COMMITTEE on WAYS and MEANS

Chairman Dave Camp

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Joint Hearing on Work Incentives in Social Security Disability Programs

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Washington, Sep 23, 2011 | comments

JOINT HEARING ON WORK INCENTIVES IN
SOCIAL SECURITY DISABILITY PROGRAMS

_________________

JOINT HEARING


BEFORE THE

SUBCOMMITTEE ON SOCIAL SECURITY

AND


SUBCOMMITTEE ON HUMAN RESOURCES


OF THE


COMMITTEE ON WAYS AND MEANS

U.S. HOUSE OF REPRESENTATIVES

ONE HUNDRED TWELFTH CONGRESS

FIRST SESSION
___________

September 23, 2011

______________

SERIAL 112-SS10 & 112-HR08

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Printed for the use of the Committee on Ways and Means

 



COMMITTEE ON WAYS AND MEANS
 
SUBCOMMITTEE ON SOCIAL SECURITY
SAM JOHNSON, Texas, Chairman

   

KEVIN BRADY, Texas
PAT TIBERI, Ohio
AARON SCHOCK, Illinois
RICK BERG, North Dakota
ADRIAN SMITH, Nebraska
KENNY MARCHANT, New York
                             

XAVIER BECERRA, California
LLOYD DOGGETT, Texas
SHELLEY BERKLEY, Nevada
FORTNEY PETE STARK, California


COMMITTEE ON WAYS AND MEANS
SUBCOMMITTEE ON HUMAN RESOURCES
GEOFF DAVIS, Kentucky, Chiarman

   

ERIK PAULSEN, Minnesota
RICK BERG, North Dakota
TOM REED, New York
TOM PRICE, Georgia
DIANE BLACK, Tennessee
CHARLES W. BOUSTANY, JR., Louisiana

LLOYD DOGGETT, Texas
JIM MCDERMOTT, Washington
JOHN LEWIS, Georgia
JOSEPH CROWLEY, New York

JON TRAUB, Staff Director
JANICE MAYS, Minority Staff Director


 _____________________

C O N T E N T S

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Advisory of September 23, 2011 announcing the hearing


WITNESSES



Robert R. Williams

Associate Commissioner, Office of Employment Support Programs, accompanied by Dr. Robert R. Weathers II, Deputy Associate Commissioner, Office of Program Development and Research, Social Security Administration
Testimony

Dan Bertoni

Director, Education, Workforce, and Income Security Issues, U.S.
Government Accountability Office
Testimony

Deb Russell

Manager, Outreach and Employee Services, Walgreens Company, Deerfield, Illinois
Testimony


James Hanophy

Assistant Commissioner, Texas Department of Assistive and Rehabilitative Services, Austin, Texas, on behalf of the Council of State Administrators of Vocational Rehabilitation
Testimony


Cheryl Bates-Harris

Senior Disability Advocacy Specialist, National Disability Rights Network, on behalf of the Consortium for Citizens with Disabilities Employment and Training Task Force
Testimony


John Kregel

Professor, Special Education and Disability Policy, Virginia Commonwealth University, Richmond, Virginia
Testimony



____________________

JOINT HEARING ON WORK INCENTIVES IN
SOCIAL SECURITY DISABILITY PROGRAMS


Friday, September 23, 2011
House of Representatives,
Subcommittee on Social Security,
joint with
Subcommittee on Human Resources,
Committee on Ways and Means,
Washington, D.C.
_____________________



The subcommittees met, pursuant to call, at 9:05 a.m., in Room 1100, Longworth House Office Building, Hon. Sam Johnson [chairman of the Subcommittee on Social Security] presiding.


[The
advisory of the hearing follows:]
______________________________________________________________________

Chairman Johnson.  Good morning.  We had a late night last night, and some of our guys haven't woken up yet. 

But this hearing will come to order.  I welcome and thank Chairman Davis and Ranking Member Doggett and the members of the Subcommittee on Human Resources for joining us in this joint hearing. 

Our Nation's most vulnerable citizens are at the center of a perfect storm.  Record deficits, a still struggling economy, and an unsustainable future spending path, driven by the aging of Americans, all threaten the essential programs those with disabilities count on.  We have been warned by the Social Security Trustees that the disability insurance program will soon be unable to pay full benefits beginning just 7 years from now, in 2018.  Those who depend on these critical benefits are counting on us to act, and we will. 

This committee will soon hold hearings on the many challenges facing Social Security disability.  Today we turn to the issue of helping those already receiving benefits who want to work.  To achieve that end, Social Security administers a number of work‑incentive programs.  Congress established the current State Vocational Rehabilitation Reimbursement program ‑‑ that is a mouthful, isn't it ‑‑ in 1981 to encourage State vocational rehabilitation agencies to provide services that would result in work by disability beneficiaries.  Last year, Social Security paid over $100 million for these services. 

In 1999, Congress passed the Ticket to Work and Work Incentives Improvement Act to make it easier for beneficiaries to return to work.  The Ticket program allows beneficiaries to choose a public‑ or private‑sector service provider, known as an employment network, to get the training and support they need to find jobs, which, in turn, leads to benefit savings because they leave the benefit rolls, theoretically. 

Two grant programs were also created as part of the Ticket legislation.  One helps beneficiaries understand Social Security's complex rules, and the other assists in the resolution of potential disputes with employers.  The authorization for these two programs expires September 30, though their funding continues until the next year. 

So where are we today?  As we will soon hear, while there is some progress to report, the results are disappointing, and problems remain.  A recent report by the GAO found Social Security's oversight and management of the Ticket to Work program isn't where it needs to be.  For example, certain employment networks were telling ticket holders how they could work and keep their full benefits.  This is simply unacceptable.  Other employment networks are increasingly splitting the Ticket payment with beneficiaries while providing no direct services. 

At the same time, I have seen for myself how beneficiaries and employers benefit when the system works.  While back home this August, I visited the Walgreens distribution center in Waxahachie, Texas.  There, with the help of the Texas Department of Assistive and Rehabilitative Services, those with disabilities, including former beneficiaries, work side by side with other workers doing the same job for the same pay with the same performance.  I look forward to hearing more of their inspiring stories today. 

Despite these and other work incentives, the fact is less than half of 1 percent of those receiving disability has left the benefit rolls to work.  Now more than ever, how every taxpayer dollar is spent matters.  Programs that don't achieve results must be fixed, or they must end.  The question we must answer today is how work incentives can achieve the results Congress and the taxpayers expect and those with disabilities deserve. 

Chairman Johnson.  I now recognize Mr. Doggett, the ranking member, of the Subcommittee on Human Resources for his opening statement. 

Mr. Doggett.  Well, thank you very much, Chairman Johnson, Chairman Davis.  And to all of our witnesses this morning, we look forward to hearing from you. 

I think we all want a system here where any American who wants to work can work, and recognize that our workforce needs to provide a range of services or of functional levels so that we can make reasonable accommodation, where necessary, to allow those who have limitations and disabilities to participate to the full extent of their disability.  We must also recognize that there are some people who have a disabling condition that is so severe that they cannot participate in the workforce.  Those who are unable to work must have the guarantee of a safety net that is more net than hole and that helps them live in dignity. 

As the recent U.S. census data indicates, we have an increasing number of individuals with disabilities who are poor.  Nearly 30 percent of people who suffer from a disability live in poverty today in the United States.  And to some extent, with reference to the Supplemental Security Income program, that is because the payment is not overly generous.  Last year, the monthly benefit was a little less than $500 on the average, which would carry you to just a little over half of the poverty measure, according to the Congressional Research Service.  The majority of those who receive SSI have a disability that is expected to last at least a year or result in death, and renders them incapable of performing a substantial level of work.  So it is not surprising that those who are on SSI, receiving those limited benefits, may have difficulty or it may be impossible for them to move back into the workforce. 

At the same time, when you look at the way the law is written and the way it has been in effect since 1974, when someone who relies on SSI does see improvement in their condition, they want to begin to provide some type of employment service, they face the limitation that after the first $20 of income, their SSI benefit is reduced by $1 for every $2 of earned income exceeding $65 a month until the benefit level reaches zero.  This income disregard used to determine program eligibility of benefit levels, and it has not been replaced since originally set up in 1974. 

As Chairman Johnson mentioned, we have made some progress through the Ticket to Work Act, but it is important to analyze how that has worked here and what we can do to make it more effective. 

In my home State of Texas, which I share with Chairman Johnson, one of the organizations working in this area is Disability Rights Texas.  They helped a 41‑year‑old Austinite with spina bifida who receives SSI and had always assumed that he wouldn't be able to work because he was afraid he would lose his benefits.  Although he had acknowledged that his disability is very severe, and he had no work experience or training, he nonetheless decided he would try to work.  Disability Rights Texas referred him to rehabilitative services and a customized employment program that ultimately helped him receive a job placement where he is experiencing some success and taking pride in the value of his work. 

Another example is a gentleman who lives in Maynard, Texas, outside of Austin, who experiences a combination of both physical and mental problems that severely affect him.  The administrative law judge who decided his case noted that he was living in a car in the woods and would just sit there most of the day and talk to himself and the animals.  By the time he had his disability determination hearing, he had been living in the nonrunning vehicle for over 4 years and had undergone five psychiatric hospitalizations.  Now that he receives SSI benefits, he has access to housing and regular medical and psychiatric care. 

A contrasting set of examples about why we need to continue to strive to improve SSI, but why it will be necessary for some individuals who are not able to become productive members of our workforce. 

Mr. Chairman, thank you for holding today's hearing, and we look forward to cooperating with you in seeking improvements in the program while maintaining this vital safety net.  Thank you. 

Chairman Johnson.  Thank you. 

Chairman Johnson.  I will now recognize the chairman of the Subcommittee on Human Resources, Chairman Davis, for his opening statement. 

Chairman Davis.  Thank you, Chairman Johnson. 

As my colleagues have discussed, today's hearing examines the effectiveness of work incentives administered by the Social Security Administration designed to help people with disabilities go to work.  Chairman Johnson and Ranking Member Doggett focused on the effects, especially on individuals who receive disability checks from the Social Security Disability Insurance program. 

As chairman of the Human Resources Subcommittee, I want to discuss the implications for people on the Supplemental Security Income, or SSI program, which falls under our subcommittee's jurisdiction.  This is our first hearing this year specifically on the SSI program, and I can't think of a more appropriate topic than how we help people go back to work, and whether those efforts are succeeding. 

Since SSI first started paying benefits in 1974, this means‑tested cash assistance program has always encouraged work and earnings by reducing benefits by only $1 for every $2 in earnings.  In other words, SSI, by design, tries to overcome disincentives to work inherent in a benefit program for disabled people with very low income.  Even though SSI recipients have less work experience than SSDI recipients, an average of 5 percent leave the SSI rolls each year due to income from work or other sources--this is 10 times the rate for SSDI recipients.  Still, 5 percent is a very low rate. 

