The Rural Exchange, The Rural Institute: Center for Excellence in Disability Education, Research, and Service, Volume 17, Number 2, 2004
Ticket To Work
Great Opportunities & Room for Improvement
To Be, or Not to Be?
Great Opportunities & Room for Improvement
By Marsha Katz, The University of Montana Rural Institute
The Ticket to Work and Work Incentive Improvement Act of 1999 is now in full swing. By the end of 2004, every person between the ages of 18 and 65 who receives Supplemental Security Income (SSI) and/or Social Security Disability Insurance (SSDI) benefits will have received a "Ticket" in the mail from the Social Security Administration. They can then use that "Ticket" to purchase employment services from any enrolled "Employment Network" (EN). The Employment Network is paid only if the person is satisfied with their service. And if the EN performs any service for the person that results in the person earning over what Social Security calls the "Substantial Gainful Activity" (SGA) level-$810/month in 2004-the EN has an opportunity to receive extended monthly payments for up to five years, depending on how long the person continues to earn over SGA, or is not due any SSDI or SSI payments. Upon enrollment, an EN elects to receive payment under one of two payment options.
- The "Outcome" option promises greater payments to the EN over a five year period, but requires that the worker not be due any SSI or SSDI check at all in order for the EN to receive payment.
- The "Outcome Milestone" option provides up to four reduced payments to an EN in a 15 month period, providing the worker earns at least SGA for up to 12 out of the 15 months. Additionally, the EN can then continue to receive the reduced payments for the remainder of five years if the person continues to earn over SGA.
While there are clearly some opportunities presented by Ticket to Work, it should be noted that they are actually accessible to a very few people. According to the Ticket program manager, Maximus, Ticket to Work was never intended to serve everyone, and if the ENs are successful with only one half of one percent of all "Ticket" holders, Ticket will have more than paid for itself. Because Ticket is meant to serve so few people, despite the broadly aimed exposure it has received, it contains some features that are frankly inequitable, and others that exemplify one of my cardinal rules when dealing with Social Security: "Don't Look for Logic."
Opportunities
Personal Opportunities
Choice
The greatest opportunity Ticket to Work provides
is that some SSI/SSDI recipients will now have real choice in
who provides their employment services. They can now choose to
receive services from any EN providing services to their geographic
location, as an alternative to the services provided by their
state Vocational Rehabilitation (VR) agency.
Benefits Analysis and Protection of Rights
One of the most constructive opportunities Ticket
to Work provides is the creation of a national cadre of
Benefits Planning Assistance and Outreach (BPAO) workers. These
BPAOs partner with SSI/SSDI recipients to examine the impact
of work on benefits before the person actually makes a decision
to go to or return to work. They share accurate information about
a range of benefits so individuals can make informed choices
that will not see them risking the loss of more than they stand
to gain by working.
Along with the BPAOs, Ticket to Work provided money to the nation's Protection and Advocacy (P&A) organizations to assure SSA does not inadvertently target people who took advantage of Ticket with Continuing Disability Reviews (CDRs), contrary to protections in the law. Many of the P&A organizations and their BPAO counterparts are also assisting SSI/SSDI recipients to write Social Security Plans for Achieving Self Support (PASS plans) to help them achieve their vocational goal.
Extended Medicare Coverage
A third Ticket opportunity
is that working SSDI recipients can continue to receive free
Medicare (Part A) hospital coverage even when they are no longer
eligible for an SSDI check because they are earning over SGA.
This free extension of Medicare Part A can continue for 8 ½ years.
When the free Medicare hospital benefits run out, people can
choose to buy-in to the Medicare hospital benefit. In addition,
when a working SSDI recipient loses eligibility for SSDI because
of earnings over the SGA level, and that person later must
stop working because of their disability, they can immediately
begin to receive their SSDI checks again if they notify SSA.
Medicaid Buy-In Potential
A fourth opportunity under Ticket exists
in those states that have elected to provide a Medicaid buy-in
to working SSDI recipients. This means that SSDI recipients
don't have to fear losing Medicaid if they go to work.
