Contract No.: 0600-03-60130 MPR Reference No.: 8977

Evaluation of the Ticket to Work Program  
Initial Evaluation Report

February 2004

Craig Thornton
Gina Livermore
David Stapleton
John Kregel
Tim Silva
Bonnie O’Day
Thomas Fraker
W. Grant Revell, Jr.
Heather Schroeder
Meredith Edwards

Contents

ACKNOWLEDGMENTS

CHAPTER I: OVERVIEW OF THE TICKET TO WORK PROGRAM AND ITS EVALUATION

A. EVALUATION COMPONENTS: GOALS, SCHEDULES, AND PRODUCTS

B. PURPOSE AND ORGANIZATION OF THIS EVALUATION REPORT

A. BASIC STRUCTURE OF TICKET TO WORK

B. PROGRAM CONTEXT

A. ROLLOUT SCHEDULE

B. IMPLEMENTATION FROM A SYSTEM PERSPECTIVE

CHAPTER IV: EARLY PARTICIPATION PATTERNS

A. ROLLOUT STATISTICS
 
B. CHARACTERISTICS OF ELIGIBLE BENEFICIARIES, AUGUST 2003
 
C. SYNOPSIS OF PARTICIPATION FINDINGS

CHAPTER V: CASE STUDIES OF EIGHT EXPERIENCED TTW PROVIDERS

A. SERVICE MODELS AND TARGETED CLIENTS

B. OUTREACH, SCREENING, AND TICKET ASSIGNMENTS

C. PRIOR RELATED EXPERIENCE OF ORGANIZATIONS AND STAFF

D. CHOICE OF PAYMENT PLAN

E. RELATIONS BETWEEN ENS AND SVRAS

F. RELATIONS WITH OTHER ORGANIZATIONS

G. FACTORS AFFECTING PROVIDER ABILITY TO ACHIEVE POSITIVE OUTCOMES FOR BENEFICIARIES

H. THE BIG ISSUE: FINANCIAL VIABILITY

I. OTHER PROBLEMS AND SUGGESTIONS

J. SUMMARY AND CONCLUSIONS

CHAPTER VI: ADEQUACY OF INCENTIVES STUDY

A. PRELIMINARY PROCESS INFORMATION ON THE ADEQUACY OF INCENTIVES

B. CHARACTERISTICS OF BENEFICIARIES IN TWO AOI GROUPS

C. RELATIVE TTW EXPERIENCES OF AOI GROUPS

D. RELATIVE EFFECTS OF TTW FOR AOI GROUPS

E. CONCLUDING OBSERVATIONS

CHAPTER VII: CONCLUSIONS AND IMPLICATIONS

A. SSA HAS IMPLEMENTED TICKET TO WORK

B. TICKET USE AND PROVIDER PARTICIPATION IS LOWER THAN MANY HOPED

C. IT IS STILL TOO EARLY TO JUDGE THE TICKET TO WORK PROGRAM FULLY

D. MORE FUNDAMENTAL CHANGES TO TTW MIGHT BE NEEDED

CHAPTER VIII: NEXT STEPS FOR THE EVALUATION

A. DATA COLLECTION SCHEDULE

B. ANALYSIS AND REPORT SCHEDULE

REFERENCES

APPENDIX A: DATA TABLES CORRESPONDING TO FIGURES IN CHAPTER IV

APPENDIX B: PROVIDER-SPECIFIC CASE STUDY SUMMARIES

APPENDIX C: DEFINING THE FOUR ADEQUACY OF INCENTIVES GROUPS

Acknowledgments

This report benefited greatly from the support and advice provided by our project officer, Paul O’Leary. Paul helped us frame the issues, focus the evaluation efforts, and use the many SSA data files related to the Ticket to Work program. He also provided very helpful comment on a draft of this report.

Mike Scott worked tirelessly and thoroughly to develop the data files and programs used in the analysis of Ticket program participation. In addition, Miriam Loewenberg helped to with file development as part of her larger effort to create the huge longitudinal data files that will be used for the impact analysis. All of our data analysis was greatly facilitated by many SSA staff who answered our questions and provided guidance about the most appropriate data sets and variables. These staff include Linda Martin, Mary Barbour, Charlie Scott, Joel Packman, Eileen Hull, Bernie Wasiljov, John Saylor, Lou Koontz, and Michael Zambonato.

SSA staff from the Office of Operations, Office of Employment Support Programs, Office of Disability and Income Support Programs, and Office of Legislative Communications and Affairs provided detailed comments on a draft of this report. They were particularly helpful in ensuring that we correctly described Ticket to Work policies and regulations.

The project also received useful advice and insightful comments from the project’s Technical Evaluation Support Group whose members include the following:

• Evelyn Brodkin (University of Chicago)

• Jeff Funk (Social Security Administration)

• Claire Ghiloni (Massachusetts Rehabilitation Commission)

• Bill Kalsbeek (University of North Carolina)

• James Lepkowski (University of Michigan)

• Arthur Meltzer (Centers for Medicare & Medicaid Services)

• Marcia Meyers (University of Washington)

• Chuck Michalopoulos (Manpower Demonstration Research Corporation)

• John Miller (AHEDD)

• Larry Orr (Abt Associates, Inc.)

• Jenn Rigger (Rehabilitation Services Administration)

• Mark Shroder (U.S. Department of Housing and Urban Development)

Finally, we want to thank all the people who provided the implementation and operational information we used to develop this evaluation report, including staff from the SSA central, regional, and field offices, from the Ticket to Work Program Manager, and from the eight experienced employment networks whose experiences are presented in this report.

Acronyms

ABIL: Arizona Bridge to Independent Living (one of the case study ENs)

AIDS: Acquired immunodeficiency syndrome

AWICs: Area Work Incentive Coordinators

AOI: Adequacy of Incentives

BPAO: Benefits Planning, Assistance, and Outreach

CDR: Continuing Disability Review

CDRCF: Continuing Disability Review Control File

DCF: Disability Control File

DoL: U. S. Department of Labor

DI: Social Security Disability Insurance (Title II of the Social Security Act)

CCSA: Career Consulting Services of America (one of the case study ENs)

CMS: Centers for Medicare & Medicaid Services

DRS: Oklahoma Department of Rehabilitation Services (one of the case study ENs)

EARN: Employer Assistance Referral Network

EES: Employment and Employer Services (one of the case study ENs)

EN: Employment Network (we use this term to refer to providers who are paid under one of the two new TTW payment systems)

HIV: Human immunodeficiency virus

IDR: Integrated Disability Resources (one of the case study ENs)

IPE: Individual Plan for Employment

IWP: Individual Work Plan

MIE: Medical Improvement Expected

MPR: Mathematica Policy Research

MRTW: Modernized Return to Work software

NASI: National Academy of Social Insurance

NPRM: Notice of Proposed Rule Making

OESP: SSA Office of Employment Support Programs

OIM: SSA’s Office of Information Management

PABSS: Protection and Advocacy for Beneficiaries of Social Security

P&A: Protection and Advocacy

PC-CDR: Personal Computer Continuing Disability Review software

RSA: Rehabilitation Services Administration

SGA: Substantial Gainful Activity (in 2004 SSA defined this as earnings of $810 per month)

SPI: State Partnership Initiative

SSA: Social Security Administration

SSI: Supplemental Security Income (Title XVI of the Social Security Act)

SSN: Social Security Number

SVRA: State Vocational Rehabilitation Agency

TTW: Ticket to Work

TWP: Trial Work Period

WIA: Workforce Improvement Act

WIAP: Ticket to Work and Work Incentives Advisory Panel

Executive Summary

The Ticket to Work and Work Incentives Improvement Act of 1999 (Ticket Act) established the Ticket to Work and Self Sufficiency program (TTW) to increase access to, and the quality of, rehabilitation and employment services available to Social Security disability beneficiaries and ultimately to increase the number of such beneficiaries who become economically self-sufficient. Very few beneficiaries now leave the rolls as a result of having found work, and TTW tries to help more beneficiaries do this by changing the way the Social Security Administration (SSA) pays for employment services. The Ticket Act also creates some new rules that let beneficiaries explore work opportunities without jeopardizing their benefit status.

Somewhat paradoxically, the goal of the TTW program is to promote work among a group of individuals judged to be incapable of working in any substantial way. People who receive disability benefits from either SSA’s Disability Insurance (DI) or Supplemental Security Income (SSI) programs have been judged to have a medically determinable impairment that is expected to last at least 12 months or result in death, and that renders them unable to engage in substantial gainful activity. The majority of these beneficiaries do not attempt to engage in any work once they are on the rolls. Only about 2.5 percent of any enrollment cohort will ultimately leave the rolls because of having found work, and less than 0.5 percent of all beneficiaries on the rolls at a point in time eventually leave because of work.