The key questions we have today are, do current programs and policies actually promote work?  And if not, what else should we be doing?  Our focus is on working‑age, disabled individuals, nearly 40 percent of whom have expressed an interest in working.  Disability applicants spend months and, in most cases, years proving they are disabled enough to merit benefit payments.  Once they successfully prove they are too disabled to work, we encourage them to try to work with the goal of leaving the benefit rolls again.  If it sounds complicated and contradictory, that is because it is. 

SSA manages a complex system of work incentives that include various exemptions and exceptions and disregards that are both difficult for beneficiaries to understand and for SSA to efficiently administer.  This confusing diagram up on the screen in front of you displays just the SSI work incentives, and it says it all.  A similarly confusing chart exists for the SSDI program.  What this all suggests is we need more balance.  Balance for the beneficiary when it comes to easing the transition to work while reducing complexity that has become an obstacle to work.  And balance for the Social Security Administration in administering complex work incentives efficiently and effectively.  Ultimately, this involves a balance of taxpayer dollars, too. 

What is the right balance of incentives for individuals who are unable to work due to disability and who receive cash benefits, health coverage, and support for a range of assistance and other programs?  Is there more assistance that would better help them work, or would more assistance make it even harder for them to work if the benefits of not working increasingly outweigh the benefits of working?  The question is, what is the right balance?  This discussion is why today's hearing is so important. 

Encouraging work and self‑sufficiency improves the well‑being of individuals and families regardless of their disability status.  We need to look deeper into these programs to hold SSA, current work incentives, and ourselves accountable for achieving this goal in a fiscally responsible manner.  We can't continue to just “do more” and “spend more” and hope that it helps.  We need to start by reviewing whether what we are already doing is working to help beneficiaries so we can ensure taxpayer resources are properly targeted.

We have an excellent panel of witnesses with us today to discuss these complicated issues and more.  We look forward to all of their testimonies. 

With that, I yield back. 

Chairman Johnson.  Thank you.  I appreciate your comments.

Chairman Johnson.  I will now recognize the ranking member on the Subcommittee on Social Security Mr. Becerra for his comments. 

Mr. Becerra.  Thank you, Mr. Chairman, to both chairmen, for holding this hearing today. 

We are examining today some of the tools SSA has to assist disabled Americans who receive benefits, but want to try to return to work.  I hope that this will be the starting point for moving legislation to continue the Social Security services that have allowed disabled Americans to live and work with dignity. 

Let us put things into perspective.  Social Security's disability programs; the Social Security Disability Insurance, DI, program; and the Supplemental Security Income program, SSI, are designed for people with severe work disabilities.  In order to qualify, Americans must suffer from a medical condition so severe that, according to medical and vocational experts, it essentially prevents them from doing any work at all. 

Most Americans receiving DI or SSI benefits are quite sick.  About 1 out of every 5 men awarded DI benefits dies within 5 years of starting benefits, and about 1 in every 10 Americans awarded DI benefits suffers from cancer.  Yet only the very sickest cancer patients qualify for benefits.  In 2010, 1.6 million Americans were diagnosed with cancer, but fewer than 10 percent of them were awarded DI benefits because they had cancer. 

New beneficiaries are also likely to be older.  Almost 6 of every 10 Americans who are awarded benefits are 50 years or older.  Nevertheless, a small number of severely disabled Americans courageously manage to work despite very serious challenges, and many others want to try.  We should encourage work whenever possible, such as by providing support to workers and employers without punishing those who are truly unable to work. 

This year's budget cuts imposed on the Social Security Administration, nearly $1 billion below what Social Security needs to do its job, will make it difficult for SSA to support Americans with disabilities who are trying to return to work.  Americans who are attempting to work often need specialized help that SSA can't provide.  Congress has authorized some small grants paid out of SSA's regular operating budget to help these Americans secure the specialized support they need.  We should do all we can to ensure that these services continue their successful record of helping disabled Americans return to work. 

Counselors funded through the Work Incentives Planning and Assistance program, or WIPA, help Americans understand and properly use the incentives offered by SSA that encourage the transition back to work.  The Protection and Advocacy for Beneficiaries of Social Security program, or PABSS, supports the efforts of disabled Americans to stay on the job; for example, by helping them obtain necessary accommodations like assistive technology or adjusted work hours. 

Mr. Chairman, I hope that we move quickly to extend and reauthorize these two important programs that result in more disabled Americans working with dignity.  At the same time, we must be careful that we do not do anything that puts Americans with severe disabilities and illnesses in danger of losing benefits they paid for with their contributions and tax dollars. 

Mr. Chairman, I look forward to hearing the witnesses today, and I am also hoping that at some point we are able to try to move on a bipartisan basis in reauthorizing many of these important programs, making the improvements where possible. 

With that, I yield back the balance of my time.

Chairman Johnson.  It can only be bipartisan if you stay on the committee. 

Mr. Becerra.  That is a super idea. 

Chairman Johnson.  Before we move on, I want to remind witnesses to please limit their oral statements to 5 minutes, if possible.  However, without objection, all the written testimony will be made a part of the hearing record. 

We have one panel today, and our witnesses who are seated at the table are from the Social Security Administration.  Robert R. Williams, Associate Commissioner, Office of Employment Support Programs, who is accompanied by Robert R. Weathers II, Deputy Associate Commissioner, Office of Program Development and Research; Dan Bertoni, Director of Education, Workforce, and Income Security Issues, U.S. Government Accountability Office; Deb Russell, Manager, Outreach and Employee Services, Walgreens Company, Deerfield, Illinois; James Hanophy, Assistant Commissioner, Texas Department of Assistive and Rehabilitative Services, Austin, Texas, on behalf of the Council of State Administrators of Vocational Rehabilitation; Cheryl Bates‑Harris, Senior Disability Advocacy Specialist, National Disability Rights Network, on behalf of the Consortium for Citizens with Disabilities Employment and Training Task Force; John Kregel, Professor, Special Education and Disability Policy, Virginia Commonwealth University, Richmond, Virginia. 

Mr. Williams, I understand you will be making a statement on behalf of the Social Security Administration, and Mr. Weathers is accompanying you to also answer questions.  I welcome you all, and thank you for being here.  You may proceed, Mr. Williams.  You are recognized.

STATEMENT OF ROBERT R. WILLIAMS, ASSOCIATE COMMISSIONER, OFFICE OF EMPLOYMENT SUPPORT PROGRAMS, ACCOMPANIED BY ROBERT R. WEATHERS, II, DEPUTY ASSOCIATE COMMISSIONER, OFFICE OF PROGRAM DEVELOPMENT AND RESEARCH, SOCIAL SECURITY ADMINISTRATION


Mr. Williams.  Good morning, Chairman Johnson, Chairman Davis, Ranking Members, and Members of the Subcommittees.  I am pleased to have this opportunity to discuss the Social Security Administration's employment support and self‑sufficiency efforts.  I want to start by offering you an overview of my view of where we need to take our programs. 

I took this job a few months ago for two reasons.  The first is that my own life and career convince me that many more Americans with significant disabilities can work and become fully self‑supporting if provided with the right opportunities and support.  Second, I think we have an opportunity to "right‑size" our expectations around the Ticket to Work program and our other employment support programs. 

We need to be realistic and strategic about the number of beneficiaries who will become financially independent due to work and earnings, even in the best of economies.  We must also ensure that the Ticket program and our other work incentives provide a path to good jobs, good careers, and better self‑supporting futures.  Frankly, it is the only way we can create a tipping point that will enable more beneficiaries to actually earn their way off of the disability rolls and to create better, more secure lives for themselves and their families. 

It is time to change our "any job will do" mentality of job placement, where we focused on getting beneficiaries into low‑wage jobs that offer little in the way of either career security or a better life.  We need to focus less on the numbers of beneficiaries who work just above the substantial gainful activity level and focus instead on the quality of support services we provide and, most importantly, the outcomes we successfully support those beneficiaries to achieve and sustain over time.  If we truly want to produce positive outcomes for the Vocational Rehabilitation, the Ticket, and Work Incentives Planning Assistance programs, the best way of doing so is by recognizing, supporting, reinforcing, and, yes, rewarding the initiative and hard‑won financial independence of these American workers. 

The Ticket program is not where we want it to be or where I believe it can be in the future.  Despite an unfavorable job market, though, we are making progress, the Ticket regulations we published in 2008 have significantly increased beneficiary and employment network participation in the program.  Building on this momentum, we are improving the data we collect on working beneficiaries.  This is enabling us to focus on those most likely to use the Ticket program and to support more beneficiaries to become and remain self‑sufficient.  I believe taking these steps will help make work truly work for more Americans with significant disabilities and, thus, advance the basic aims Congress set when it passed the Ticket to Work and the Work Incentives Improvement Act of 1999. 

As you know, last year the Congress extended funding for the WIPA and PABSS programs through the end of this month.  Unless those programs are reauthorized, the money for the WIPA and PABSS programs will effectively run out on June 30, 2012, and September 29, 2012, respectively. 

Disseminating accurate information to beneficiaries with disabilities about work‑incentive programs in support of their efforts to work and become self‑supporting is critical, and we will work with Congress to improve the effectiveness of the program. 

We are aware of a few concerns regarding the current structure of WIPA grants.  Findings from the most recent evaluation of WIPA will be available shortly, and we look forward to reviewing these new findings and working with Congress to ensure the best approach going forward. 

The Ticket Act also granted Social Security authority to conduct demonstration projects to test how certain changes in the program would affect beneficiary work and we have initiated several projects.  My colleague Bob Weathers will answer any questions you may have about these projects. 

In closing, we are firmly committed to assisting beneficiaries with disabilities who want to work and become self‑supporting.  To increase our success, we need to refocus our efforts and promote real pathways that more beneficiaries can pursue to gain and sustain financial independence. 

Thank you for your interest in this matter.  I am happy to answer any questions you may have. 

Chairman Johnson.  Thank you.  I appreciate your comments. 

[The statement of Mr. Williams follows:]

Chairman Johnson.  Mr. Bertoni, welcome.  Please go ahead. 

STATEMENT OF DAN BERTONI, DIRECTOR, EDUCATION, WORKFORCE, AND INCOME SECURITY ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE


Mr. Bertoni.  Mr. Chairmen, Ranking Members, members of the subcommittee, good morning.  I am pleased to discuss work incentives for disability program beneficiaries; in particular, SSA's Ticket to Work program.  The Ticket program has been under way for more than a decade and utilizes approved providers to assist beneficiaries, known as ticket holders, in obtaining employment and ultimately reducing their dependence on benefits. 

Our prior work and the work of others has questioned the viability of the program due to low participation and costs that are not offset by beneficiaries returning to work.  In an effort to attract more ticket holders and employment network providers, SSA revised its regulations in 2008 to include additional incentives for both groups.  My testimony this morning summarizes our May 2011 report and discusses trends in ticket holder and employment network participation over time, services provided by the various employment networks in SSA's management and oversight of the Ticket program. 