When their earnings put them over their state's income
eligibility limit, working SSDI recipients can buy-in to Medicaid
at very affordable levels.
Community & Government
Opportunities
Demonstration Project Funded
Increased Tax Base and Economic Growth
From a community's perspective, Ticket
to Work represents an opportunity for the community
to gain motivated, productive workers and business owners who
contribute to the tax base as well as to the local economy.
When working, SSDI recipients will likely spend some or all
of their increased income in their own communities buying goods
and services from local merchants.
Communities Gain
A second community opportunity exists when an SSI/SSDI recipient
uses Ticket to start a business
that provides goods and/or services that the community lacks
and needs. Unfortunately, this opportunity comes with a significant
challenge explained later under "Room for Improvement."
Slowing of Growth in SSI/SSDI Programs
Finally, Ticket is an opportunity
for the federal government to reduce the amount of disability
benefits paid out, thus saving money and slowing the growth of
the SSI and SSDI programs. The beauty of this cost savings is
that it is not accomplished by selective, hurtful budget cuts
that put vulnerable people at risk. On the contrary, it is accomplished
by providing choice, supports, and assistance to people so they
can go to/return to work and not lack health care insurance.
It's a win-win situation.
Room for Improvement…
The opportunities contained in Ticket to Work are minimized, or unavailable altogether to many people, partly as a result of uninformed changes and compromises that occurred between the time the intended legislation was envisioned, and the time it was signed into law. These changes and omissions have seriously diluted the promise of Ticket, thus similarly diluting the intended outcomes of its implementation.
No Access to Services from Employment Networks (EN) for SSI Recipients with Significant Disabilities
SSI is a disability-based public assistance program that poor people with disabilities who have little or no work record receive. In most states SSI comes with Medicaid, which provides the funding for general health care, and for medications, personal assistance services, and developmental disability and mental health services. Depending on their state, persons on SSI can gross up to $14,500-$42,000/year before they risk the loss of their Medicaid. This potential for high earnings would seemingly make SSI recipients very desirable customers for ENs. Under the Ticket to Work regulations, ENs can choose whether or not to serve a consumer, in the same way the consumer can choose from whom to buy employment services. ENs can receive reduced payments for their services when a consumer they assist grosses over the SGA level. Or, they can choose to receive full payments over a 5-year period, if the consumer they assist is earning enough to not be due any benefit check. For an SSI recipient, this typically means earnings of $1,213/month in 2004 (as opposed to earnings of $810/month for SSDI recipients). Therefore, ENs providing services under the "Outcome" payment option will most often choose to serve only those SSI recipients who are likely to earn at least $1,213/month.
Persons born with significant developmental disabilities typically receive SSI for much of their lives. They also frequently have work histories that are very limited from years in work activity centers and sheltered workshops. Even those in Supported Employment often work only part-time for minimum wage. At the minimum wage of $5.25/hour, even a full time job would produce only $840-$900/month, which is less than the $1,213/month the person would have to earn in order for the EN to receive full payments for their services. Therefore, ENs providing services under the "Outcome" payment option are much less likely to choose to serve persons with significant developmental disabilities, because there may be practically no chance the EN will receive payment for those services.
Even when the EN has chosen to provide services under the "Outcome Milestone" payment option, a person earning $5.25/hour would have to work nearly full time in order to gross over SGA, thus making the EN eligible for payment. Once again, ENs will be far less likely to serve persons with significant disabilities because they are not as likely to receive any payment for their services.
In essence, SSI recipients—the persons with the best health care safety net, who can afford to try earning more without losing essential services—are also the people who have the least chance of earning enough to make it worthwhile for an EN of their choice to serve them. The result is that Ticket to Work does not provide people with significant developmental and other disabilities the same freedom of choice and opportunity for self-determination that it provides to people with less significant disabilities. Ticket, as it reads today, sets up a situation where ENs are likely to consistently refuse services to persons with significant disabilities. Outside the realm of Ticket to Work, consistent denial of government or other services to one segment of the population would likely be termed as discrimination.
