The Social Security Administration's Efforts to Promote Employment for Individuals with Disabilities: New Solutions for Old Problems

Remarks by Joan Durocher to the Social Security Advisory Board
January 31, 2006

Thank you for inviting NCD to be here today.  I am pleased to be joined on the telephone by Dr. John Kregel, Ed.D., Chairman, Department of Special Education and Disability Policy and Research; and Director, Virginia Commonwealth University Rehabilitation Research and Training Center on Workplace Supports. The Council worked with Dr. Kregel and his project team in the development of this report.

NCD’s social security report was developed as a result of a decision by the 15 members of the Council to target employment as a major issue to be addressed.  NCD feels that public policy on employment of people with disabilities impacts significantly on the ability of people to live in integrated settings with access to all necessary services, including long term services and supports, and unless these issues are considered holistically, we will not be successful.

NCD decided to start by looking at social security because of the sheer number of people with disabilities impacted by the SSA programs. In 2005 more than 48 million Americans received approximately $518 billion in SS benefits and over 7 million of these people will receive benefits as disabled workers or their dependents. And I’m sure you’re familiar with the staggering statistic that fewer that ½ of 1% of SS disability beneficiaries actually go to or transition back to work.  

The reasons for this are many and there’s much more detail contained in our report, but the basic issue is that as disability policymakers, we have not yet created a climate where people with disabilities feel that they can simultaneously seek employment and protect their access to health care or financial support.

Before getting into specific findings and recommendations, I thought it may be helpful to you to tell you briefly where our information came from. Several activities were conducted in the development of this report.

First, a comprehensive literature review was completed, and then structured interviews with key stakeholders were conducted.

From the data, NCD and its researchers developed seven topic papers that synthesized the findings. These topic papers were distributed to invited participants at a consensus validation conference that was convened in late January 2005 in Washington, D.C. The purpose of developing the topic papers was to present a written discussion of key issues that affect the employment of social security beneficiaries so that invited participants could react to the information and identify additional issues that should be prioritized and included in the study report.

Last was the development of this comprehensive study report, which went through an external review process, and contains 38 very specific recommendations designed to improve the opportunities for beneficiaries of social security.

We are well aware that over the past decade the Social Security Administration has devoted considerable resources to promoting employment and return to work among DI and SSI beneficiaries.  The agency has implemented a number of new initiatives authorized under the Ticket to Work and Work Incentives Improvement Act; it has modified program rules to provide increased work incentives to beneficiaries; and it has launched or is planning to launch a number of demonstrations that will review early intervention services, new modifications to work incentives within the DI program, and services targeted toward youth with disabilities.

Yet, SSA faces a number of challenges that unless addressed by Congress and SSA policy change, may not significantly address the huge number of SSA beneficiaries who never leave the SSI and DI rolls. The major findings of this NCD study reinforced once again that success in increasing the return to work opportunities of social security beneficiaries is predicated upon real collaboration across federal and state agencies; a fresh look at social security programs, including the definition of disability and approach to rehabilitation; and, implementation of demonstration projects that produce evidence based return to work practices.   

For example, one of the findings in our report includes:

• The definition of disability in the current SSA eligibility process is based on a 50 year old conceptualization of disability that is in direct conflict with the policy premises of more recent federal policies and programs.  The present eligibility determination process fails to acknowledge the concepts of partial disability or temporary disability. Rather than facilitating early intervention services by making rehabilitation services available to individuals early in the disability process, it delays eligibility for those services that might enable individuals to return to work.

The report contains findings and recommendations that fall into 3 general categories where NCD felt the need for change was most evident.  The three categories are beneficiary perspective and self-direction; income issues and incentives; and coordination and collaboration among multiple public and private systems.  The recommendations simply reflect those actions which would allow more Americans with disabilities to consider employment. We will not review all of the recommendations today; however, we will cover a few of them in our brief review of the three categories. 

Beneficiary Perspective and Self-Direction

First, the lack of a comprehensive, beneficiary-directed system of supports creates enormous risks in the lives of already vulnerable individuals. When an unsuccessful work attempt can have a significant negative impact on an individual’s financial and health status, it is unrealistic to expect large numbers of beneficiaries to attempt to leave the benefit rolls. This study again documents the fear that many disability beneficiaries have in exploring work options.

Congressional and regulatory policymakers must design alternatives that are better at recognizing the financial risks faced by beneficiaries. Our recommendations include a call for an integrated benefits planning and assistance program so that beneficiaries can better plan a return to work. Our recommendations also call for a strong national marketing program that will inform beneficiaries about TTW and other social security work programs. Congress and SSA must address these concerns through improvements in the delivery of customer service, modifications to the TTW program, expansion of SSA’s efforts to promote consumer choice, eradication of overpayments, and the elimination of marriage penalties.

Income Issues and Incentives

Second, the disability benefits programs are characterized by complex rules governing how various forms of income and assets are treated in terms of benefit eligibility and payment amount. Both the SSI and DI disability programs make a significant distinction between income that is earned and that which is unearned.