It has proven difficult to raise the low employment rates among disability beneficiaries. Nevertheless, many people with medical conditions that would make them eligible for disability benefits do in fact work, and advances in technology and rehabilitation techniques make it feasible for many people with very severe disabilities to obtain and hold jobs. This has generated a continuing interest in promoting employment among DI and SSI beneficiaries, which in turn has led to a consensus that no person with a disability should be denied the right to participate fully in society, including work, because of external barriers that can be removed with a reasonable effort.

The TTW program and other elements of the Ticket Act provide new means to help beneficiaries become employed and financially self-sufficient. In particular, it introduces a new financing system for providers and gives beneficiaries a choice in which provider to use. The new financing system adds two payment options to the traditional system that SSA has used to pay state vocational rehabilitation agencies (SVRAs) for rehabilitation services provided to beneficiaries. The traditional system reimburses an agency’s costs, up to a limit, if a beneficiary obtains earnings of at least the substantial gainful activity level (currently set at $810 per month for most beneficiaries) for nine months. Both of the new payment options give providers a substantially stronger performance incentive because they require a beneficiary to exit cash benefit status by reason of increased earnings for 60 months before the provider receives full payment. Of the two new systems, the first option, the "outcome payment" system, provides higher payments but only when a beneficiary leaves the rolls due to work or earnings. The other new option, the "milestone-outcome" system, provides smaller outcome payments, but can also provide up to four larger milestone payments while a beneficiary is still receiving benefits, if the beneficiary achieves specified earnings targets.

TTW increases the choices given to beneficiaries who voluntarily decide to pursue employment. It does so by greatly expanding the types of organizations that SSA will pay to assist beneficiaries’ work efforts. In addition to SVRA’s these organizations include a range of public and private providers, called employment networks (ENs), that have signed a contract with SSA. In addition, TTW gives service providers and beneficiaries considerable flexibility in choosing the services that will be provided. In fact, providers and beneficiaries must agree on an individualized work plan before a Ticket can be put into use. This plan could, in theory, include a wide array of services designed to help beneficiaries overcome barriers related to their knowledge of the service system and the labor market, their need for new or enhanced job skills, and even employer misperceptions of their abilities.

Service delivery in TTW is constrained, however, by providers’ desire to limit service expenditures to a level that fits within the payments they expect to receive and by their assessment of whether the services they can provide are likely to result in a beneficiary leaving the rolls. In fact, providers can refuse to serve beneficiaries whom they think have a low probability of leaving the rolls due to work (and therefore not triggering outcome payments). Beneficiaries who only want to work at an earnings level that would enable them to retain part or all of their benefits will generally not be attractive clients to providers.

TTW is being implemented in three phases. In Phase 1, which began in February 2002, the program was rolled out in 13 states across the country. Phase 2 began in November 2002 and extended the program to an additional 20 states plus the District of Columbia. Phase 3, which began in November 2003, will see TTW implemented in the remaining 17 states and U.S. territories.

MAJOR FINDINGS

This is the first major report from SSA’s TTW evaluation. Drawing on information collected during just the first five months of the study, it examines early implementation issues and sets the stage for the more comprehensive reports to follow. In particular, this report is based on the preliminary process analysis (Livermore et al. 2003) and our interviews with staff at SSA, the TTW Program Manager, and several ENs and SVRAs. We also present findings on enrollment and participation patterns from our early analysis of TTW administrative data.

Overall, we found that SSA has implemented all aspects of the TTW program. As of August 2003, Tickets have been mailed to more than 5 million beneficiaries, and more than 25,000 have assigned a Ticket to a provider. Furthermore, SSA has begun making payments to providers as some of the early participants meet milestones or leave the rolls. However, enrollment remains very low and is concentrated in SVRAs using the traditional payment system. In addition, several important operational issues should be addressed. In the Phase 1 states, where the rollout was completed in October 2002, only 0.74 percent of eligible beneficiaries were using their Tickets as of August 2003; participation in Phase 2 states appears to be on the same slow track. On the provider side, our interviews with eight experienced ENs found that they were all losing money on their TTW operations. Many expressed doubts about their continued participation, and some have already cut back their TTW operations. SSA has moved to assist providers by simplifying the payment process. This and other administrative actions could increase participation of providers and beneficiaries, and a strengthening of the economy is also likely to help. Nevertheless, if the attitudes of the eight experienced ENs interviewed for this report are indicative of most ENs, then SSA will have to move quickly to address operational and payment design issues in order to sustain the roll-out momentum and providers’ efforts to increase beneficiary employment.

Some of the key findings supporting these observations are as follows.

Beneficiary Participation Is Low. By August 2003, SSA had mailed out more than 5 million Tickets to eligible beneficiaries, and although participation rates continue to rise, less than 1 percent of recipients were using their Tickets. The participation rate varies by state and by beneficiary characteristics. In the Phase 1 states, the overall participation rate was 0.74 percent, compared with 0.27 in the Phase 2 states, reflecting a difference in the duration of Ticket availability. Among the Phase 1 states, participation rates ranged from 0.3 to 1.9 percent, reflecting differences in economic and service environments, including the aggressiveness of providers, especially SVRAs, in seeking out beneficiaries to serve or in encouraging ENs to do so. Beneficiary participation rates also decline steadily with age; in Phase 1 states, 2.0 percent of those age 18 to 24 were participating, compared with just 0.3 percent of those age 50 and over.

Most Ticket Assignments Have Been to SVRAs. As of August 2003, the vast majority of assigned Tickets nationwide (91 percent in Phase 1 states, 81 percent in Phase 2 states) were assigned to SVRAs. Thus, a relatively small fraction of disability beneficiaries are being served by new providers. Most Tickets also were assigned under the traditional payment system—87 percent in Phase 1 states and 75 percent in Phase 2 states. All SVRAs had to select one of the two new payment systems as an option, and although most are experimenting with the new systems, extensive use is the exception

EN Recruitment and Retention Is Difficult. EN recruitment has been a significant challenge. When last interviewed, the Program Manager reported aggressively marketing the program to over 50,000 organizations through thousands of informational mailings, over 90 EN recruitment conferences, over 200 informational presentations, and hundreds of telephone contacts. Just over 1,000 providers have signed up as ENs (including some from the Phase 3 states). Recruitment has not become easier over time; in fact, having viewed ENs’ early experiences with TTW, some organizations have apparently become even more reluctant to join the program. Like recruitment, EN retention also has become a challenge. More than 38 organizations have terminated their status as ENs, including one of the largest, most experienced ENs. It appears that many others have informally dropped out—by not accepting Tickets or by unassigning previously accepted Tickets.

The type of agencies serving as ENs varies widely. Many are "traditional" providers with extensive experience delivering employment services to SSA beneficiaries. The TTW program affords these agencies an opportunity to continue or expand existing services through a new source of funds. For other ENs, however, the TTW program represents their first effort to provide employment services to SSA beneficiaries or individuals with disabilities. To the extent that these ENs are successful, they will enhance beneficiary choice among providers and create a new set of service providers for SSA.

Provider Service Models Vary Widely. ENs have taken a wide range of approaches to serving Ticket holders, demonstrating that the program does have the potential to foster an increasing variety of work-related services for disability beneficiaries. A few of the ENs act primarily as placement agencies, helping clients build job-search skills and directing them to potential employers. One Internet EN provides no training or job placement services whatsoever but attracts clients with a financial incentive; it promises to give them 75 percent of any Ticket payments it receives on their behalf. Another EN focuses on post-employment support through counseling and case management.

EN Ticket Assignments Are Concentrated Among a Few Providers. Ticket assignments among ENs have been highly concentrated, with a few ENs serving many beneficiaries and most ENs serving few or none. For example, as of late July 2003, among the 131 ENs that had accepted Tickets and were operating in Phase 1 states, one EN had over 300 assignments, and 6 had between 50 and 150, whereas 29 ENs had 10 or fewer Tickets.

Ticket Payments Have Begun. As of the end of August 2003, about 1,400 payment requests had been submitted by providers. Just over half (55 percent) had been paid, 14 percent were under review by the Program Manager, another 14 percent had been cleared by the Program Manager and were under review by SSA, and the remaining 17 percent had been returned to the providers because they failed to meet the standards for payment. As of mid-August 2003, only 67 ENs had received any payments; in total, they had received 630 payments on behalf of 211 Ticket holders. Reflecting the concentration of Ticket assignments mentioned above, most of these ENs had received relatively little money on behalf of just a few participants, while a handful of the ENs had collected substantially more. Twenty-seven ENs had received less than $1,000, 30 had received $1,000 to $5,000, while four ENs had received more than $10,000, including one with more than $30,000 in Ticket payment revenues. Among SVRAs, only three had received any milestone or outcome payments, and 93 percent of the total $29,000 in payments to SVRAs went to a single SVRA.