One solution to this inequity would be for Ticket to authorize payment to ENs that assist SSI recipients to have earnings that (significantly) reduce their SSI check each month, even though those earnings are less than $1,213 (in 2004).
Loss of Essential Health Care for SSDI Recipients
Conversely to the above situation, many SSDI recipients have significant work histories. Often having worked before acquiring their disabilities, they understand the world of work and typical workplace behaviors and rhythms, and are thus retrained for a new job more easily. This means they are often better candidates for a return-to-work than are many SSI recipients, and are more likely to have higher earnings, or the prospect of earning over the SGA amount each month.
ENs can receive the reduced payments for serving SSDI recipients when they earn $810 or more/month in 2004, if the EN chooses the "Outcome Milestone" payment option. If the SSDI recipients earn the Substantial Gainful Activity amount or more for enough months, SSA will deem them not eligible to receive their SSDI checks, and the EN can then receive full payment for providing employment services, if the EN has elected to provide services under the "Outcome" payment option.
While SSDI comes with Medicare, Medicare doesn't yet cover all prescription costs, personal assistance services, and most developmental disability and mental health services. (In late 2003, Congress passed a Medicare prescription bill that will provide partial assistance with prescription costs for SSDI and SS Retirement recipients.) If SSDI recipients need Medicaid in addition to their Medicare, in order to cover their expensive medications, personal assistance services, or mental health and developmental disability services, they must keep their income within specific low limits to become or stay financially eligible for Medicaid in their state, unless that state is one with a Medicaid buy-in program. Since working means having additional income, many SSDI recipients are fearful of working because they can't afford to lose their essential Medicaid.
So, the people with the best chance of earning enough to make them desirable candidates for ENs, and for whom the ENs are most likely to receive payment for services, are the least likely to seek out those services for fear of losing Medicaid. Many have noted that there appears to be a lack of logic in many current Ticket to Work regulations and policies that prevents accomplishing the very things the law initially said it wanted to accomplish.
The only light at the end of the tunnel currently is in the states that already had a Medicaid buy-in program before Ticket to Work, or that created one pursuant to the provisions in the Act. However, because the Medicaid buy-in provision was not mandatory for all of the states in Ticket to Work legislation, even this bit of potential light comes with pitfalls. First, faced with the option, States may choose to not create a Medicaid buy-in program, and secondly, again because the program is optional, it can easily end up on the chopping block during state budget negotiations since states cannot by law cut mandatory Medicaid services.
Inequity for Self-Employment
Issues Around Earnings
As I described above, payment for EN services can be partial
or full, based on whether SSI/SSDI recipients simply earn SGA
($810/month) for a number of months, or whether they earn enough
money for a long enough time to not be due any SSI or SSDI check
at all.
When someone receiving SSI/SSDI benefits chooses self-employment as their vocational goal, they look for financing that will help them start their small business while not creating additional debt. Thus, loans are infrequently used. Some of the more common sources of financing used by persons with disabilities include funds from Vocational Rehabilitation, Tribal Vocational Rehabilitation, Workforce Investment Act One-Stops, and PASS plans through the Social Security Administration.
Alone or blended, these funding sources allow persons with disabilities a modest start for their business. Typically, during the first year of a new business, and often on into the next few years, the gross income generated by the business is used to pay ongoing business expenses, and any money left is likely to go back into the business in order to help the business grow. This typical and necessary business practice puts persons with disabilities in a position that is in direct conflict with the Ticket to Work payment system for Employment Networks.
Currently an EN that assists someone with self-employment gets paid on the basis of the person's "net" income. Net income is what is left after all business expenses are paid out of the "gross" income. These business expenses may include things like the rent, utilities, and the cost of inventory and supplies that are necessary for day-to-day business. And these business expenses may also include money spent on new equipment to improve the business, or the cost of establishing an additional product line.
