to Work Program.  Fortunately, we have private foundation funding to do some of this, but our limited funding will not meet the need.  Based on this experience, the Partnership recommends that a technical assistance and training system built off of the existing SSA-funded technical assistance and training system be created.  The system must be built on a regional and local level so that employment service providers can receive services without extensive travel costs and lost staff time.  Such a model will also foster information sharing and replication of promising practices among ENs.

Chicago Ticket to Work Pilot
I will use the balance of my time to talk the Chicago Ticket to Work Pilot Project designed to demonstrate to you, SSA, and others how an adequate payment system can result in the positive outcomes that the TWWIIA legislation intended.   Health & Disability Advocates and other members of the Partnership have successfully engaged the Chicago Mayor’s Office for People with Disabilities, Chicago Mayor’s Office of Workforce Development, and the Illinois Department of Human Services—Division of Rehabilitation Services to pilot an up-front payment system for ENs in the city of Chicago.

The Chicago Ticket to Work pilot is slated to begin in April or May of 2004, and will be the only project of its kind in the country that combines municipal and state dollars.  The purpose of this pilot is to demonstrate a payment system that provides ENs with guaranteed payment within the first year of placement, encourages active participation by ENs and, more importantly, results in successful transitions to self-sufficiency.  The Pilot Project will be implemented as follows.  Through a neutral application process, three ENs serving residents of Chicago will be chosen to participate in the Project.  These three ENs will be eligible to receive payment on 8 to 10 of their assigned tickets.  Upon placing one of these ticket holders in competitive employment, the EN will receive $2000.  After 6 months of successful placement, the EN will receive another $2000.  Upon completion of one year of successful employment, the EN will receive $1000.  After this, the Employment Network will continue to be paid by the Social Security Administration through the current payment system.   

Each EN will be assigned to work closely with one of the Department of Labor/Social Security Administration-funded Disability Program Navigators (DPN) and/or the Department of Labor-funded Work Information Navigator (WIN).  The DPN and/or WIN will provide recruitment and referral services to the EN.  The EN will only be paid under the Pilot Project for tickets assigned as a result of a referral from the DPN and/or WIN.  Through this requirement, the Project hopes to build new and lasting relationships between the Employment Network and the One-Stop Center system.

Many stakeholders and experts have stated that the payment structure needs to change for TWWIIA to meet its goals.  We have created this Project to put into action what so many have said and hope that SSA will follow our lead.

Mr. Chairman, and members of the committee, I thank you for your time and welcome any questions you may have.