In summary, we found that beneficiaries assigning their tickets to employment network providers have more than doubled since 2008 to about 49,000; however, that number is relatively small compared to 12 million eligible beneficiaries.  And despite increased enrollments, the extent to which beneficiaries are returning to work and leaving the rolls is unknown because SSA has not yet evaluated program outcomes as required by law.  Because such an evaluation is key to assessing a program's effectiveness and long‑term viability, we have recommended that SSA prioritize and carry through with its plans to study ticket holder exits from disability rolls. 

Since 2008, employment network participation has also increased to about 1,600 providers; however, the bulk of activity in more than 70 percent of the $13 million SSA paid out last year went to only 20 providers, and just 3 received nearly a third of all payments.  Our analysis show that employment networks offer a range of services including assistance with job search, retention, and transportation; however, since 2008, an increasing number of providers are specifically targeting beneficiaries who are already working or don't need help finding work, and the largest are simply passing a portion of the Ticket payment back to the ticket holder, taking a substantial percentage for themselves and providing no direct services.  Such transactions essentially result in a benefit subsidy to the ticket holder and fairly easy money for providers. 

We have recommended that SSA compile data and assess trends in employment network service provisions to determine whether they are consistent with the program's goal of helping individuals find and retain sustainable employment and reduce dependence on benefits. 

Finally, we found that SSA lacks management tools for evaluating providers and beneficiaries to ensure program integrity and effectiveness.  For example, SSA had not developed clear guidance and performance measures or providers, which can lead to confusion about program goals and cause them to send mixed messages to beneficiaries about expected outcomes.  In fact, despite the program's stated purpose to reduce benefit dependence, our investigator, posing as a brother of a fictitious ticket holder, documented multiple providers promoting indefinite part‑time work and keeping ticket holders below certain income thresholds so as not to jeopardize their disability benefits.  Similar information was conveyed on other providers' Web sites and recorded phone messages. 

We also found weaknesses in SSA's oversight of ticket holders' timely progress toward employment due to the agency's suspension of required progress reviews between 2005 and November 2010.  As a result, thousands of ticket holders have been exempt, per program rules, from undergoing medical continuing disability reviews, or CDRs, for many years, regardless of whether they are actually moving towards self‑sustaining employment, intentionally resulting in improper payments to individuals who are no longer medically eligible. 

We have recommended that SSA develop program performance measures consistent with the Ticket law and a strategy for completing the backlog of required progress reviews, which SSA estimates to be between 13,000 and 22,000 cases per month, over the next year.  Moreover, we have recommended that SSA independently verify the information reported by beneficiaries to more accurately assess timely progress towards sustained employment. 

Mr. Chairman, members of the subcommittee, this concludes my statement.  I am happy to answer any questions that you may have.  Thank you. 

Chairman Johnson.  Thank you, sir. 

[The statement of Mr. Bertoni follows:]

Chairman Johnson.  Ms. Russell, welcome.  It is good to see you again.  Please proceed.
 
STATEMENT OF DEB RUSSELL, MANAGER, OUTREACH AND EMPLOYEE SERVICES, WALGREENS COMPANY, DEERFIELD, ILLINOIS

 

Ms. Russell.  Thank you.  Chairmen Johnson and Davis, Ranking Members Becerra and Doggett, thank you for the opportunity to testify today on behalf of our company. 

My name is Deb Russell, and I am a corporate manager at Walgreens.  In this role I am responsible for our efforts to include people with disabilities in our 20 distribution centers that serve our 7,700 stores in all 50 States, the District of Columbia and Puerto Rico.  Overall, this division employs nearly 10,000 full‑time employees. 

Walgreens is committed to offering and enhancing employment opportunities for people with disabilities.  I realize that this hearing is dedicated to individuals who are recipients of SSI and SSDI, but it is difficult to speak about employing them without speaking about our overall experience.  And to qualify, when we speak of people with disabilities, we are speaking about people who have disclosed their disabilities to us. 

Walgreens started intentionally recruiting people with disabilities with the opening of our distribution center in Anderson, South Carolina.  Since the opening of that facility, we have found that our model works in new as well as older buildings and in our stores.  However, the most rewarding demonstration of our success is the high number of companies who have toured our facilities and asked us for assistance in the development of a strategy that will work for them.  Companies like Lowe's, Best Buy, AT&T and Procter & Gamble have dedicated staff and time to learn about our inclusion and then gone back and designed efforts that have brought them great success as well. 

We teach them about the factors we think made us successful and seem to be universally true, which are that we need partners, education, and high standards.  We have learned that we do not need to have all the answers, and, in fact, we have found that companies who approach inclusive employment with that requirement seem to struggle to get their initiatives off the ground.  We do not pretend to be perfect at this nor to have all the answers, but we are always happy to share our story in hopes that it will inspire others. 

Our relationship with Social Security started in 2007.  As we discovered our success in Anderson, we looked for ways to ensure we could sustain our efforts.  The Ticket to Work seemed like a good fit.  The program has offered us a way to access resources that sustain needed accommodations, like sign language interpreters. 

The Ticket to Work's outcome payment method is a good match since we employ everyone in our distribution centers full time and at a starting pay average of over $12 per hour. 

We have three criteria for participating in this program.  We do not want a heavy administrative burden.  We do not want to compete with any other ENs to assign an employee's ticket and therefore provide the supports needed, and we do not want to have to manage mass inquiries from ticket holders.  We also want to avoid the real or perceived conflict of interest of being an employer which requires our employees to achieve high standards and for each month the employee remains with us. 

Throughout our experience as an EN, multiple changes to the program and the contract have made it more difficult for us to maintain our status.  Each round of changes seems to focus on the services an EN will offer prior to employment, which is not a good fit for us.  And the changes usually require more documentation and information that we do not have access to as an employer.  During this time both Maximus and the staff at the Social Security Administration's Office of Employment Supports have worked with us to be sure that they had the information needed, but allow us to deliver it in the easiest way possible. 

We have had 27 tickets assigned during our time as an EN.  The most we have had at one point in time was 16.  And to date, we have collected a little more than $300,000.  We now have seven tickets that have reached maximum reimbursement, meaning they have worked for us long enough to no longer have their ticket high value.  We are sure that many more of our employees have had tickets, but for many reasons have not surfaced through our Ticket activities. 

In addition to the Ticket program, we have interacted with WIPA.  In Anderson, the benefits person attended multiple new employee benefit sessions to ensure he could provide thorough information to our employees regarding the impact of earnings and employee benefits on their public benefits.  In all other buildings, our human resources staff are familiar with where to find their local WIPA contact information if an employee expresses a concern. 

As we continue to partner with the disability community, we still hear from agencies and parents that loss of benefits is an issue, but we do not hear this from our employees.  We have no knowledge of anyone terminating their employment with us due to overpayments or the desire to maintain benefits as an alternative to work.  I admit that many of our employees need assistance with wealth management and learning how to manage a life that is no longer deep in poverty, but they are not electing to stay home and collect a small check and stay immersed in the system. 

As we move our inclusion efforts into our stores, we do anticipate benefits being more of an issue since the nature of the retail industry is lower hourly pay combined with part‑time and sometimes irregular schedules.  Many of our retail employees will probably straddle employment and benefits, which is why we will not expand our role of an EN for our store employees.  However, we will continue to offer information on local WIPA services to hopefully alleviate doubts and issues that come with remaining part of the benefits system while being successful in a job. 

For many of our employees with disabilities, Walgreens is their first full‑time job.  We have seen the improvements in their lives as they earn and receive recognition for a job well done and build relationships with other team members. 

I do not minimize the extraordinary challenges facing people with disabilities who join the workforce, but the toughest challenge of all is when people with disabilities are seen as "them" and not as "us."  A job changes that.  A job is more than a paycheck.  It is a source of dignity.  The workplace can be a fulfilling place, a place where people with disabilities transform their lives from the margins to the mainstream.  At Walgreens, we feel fortunate to have made the commitment to invest in employing people with disabilities, people who make such an enormous contribution to our company, our customers and their community. 

Thank you for the opportunity to tell our stories.  I would be happy to answer any questions. 

Chairman Johnson.  Thank you, ma'am.  I appreciate that.  Thank you for letting us visit your center down there.

[The statement of Ms. Russell follows:]

Chairman Johnson.  Mr. Hanophy is from the great State of Texas.  Is your son the one that caused Texas A&M to leave the Big 12 conference? 

Mr. Hanophy.  I didn't want to mention that, but ‑‑

Chairman Johnson.  Welcome.  Please go ahead with your testimony.

STATEMENT OF JAMES HANOPHY, ASSISTANT COMMISSIONER, TEXAS DEPARTMENT OF ASSISTIVE AND REHABILITATIVE SERVICES, AUSTIN, TEXAS, ON BEHALF OF THE COUNCIL OF STATE ADMINISTRATORS OF VOCATIONAL REHABILITATION


Mr. Hanophy.  Good morning, Chairman Johnson, Chairman Davis and ranking members.  I am here representing the Council of State Administrators of Vocational Rehabilitation to discuss Ticket to Work and work incentives designed to help beneficiaries with disabilities return to work. 

The public vocational rehabilitation system serves over 1 million people with disabilities every year, and in 2010 helped approximately 172,000 people become employed and taxpaying citizens.  On average, the typical VR consumer will pay back through their taxes the cost of their VR services in just 2 to 4 years. 

The VR program has a longstanding partnership with Social Security.  Social Security reimburses the VR agencies for the cost of services provided to the beneficiary only after that individual has achieved earnings above substantial gainful activity, which is approximately $1,000 a month for 9 months of any 12‑month period.  The reimbursements earned from Social Security enable VR agencies to serve more consumers and in some states serve consumers on their waiting list. 

CSAVR is grateful to Social Security for initiating positive changes in the new Ticket to Work regulations, such as Partnership Plus that redefines the relationship between SSA beneficiaries who want to work, VR agencies, and ENs.  This, in my opinion, creates a five‑way win.  VR and the EN win because we are able to help a beneficiary go to work in a coordinated way with funding supports.  The taxpayers win as people become less reliant on benefits and more self‑supporting.  The business wins because they are able to hire a qualified applicant who has been screened and will be well supported.  And most of all, the beneficiary wins because they are able to go to work in a job that meets their talents, interests, and receive the work supports they may need. 

VR agencies and ENs are developing innovative arrangements to provide services to meet the needs of beneficiaries.  In Texas, the VR program offers incentive payments called Employment Advancement Payments to EN providers for services from the EN if a beneficiary reaches and maintains substantial gainful activity.  Partnership Plus also funds ongoing supports for ENs who provide embedded training within the Texas VR within our business customers where we do preemployment training. 

In Connecticut, Utah, Vermont, Virginia, as well as many other States, VR programs and ENs are working creatively to streamline processes, coordinate services, and leverage funding to increase successes for beneficiaries.  These arrangements are as different as the States themselves, which adds to the value of Partnership Plus. 

In Connecticut, the VR program is also working with Walgreens, who is an EN, to meet their business needs.  Walgreens built a state‑of‑the‑art distribution center where now currently 45 percent of the employees are people with disabilities. 