In addition, the SSI program imposes resource limits and includes a wide range of regulations that define which resources count and under what circumstance they count, as well as numerous citations detailing a host of specific income exclusions. The manner in which SSA treats these various forms of income and resources has a significant effect on the behavior of beneficiaries. The rules may serve to either encourage or reinforce behavior or to punish or decrease behavior. The manner in which these rules influence efforts by beneficiaries to attempt employment is detailed in this report and recommendations are included to address this concern.

Coordination and Collaboration among Multiple Public and Private Systems

And finally, too often, this alarming growth of the Social Security disability rolls has been represented and perceived as SSA’s problem to solve, when in fact it is a much larger problem. Receipt of Social Security disability benefits is merely the last stop on a long journey that many people with disabilities make from the point of disability onset to the moment at which disability is so severe that work is, at least temporarily, not possible. 

All along this journey, individuals encounter the policies and practices of the other systems involved in disability and employment issues. When these systems fail to stem the progression of disability or work at cross-purposes with one another to prevent successful employment retention or return to work, it is often the Social Security disability system that bears the eventual brunt of this failure.

Ultimately, however, the costs associated with having so many Americans exiting the nation’s workforce to lead lives of dependency on federal disability benefits are borne by all U.S. citizens. Any meaningful effort to slow down or reverse this relentless advance toward federal disability benefits will require significant and sustained collaboration and coordination between the Social Security Administration and the other federal agencies with a stake in developing disability and employment policy.

A significant opportunity to establish such systems collaboration was created on February 1, 2001, when President George W. Bush announced the New Freedom Initiative as part of a nationwide effort to remove barriers to community living for people with disabilities. While it is still too early to assess the full impact of the New Freedom Initiative, the platform it provides for systems coordination, collaboration, and integration is promising.

This NCD report discusses all of the relevant systems, examines the current status of coordination and includes recommendations to improve coordination and collaboration.

I just want to highlight a few of the specific recommendations in the report. 

• Congress and SSA should implement a series of procedural reforms to reduce overpayment to beneficiaries by increasing the use of electronic quarterly earnings data, piloting the creation of centralized work Continuing Disability Review processing cadres, and enhancing efforts to educate beneficiaries on reporting requirements, the impact of wages on benefits, and available work incentives.  One way of addressing the last part of this recommendation would be to allow beneficiaries to access benefits planning services through an integrated, coordinated program across multiple federal systems.

• Congress and SSA should address current shortcomings in the Ticket to Work program by expanding eligibility to include beneficiaries whose conditions are expected to improve, and to beneficiaries under the age of 18.  Further, Ticket to Work regulations should be modified to ensure that Ticket assignment practices do not violate the voluntary nature of the program and beneficiary rights to give informed consent.

• Congress should modify the current Title II disability legislation to eliminate Substantial Gainful Activity (SGA) as a post-entitlement consideration for continued eligibility and provide a gradual reduction in DI cash benefits based on increases in earned income.

• Congress should direct SSA to simplify regulatory earnings definitions and wage verification processes so they are consistent across the SSI and DI programs, as well as modify regulations related to the treatment of earnings in the DI program by applying the same rules currently applied in the SSI program.

• Congress should direct SSA develop and test program additions and regulatory modifications that will enable SSI beneficiaries to accumulate assets beyond existing limits through protected accounts and other savings programs.  Also, SSA should change current program rules and work with other federal agencies to modify and expand the value of Individual Development Accounts for all beneficiaries with disabilities.

• SSA should modify Ticket to Work program regulations to allow the SSA Vocational Rehabilitation traditional Cost Reimbursement Program to carry on as a parallel program to the Employment Network Outcome or Outcome Milestone payment mechanisms and ensure that an EN is able to accept a Ticket from a beneficiary and refer that individual to a VR agency for services without having to reimburse VR for those services.

• Congress should direct SSA to work with the Department of Education to expand the current Student Earned Income Exclusion and the Plan for Achieving Self Support programs to encourage involvement of transitioning beneficiaries in postsecondary education and training.  SSA should implement a policy change that would disregard all earned income and asset accumulation limits of transitioning beneficiaries for at least one year after post secondary education or training is completed.

• The Centers for Medicare and Medicaid Services and SSA should work closely together to modify existing program regulations in order to uncouple Medicare and Medicaid coverage from SSI or DI cash payments; eliminate the many employment disincentives built into CMS’s Medicaid waiver, Medicaid Buy-in, and Health Insurance Premium Payment programs; and work collaboratively with public and private insurance providers and business representatives to design insurance partnerships that will expand access to health care for individuals with disabilities.

In closing, we need to recognize that most social security beneficiaries, indeed most Americans, want to work. We must design a system that works across many national, state, and local rules and regulations and actually supports return to work. With the appropriate supports, including a forward thinking income support program, this can happen.