When profits are reinvested this way in the business in order to "grow" it, there is often little or no "net" income that remains. Little or no net income means that the EN won't be eligible to be paid for the services they provided to the new business owner, because the person isn't showing "net" income at the SGA level or above. If there is little or no prospect of payment for ENs, few of them are likely to serve persons with disabilities who want to engage in self-employment.
This inequity could be relieved by any of several changes to
the Ticket to Work. Perhaps the
simplest would be to pay ENs based on the business' gross
income per month, instead of the net income. Another possible
measure might include payment to ENs as long as the business
continues to have income and grow over the first 2-3 years, and
then shows a net profit of over the SGA amount beyond that time.
Unless some change in the current policy occurs, persons with
disabilities interested in self-employment are likely to be excluded
from the opportunities and choice offered by the Ticket in
much the same way that persons with significant disabilities
are excluded.
Continuing Disability Status
One other inequity for persons with disabilities choosing self-employment
over wage employment is the way Social Security evaluates their
earnings for purposes of a continuing disability status. If workers
in wage employment gross over $810/month, ENs electing the "Outcome
Milestone" payment option can receive payment for their
services. And yet, when SSA evaluates that work for evidence
of SGA, and thus, continuing eligibility for benefits, the workers
are also able to protect their SSDI benefits if they have Impairment
Related Work Expenses (IRWEs), or if they receive "Subsidy" that
brings their earnings below SGA.
People in self-employment can also use IRWEs and "Subsidy" to reduce how Social Security views their net earnings. However, if they do so, and the result is that Social Security views their net earnings to be under SGA, the ENs serving them will not be paid for their services under either payment option.
Marketing and Loss of Confidentiality
When an employment provider becomes an official EN under the Ticket to Work, it receives a list of all the Ticket holders in its service catchment area so it can market its services to them. When Social Security provides this list, it shares confidential information about Ticket holders that the Ticket holders have not authorized. In some cases, Ticket holders may be strongly opposed to having personal information shared with particular providers, but they are not consulted or given a choice ahead of time. While the opportunity to market its services to Ticket holders will allow newer and smaller employment providers to become known, it must somehow be balanced with the right of SSI/SSDI recipients to have their privacy respected, and to remain in control of who has access to confidential information about them.
Why Participate in Ticket?
Despite the preponderance of inequities and problems in the Ticket to Work, there are definitely reasons for SSI/SSDI recipients to assign their Ticket to an EN, and there are definitely reasons for an employment provider to enroll as an EN. The trick is to remember that the Ticket to Work only applies in very select situations. Therefore it is best thought of as only one more option, in an array of options available to SSI/SSDI recipients and employment providers.
Employment providers have nothing to lose by enrolling as an EN, and when the situation is carefully selected, they can gain by providing services under the Ticket. Whether or not an SSI/SSDI recipient uses their Ticket must be decided on a one-person-at-a-time analysis of the particular costs and benefits in that particular situation. Use of the Ticket is just one more piece to include in the comprehensive Benefits Planning process.
For the right person, and the right employment provider, the Ticket to Work has great potential to result in a win-win situation where all parties reap the benefits.
Marsha Katz is the Project Director for the Rural Institute's
Rural Entrepreneurship and Self-Employment Expansion Design (RESEED)
Project. You may reach her at (406) 243-2821, (877) 243-2476
(toll free), or adaptmt@aol.com.
Great Tips & Techniques for Strategic Planning
By Mike Flaherty, The University of Montana Rural Institute
The Ticket to Work is not for everyone.
Not every ticket holder will benefit from the Ticket, and not every organization will benefit by serving Ticket holders as an Employment Network (EN). According to Maximus, the firm managing the Ticket, the Ticket will apply to only 30,500 people across the country.
Having said that, there are scenarios in which the opportunities presented by the Ticket can result in win-win outcomes for everyone.
The application to become an EN is not difficult to complete, so many organizations have nothing to lose by filling it out, and then judiciously serving Ticket holders for whom they are likely to receive payment. These organizations may elect to be paid under the Outcome/Milestone payment system, choosing to receive lower payments that come more quickly, instead of higher payments that are delayed because they require sustained employment with earnings consistently over the Substantial Gainful Activity level (SGA, $810/month in 2004).