EN Financial Viability Is Still Uncertain. Twelve to 16 months after starting in the program, all eight of the experienced Phase 1 ENs we interviewed said they were losing money on their TTW operations. For most of them, the program was not looking financially viable. One of the ENs was planning to withdraw from the program, and another had nearly withdrawn but was persuaded by the Program Manager to continue operating in just one state after having started on a nationwide scale. Some of these ENs found that their clients were not earning enough to generate a consistent payment stream. The ENs also complained about the difficulty of obtaining adequate earnings documentation to support payment requests and about delays in receiving payments. SSA has recently simplified the documentation required to receive outcome payments, but the eight ENs we interviewed felt that still more changes would be needed.

Providers Complain About TTW Marketing. Besides financial problems, one of the more common concerns voiced by representatives from the experienced ENs has to do with marketing. They feel strongly that SSA and the Program Manager need to do a better job of both explaining TTW to beneficiaries and reaching out to encourage participation. They reported being burdened by inappropriate referrals and the continuing need to explain basic program features to large numbers of beneficiaries. Similar concerns were expressed in an EN Summit Conference held in 2003. SSA has recently issued a contract to develop a strategic marketing plan aimed at both improving beneficiary understanding of the program and promoting Ticket assignments. The effects of this effort, however, will not appear until 2004 or later, and will be examined in future evaluation reports.

TTW Success Is Mixed for Beneficiaries in the Four Adequacy of Incentives (AOI) Groups. The evaluation pays special attention to the extent that TTW is reaching beneficiaries in the four congressionally defined groups that were expected to find it difficult to obtain services under TTW—those who (1) need ongoing support and services, (2) need high-cost accommodations, (3) earn a subminimum wage, or (4) work and receive partial cash benefits. The financial problems noted at the eight experienced ENs suggest that provider incentives are weak overall and so are likely to provide little motivation for ENs to serve beneficiaries in general, let alone those beneficiary groups identified by Congress. This possibility has been confirmed by our conversations with providers, through which we found that while SVRAs have typically agreed to serve any interested beneficiary determined eligible for services, ENs have commonly screened out those they perceive as requiring substantial or long-term services because they are seen as unlikely to yield payments sufficient to offset service costs.

A slightly different picture comes from our preliminary analysis of administrative data, which we used to develop a rough approximation of the first two AOI groups (those requiring ongoing support or high-cost accommodations) based only on information about beneficiaries’ primary impairments. These approximations, which were developed in the evaluation’s design report (Stapleton and Livermore 2002), suggest that beneficiaries in these two AOI groups constitute a substantial majority of eligible beneficiaries. Furthermore, we found that beneficiaries in these two groups have higher participation rates than all other beneficiaries and that they account for 71 percent of all Ticket users. These results primarily illustrate the fact that even among beneficiaries who appear to require substantial services in order to sustain employment, many have been able to find a provider (typically a SVRA) that will accept their Ticket. It appears that ENs commonly refer candidates that they perceive will require extensive services to SVRAs, where they are more likely to be served under the traditional reimbursement mechanism. Further, some non–SVRA ENs are actually focusing on serving beneficiaries in AOI groups by using Ticket revenues as a supplement to their traditional funding resources.

We will continue to examine this issue, focusing on developing more refined definitions of the groups and on the characteristics of beneficiaries who have the lowest participation rates.

The Consequences of SVRA Dominance in TTW Are Still Emerging. So far, SVRAs account for the great majority of Ticket assignments. This reflects their large scale and long-standing participation in SSA’s traditional program for assisting beneficiaries to become employed. It also reflects their advantages in the TTW program—particularly their ability to finance their services with funds from Title 1 of the Rehabilitation Act and the fact that they can choose to use either the traditional payment system or their new EN payment system.

The consequences of this dominance are still emerging, but several concerns have already arisen. First, both SVRAs and ENs have expressed concern regarding SSA’s guidance to SVRAs allowing them to accept assignment of a Ticket when a beneficiary has signed an agency’s Individual Plan for Employment, but not the SSA Form 1365 typically required to assign a Ticket. As a result of this policy, a SVRA could accept a beneficiary’s Ticket even though the beneficiary did not fully understand his/her full options. Some SVRAs have indicated that this policy seems to conflict with the consumer choice provisions of the Rehabilitation Act. Also, many non-SVRA ENs feel that the policy gives SVRAs an unfair advantage, severely restricting ENs’ ability to recruit and serve beneficiaries.

Second, the nature of SVRA participation varies widely, thus contributing to the variation in participation rates across states. Such variation means that beneficiaries in some states will have different opportunities than those in other states.

Finally, SVRA dominance may reduce beneficiaries’ choice of providers and thus work against one of the key goals of the program. Choice could be expanded if the SVRAs helped to develop the EN market. Most, but not all, SVRAs have developed standardized agreements with ENs in their state that would enable beneficiaries to be served jointly by ENs and SVRAs. In the absence of such an agreement, most SVRAs are refusing to accept clients who have already assigned their Ticket to an EN on the grounds that this would violate the "comparable benefits" provision of the Rehabilitation Act. But many of the agreements have financial terms that favor the SVRA over the ENs, often requiring that the EN assume a very large share of the risk even though the SVRA can use funds allocated under the Rehabilitation Act (Title 1) to minimize its own risk. Some ENs interviewed indicated that the terms of the SVRA/EN agreement actually make it less likely that the EN would refer a beneficiary to the SVRA for services. Such terms seem particularly likely to discourage entities that provide services to SVRAs from becoming ENs.

CONCLUDING OBSERVATIONS

SSA faced a daunting challenge in designing and implementing this large new program literally from scratch—especially considering that no dedicated funds were appropriated for the task. While the original concept of the program sounded simple, many complexities arose as SSA worked out all the details of how TTW would relate to the many rules and systems associated with the SSI and DI programs. Further, SSA had to address the interests of a wide variety of stakeholders in developing all the rules, regulations, procedures, and systems needed to make TTW operational.

At present, however, most of the important evaluation questions cannot be answered; the program has just begun to roll out in the remaining Phase 3 states, and the evaluation has just begun. Still, even at this early point, some emerging issues merit careful consideration and monitoring as time goes on, as they have the potential for seriously undermining the program’s success.

Ticket participation rates remain low, although they are increasing. Even though the program was never envisioned as a way to move a large percentage of disability beneficiaries into self-sufficiency, Ticket use is lower than many had hoped for at this stage. Several factors may be contributing to this finding. First, despite efforts by SSA, the Program Manager, and individual ENs to explain TTW to beneficiaries, many people appear not to understand the basics of how the program operates, what it means for their benefits, and the opportunities it offers. Second, beneficiaries who are not ready to move quickly into full-time employment may have a hard time finding an EN that will accept their Ticket. Discussions with ENs suggest that many are focusing on beneficiaries whom they expect can quickly obtain sufficient earnings to move off the disability rolls and therefore generate outcome payments to the EN. This seems particularly true for those ENs that rely solely on TTW payments.

A related, but separate, issue of concern is that some beneficiaries may have difficulty finding an EN that is accepting any Tickets at all. Fewer ENs than hoped for have joined the program, and relatively few of them have accepted Tickets. The vast majority of Tickets are assigned to SVRAs, raising questions about whether TTW is succeeding in increasing the diversity of providers and services available to beneficiaries. New ENs appear to be taking a very tentative, wait-and-see approach to the program, hanging back until the early operational difficulties are worked out. They may also see the program—especially under the current payment systems—as posing too great a financial risk. This perception is certainly understandable, given the financial problems that the most active, experienced ENs have already encountered.

Yet another issue of concern is that few of the Tickets assigned have resulted in payments to ENs. It seems likely that the economy is a contributing factor insofar as the economic downturn has reduced the number of job openings and increased competition for the vacancies that do exist. The experienced ENs we interviewed said that it had been difficult to find jobs for their clients. Other factors, though, are also in play. In some cases, ENs have found that beneficiaries do not stick with the service plan or try to find suitable employment. In other cases, beneficiaries have not remained in jobs long enough to generate much of a payment stream for the EN. DI program rules allow beneficiaries to remain on the rolls during a 9-month trial work period, regardless of the level of earnings, which delays the start of an outcome payment stream. SSI recipients can prolong the receipt of benefits indefinitely if their earnings are sufficiently low.