In addition to highlighting the Partnership Plus successes, these examples also illustrate the success the VR program has had in developing a dual‑customer approach, whereby VR works for both a person with a disability and a business as customers.  The VR National Employment Team consists of VR agencies that have developed a network of business partners committed to hiring qualified applicants who have disabilities, resulting in more full‑time jobs with benefits and career opportunities for SSA beneficiaries.  An example of this is the partnership with Walgreens and Texas, where one‑third of the people hired at the distribution center in full‑time jobs with benefits are SSA beneficiaries. 

We would also like to offer some suggestions for program improvements.  People who come on the disability rolls earlier stay longer, cost more, and lose out on work opportunities.  Social Security might explore an option of paying more for outcome payments or offering bonus payments for serving younger beneficiaries. 

Also, while not inherently part of the Ticket, we urge the committee and SSA to aggressively explore an early intervention model for applicants for SSI and SSDI benefits.  CSAVR has developed a risk‑free early intervention proposal that might help applicants try to work first.  This is attached to our written testimony.  This completely voluntary program would not stop the disability application process; however, before eligibility for benefits is determined, an applicant would be provided immediate access to temporary cash assistance, immediate access to health care, and immediate access to vocational services designed to help a person go to work.  The proposal would suspend the Social Security disability application once employment above SGA is found.  However, if employment fails, the work effort would not be considered as evidence against the participant in their application for disability benefits.  We believe a pilot targeted to a select number of States with a sample of applicants would cost little and inform us greatly about the potential. 

Lastly, it is important to keep in mind the effort to help SSA beneficiaries return to work is more than just a matter of having a ticket.  SSA funds the Work Incentive Planning and Assistance project, or WIPA, and we cannot stress strongly enough how important benefits planning is to helping SSA beneficiaries understand the various work incentives in SSI and SSDI.  CSAVR respectfully requests the committee to reauthorize the WIPA program in a timely fashion and provide the resources needed to ensure this critical service is available to beneficiaries.  The WIPA project is a proven benefit that works and deserves our full support. 

Again, thank you for the opportunity to testify, and I will answer any questions you have. 

Chairman Johnson.  Thank you, sir.

[The statement of Mr. Hanophy follows:]

Chairman Johnson.  Ms. Bates‑Harris, welcome.  Please proceed. 

STATEMENT OF CHERYL BATES‑HARRIS, SENIOR DISABILITY ADVOCACY SPECIALIST, NATIONAL DISABILITY RIGHTS NETWORK, ON BEHALF OF THE CONSORTIUM FOR CITIZENS WITH DISABILITIES EMPLOYMENT AND TRAINING TASK FORCE


Ms. Bates‑Harris.  Good morning.  Thank you, Chairman Johnson, Chairman Davis, and other distinguished members of the committee for this opportunity to testify today regarding work incentives in the Social Security disability programs.  As indicated, I am representing the CCD, Consortium for Citizens with Disabilities Employment and Training Task Force.  The CCD Employment and Training Task Force believes that meaningful employment represents one of the best opportunities for people with disabilities as they work towards becoming a productive and fully included member of society. 

Social Security work programs are among the many critical avenues for Social Security beneficiaries to gain access to employment.  We support improvements to Social Security to make it more effective in serving those that rely on it; however, we stand firm in our belief that changes to the Social Security system should not be made in the hothouse environment of deficit reduction.

Considerable attention is being given to the plight of long‑term umemployed, and it is important that policymakers understand that millions of people with disabilities are disconnected from the workplace and do not fall within the traditional definitions of long‑term unemployment.  Therefore, these critical services are essential to ensure their participation and return to employment.

Employment of individuals with disabilities requires a comprehensive approach that addresses all aspects of the service system to ensure that the vision of integrated competitive employment is fostered and promoted.  Ongoing staff development, among systems staff and service providers, is vital so that they not only embrace the vision, but have the technical knowledge to implement it.  A holistic approach requires addressing a wide range of other issues:  outreach to and engagement with employers, service monitoring and quality assurance, engagement of individuals and families, and the availability of benefits counseling and protection and advocacy support which will allow community employment, transportation, interagency collaboration, just to name a few. 

Over the past decade, Congress has focused most of its attention only on the Ticket to Work program.  Revised regulations and things have drastically changed the program, so I am not going to talk so much about the Ticket as much as the supports of the two critical programs that are soon to expire. 

The first is, of course, the Protection and Advocacy for Beneficiaries of Social Security.  It is the responsibility of these programs to provide information and advice about obtaining vocational rehabilitation and employment services, information and referral services to beneficiaries on work incentives, advocacy, and, most importantly, legal services that a beneficiary needs to secure, maintain, or regain employment, including the investigation and remedy of complaints of employment discrimination and other civil and legal rights violations.  Despite the extensive set of duties and growing demand for services, the PABSS program has been funded at the same level, and its authorization expires at the end of the fiscal year. 

The WIPA programs inform beneficiaries on the impact that employment will have on disability income and medical coverage, and addresses many of the fears that individuals have about going to work at the risk of losing health coverage.  Authority, again, for these grants will expire. 

More needs to be done to ensure that individuals and families are aware of the availability of these critical services, and that consistently provides the message that encourages employment in the community rather than simply the preservation of benefits.  So we believe that it is really important to address those. 

Some of the other issues that we also think are critically important to continue are the expanded use of the employment networks; the Medicaid Infrastructure grants, the Partnership Plus model.  The Social Security Administration's revised Ticket regulations improved the overall effectiveness of the program, and it is important that these things continue. 

The Ticket program is poised to benefit from data‑matching advances. 

And one area that has slipped due to staffing shortages is the process of earnings reported by beneficiaries.  When beneficiaries get overpayment notices, it is shocking to beneficiaries when they receive these notices and assume that the information has been processed properly. 

The rest of my testimony is written and can be submitted for the record, and I am happy to answer any questions that you have. 

Chairman Johnson.  Thank you, ma'am.  It will be entered into the record. 

[The statement of Ms. Bates‑Harris follows:]

Chairman Johnson.  Dr. Kregel, please go ahead.
 
STATEMENT OF JOHN KREGEL, PROFESSOR, SPECIAL EDUCATION AND DISABILITY POLICY, VIRGINIA COMMONWEALTH UNIVERSITY, RICHMOND, VIRGINIA

 

Mr. Kregel.  Thank you, Chairman Johnson, Chairman Davis.  Thank you very much for this opportunity.  I will focus my comments today on the Work Incentives Planning and Assistance, or WIPA, program. 

Individuals with disabilities who receive SSI and SSDI are frequently viewed as unemployable when in reality millions of beneficiaries have clear goals to work and reduce their reliance on disability benefits.  Of the 13 million current SSA beneficiaries, it is estimated that 2.7 million see themselves working in the near future, and an additional 2.6 million have also been employed or looked for work in the past 12 months.  These 5.3 million individuals should be the primary focus of SSA's employment and return‑to‑work initiatives. 

So why aren't more people working?  First, disincentives in our SSA program rules often penalize beneficiaries who attempt to work.  Most depend on their SSA benefits to meet their basic needs and would tremendously benefit from working.  Unfortunately, beneficiaries are repeatedly told that employment will quickly lead to loss of their benefits.  This is absolutely not the case.  Yet fear of losing benefits leads them to unnecessarily choose not to work or to needlessly restrict their work hours and earnings. 

Second, while many beneficiaries would willingly forgo their cash benefits for the possibility of increasing their income through employment, they still fear potential loss of their corresponding Medicaid or Medicare coverage.  Many beneficiaries possess serious chronic health conditions that would make the loss of health care coverage catastrophic to them personally. 

Third, beneficiaries fear potential overpayments or sudden benefit termination.  Local Social Security offices, facing enormous pressures while attempting to respond to the large increases in program applications, simply lack the personnel and time necessary to accurately administer the work‑incentives provisions.  The result is an abundance of disruptive overpayments and a sudden loss of benefits that often lead beneficiaries to abandon their hopes for long‑term employment. 

To address these problems, SSA has established the Work Incentives Planning and Assistance, or WIPA, program.  The WIPA program is an employment support that is designed to enable SSA beneficiaries to pursue their goals of personal employment and economic self‑sufficiency.  WIPA services refer to efforts by a rigorously trained community work incentive counselor to provide accurate and complete information to SSA beneficiaries to enable them to obtain employment, return to work, and reduce dependence on SSI and SSDI. 

Currently the WIPA initiative is comprised of 102 projects providing benefits to SSA beneficiaries in all 50 States and territories.  Collectively the projects employ 500 rigorously trained Community Work Incentive Coordinators, many of whom are themselves individuals with disabilities.  Since their inception in 2000, WIPA programs have provided work‑incentive counseling services to over 450,000 SSI, concurrent and SSDI beneficiaries, including 60,000 persons served over the past year. 

So what do they do?  In Dallas, a 40‑year‑old gentleman named Danny secured a heart transplant after a 6‑year battle with heart disease.  He thought he could never work again without losing his $1,800‑per‑month SSDI check.  After working with the WIPA project for 3 months, he is working 15 hours per week and is earning over $1,500 a month for a heavy equipment sales company.  In November, his $1,800 check will go to zero, saving SSA $20,000 per year for hopefully many years to come. 

Jay in Louisville is a young man with developmental disabilities, who receives SSI and has a Medicaid waiver for personal and employment supports.  His father contacted a CWIC when Jay began working with a new supported employment provider.  The family has received work incentive counseling and information that have allowed them to feel comfortable in letting Jay go to work for the University of Louisville in a job that provides him earnings at a level of over $1,000 per month.  Each month he works results in a savings of $400 to SSA.  Given his age, these savings will compound over the next several decades.  If his earnings increase, the savings to SSA will increase as well. 

In Los Angeles, Michael received a termination letter on his benefits.  The letter also stated that he had an overpayment of $79,000, money he was ordered to pay back to the Social Security Administration.  The CWIC assigned to this beneficiary thoroughly reviewed his case and discovered the client was incorrectly terminated.  Due to the CWIC's diligence, attention to detail, and excellent rapport with SSA Claims Representatives and community partners, both issues were resolved.  The beneficiary received reentitlement to his SSDI check, and the alleged $79,000 overpayment was cleared. 

Services provided by WIPA projects lead to increased employment, improved earnings, and reduced dependence on disability benefits.  These outcomes lead to significant reductions in the overall amount of general funds and trust fund payments to beneficiaries.  These savings are large enough to offset the cost of the program and could be expected to compound steadily over time as individuals leave the disability rolls after receiving WIPA services and remain in the workforce for many years to come. 

Thank you, Mr. Chairman, and I appreciate the opportunity to answer any questions.

[The statement of Mr. Kregel follows:]

Chairman Johnson.  I thank all of you for your testimony.  We will now turn to questions.  And as is customary for each round of questions, I will limit my time to 5 minutes and ask my colleagues and my companion chairman here to limit your time to 5 minutes as well. 