Following are a few examples of situations that can benefit an organization when that organization is debating whether or not to enroll as an EN. These examples are not all inclusive, and represent just a sampling of situations where an organization can either generate new money, or recoup some of the funds it would be spending anyway.
CILs as an EN
Perhaps you are a Center for Independent Living (CIL), or other community organization that routinely employs people with disabilities. If you enroll as an EN, and serve a Ticket holder, you could be eligible to receive payment for services in the following scenarios:
-
You have an employee with a Ticket who is currently grossing
less than the SGA level, but who could be working more hours, or
could be promoted to a higher paying position. If you provide any
service to that employee that results in the employee grossing
over the SGA level, you can receive payment under the Ticket to
Work. That service might be locating the higher paying position
within your organization, or providing benefits counseling around
the prospect of higher earnings.
- You are advertising for a new employee to fill a position
that pays at least the SGA level. If a prospective candidate for
the position holds a Ticket that he/she is willing to assign to
you as the EN, and you then hire that person, you are eligible
to receive payment under the Ticket to Work for locating the job.
- Perhaps your Center already offers some measure of accessible
transportation to consumers. If someone assigns their Ticket to
your Center as their EN, and the transportation you provide allows
the person to accept a job and get to work with the result that
the person grosses over the SGA amount you can receive payment
as an EN under the Ticket to Work.
- Maybe a consumer (or employee) comes to you wanting to go to work, or who is already working, but is grossing less than SGA. If that person assigns their Ticket to you, and you write a PASS plan that helps the person get a job paying SGA or more, or increase their wage so they are grossing SGA or more, you are eligible for payment under the Ticket.
Tribal VR Agency
Because Tribal Vocational Rehabilitation Agencies (TVR) are currently funded as a five-year grant, they don’t receive the reimbursements from Social Security that state Vocational
Rehabilitation (VR) agencies can receive when they have “successful closures” after providing services. If you are a TVR, you have a finite amount of money each year that you use to serve whoever comes your way seeking assistance to work. If you enroll as an EN, you can receive payment for your services when someone assigns their Ticket to you and you provide any service that results in the person grossing over SGA. You won’t want to serve all your consumers under the Ticket, but you can benefit by acting as an EN when there is a high likelihood that the person will gross over SGA. You would continue to serve everyone else (meaning people not likely to consistently gross over SGA) in your typical capacity as a TVR.
One-Stops & Workforce Investment Boards
Many of you haven't realized that you are eligible to
enroll as ENs. Perhaps the thought never occurred to you because
you have only recently begun to serve increasing numbers of people
with disabilities as a regular part of your day-to-day operations.
With the increase in the number of customers with disabilities,
One-Stops are becoming increasingly more knowledgeable about
some of the resources available to persons with disabilities.
Along with the Ticket to Work, those resources might include
Social Security Plans for Achieving Self Support (PASS plans)
and additional funding from state and tribal VR agencies.
How Creative Can ENs Be?
Surprisingly, you can be very creative. Some ENs are sharing their payments with the consumers they serve as a way to assure that consumers continue to report their wages to the EN for the entire time the EN is eligible to receive Ticket payments. This is perfectly legal and allowable, and helps the EN obtain the monthly documentation it needs to submit to Maximus in order to receive reimbursement.
Other ENs are sharing payments with employers once someone is placed and begins to earn over SGA each month.
Some ENs are concentrating on serving primarily one disability group, like people who are deaf, or people who are blind.
Both Ticket holders and ENs have a choice as to whether or not they will work with one another. This means that ENs, especially those with more meager cash resources, can be as selective as they wish, choosing to serve only those people for whom they are most likely to receive payment. Other larger, non-profit employment organizations may choose to serve many Ticket holders who are likely to gross SGA so they can also afford to serve some higher cost people who may never earn SGA.
To be or not to be an Employment Network? What’s YOUR answer?