The potential implications of the problem of low EN revenues are clear and seem to pose the most serious threat to program success. If ENs cannot cover their costs, they will not be able to operate. Without them, some beneficiaries may find it virtually impossible to use their Tickets, and the TTW program may become little more than a minor revision to the traditional SVRA payment system.

SSA has recognized the issues discussed above and is trying, within the limits of its discretion, to address them. Most important, SSA has taken steps to simplify the process for documenting beneficiary earnings required to trigger milestone and monthly outcome payments. More rapid payments that require simpler documentation should increase ENs’ net revenues and reduce their costs. SSA is also trying to help ENs find additional revenue sources for financing their start-up expenses, which must be paid before they can realize substantial revenue streams from monthly outcome payments. SSA has also started to develop a national marketing campaign intended to improve beneficiary awareness and understanding of the TTW program and related return-to-work initiatives. It will take some time before the effectiveness of these changes and efforts can be assessed.

SSA is already considering more fundamental changes to the TTW program. The most obvious change is to increase the payment amounts. Another possible change is to restructure the payment system so that ENs are paid sooner in the process—that is, they would get a higher proportion of their payments closer to when the beneficiary goes off the rolls (potentially even before that point) rather than receiving payments spread evenly over 60 months after a beneficiary leaves the rolls. There are also suggestions that SSA, perhaps in collaboration with Rehabilitation Services Administration, take steps to encourage SVRAs to use the new payment systems and/or make a positive contribution to the development of the EN market in the SVRA’s state. Toward this end, changes could involve the traditional payment system as well as regulations and incentives that would encourage more balanced SVRA-EN agreements. As the TTW program proceeds, SSA may even wish to modify the work incentive rules governing when SSI and DI beneficiaries lose their cash benefits to make the rules more consistent with the concepts underlying TTW and with each other.

In any event, changes should be made quickly in order to preserve the TTW program’s current momentum. Participation rates were still rising through August 2003, the last month for which we have data, but ENs are continuing to drop out of the program. As a result, beneficiaries may face reduced choices and program enrollments may stagnate. The loss of momentum is not the end of TTW, but may make it harder to SSA to provide the choices and opportunities that TTW promises to beneficiaries.

Chapter I
Overview of the Ticket to Work Program
and Its Evaluation

The Ticket to Work and Work Incentives Improvement Act of 1999 (Ticket Act) established the Ticket to Work program (TTW) to increase access to, and the quality of, rehabilitation and employment services available to Social Security disability beneficiaries, and ultimately to increase the number who become economically self-sufficient. Currently, very few beneficiaries leave the rolls due to work. TTW tries to help more beneficiaries exit due to work by changing the way the Social Security Administration (SSA) pays for employment services. It also changes some program rules in order to let beneficiaries explore work opportunities without jeopardizing their benefit status.

The TTW program operates with the apparent paradox of trying to promote work among a group of individuals judged incapable of substantial work. People who receive disability benefits from either SSA’s Disability Insurance (DI) or Supplemental Security Income (SSI) programs have been judged to have a medically determinable impairment that is expected to last at least 12 months or result in death and that renders them unable to engage in substantial gainful activity. The vast majority of beneficiaries will not attempt any work once they are on the rolls. Only about 2.5 percent of any enrollment cohort will ultimately leave the rolls due to work and less than 0.5 percent of all beneficiaries on the rolls at a point in time eventually leave due to work (Newcomb et al. 2003; Berkowitz 2003).

The low employment rates among disability beneficiaries have proven difficult to increase substantially. There is no evidence that the many work incentives that SSA has instituted prior to TTW have increased work-related program exits (Newcomb et al. 2003). Furthermore, two prior SSA demonstrations to test employment support programs, Project Network and the Transitional Employment Training Demonstration, had low participation rates: about 6 percent of eligibles participated (Kornfeld et al. 1999; and Decker and Thornton 1995). In addition, while both demonstrations’ interventions generated a large proportional increase in participant earnings, those increases were small in absolute terms. These small absolute increases translated into negligible reductions in benefit payment as most working participants had earnings below the thresholds that would result in losing their benefits.

Nevertheless, it is well-known that many people with medical conditions that would make them eligible for disability benefits do in fact work, and advances in technology and rehabilitation techniques make it feasible for many people with very severe disabilities to obtain and hold jobs (for example, Bond et al. 1997). This has generated a continuing interest in promoting employment among SSA’s disability beneficiaries, which in turn has led to a consensus that no person with a disability should be denied the right to participate fully in society, including work, because of external barriers that can be removed with reasonable efforts. The main issues for SSA are therefore: what are the best methods for addressing barriers? How many beneficiaries will seek to take advantage of new opportunities? Will the programs enable many beneficiaries to earn enough to leave the rolls? And what will be the net cost or savings to the government?

There are essentially four major types of barriers that disability beneficiaries face when they want to obtain substantial employment:

• Benefit Policies That Reduce Gains from Employment. Cash benefit programs, including DI and SSI, generally contain provisions to reduce or stop benefits as a beneficiary’s earnings increase. This can create a substantial disincentive for beneficiaries to work since a beneficiary’s total income (benefits plus earnings) may rise slowly, or in some cases even fall, as earnings increase. Also, while health insurance benefits through Medicare and Medicaid are available even to beneficiaries who are no longer receiving cash benefits, many beneficiaries may nevertheless be concerned about losing those benefits if they attempt to work.

• Limited Beneficiary Knowledge of the Service System. Both the DI and SSI programs contain provisions designed to encourage work among beneficiaries. However, many beneficiaries are unfamiliar with these provisions and have an incomplete picture of how working will actually affect their benefits. Beneficiaries may also be concerned that the provisions, which are often fairly complex, may not be implemented fully or accurately. In either of these cases, beneficiaries are likely to under use the provisions and be less inclined to work.

• Inadequate Employment-Related Skills or Workplace Accommodations. Beneficiaries may lack the full set of skills and attitudes required for successful employment, including knowledge of the labor market and how to search for a job as well as more fundamental job skills or basic education. Beneficiaries may also require accommodations to help them overcome impairments that might prevent them from being productively employed. Furthermore, some beneficiaries may have become discouraged about work and withdrawn completely from the labor force. While beneficiaries could, in theory, purchase training and job placement services, they often lack sufficient financial resources or access to loans to purchase the training or services that would enable them to obtain substantial employment.

• Employers’ Misimpressions. Persons with disabilities may also face barriers created by employers’ misimpressions of their abilities or, in some cases, discrimination. Thus, even when they want to work, they can have a difficult time getting a job offer.

TTW increases choice by greatly expanding the types of organizations that it will pay to assist beneficiaries’ work efforts. Beneficiaries can choose between a range of public and private providers other than SVRAs, called Employment Networks (ENs), that have signed a contract with SSA. ENs cannot use the traditional payment system, they must elect to be paid under either the outcome-only or milestone-outcomes payment systems. SVRAs can act as ENs by using the new payment systems, but they can also decide to serve beneficiaries under the traditional system.

In addition, TTW gives service providers and beneficiaries considerable flexibility to choose the services that will be provided. In fact, providers and beneficiaries must agree on an individualized employment plan before a ticket can be put into use. This plan could, in theory, include a wide array of services designed to help beneficiaries overcome barriers related to their knowledge of the system and labor market, their employment-related skills, and even employer misperceptions of their abilities.

Service delivery is constrained, however, by providers’ desire to limit service expenditures to a level that fits within the payments they expect to receive and by providers’ assessments of whether the services they can provide are likely to result in a beneficiary leaving the rolls. Participation in TTW is completely voluntary for beneficiaries and providers, so providers can refuse to serve beneficiaries whom they think have a low probability of leaving the rolls due to work (thereby triggering outcome payments).

The TTW legislation also introduces other changes that try to reduce the policy barriers that can make work unattractive to some beneficiaries. In particular, the Ticket Act contained the following provisions:¹

• Expedited reinstatement that allows beneficiaries who have left the rolls because of work to have their benefits (and any associated health insurance) reinstated without a new application. This option is available for five years following termination of a beneficiary’s eligibility for disability status due to work.

• Suspension of medical disability reviews used to assess whether a beneficiary’s impairments are still present and still sufficient to preclude substantial gainful activity. This suspension lasts as long as a beneficiary is actively using a Ticket by pursuing the goals established in his/her individualized work plan.

• Removal of work activity as a trigger for a medical disability review for long-term DI beneficiaries, which means that these beneficiaries (regardless of participation in TTW) can seek work without fear that their engaging in work will lead SSA to conduct a review of their disability status.