Mr. Bertoni, GAO found employment networks paid by Social Security who were essentially coaching ticket holders to work part time so they wouldn't lose their benefits even though the goal of Ticket to Work is to get individuals back to work and off disability.  I understand you have taped conversations to prove this.  I would appreciate it if you would play a couple of these conversations for us and then tell me, one, how widespread it is; two, what Social Security has done to address it; and three, what this says about Social Security's ability to manage this or other work‑incentive programs. 

Mr. Bertoni.  Sure.  Let me quickly preface this by saying that in interviewing the employment networks, 15 of 25 of them told us that SSA had not articulated any specific outcomes for them, nor had they provided performance goals.  So in an environment like that, you really run the risk of, number one, confusion in terms of how you explain the rules; lack of consistency across the various profiles in terms of how those rules are applied; and lastly, it is an opportunity for a potential abuse.  So any one of those things could be coming into play with these recordings.  It just shows that when you have that type of environment, that these types of things can happen.  So if you want to roll those tapes, that would be great. 

[Tape played.]

Mr. Bertoni.  It looks like they just went with two calls. 

Your question was, how pervasive?  We don't know how pervasive this is.  What we did is we followed the money.  We went with the top 20 providers, and we talked to an additional 5 providers.  We had three lines of questioning.  We had lines for shared payment approaches.  We had calls for employer‑driven approaches, and we had calls for vendors that we didn't know what they were doing.  Based on the descriptions of their Web sites, and interviews that we had, and documents that we looked at, we really couldn't discern what the services that were being offered, so we felt that we had to call these individuals and sort of get behind that information. 

We made eight calls to different providers.  We had multiple no answers, no contacts where we couldn't get through.  But three of those eight resulted in these conversations where it appeared that there was some real coaching going on. 

SSA doesn't have a good sense of this either.  We do know there are other Web sites and other providers that are promoting this type of activity, but we don't have a good sense of the universe or what is going on amongst the 1,600 providers.  But SSA could do that.  They could get behind that. 

You asked actions they can take and are taking.  They do a secret shopper program.  They have a secret shopper program.  You could systematically do exactly what we did:  sample or go through the entire range of employment networks, the larger providers, and sort of get a sense of the extent to which this is happening. 

I think one of the primary things that has to happen here is they really need to establish performance metrics that are designed to move employment networks towards pushing employment that is beyond part‑time work.  Until you establish that metric and you hold these folks accountable, again, you have opportunity for confusion, inconsistent application, and perhaps abuse. 

Chairman Johnson.  Thank you.  My time has expired.  I appreciate you all looking at that.  Thank you so much. 

Mr. Williams, would you care to respond? 

Mr. Williams.  Yes, I would. 

Chairman Johnson.  Go ahead.

Mr. Williams.  We have established clear performance standards and expectations that coaching people to limit their earnings is completely unacceptable, and we are weeding out those that do.  We have instituted a contract process that will enable us to terminate bad actors and have done so already.  Additionally, we will submit a response for the record.

[The information Robert R. Williams follows:]

Chairman Johnson.  Thank you, sir. 

Mr. Bertoni, are you guys on top of most of the States in the country? 

Mr. Bertoni.  In terms of ‑‑

Chairman Johnson.  Looking at this program. 

Mr. Bertoni.  The distribution of the 25 providers gave us some good geographic distribution, but I don't know if we covered ‑‑ we certainly didn't cover every State. 

Chairman Johnson.  Well, no two States are alike, I presume.

Mr. Bertoni.  No.  But the rules of the program should be alike, and they should be applied very consistently. 

Chairman Johnson.  Agreed.  Okay.  Thank you for your comments.  And I have extended my time. 

I recognize Chairman Davis.  And thank you for having your subcommittee join us today. 

Chairman Davis.  It is a privilege, Mr. Chairman. 

Mr. Bertoni, I want to follow on the line of having SSA get necessary program information.  Do we know how much taxpayers have spent on the Ticket to Work program since it started, including amounts paid to employment networks? 

Mr. Bertoni.  Sure.  I can give you recent information from our reporting period a little bit before that.  When we reported, it was about $34 million in administrative costs and about $13 million paid out in Ticket dollars to ticket holders.  In 2007, that amount ‑‑ Ticket payments were about $3.8 million.  By 2008, they were $5.6 million.  By 2009, they were up to $12.6, and partial‑year 2010 were $13 million.  So that is about $41.5 million in Ticket payments. 

This year here, though, we have a real rapid increase in these payments.  We see that is a pretty significant increase post‑2008, primarily driven by the rapid increase in beneficiaries from 22,000 to 49,000.  So this program has grown ‑‑ well, the numbers are relatively small.  It has grown quickly in terms of the payments.  And when you look at the potential eligible beneficiaries, there are 12 million people out there who have a ticket who could come forward at some point in the near future.  So this program is poised to grow, and it could be significantly, based on the numbers that could take up the tickets. 

Chairman Davis.  It sounds like a disproportionately high amount of administrative costs for the current payout.  Do we know what aspects of the Ticket program are working? 

Mr. Bertoni.  I think, as SSA and others have said, I think they have done a very good job of increasing the number of employment networks and are doing a significant job in increasing the number of folks who are taking up tickets and using them. 

Chairman Davis.  I guess maybe a bigger question is, in my mind, getting people into a program is not necessarily a definition of effectiveness.  Would you rate the Ticket program as effective?  And do you believe that SSA is adequately collecting and analyzing proper information to be able to answer these sorts of questions? 

Mr. Bertoni.  To date, no.  I think the front part of that is getting folks in the program is important.  You have to work with something.  But there is a management aspect to this, and from that standpoint, I think they have not been effective in many ways in terms of vetting and approving the employment networks to ensure they are qualified; in terms of monitoring individual ticket holders; certainly establishing performance measures to hold employment networks accountable; and also to evaluate and reevaluate the program, determine what is working and what isn't, what are the trends in service provisions, and what are the outcomes that are coming out of this program.  That is what is not happening, and that is what we don't know, and that is what SSA does not know to date. 

Chairman Davis.  Dr. Weathers, do you have anything to add? 

Mr. Weathers.  Yes.  We do have an independent evaluator, Mathematica.  They have been doing an evaluation of the Ticket program since its inception.  Many of their earlier reports ‑‑ they have already produced five reports ‑‑ were used in order for us to change the program in 2008 with the new regulations. 

Since 2008, we have been collecting data on outcomes of ticket beneficiaries, and we just completed a national beneficiary survey.  Mathematica is conducting an analysis of that national beneficiary survey so we will be able to measure outcomes of ticket beneficiaries since the new regulations went into place in 2008.  But it does take time for a new program and new rules to be communicated to the public and to beneficiaries, and we need to wait a period of time before we can effectively evaluate how the new rules are working. 

Chairman Davis.  Okay.  Dr. Kregel, as an academic, do you think Dr. Bertoni's findings are acceptable, and what do you recommend we do to hold Ticket to Work and other work‑incentive programs accountable? 

Mr. Kregel.  I think that it is important to set performance standards for each of these programs.  Looking at, for example, the Ticket program, it is important to ask, in the absence of this program, would these people still return to work?  And if you look at the examples that have been cited that effectively indicate that individuals are assigning their ticket with an EN, they are working, but the EN is not providing them any service, then it is very reasonable to say, in the absence of this program, wouldn't this person have gone to work anyway?  So the notion is, if the program is not there, would these individuals return to work?  Would it result in savings to the government, savings to SSA?  And that is the question that needs to be addressed going forward. 

Chairman Davis.  I will just leave you with a thought.  And perhaps those of you on the panel that feel so moved, but specifically from Dr. Weathers and Mr. Bertoni, I would appreciate just a response in writing for the sake of time. 

It seems that there are compelling disincentives for people to want to go to work, particularly what I have seen in the eastern portion of my district, an outright racket with attorneys who are advertising on the radio for benefits, that make outrageous fees, and, you know, really want to discourage folks from going back to work and the benefits of that. 

I would be interested just as an adjunct in this, in order to make Ticket to Work work, what are some things that might be able to be done to curtail the program from an inappropriate perspective; wanting to help people, but at the same time avoiding folks profiteering off the backs of these folks in need? 

[The information Robert R. Williams follows:]
[The information Dan Bertoni follows:]

Chairman Davis.  With that, I thank the chairman for his additional indulgence, and I yield back. 

Chairman Johnson.  Thank you.  I appreciate your comments. 

Mr. Becerra, you are recognized for 5 minutes. 

Mr. Becerra.  Thank you, Mr. Chairman. 

And thank you all for your testimony and your work. 

Mr. Bertoni, I want to focus in on some of the things that you have been saying, because you are going to get most of the attention here.  I want to see if I can get ahold of a threshold question.  We are talking about folks who qualify for SSI or SSDI benefits.  We are talking about folks who have proven to have a health condition that is severe enough that they would qualify to receive some form of assistance, disability assistance.  No one is questioning that the folks that we are talking about are disabled in some form that are interested in trying to work. 

Mr. Bertoni.  Correct. 

Mr. Becerra.  So having said that, as I listen to those tapes, my sense was that we may have to work on these employment networks. 

Mr. Bertoni, do you have anything to share with us that shows that beneficiaries were trying to game the system? 

Mr. Bertoni.  No.  I think the ‑‑ our recommendations in my introduction was that it is between the agency and the employment networks where the guidance needs to be clarified, and these networks need to be educated as to what you can't say and what you can say, and how best to screen and counsel folks to get them back to work. 

Mr. Becerra.  So you have given us some good guidance on how to zero in to try to make these programs work better, because I don't hear anyone saying here that beneficiaries are trying to game the system, get benefits that they don't deserve, or game the system by saying they are working or working enough and then keep both benefits and salaries. 

Mr. Bertoni.  No.  In fact, if you listen to the tapes, you go to the Web sites, or you read any of SSA's materials that they put out, that is what is said:  You can work.  You can work part time.  It is acceptable.  But there is a "for a period of time" in there, of course.  But I think these folks are reading this as, I can do this. 

Mr. Becerra.  So now I want to get the question to you in just a second, but first I want to ask Ms. Russell a question. 

The chairman and I were just chatting about the work that Walgreens is doing, which seems to be tremendously helpful to a lot of these folks who are receiving these disability benefits that are trying to work.  So I want to make sure we don't paint with a broad brush all these employment networks, because there seem to be some that are trying to do this the right way.  And I would hate for folks who are trying to really connect someone who is receiving these disability benefits with a job, all of a sudden I feel like, gosh, I am getting bashed over the head for trying to do this, and I am also investing some pretty significant resources to make it work. 

Have you found a particular formula that helps you succeed so that you don't find that your folks on the other end of the phone doing something like this? 

Ms. Russell.  Yeah.  I think that our formula for success overall mirrors our formula for success with the Ticket program, and that is that education is key.  Our individuals, our staff people who are involved in the Ticket program, are well educated on what parameters within our role as an employer and our role as an employment network they need to operate within.  They are provided a lot of information about what they can and can't say, what they can and can't do.  We maintain a lot of the control at corporate, which prevents us from having to worry about things happening out in the field that would be inappropriate. 