• Extended eligibility for Medicare continues coverage for DI beneficiaries who return to work for an additional 54 months beyond what was available before (from 39 to 93 months). In addition, when that extended coverage expires, beneficiaries can purchase Medicare coverage.

• Medicaid Buy-In program provisions in the Ticket Act make it easier for states to establish programs that let people with disabilities purchase Medicaid coverage on a sliding-fee basis. Currently 28 states have such programs.

Thus, the TTW program seeks to increase the rate at which disability beneficiaries exit the rolls due to work by adding two payment systems with stronger performance incentives that expand beneficiaries’ choices for service providers and reduce some of the work disincentives.

TTW is being rolled out across the country in three phases, beginning in February 2002 and continuing through September 2004. As of September 2003, the program was well underway, operating in 33 states plus the District of Columbia. At that time, SSA had mailed tickets to almost 5.3 million beneficiaries, 784 providers had registered as ENs in addition to 50 SVRAs, and almost 25,000 beneficiaries had assigned their ticket to an EN or a SVRA (Social Security Administration 2003).

Even at this relatively early point in its development, TTW has become one of the biggest operations ever fielded by SSA. It has required SSA to develop many new systems that were not particularly important when its mission focused primarily on paying benefits. In particular, new procedures had to be developed to recruit and register ENs, to inform and recruit beneficiaries, and to track monthly eligibility status and work activity in sufficient detail to support the milestone and outcome payments. Given the magnitude of these changes and complexity of program interactions, it will take a while before all components are working smoothly and the program can achieve its maximum effectiveness.

Given the importance and complexity of this new program, Congress mandated that SSA conduct a comprehensive evaluation to provide important short-term information about program implementation that will help SSA refine program operations. This feedback is particularly important to SSA as it proceeds through the difficult initial stages of program implementation. The evaluation will also provide information about the long-term effects of TTW on beneficiaries’ employment, earnings, and benefit receipt, which in turn will help SSA and Congress assess the extent to which TTW meets its goals.

In addition, the evaluation will provide important information for SSA’s ongoing policy development. The evaluation will analyze the records of millions of beneficiaries and survey thousands of beneficiaries and TTW participants during the next five years. In doing so, it will provide detailed information about the work behaviors and attitudes of beneficiaries, and identify the ways they get information about Social Security programs and the labor market. This information will enable SSA to tailor the TTW program and future initiatives to more effectively reach beneficiaries and help them to achieve their full employment potential.

At the end of May 2003, SSA contracted for the full evaluation, although substantial evaluation activity had occurred under an earlier design contract. In particular, the full evaluation follows the design developed by Stapleton and Livermore (2002) and builds on the preliminary process analyses done by Livermore et al. (2003).

As specified in the design, SSA has established seven major priorities for the TTW evaluation (shown in Table I.1). The evaluation will use three types of data to address these priority questions: (1) extensive qualitative data about TTW operations to be collected through document review, on-site interviews, telephone interviews, and focus groups; (2) longitudinal SSA administrative data for millions of beneficiaries plus Rehabilitation Services Administration data that will be matched to SSA records; and (3) a set of surveys that includes both repeated cross-section surveys of disability program beneficiaries and longitudinal surveys of TTW participants. In addition, the process analysis will help to identify ways to improve TTW operations and will also provide information that will help interpret findings from the participation, impact, and adequacy of incentives analyses.

Table I.1:  Evaluation Priorities, Components, and Data

The evaluation will conduct the following four analyses.

The process evaluation will rely on both administrative and survey data combined with qualitative data from site visits, telephone interviews, and focus groups with the TTW Program Manager (a contractor hired by SSA to help implement TTW), SSA, ENs, and other providers who choose not to become ENs. It will document how TTW is being implemented, assess how the program affects the market for employment-related services, and provide contextual information to help interpret impact analysis findings. It will also assess the implementation and ongoing operations of TTW over the 2003–2007 period, building on the information collected earlier by Livermore et al. (2003). The broad issues to be addressed include the following:

• How is TTW being implemented and what are the issues and/or problems faced by SSA, the Program Manager, ENs, beneficiaries, and other stakeholders?
• What changes in the program policies and operations have been made since inception?
• Does TTW improve the supply of employment-related services to beneficiaries and, if so, in what manner? If not, why not? Also, what factors influence service providers’ decisions to participate in the TTW program?
• Does TTW expand or change the use of employment-related services by beneficiaries and, if so, in what manner? If not, why not?
• Are intermediate program outcomes and goals being achieved? What external factors affect outcomes? How might outcomes be improved?

2. Participation Analysis

The participation analysis will rely on administrative and survey data to answer the broad questions: how many beneficiaries participate in TTW, what are their characteristics, and what are their reasons for nonparticipation? More specifically, the analysis will address the following questions:

• How do beneficiaries learn about the TTW program? Do they generally understand the opportunities it offers?
• How many beneficiaries participate in the TTW program?
• What are the characteristics of individuals who do and do not participate in the TTW program and how do these characteristics relate to participation?
• How do potential participants’ attitudes and perceptions of the TTW impact whether or not they participate in the program?
• What are the most effective sources of information about TTW for potential participants?
• How common is involuntary nonparticipation, that is, instances where a beneficiary seeks services but their ticket is refused by an EN?

3. Impact/Outcome Analysis

This evaluation component will address SSA’s three top evaluation priorities as highlighted in Table I.1:

• Did TTW significantly reduce dependence on SSA benefits through increased earnings?
• What was the impact of TTW on earnings, employment duration, SSA benefits, and beneficiary income?
• Did TTW produce net SSA program costs or savings? How much? What are costs and benefits of the TTW program to SSA?

The evaluation will estimate program impacts using a design that compares outcomes for TTW participants with outcomes for similar beneficiaries who do not participate. The major challenge of the evaluation is to select comparison beneficiaries who behave as the participants would have in the absence of the TTW program. To meet this challenge, the evaluation will use a variety of analytic approaches, each using a specific comparison group and statistical methodology to assess the extent to which observed differences between participants and the comparison group members are attributable to TTW. These approaches include comparisons within states of similar beneficiaries before and after TTW rollout, contemporaneous comparisons during the rollout period between beneficiaries in states where Tickets are available and those where Tickets are not yet available, and within-state comparisons between beneficiaries who receive Tickets in early mailings and those who receive Tickets in the last rounds of mailing (Stapleton and Livermore 2002).

The impact analysis will be conducted within the context of a general model that will be flexible enough to accommodate all reasonable and defensible analytic approaches. This model will generate impact estimates that, in effect, will be weighted averages of the estimates that would be generated by the specific approaches. These will constitute the evaluation’s “benchmark” estimates of the TTW program’s impacts. By placing restrictions on the general model, we will also be able to produce impact estimates that correspond to each specific analytic approach. This approach provides a set of plausible estimates, rather than a single inherently uncertain estimate. In doing so, it tries to give policymakers a good sense of the effects TTW produces, particularly when the impact estimates are interpreted in the context of the detailed operational and contextual information gathered in the process evaluation and participation analysis.

Most of the estimates will be based on analysis of SSA administrative data. Survey data will be used to measure outcomes that are not measured in the administrative data (e.g., hours worked, wage rates, fringe benefits, and satisfaction with EN services). Because the number of people included in the surveys will be far fewer than those captured in the administrative data, and because we could not conduct the surveys before TTW’s rollout, we will not be able to estimate impacts on such outcomes; instead, we will focus on describing outcomes and trying to understand beneficiaries’ perspectives of the TTW program and work.

4. Adequacy of Incentives Analysis

The adequacy of incentives analysis will draw on the process, participation, and impact/outcome analyses. In essence, the evaluation will examine many of the issues previously described, focusing specifically on the subgroups of beneficiaries that are expected to have a particularly difficult time accessing services through the TTW program. This subgroup, as defined in the Ticket Act, includes individuals who need ongoing support and services in order to maintain employment, individuals who require high-cost job accommodations, individuals who earn a sub-minimum wage, and individuals who work and receive partial cash benefits. The Ticket legislation requires SSA both to assess whether the program includes sufficient incentives to encourage ENs to work with these groups of beneficiaries and to consider program modifications that might improve services for these individuals. The evaluation will focus on the first of these requirements and provide SSA with information that will help the agency address the second. Some of the key questions for this evaluation component include the following:

• How many beneficiaries are in these four Adequacy of Incentives (AOI) groups, and what are their characteristics and program benefits?
• Are ENs willing and able to work with beneficiaries in the AOI groups?
• What employment services do beneficiaries in these groups receive, with and without Tickets?
• To what extent does TTW affect employment and program outcomes for these beneficiaries?
• To what extent does TTW affect net program costs for these beneficiaries?
• To what extent do non-SSA programs serve these beneficiaries, and how does TTW affect those programs?

B. PURPOSE AND ORGANIZATION OF THIS EVALUATION REPORT

This is the first report from the evaluation. Written using data collected within four months after the effective date of the contract, its primary goal is to provide SSA with formative information on program implementation. The issue of program effectiveness will be addressed in subsequent reports. This report begins by reviewing the basic structure of the TTW program and its legislative and programmatic context (Chapter II). It then turns to the early TTW implementation experience, examining the many procedures and policies SSA developed for this new program and the early operation experience of SSA, the Program Manager and ENs (Chapter III). Then the report presents current statistics on the number of tickets that have been mailed, accepted by ENs or SVRAs, and the characteristics of beneficiaries who are using their Tickets (Chapter IV), which is followed by case studies of experienced ENs that have served substantial numbers of beneficiaries under the TTW program and that were interviewed earlier in the preliminary process analysis (Chapter V). The report then turns to the important issue of the adequacy of incentives, using a mixture of updated process information and statistics on ticket assignments (Chapter VI). The report concludes with two chapters that identify the operational issues that deserve further consideration (Chapter VII) and describe the remaining data collection, analysis, and reporting activities of the evaluation (Chapter VIII). Appendices provide more detailed statistics on ticket activity in the 33 states where TTW is currently operational, more details about the case-study ENs, and details about how we identified beneficiaries in the AOI groups.

Notes:

¹ Other than the suspension of medical disability reviews, these provisions are available to beneficiaries regardless of whether they are using a Ticket. Return to text.

Chapter II
Structure and Background
of the Ticket to Work Program

The ideas behind the TTW program are fairly simple, but the program itself has become fairly complex (Berkowitz 2003). The basic approach was developed by a panel formed by the National Academy for Social Insurance, which sought to make the rehabilitation system more effective by paying providers only when they enabled a beneficiary to earn his or her way off the rolls. The panel’s entire concept was summarized in the following few sentences:

However, as this idea was translated into practice, the actual program became fairly complicated. Eligibility rules were established to avoid paying for services to beneficiaries who were expected to medically recover and exit the rolls anyway or for SSI recipients who had recently turned 18 but who had not yet been determined eligible for SSI as adults. Milestone payments were introduced to help providers finance services and encourage them to serve beneficiaries who would not be expected to leave the rolls quickly. Payment amounts were tied to overall average benefit payments rather than to each individual’s benefits. Because average monthly SSI benefits are lower than average monthly DI benefits, the payments to ENs for serving SSI-only recipients are lower than those for serving DI beneficiaries. To resolve arguments between beneficiaries and providers, SSA established a dispute resolution process. The agency also created new computer systems to track program participation and exits due to earnings as well as to pay providers.

This chapter describes the structure of the TTW program as it is implemented today (late 2003), including the key groups and organizations involved; the rules that guide its operations; and the context in which it has been established, including the service and payment system it is replacing and related initiatives that may help the program succeed. This description gives an overview of how the program is intended to operate. The chapters that follow describe how each element was implemented. Livermore et al. (2003) provide information about earlier implementation.

A. BASIC STRUCTURE OF TICKET TO WORK

This section begins with an overview of the roles and responsibilities of the major program stakeholders. It then describes the key processes and policies of the program, generally from the perspective of a beneficiary. It concludes with an explanation of the services that ENs provide and the program’s reimbursement policies.

Conceptually, TTW is a fairly simple program. It begins with the disability beneficiaries who may, with varying degrees of assistance, be able to achieve economic self-sufficiency and thus leave the SSI or DI rolls. The program then revolves around two relationships. The first relationship involves the Ticket itself, which is essentially a promise of payment from SSA to an EN for providing services that move disability beneficiaries back to work and off the SSI/DI rolls. The second relationship, between a beneficiary and an EN, is governed by a voluntary agreement about services, called an Individual Work Plan (IWP). ¹

In reality, however, the success of the TTW program depends on multiple stakeholders carrying out many diverse and interrelated tasks according to specific rules and time frames. For instance, SSA provides a Ticket and related information to eligible beneficiaries and a list of those beneficiaries to the Program Manager. Beneficiaries take their Tickets to an EN, negotiate an IWP with the EN to specify a set of services that will get them working, and then participate in those services. Once they are employed, participants report their earnings to SSA and their EN; the earnings determine whether the beneficiary remains eligible for DI or SSI benefits and therefore help to determine the payments that ENs receive. ENs provide or arrange for services to beneficiaries and submit payment claims to the Program Manager. The Program Manager recruits ENs, notifies beneficiaries about ENs in their area, facilitates payments to ENs on behalf of SSA, and notifies SSA about any problems with EN performance. The responsibilities of the four major TTW stakeholders—SSA, the Program Manager, ENs, and beneficiaries—are identified below.

a. SSA Responsibilities

1. Develop the program regulations
2. Develop the systems within the agency to manage the program
3. Develop the procedures required to administer the program
4. Train SSA staff on the program procedures
5. Identify all DI and SSI beneficiaries who are eligible to receive a Ticket
6. Provide data on Ticket-eligible beneficiaries to the Program Manager
7. Develop and update EN requests for proposals to recruit prospective ENs, and make EN contract awards
8. Use a Government Printing Office contractor to mail a "Ticket Package" to every eligible beneficiary who lives in a state where TTW has been implemented
9. Provide beneficiaries who contact SSA through its toll-free number or who visit an SSA field office with supplemental information on the TTW requirements and refer them to the Program Manager’s toll-free telephone number for more detailed information
10. Inform beneficiaries of their rights and responsibilities when an EN elects to terminate an IWP after the EN has provided written notification to the beneficiary and the Program Manager, and the Program Manager has updated the SSA database
11. Provide periodic opportunities for ENs to change their payment elections for prospective clients
12. After receiving EN payment requests via the Program Manager, evaluate the work report for cash benefit effect, determine whether payment to the EN is appropriate, and authorize the appropriate payment amounts or deny the request

b. Program Manager Responsibilities

By law, the Program Manager is a private- or public-sector organization that enters into a contract to assist SSA in administering TTW. SSA may choose to contract with one or more entities to act as Program Manager(s). In September 2000, SSA contracted with MAXIMUS to serve as the Program Manager for a period of five years. The Program Manager is prohibited from directly participating in the delivery of employment services, vocational rehabilitation services, or other support services to beneficiaries with Tickets in the Program Manager’s designated service delivery area. The primary responsibilities of the Program Manager under TTW are to:

1. Recruit and recommend potential ENs to SSA and ensure adequate service coverage in each state
2. Design and maintain a system to collect, store, and report management information data supporting the TTW program
3. Provide training on TTW to Program Manager staff, ENs, SVRAs, and SSA staff members
4. Establish a toll-free telephone number through which to receive inquiries from beneficiaries, ENs, SVRAs, and other interested parties and provide detailed information on TTW program provisions
5. Accept and process requests for Tickets on demand (that is, requests for Tickets by beneficiaries who live in a state where TTW has been rolled out but who have not yet been mailed a Ticket)
6. Facilitate beneficiary access to ENs, including making lists of ENs available to beneficiaries and ensuring that information is in an accessible format
7. Manage the Ticket assignment process by reviewing IWPs and resolving disputes between beneficiaries and ENs or SVRAs
8. Ensure that beneficiaries have the ability to change ENs, and reassign Tickets based on beneficiaries’ choices
9. Facilitate payments to ENs and ensure that they have complied with their SSA contract
10. Monitor EN activities and inform SSA of problems with EN performance
11. Monitor the selected ENs to ensure that service choices available to beneficiaries are adequate

c. Employment Network Responsibilities

Any interested entity may propose to serve as an EN for the TTW program, subject to approval by SSA. An EN may be a public or private organization, a single organization, or a consortium or organizations. Its scope may range from providing services in a single, small area to doing so nationwide. Employers may also become ENs. There is no limit on the number of ENs that may participate in TTW. It was anticipated that many organizations already serving persons with disabilities would step forward as ENs, but new organizations or existing organizations that have not previously provided a substantial set of services to people with disabilities may also participate. The primary responsibilities of ENs are to:

1. Enter into an agreement with SSA
2. Designate the geographic area(s) in which they will provide services, the types of services they will provide, and the types of beneficiaries they will serve.
3. Select one of the two available payment systems (outcome or milestone-outcome)
4. Provide the beneficiary with a comprehensive explanation of both the services they offer and the beneficiary’s responsibilities
5. Verify Ticket-holder eligibility and whether any payments have been made to another EN
6. Develop an IWP with each beneficiary and ensure that services provided are appropriate to the IWP
7. Submit the appropriate documentation to the Program Manager, which assigns the Ticket
8. Provide employment services, vocational rehabilitation services, or other support services to beneficiaries, either directly or by entering into agreements with other entities
9. Submit claims for payments to the Program Manager with the documentation needed to support the claim for payment
10. Notify the beneficiary and the Program Manager in writing when a beneficiary’s ticket is terminated

d. Beneficiary Responsibilities

To be eligible for a Ticket, a person must be receiving SSI or DI benefits and be between the ages of 18 and 64 (inclusive). Their impairments may be either permanent (improvement is not expected) or nonpermanent (improvement is either expected or cannot be accurately predicted). Two small groups (accounting for about six percent of all beneficiaries) are ineligible: (1) SSI beneficiaries who had been entitled to benefits under the childhood regulations but who have very recently turned 18 and have not undergone the process to determine whether they are disabled under the adult eligibility criteria and (2) both SSI and DI beneficiaries for whom medical improvement was expected at the time of benefit award but who have not passed at least one medical continuing disability review.

The primary responsibilities of beneficiaries are to:

1. Obtain sufficient information to decide whether to participate in TTW, and if so, to select an appropriate EN
2. Locate and contact, with the help of the Program Manager, an appropriate EN or SVRA willing to accept the Ticket
3. Participate in the development of the IWP with the EN
4. Participate in the activities described in the IWP and meet the "timely progress" requirements for active TTW participation
5. Once employed, report earnings to SSA and the EN
6. Inform the EN and the Program Manager in writing of a decision to dissolve the relationship with an EN

2. Mechanics of the TTW Program

a. Ticket Assignment

The sequence of activities a beneficiary would follow starts with receipt of a ticket—a red, white, and blue certificate stating SSA’s agreement to pay an EN for services provided when the beneficiary achieves prescribed earning objectives. First, the beneficiary must decide whether to seek services from an EN. (Because participation in TTW is voluntary, the beneficiary is free to choose whether to use the Ticket to seek services.) The Program Manager makes available a list of approved ENs in the beneficiary’s area, and beneficiaries may assign their Tickets to participating ENs in any month in which they meet program eligibility requirements. Beneficiaries cannot assign their Tickets to more than one provider at one time.

ENs are not obligated to accept a Ticket and may choose which beneficiaries they want to serve. In making this choice, they might consider, for example, their ability to help a particular beneficiary achieve sufficient earnings to generate Ticket payments. The beneficiary and the EN are free to negotiate the services provided in exchange for the Ticket. In order for a Ticket to be officially assigned, the EN and the beneficiary must co-develop and sign an IWP. Any participating beneficiary who is not satisfied with the services he or she is receiving may take the Ticket out of assignment and re-assign it to another provider that is willing to serve them, which would require developing and signing a new IWP.

Once a Ticket is assigned, the Program Manager initiates a series of reviews to determine whether the beneficiary is making "timely progress" toward self-supporting employment, which is defined as working at levels that will reduce or eliminate dependence on DI or SSI benefits. So long as beneficiaries are determined to be making timely progress, their Tickets are considered in use. This is significant because for these beneficiaries, SSA may not initiate a medical continuing disability review (CDR), the usual process for determining a beneficiary’s medical eligibility for continued benefits. Beneficiaries not eligible for Tickets, those whose Ticket are not in use, and those who do not meet timely progress requirements are not eligible for the CDR protection.

The first progress review takes place 24 months after Ticket assignment, excluding any months a Ticket was either not assigned to an EN or in inactive status (which is defined in the next section). The purpose of this review is threefold: (1) to determine whether the beneficiary is "actively participating" in his or her IWP, defined as engaging in activities outlined in the IWP on a regular basis and approximately in the timeframe specified; (2) to examine whether a goal in the IWP is to work at least three months at the substantial gainful activity (SGA) level by the time of the second review; and (3) to assesses whether the beneficiary can reasonably be expected to reach that goal.

The second and all subsequent reviews take place on an annual basis. During these reviews, beneficiaries are expected to meet progressively higher levels of employment for their Tickets to remain in active-use status and thus to extend their exemptions from medical CDRs. During the first 12-month review period, beneficiaries are required to work at least 3 months at the nonblind SGA level (currently $810 per month). During the second 12-month review period, they are required to work at least 6 months at the nonblind SGA level. During the third 12-month review period (and succeeding 12-month periods), they are required to work at least 6 months in each year² and have earnings in each of those months that are sufficient to eliminate the payment of DI or federal SSI benefits. Although this overall process could involve multiple reviews, SSA anticipates that most TTW participants will not be subject to multiple reviews because those who begin working will very likely be working at levels that quickly move them off the SSI or DI rolls.

b. Placing a Ticket in Inactive Status and Reactivating It

Beneficiaries who have assigned their Tickets but are temporarily unable to participate or who are not actively participating during the first 24 months after Ticket assignment may place their Tickets in inactive status.³ To do this, they must submit a written request to the Program Manager along with a statement from the EN about the inactivity. As mentioned above, inactive-status months do not count toward the time limit for making timely progress toward self-supporting employment, and beneficiaries with Tickets in inactive status are subject to medical CDRs. If a beneficiary whose Ticket is still assigned but in inactive status wants to resume participation in the program, he or she notifies the EN, which in turn notifies the Program Manager. The Program Manager then contacts the EN after three months to verify active participation. Beneficiaries who are found not to be actively participating are notified of this finding by the Program Manager and become subject to medical CDRs unless the beneficiary requests a review of the decision.

Beneficiaries who fail to meet the timely progress requirement may submit a written request to the Program Manager to re-enter in-use status. The Program Manager determines whether a beneficiary meets the requirements to re-enter the program based on active participation and/or work activity for a specified length of time.

c. Dispute Resolution

In a program as complex as TTW, and with beneficiaries’ income and ENs’ revenues at stake, it should not be surprising that disputes may arise at various points in the process. Anticipating this problem, SSA has developed a three-step process for resolving disputes between beneficiaries and ENs (that are not an SVRA): (1) either party may seek resolution through the EN’s internal grievance process; (2) if the EN’s internal grievance process does not produce a resolution satisfactory to both parties, either party may seek resolution from the Program Manager; (3) if the beneficiary or the EN is not satisfied with the Program Manager’s proposed resolution, either party may request a decision from SSA. SSA’s decision on the dispute is final. In addressing disputes with ENs or other service providers, beneficiaries may engage the assistance of the SSA-funded Protection and Advocacy for Beneficiaries of Social Security (PABSS) programs, described later in this chapter.

Disputes arising between beneficiaries and SVRAs (even those acting as ENs) are governed by the dispute resolution provisions of the Rehabilitation Act. These provisions allow beneficiaries to pursue grievances through their state’s Client Assistance Program⁴ and provide opportunities to resolve disputes through formal mediation or an impartial hearing process.

Disputes arising between ENs and the Program Manager are subject to review under the Program Manager’s internal grievance process. If the grievance process does not result in a mutually agreeable resolution within 20 days, the Program Manager must refer the dispute to SSA for a decision. Like disputes between beneficiaries and ENs, SSA’s resolution is final in EN-Program Manager disputes.

d. Ticket Period of Use and Termination

The period during which a Ticket can be used ends after 60 outcome payments have been made to an EN. At any prior point, a beneficiary’s Ticket will be terminated if his or her eligibility for DI or SSI benefits ends for reasons other than work activity or earnings. Examples include medical improvement, conversion to the Social Security Old Age or Survivors programs, unearned income exceeding SSI eligibility limits, and death.

3. Services and Reimbursement

As mentioned above, services to beneficiaries under TTW are governed by a written, signed agreement between the beneficiary and the EN, known as an IWP. The IWP outlines the specific employment services, vocational rehabilitation services, and other support services that the EN and the beneficiary have determined are necessary to achieve the beneficiary’s stated employment goals (the ultimate goal being earnings at a level that takes the beneficiary off the disability rolls). The EN must submit a signed copy of each IWP to the Program Manager. The EN must also develop and implement the plan in a manner that gives the beneficiary the opportunity to exercise informed choice in selecting an employment goal. According to final program rules, an IWP must include statements addressing:

1. The vocational goal developed with the beneficiary, including appropriate goals for earnings and job advancement
2. The services and support necessary for the beneficiary to accomplish the goal(s)
3. Any terms and conditions related to providing the services and support
4. The fact that the EN may not request or receive compensation from the beneficiary for the cost of services and supports
5. The conditions under which the EN may amend the IWP or terminate the relationship
6. The beneficiary’s rights under TTW—including to privacy and confidentiality, to have a copy of the IWP, and to seek to amend the IWP—and of the remedies available to the beneficiary.