Mr. Becerra.  I will ask Mr. Williams and Dr. Weathers, I know you have some budgetary issues, staffing issues, but I suspect that there are some employment networks that are out there that produce well and most folks that, say, are doing the right thing.  I am not sure if it is a matter of getting the best practices from some of these folks or somehow doing things because I know you are shy of money.  But I think there has got to be a way, short of making very expensive investments, to try to make this program work. 

I think what Mr. Bertoni had pointed out through these taped phone conversations is that either the employment network folks are trying to help these folks maintain as much of an income as possible, or they are trying to avoid having to bring them on full time.  Either way I think we need to figure that out. 

Mr. Bertoni, let me ask you this:  SSA just took a massive hit in its budget.  It is receiving $1 billion less than it said it needed just to try to keep pace with an already growing caseload.  What you are suggesting that they do is program integrity isn't cheap, and it is not free.  They would have to hire more folks or put more investments up front with people who are already steeped with work in order to try to up front catch some of this gaming activity.  Is that correct? 

Mr. Bertoni.  There is no question with more resources you can do more.  I guess the position we have is this program has been around since 1999.  It has been growing, expanding.  There were some new initiatives in play.  And there is some blame to be laid at the agency's management doorstep in terms of what could have been done in prior years. 

Luckily, we are here at a time when the program is not huge.  Five years from now, we could have a bigger problem on our hands.  These are issues that need to be addressed.  And within the resources they have, I think they can leverage some of that to do better.  If they had more resources, could they do more?  Absolutely. 

Mr. Becerra.  Thank you for that.  And I just hope that what SSA does is takes some of this information, perhaps talks to some of those who have shown some good practices, and try to quickly take advantage of those best practices so that we can move the program forward, you know, make it work better, because I think what we are showing is that there are a lot of Americans who are receiving disability benefits who would love nothing more than to be able to go to work as much as possible.  So thank you all for your testimony.

Mr. Williams.  If I might, sir, I agree we need to do more to identify what is working, and a prime way we need to do this is to learn more about the over 5,000 people that have left the rolls with the support of an employment network.  That, to me, is where to start. 

Chairman Johnson.  Thank you, sir. 

Mr. Brady, you are recognized for 5 minutes. 

Mr. Brady.  Thank you, Mr. Chairman.  Both of you, thanks for holding this hearing. 

Ticket to Work is a great concept, it makes great sense not just for taxpayers, but for those with disabilities that, as technology progresses, it allows them to move back into the workforce.  It makes sense.  My frustration is that after 15 years, we don't know if this works. 

Dr. Weathers, a simple question.  A decade and a half, what percentage of those using Ticket to Work have now gone on to full‑time, sustained employment?  What percentage? 

Mr. Weathers.  A very, very small percentage.  We are currently conducting an evaluation of the percentage of people who have returned to sustained full‑time employment since the new regulations were in place in 2008.  We needed a 3‑year period in order to track. 

Mr. Brady.  Do you have numbers prior to that? 

Mr. Weathers.  We do have numbers prior to that, yes, between 2001 and 2006, and the numbers were very, very small.  And that is what inspired the impetus behind changing the regulations in 2008. 

Mr. Brady.  What was that percentage?  I am not trying to pin you down.  I am trying to figure out what we can do to make this really work. 

Mr. Weathers.  I can provide that number for the record for you. 

Mr. Brady.  Bigger than a bread box; 5 percent, 10 percent? 

Mr. Weathers.  No.  I would say around 5 to 10 percent is the ballpark.  But I can provide you with a more precise number for that. 

[The information Robert R. Williams follows:]

Mr. Brady.  What do you expect the new numbers to be? 

Mr. Weathers.  I would hope that we could get it up much higher than that. 

Mr. Brady.  What do you think it ought to be? 

Mr. Weathers.  I would hope that we could make it work for everybody that is using a ticket.  But I think if we could get 50 percent, that would be a pretty good number. 

Mr. Brady.  My frustration, this is a great concept.  This ought to be working.  After 15 years, it isn't.  So my frustration is, you know, Mr. Williams talked sincerely about having performance standards clearly lined out.  Mr. Bertoni said 15 out of 20 of the employment networks say they don't have it.  Clearly there is gaming of this system.  It seems to me we need a fresh start on this program.  You know, 5 percent, 10 percent, 20 percent just aren't the numbers I think anyone was hoping for when, in a bipartisan way, we put this program together. 

Let me ask the panelists, if we could start with a fresh ‑‑ I don't mean end it ‑‑ if we could start with a blank page and redesign this, knowing what the technologies are today, knowing what the common disabilities are today, what would you do differently?  How would we start with a fresh slate and recreate a program that really did help people get back to sustainable work?  Any panelists? 

Ms. Bates‑Harris.  I would like to say something.  As a representative of the National Disability Rights Network, I feel compelled to remind people that people on Social Security benefits are among the most disabled people in this country, and many of them want to return to work.  And unfortunately, as my boss would say, discrimination is our business, and business is good.  And sometimes you can get all the perfect services in place, but discrimination is alive and well, and people do not get employed. 

Mr. Brady.  I understand. 

What do you believe is an acceptable rate?  What do you think our goal ought to be?  Five percent? 

Mr. Kregel.  I would like to answer that directly.  The evaluation that Dr. Weathers talks about has identified that currently in this country, there are about 2.6 million SSA beneficiaries who indicate that they would like to work, and they see themselves working in the foreseeable future. 

Mr. Brady.  How many, Doctor ‑‑

Mr. Kregel.  2.6 million. 

Mr. Brady.  ‑‑ would like to go back to work? 

Mr. Kregel.  Would like to go back to work, and who have either worked during the past year or have taken action towards working in the past year, such as applied for a job, taken a training course or something like that. 

What should the number be?  Well, the programs should first focus on those 2.6 million people, and then we can look at other people whose health conditions may improve.  And then we move our services towards those individuals as well. 

In terms of starting over with the Ticket program, I think that it is important to keep in mind that 12 years have passed, and not only has the situation changed for SSA beneficiaries, but the situation has also changed in terms of how employment services are designed and delivered to people with disabilities generally.  And I think that to start all over, it would be important to incorporate some of the cutting‑edge best practices that have been described to you by Mr. Hanophy and described to you in terms of the Walgreens operation.  These are the kinds of things ‑‑ employer partnerships, working in collaboration with public and private enterprises that really need to be included in the redesign of the Ticket program.  By incorporating the resources out there, we can get a lot farther along in terms of who we are serving. 

The other thing that needs to be done, as Mr. Hanophy pointed out, is to look at people who have been on the rolls for a very short period of time, and that includes transition‑age youth.  Returning to work for someone who has been on the rolls for 22 years and is now 45 years old is a different challenge than for someone who is 22 years old.  We don't want these individuals locked into lifelong dependency on Federal benefits.  So targeting the Ticket program to transition‑age youth and involving private‑public partnerships with business, I think, are the major areas that we can explore in terms of redesigning the program for more effective services. 

Mr. Brady.  Well, thank you.  Again, this is such an important program.  For those who want to go back to work, there has got to be a smarter, better way to do this. 

Mr. Chairman, thank you. 

Chairman Johnson.  Thank you. 

The gentleman's time has expired.  Mrs. Black, you are recognized for 5 minutes. 

Mrs. Black.  Thank you, Mr. Chairman. 

And I thank you, panel, for being here today. 

Mr. Bertoni, I want to go to what we heard on the audio in reference to the misinformation that is being given by those who should know the correct information.  Is it your opinion that we are just not training those who are working in the offices, that they don't know the information?  Or how do we get such misinformation being given out? 

Mr. Bertoni.  I don't know what the extent of training is.  I would defer to the SSA on that.  I would say that over time, and with the changes to the regulations ‑‑ basically the regulations, it is a couple key things.  Number one, they lowered the bar at which employment networks could be paid, so that made part‑time earnings attractive to both ticket holders as well as employment networks.  They were trying to entice more individuals on both sides of the equation into the program. 

Another thing the regulations did was to make it acceptable for employment networks to directly pay the ticket holders from the Ticket money, so that essentially increased the value of the shared payment model. 

And thirdly, it also allowed for those whose medical improvement was expected to participate in the program. 

So we have sort of a convergence of folks here who could, in fact, benefit from part‑time work and early payments. 

So we see this new guidance come out.  We see these are allowable things.  And the firewall between SSA and the field, the employment networks, is there.  And someone has to work through this firewall to communicate even with those changes that are acceptable, what are the ultimate end goals for this program.  Yes, part time should be the start for many.  It might be it for many.  But certainly if we can get people into part‑time work, and for those that can move up to more substantive employment, that should be the end goal, because that is the stated purpose of the program.  I am not sure everybody knows that. 

Mrs. Black.  Well, thank you.  I think you are right.  And obviously, the people that were taking these phone calls did not know that.  But you also made mention that you thought they should develop program performance measures.  How would you see those performance measures?  What would be in those? 

Mr. Bertoni.  I would hate to be too prescriptive here, because any one that I threw out, the people would come behind me and tell me I had a bad measure. 

I guess right now I believe there is one measure for the program.  That is the number of ticket holders with an assigned ticket.  To me, that is the start.  You have found the person.  You have given them the ticket.  They have assigned it to an employment network. 

But the outcome measures are not there.  We have outputs, but not outcomes.  Really, the number of folks who have moved on, who have transitioned to sustainable, long‑term employment that has allowed them to reduce dependency and benefits, part of that should be in the equation when you are evaluating how effective an employment network is. 

Mrs. Black.  And I know I am going to run out of time very quickly here.  So, Dr. Weathers, do you agree that this is a good recommendation?  And if so, what do you all plan on doing to initiate those kinds of measures that will help to show what kinds of outcomes are there? 

Mr. Weathers.  Bob Williams' office is responsible for putting together a report card, and I think he could say a word or two about what they are doing. 

Mr. Williams.  We have, in fact, initiated such benchmarks, including one that will hold ENs responsible for moving some beneficiaries into jobs that pay at least twice the poverty level.  It is not enough to get someone off benefits if doing so makes them worse off than they are now. 

Mrs. Black.  Thank you. 

Mr. Chairman, if I may ask in writing, Ms. Russell, could you tell us about some of the barriers that you have found in working with the program?  I congratulate you for doing what you have done. 

And then, Ms. Bates‑Harris, you talked about discrimination.  And if I could have you in writing tell us a little bit more about where those discrimination factors are and how you think we might overcome those.  I appreciate that. 

Thank you, Mr. Chairman. 

Chairman Johnson.  You are welcome. 

Could you two respond that way, in writing, please?  Thank you. 

[The information Deb Russell follows:]
[The information
Cheryl Bates-Harris follows:]

Chairman Johnson.  Mr. Stark, you are recognized. 

Mr. Stark.  Thank you.  Thank you, Mr. Chairman.  Thank you for this hearing.  And I thank the witnesses for enlightening us. 