Services provided under TTW could vary substantially depending on beneficiaries’ needs. A beneficiary with well-developed work skills and substantial work experience might need only short-term assistance in identifying and getting interviews with appropriate employers. For such a person, an EN would function generally as a job placement firm. Some beneficiaries might need longer-term job training or vocational rehabilitation to develop skills that would enable them to get and keep a job with wages high enough to move them off the disability rolls. Others might need an EN to provide support services such as transportation and child care to help them remain and function effectively in the workplace.

When beneficiaries make progress toward and achieve approved employment objectives—that is, work for a specified numbers of months at the nonblind SGA level—ENs may be paid for those outcomes. Overall, the TTW reimbursement system marks a significant departure from the traditional cost reimbursement system for SVRAs, which is discussed later. Under the TTW program, ENs may choose to be paid under one of two payment systems: an outcome-only payment system or a milestone-outcome payment system. The former provides a potentially larger total payment, with all payments occurring only when the beneficiary is off the disability rolls; the latter provides somewhat lower total potential payments but up to four initial payments that begin while the beneficiary is still on the disability rolls but has achieved specific earnings milestones. The two plans were designed so that the maximum total amount of payments made to an EN with respect to a beneficiary under the milestone-outcome system would equal about 85 percent of the payout available under the outcome-only system. An overview of the two systems is provided in Table II.1

Table II.1: Outcome-Only and Milestone-Outcome Payment Systems, Based on 2003 Amounts

	% of PCB*	SSI Ticket-Holder	SSDI Ticket-Holder
Outcome-Only Payment System
Outcome Achieved When:
The beneficiaries’ entitlement to Social Security disability cash benefits ends or eligibility for SSI cash benefits based on disability or blindness terminates due to work activity or earnings.	40%	$196 per Month	$328 per Month
Total outcome payments available (60 payments)		$11,760	$19,680
Milestone–Outcome Payment System
Must occur before the first Outcome payment month, and is achieved when the beneficiary works:
Milestone:
1. 1 calendar month above gross SGA	34%	$167	$279
2. 3 calendar months above gross SGA in a 12-month period	68%	$334	$557
3. 7 calendar months above gross SGA in a 12-month period	136%	$668	$1,114
4. 12 calendar months above the applicable SGA threshold amount in a 15-month period	170%	$835	$1,393
Total of the 4 milestone payments available		$2,004	$3,343
+60 (reduced) Outcome Payments
Same rules apply with regard to when an outcome is achieved as under the Outcome Payment Method. Each outcome payment made to an EN will be reduced by an amount equal to 1/60th of the total Milestone payments made to that EN.	34%	Depending on the number of milestones achieved, outcome payments could range from $134 to $279
Estimated Total Available
Added together, the 4 Milestone Payments plus the 60 available months of reduced Outcome Payments should equal about 85% of the maximum possible under the Outcome Payment Method.		$10,044	$16,723

Source: http://www.yourtickettowork.org/selftraining/EN_Unit6_PaymentOptions.doc (accessed November 13, 2003).
Note: The potential for outcome payments related to SSI beneficiaries may be affected by their monthly federal benefit calculation
*The PCB is based on the cash disability benefits SSA paid in the prior calendar year. These formulas are updated annually. The PCBs for 2003 are $819 for SSDI and $491 for SSI. Individual payments have been rounded to the nearest whole dollar.

Under the outcome-only payment system, SSA makes up to 60 monthly payments to the EN, one for each month in which the beneficiary receives no DI or federal SSI benefit payments because of work or earnings.⁵ After DI/SSI benefits reach zero, an outcome payment occurs for any months in which the individual (1) has gross earnings from employment (or net earnings from self-employment) that exceed the level defined as substantial gainful activity (SGA) and (2) is not entitled to or eligible for any type of Social Security or SSI benefit. The months need not be consecutive. Monthly outcome payments are equivalent to 40 percent of the payment calculation base (PCB)—the prior calendar year’s national average monthly DI or SSI disability payment amount. In 2003, TTW monthly outcome payments to ENs were $328 for DI and $196 for SSI. For concurrent beneficiaries, outcome payments are based on the average DI amount.

Under the milestone-outcome payment system, SSA makes up to four payments to the EN, based on the beneficiary achieving certain self-sufficiency goals, or "milestones," while he or she is still receiving cash disability payments. The first milestone is achieved when the beneficiary has worked for one month and has earnings in that month that exceed the SGA level. The second milestone is achieved when the beneficiary has worked for 3 months within a 12-month period and has earnings for each of the 3 months in excess of the SGA level. The third milestone is achieved when the beneficiary has worked for 7 months within a 12-month period and has earnings over the SGA level for each of the 7 months. The fourth milestone is achieved when the beneficiary has worked for 12 months within a 15-month period and has earnings for each of the 12 months that are above the SGA level. Any of the months used to meet previous milestones can be included in the months used to meet subsequent milestones. In addition to the milestone payments, ENs choosing this option can also request monthly outcome payments after a beneficiary leaves the disability program rolls, although each outcome payment will be reduced by an amount equal to 1/60^th of the milestone payments made to the EN with respect to a particular beneficiary.⁶

Each of the milestone payments is larger than the preceding one, reflecting the progressively greater accomplishments represented by successive milestones. The first milestone payment is equal to 34 percent of the PCB, as defined above. The second milestone payment is equal to 68 percent of the PCB for the calendar year in which the month of milestone attainment occurs. The third milestone payment is equal to 136 percent of the PCB for the calendar year in which the month of milestone attainment occurs. The fourth milestone payment is equal to 170 percent of the PCB for the calendar year in which the month of milestone attainment occurs. Monthly outcome payments under the milestone-outcome system are equal to 34 percent of the PCB for the calendar year in which the month occurs.

To obtain either an outcome or milestone payment, an EN must submit a request and proper documentation of the beneficiary’s earnings to the Program Manager. Detailed rules govern the type of earnings evidence that will be accepted and how it will be evaluated. Evidence is categorized as primary or secondary, reflecting the degree to which it can be relied upon as an accurate and complete record of earnings. Primary evidence consists of employer records—for example, pay stubs, employer wage statements, or oral statements by employers. Secondary evidence comes from other (third-party) sources such as state unemployment insurance, tax returns, employee business records, or employee statements of earnings. If the EN is unable or unwilling to submit the primary earnings evidence, it must wait until SSA investigates the reported earnings and develops the evidence necessary to process the claim. This can take substantial time, depending on field office workloads and beneficiary and employer cooperation. The EN can expedite the process by providing the primary earnings evidence up front.

The Program Manager encourages ENs to meet the requirements for primary evidence, as this will expedite the payment process. Evidence that does not meet the standards for acceptance (original, legible, unaltered, clearly identifying the beneficiary, and so on) must be further investigated by the Program Manager (by contacting the EN, beneficiary, or employer) or referred to the relevant SSA field office for continued development; both of these processes could substantially delay payment. The high standards placed on the evidence reflect its use as a key determinant of a beneficiary’s continued eligibility for benefits. With respect to primary earnings evidence, one issue that often must be addressed is that pay stubs may not contain all of the information that SSA needs to process the claim. The evidentiary requirements also differ depending on the program(s) from which the beneficiary is receiving benefits (DI and/or SSI) and the type of payment claim.⁷ As discussed in Chapter III, SSA is in the process of implementing changes intended to reduce the burden of collecting evidence after the third Ticket payment for a beneficiary has been made.

ENs may periodically elect to change their payment systems. They may change their initial payment system within 12 months after selecting it or within 12 months after TTW is rolled out in the state, whichever is later. Thereafter, ENs can switch payment systems no more frequently than every 18 months. However, payments made to ENs with respect to a particular beneficiary are always based on the payment system in place when the beneficiary’s Ticket was assigned. Consequently, ENs that select to switch payment systems may receive payments under both systems simultaneously.

SVRAs can choose whether to serve a given beneficiary under either of the two new payment systems or under the traditional payment system. If acting as an EN, the SVRA will be paid under the EN payment system it has elected (the outcome-only or milestone-outcome system). If acting as a traditional vocational rehabilitation provider, the SVRA will be reimbursed under the traditional payment system. This system is also used when SVRAs serve beneficiaries who have not been issued Tickets or benefici