I must take this opportunity to thank SSA, and in particular their San Jose office, which services our office nearby for the numerous inquiries we get.  We just get wonderful service from them.  And I am afraid they are going to need help.  The number of inquiries is growing.  The number of the elderly people is growing.  And the money to fund that growth in service has got to come from somewhere.  I don't think there is an SSA fairy that is going to sprinkle that dust on you and allow you to hire the people or pay them for overtime.  So as we see more people with more severe health problems, I hope that we can find the additional funding to let you continue to provide that good service. 

I want to make sure that you have cleared your phone messages with the PATRIOT Act.  And I didn't notice that you had inquired about the offers for half‑price Viagra that Sam and I keep getting.  And are those legitimate offers or not?  If you could look into that for us, and we would appreciate it very much. 

The one question that I wanted to direct to Ms. Bates‑Harris is the question of the disregards.  We have disregards for beneficiaries' income in determining their eligibility.  And it is my understanding that those were set about the time that I came to Congress.  And the average benefit was under $500, and SSI benefits were reduced for income that exceeded $65 a month, and if a recipient earned as little as $20 a month from any source, the disregards came into effect.  Do you think that it is time that we have a modest change in that and bring those disregards from the 1970s up to standards of today, that that would just be a fair and proper thing to do? 

Ms. Bates‑Harris.  Absolutely, positively.  The $20 general income disregard and the $65 earned income disregard have remained static, and, in fact, people have basically lost money on that with the cost of inflation.  So we really believe that they should be indexed and increased just the same as how the SGA and the other factors in the Social Security program are indexed. 

Mr. Stark.  Thank you. 

I want to thank all of you for your work in this area.  It is important to our seniors, to our people with disabilities, and that is a growing population.  Thank you for your service.  Thank you for your testimony today. 

Chairman Johnson.  Thank you, Mr. Stark. 

Mr. Reed, you are recognized for 5 minutes. 

Mr. Reed.  Thank you, Mr. Chairman. 

Maybe it is because I was up late last night and then I had to listen to that.  That angers me.  That angers me, that tape, and it angers me on multiple levels.  But most importantly it angers me because there is a good mission that you are trying to accomplish with these programs and with SSA and the disabled Americans across the country.  And we applaud that.  I support that.  I don't think you are going to get any opposition up here on both sides of the aisle from that mission.  But when you hear stuff like that and the people that are abusing the system at the cost of the true people that are disabled and doing the right thing day in and day out, I want to know, what is the result of that?  Are those two individuals that were taped, are they still involved in this process?  Have they been terminated, out of this program?  Yes or no? 

Mr. Williams.  Yes. 

Mr. Reed.  Excellent.  And I hope that continues, because that oversight needs to be done because that type of behavior needs to end. 

Mr. Williams.  It will. 

Mr. Reed.  What I would like to ask ‑‑ and I am also getting a little tired of the mantra of, we need more funding in order to accomplish the mission.  The harsh reality of our country and our fiscal resources are we don't have the funding.  I would love to be able to give you all the funding you needed, but I think the harsh reality of our world today and our Nation today is that we don't have those unlimited pots any longer. 

So I am looking to you, Dr. Weathers and Mr. Williams, to tell me, what is your plan to deal with the reality of the situation where more funding is just not going to be on the table?  When I ran my businesses, and I hit hard times, I had to make tough choices.  I had to reprioritize my mission and my goals.  I had to reallocate employees to areas that were critical objectives of my business in order to accomplish the mission.  Do you have that plan in place? 

Mr. Weathers.  We recognize these are lean times.  Commissioner Astrue has said that we are going to have to make difficult choices about service delivery.  Mr. Williams and I aren't involved in our day‑to‑day operations and budget process, but we would be happy to submit to the record more information on your question. 

Mr. Reed.  I would appreciate that.  And also, what that new mission plan or that business plan, if you would, for SSA going forward in the reality of these times would be.

[The information Robert R. Williams follows:]

Mr. Reed.  And that gets to my last question.  I am hearing, as I read this testimony and hear this testimony and look at the evidence, I feel there is a big issue here of duplication of services.  And I know there was a hearing here on this subcommittee before looking at the benefits planning services or grants to community organizations, work incentives planning, protection advocacy for beneficiaries of Social Security, the laundry list of programs that are out there.  Is that an example of efficiency?  Would anyone like to ‑‑

Mr. Williams.  Yes.  Both the WIPA and the Protection and Advocacy programs serve distinct functions.  One focuses on providing information and assistance on using our complex work incentives, and the other on legal assistance.  Whether there are efficiencies to be had by a better cooperation and coordination.  In that area we would be glad to explore. 

Mr. Reed.  I would be glad to be a partner in that effort. 

With that, I yield back, Chairman. 

Chairman Johnson.  Thank you. 

Mr. Paulsen, you are recognized for 5 minutes. 

Mr. Paulsen.  Thank you, Mr. Chairman, also for holding this hearing and for all the witnesses being here. 

Let me switch gears a little bit.  Dr. Kregel, the Social Security inspector general was rather critical of WIPAs in their recent report for not having adequate performance measures.  And when reviewing the data provided on all WIPAs, there are a lot of process measures that are in there.  How quickly was the beneficiary contacted?  Were they informed about possible options, et cetera? 

But what there aren't so much in there are these outcome measures or performance measures, like did the beneficiary attempt to return to work or actually return to work?  Isn't that what this is all about?  If you go back to maybe what Mr. Brady was asking about earlier, about how would you redesign this with a blank piece of paper, et cetera, tell us a little bit about that.  How much does the WIPA program cost to date?  How many people have obtained work as a result of it, and how would we redesign it and look on those performance measures? 

Mr. Kregel.  The WIPA program costs $23 million per year to fund the 102 projects, including the Minnesota Work Incentive Connection, which is really recognized as one of the top programs in the country.  They estimate that they save $1.7 million per year as a result of the $300,000 funding level that they receive to do their ongoing work. 

But you are absolutely right.  Performance measures to date have focused on the process, what are we doing.  And outcome measures really need to be the focus of what we look at going forward, particularly in light of whether or not this program should be continued for an extended period of time.  This would include whether individuals are working at a level that would result in reduced benefits, or working at a level that would result in terminated benefits?  Are they working at all?  Or do they have access to the health insurance so that they continue to meet their complex health care needs? 

But also there needs to be savings, return on investment from the monies that are invested in the WIPA program or any of the other programs.  That would be increasing the number of individuals exiting the rolls, reduction in the cost of disability payments, reduction in the cost of public health care benefits and reduction in the number and amount of benefit overpayments, something that hasn't been talked about today, but another area where the WIPA program and several of these other programs can make a huge difference looking at the billion‑dollar problem that exists in the area of overpayments today. 

Mr. Paulsen.  Why are not some of these standard measures when reviewing WIPA in general?  For that matter, for any of these work incentives? 

Mr. Kregel.  I think that the focus has been, as these programs have evolved, to look at how effective is the process, with the assumption that the process will lead to the outcomes.  But now these are more mature programs.  There is information that exists, for example, that says that the WIPA program will generate a 3‑for‑1 return on investment if you look at the resources that are devoted to this effort and the savings in benefits payments and that type of thing.  But this has only been done with very recent information and it really needs to be looked at on a broad scale to make sure that we are not paying for an outcome that might have occurred anyway, given the nature of the situation. 

So these things are long overdue, and I know that these benchmarks are being established by SSA, and they are looking at that going forward. 

Mr. Paulsen.  Dr. Weathers or Mr. Williams, can you follow up on that a little bit? 

Mr. Weathers.  I can follow up. 

We are going to be releasing a report on the WIPAs looking at the outcomes of the beneficiaries that they serve within the next few weeks.  We just received the final report last week, and we are reviewing it, and we are happy to submit it for the record.  But I do think that it shows some positive outcomes in terms of employment for beneficiaries who are served by the WIPA organizations. 

[The information Robert R. Williams follows:]

Mr. Williams.  We have established in the grantees' contracts that went into effect this July many of the outcome measures that John mentioned.  We are not where we need to be at.  It is going to take a constant push for a culture change, because, frankly, the perception is that working full time and being financially independent cannot and does not work for people with significant disabilities.  We know that many young people on SSI who go to college either never finish, or, if they do, they do not go to work.  That is a national tragedy, but, likewise, a huge opportunity to, as I say, right‑size what this program is about and what we need to be held accountable for achieving. 

Chairman Johnson.  Thank you. 

Dr. McDermott, you are recognized for 5 minutes. 

Mr. McDermott.  Thank you, Mr. Chairman. 

I may be the only one on the dais, maybe in the room, who has actually sat in hearings with people applying for SSI.  As a psychiatrist, I used to see them frequently in Seattle.  And as I listen to this discussion, I keep thinking about SSI patients.  And I don't know that people ‑‑ if you have never talked to someone who is on SSI and spent some time with them and realized what their life is about, it is important to realize what this system is. 

You have to have a disability that is going to keep you off the rolls for a year, that you are going to be unable to work for a year, or die.  Those are the sort of end points of the assessment.  So you don't get on easily.  If you get on SSI, it means you have never had any connection to the workforce or any substantial connection to the workforce.  So you are really at the bottom of the working population in this country, if you can be considered that at all. 

Then we designed the program in 1974, and we haven't upgraded it.  I mean, tell me nothing has changed in cost since 1984, right?  If you get $65 of income from earnings and $20 from any other source ‑‑ your brother gives you $20 ‑‑ $85 you now have on top of your $499 on SSI ‑‑ that is the average ‑‑ you start to lose $2 for every $1 that you earn.  Now, you tell me what the incentive is to go out for a job and know that for every hour you work or every 2 you work or 3 hours you work, you are going to lose the pay for 2 of those hours.  It is a program that is designed poorly and needs to be reformed from the basics of the way it works. 

And I think that a lot of this performance stuff we are looking for ‑‑ I mean, I can give you all kinds of cases from Missouri and Illinois and New Mexico.  You know, there are endless problems.  And I would like for Ms. Harris to talk a little bit about what you see out there.  Give us a picture so everybody on this committee can understand who these SSI people are as human beings. 

Ms. Bates‑Harris.  Well, first of all, they are individuals who are very poor because the program is means‑tested.  So they can basically have no or very, very limited resources.  They are significantly disabled or impaired and, as you indicated, with very little work history, which means that either their disability has been so prevalent over their lifetime that they have been unable to enter the workforce or possibly even benefit from the education system and have not obtained the necessary skills required for jobs. 

So we are talking about people who need a lot of support and need a lot of assistance, and who are extremely dependent on the income supports from the Social Security program to have a place to live and to be able to put food on their table.  And to those individuals, the thought of returning to work and risking the benefits because the work incentives are complicated, or they don't understand them, or people have told them if they go back to work, they are going to lose their Medicaid, or if they go back to work, they are going to lose their cash benefit, these are individuals who are in a very, very precarious situation and who very much need the services and supports that are offered by both the WIPA, the PABSS program, and other community programs out there that will help them improve their quality of life. 

Mr. Kregel.  May I follow up to that as well? 

Mr. McDermott.  Yes.

Mr. Kregel.  I agree entirely with your analysis of the SSI program.  And you wonder what makes these people want to go to work.  Well, the answer basically is that the mean benefit is $500, and 71 percent of the SSI population live below the poverty level, 71 percent.  So the situation is these are individuals who are at risk of not having food on the table.  They are at risk of not having shelter over their heads.  And they are courageous enough, some of them, to go ahead and try to increase their income, even though the rules are stacked against them, out of sheer economic necessity in many, many situations. 

I agree entirely with your comments in terms of the disincentives within the SSI program.  I just think that we need to understand that the reason that people take some of these courageous steps is out of sheer economic need to meet the basic needs, including food and shelter. 

Mr. McDermott.  The bottom line being if you keep them poor enough and hungry enough, they will ultimately finally find some way to get out of it; is that what you are saying? 

Mr. Kregel.  The situation is that also their health is impacted by living in poverty the way that they are, and they look at extensive health care costs. 

So I think anything that can be done so that when SSI beneficiaries work that they are not penalized for working is a very, very sound approach in terms of moving forward.  It is the best way to go. 

Mr. McDermott.  Thank you. 

Chairman Johnson.  Thank you. 

Mr. Berg, you are recognized for 5 minutes. 

Mr. Berg.  Thank you, Mr. Chairman. 

I come from a State where, quite frankly, we are looking for employees.  We have got around a 3 percent unemployment rate.  And I am just sitting here.  And again, the big problem as I see it is in 2018, we are broke.  So we have kind of been dancing around a lot of these questions.  But it seems to me that that is really the number one thing that we need to focus on. 

Having said that, if there are 2.6 million people who would like to work, it seems like that is almost 25 percent of the people that would like some sort of work.  And if in 2018, according to the numbers that we are given, we would only be able to fund 84 percent.  Well, quite frankly, if half the people that wanted to work found work and became self‑sufficient from an income standpoint, that would certainly push that 2018 date out. 

So I guess ‑‑ and I appreciate the concern of not wanting people to coach to the program, but, quite frankly, I don't think anyone really needs any coaching to look at the program and realize that if you make more than $1,000, you are going to lose all your benefits.  It is not that complicated for anyone that is on the program.  So it seems to me that there are really some fundamental flaws in the program that need to, quite frankly, encourage people and partner with people getting on their own rather than creating some sort of barrier.  When they figure it out, they are making $2, $3 an hour for the extra work.  So, I mean, that is kind of one of the big chunks. 

We are running out of time here, and it appears to me that, obviously, what we have heard from the employers, that is one ‑‑ I mean, there are two ways of doing this, from my perspective.  We could take from the employers and kind of work an environment where we have work and opportunities, or it seems like we can also just push people from the bottom up.  I would like to hear from Mr. Hanophy about how can we encourage employers to ‑‑ are there barriers there?  Are there things that we can do that would encourage employers to say, here is a real opportunity to bring a valuable person into my company long term? 

Mr. Hanophy.  Sure.  Thank you. 

Essentially there are three parts to that.  Number one is what we identified earlier, which is the dual customer; in other words, knowing the business and knowing your applicant, the person with a disability.  That means understanding what the business needs, but understanding how they operate, how the jobs operate, the work culture.  Once you are able to do that, you are able to have a discussion with this business about your ability to bring them a qualified applicant. 

Study after study shows that the reason why people get hired is because they can do the job.  And so this isn't about charity.  This is about helping them find an applicant who can do the job.  So the key for the providers is to provide the supports and also do the screening and make sure these applicants are qualified. 

Number two is helping a business increase their access to an applicant pool of people with disabilities.  The term we prefer to use is "multiple portals."  We have had examples with Walgreens and several other companies where by providing a little bit more training on the front end or a little better adjustment on the front end, we are able to help ‑‑ we call it embedded training, for lack of a better term, where an applicant with a disability can hear the noise, smell the dust, be a part of the work environment, but learn at a pace to where they will be able to get up to speed to eventually be hired by that employer.  So different portals of entry. 

And then the third piece is support.  Companies very often are very interested in supporting people with disabilities, but don't know how.  We hear the term "reasonable accommodations."  I prefer to use the term "adjustments," because a reasonable accommodation is nothing more than a commonsense adjustment to help somebody go to work.  My favorite example is, if your job requires you to reach something on the top shelf, and you can't get that thing on the top shelf, let us move it down.  And it doesn't matter if you are 4 feet 11 or you are in a wheelchair.  Let us just move it down and move on. 

And providing supports about how to help folks with significant disabilities adjust to work tasks.  This is where the Partnership Plus model, I think, has been effective in partnering with Social Security in being able to provide some of those longer‑term supports. 

The bottom line is know your business and know your individual with a disability. 

Mr. Berg.  Thank you. 

Ms. Russell, I would like to ask you a kind of similar question.  If from a business‑down approach you are going to develop or increase it, are there barriers that are out there?  Or what changes would you like to see? 

Ms. Russell.  I think the barrier we experience is trying to locate the talent.  And that is, as Mr. Hanophy just described, something that we have been able to find in Texas with their assistance is being able to locate the individuals who have the skills that match what we are requiring.  It is unfortunate that we have a lot of situations where a week goes by, and I see that we have hired 50 new workers, and not one of them is identified as somebody with a disability.  It is 50 opportunities that our partners have passed on by not being able to help us find the individuals with disabilities who have the skills to do our jobs.  So it is all about a talent pool and finding the talent, developing the talent, and then being able to match it to the business' needs. 

Mr. Berg.  Thank you, all. 

I will yield back, Mr. Chairman. 

Chairman Johnson.  Mr. Crowley, would you care to question?  You are recognized for 5 minutes. 

Mr. Crowley.  Thank you, sir.  Let me thank you and Chairman Davis for holding this hearing today.  I want to thank the witnesses for their testimony. 

My office frequently hears from our constituency about navigating the Social Security benefits, the disability system, and, quite frankly, it is one of the most frustrating things about our office, I think.  I think I speak for both sides of the aisle in this because they are repeated, and, over a period of time, one of the most time‑consuming aspects of the office.  I am not complaining about that.  That is what we do.  That is what we are here to help them navigate. 

But, Ms. Bates‑Harris, if I could ask you to just comment.  Obviously not everyone can work.  There are some people in this world who, by no fault of their own, simply just do not have the wherewithal for various reasons to work.  Is that correct? 

Ms. Bates‑Harris.  My philosophical ‑‑ because my original work in the field came from the Rehab Act, and the premise of the Rehab Act is that all individuals, regardless of the significance of disability, are capable of engaging in an employment outcome if they are given the proper services and supports, my gut reaction is to say that everyone can work.  But unfortunately all the resources and supports are not in place, so there are individuals who cannot work. 

Mr. Crowley.  In the perfect world ‑‑ just clarify this for me.  There are some people in this country who do not have the ability to work.  Those individuals do exist.  Am I not correct? 

Ms. Bates‑Harris.  Yes, they do. 

Mr. Crowley.  So in a perfect world, if the Ticket to Work program worked perfectly, there would still be a need for SSI and SSDI benefits; is that not correct? 

Ms. Bates‑Harris.  Absolutely, positively. 

Mr. Crowley.  That is an important point just to note.  I appreciate the recording of that was played as well, understand that that could be disturbing, as many of the things in life are disturbing to all of us, I think.  But also, when people are asked a question and are answering to the best of their ability and following the guidelines of the law, I think that also needs to be taken into consideration regardless of the characterization of how that question is asked. 

One of the questions my office often gets from constituents is, can I still work while receiving disability benefits?  Ms. Bates Harris, in your written testimony you mentioned the importance of the Work Incentives Planning Assistance program, which supports benefits counselors in the community to answer just those types of questions.  What kind of impact will our constituents see if this program is not reauthorized, particularly once the funding begins to run out? 

Ms. Bates‑Harris.  I think that it would have a devastating impact on those people who are motivated and want to return to work, because we would fall back onto the old beliefs that if you go back to work, you are going to immediately lose your benefits, you are going to lose access to your health care, and you are going to lose access to the other supports. 

I think it has been a very slow process getting the public and people with disabilities to understand that, yes, there is going to be an impact on your benefits, but depending on whether you are getting SSI or SSDI, the impact is not immediate.  If people understand what is going to happen and how it is going to happen, then it allows them to plan their lives and plan their return to work and make the adjustments that they need to be successful in it.  And without it, people would simply give up and not even try.

Mr. Crowley.  You mentioned the Affordable Care Act and the opportunity it gives disabled individuals to receive health care without having to rely upon public assistance.  What are some of the several beneficial provisions included in this law which would be lost if the law were to be repealed? 

Ms. Bates‑Harris.  I am sorry, would you repeat the question? 

Mr. Crowley.  You mentioned the Affordable Care Act in your written statement, and the opportunities it gives to the disabled individual to receive health care without having to rely upon public assistance.  If that were to be repealed, which many of my colleagues on the other side would like to see happen, what would be the fallout from that?  Do you understand? 

Ms. Bates‑Harris.  I do understand the question.  And I am sorry, I am a little tired, I traveled late last night. 

I think, you know, the biggest issue right now is that people with disabilities face a lot of discrimination in insurance and insurance coverages and what will be covered; for instance, assistive technology and durable medical equipment and things like that.  And without access to health care, and without access to the services and supports they need, which are very different for different people, they would not be able to maintain the health status that they have, and would not be able to basically, you know, maintain their level of wellness, so to speak, to enable them to continue to work.  And I am not sure that I answered your question. 

Mr. Crowley.  I think you answered the question just fine.  And given that you got in late last night, we were up late last night. 

Ms. Bates‑Harris.  I know.  We were on the same schedule. 

Mr. Crowley.  Just for the record, I am not picking on you.  I was going to move on to someone else after that anyway, but I ran out of time.

Ms. Bates‑Harris.  Sorry.

Mr. Crowley.  Thank you, ma'am. 

Chairman Johnson.  Thank you all for your testimony. 

Thank you, Mr. Crowley. 

I appreciate you all being here.  Chairman Davis and I are interested in improving the system, if we can, and helping the people out there that need help. 

Again, thank you all for b
eing here today, for your testimony.  I look forward to working with you and all my colleagues to make sure work incentives achieve the results Congress and the taxpayers expect, and those with disabilities deserve. 

With that, the committee stands adjourned.

[Whereupon, at 11:17 a.m., the subcommittees were adjourned.]


QUESTIONS FOR THE RECORD


Robert R. Williams

Dan Bertoni

James Hanophy

John Kregel


SUBMISSIONS FOR THE RECORD


Arizona Bridge to Independent Living

Corporation for Enterprise Development

Linda Landry

Health & Disability Advocates

National Association of Benefits and Work Incentives Specialists

National Disability Rights Network

Oregon Department of Human Services Office of Vocational Rehabilitation Services

Steve Kofahl

APSE




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