News & Information

CCH® UNEMPLOYMENT INSURANCE — 7/2/08

SSA finalizes changes to Ticket to Work program

The Social Security Administration is revising its regulations governing “The Ticket to Work and Self-Sufficiency Program,” which encourages Social Security disability beneficiaries to return to work. “These rules outline a new and improved Ticket to Work program and are based on learning from our experiences, listening to input from interested parties, and responding to their suggestions,” said Michael J. Astrue, Commissioner of Social Security. “Beneficiaries with disabilities will have greater flexibility and expanded choices in obtaining the services they need to attain their employment goals.” Essentially, the changes add an educational and technical training option to supplement the work requirement for Ticket to Work eligibility, and would tighten up the progress requirements for continued participation in the program. The final regulations are effective July 21, 2008.

Background

The Ticket to Work program was established on December 17, 1999. Under the program, the Commissioner of Social Security may issue a “ticket” to any Title II or Title XVI beneficiary, who then may use the ticket to obtain services from an “employment network” (EN) or from a state vocational rehabilitation (VR) agency. A beneficiary and an employment network or state vocational rehabilitation agency work together to develop an individual plan which outlines the employment services, vocational rehabilitation services and other support services necessary to assist the beneficiary to obtain and ultimately maintain self-supporting employment. The services are provided without charge to the beneficiary, but are paid for by the SSA if the beneficiary achieves certain outcomes.

Under the regulations, the ticket may be terminated if the beneficiary fails to make “timely progress” towards self-supporting employment, as defined in the regulations. During the initial 24-month period, a beneficiary is considered to be making “timely progress toward self-supporting employment” if he or she actively participates in the plan. The SSA, in turn, refrains from initiating any Continuing Disability Review during this period. In the third year, a participant must engage in three months of substantial gainful activity (SGA); in the fourth year, six months of SGA are required; and in year five and beyond, a beneficiary participating in the program must engage in six months of work at a level that precludes payment of disability benefits.

State participation and beneficiary choice is expanded

Many of the changes will greatly expand beneficiary choice of ENs and enable beneficiaries to take advantage of a more effective combination of services from both a state VR agency and an EN. For example, the state VR agency could provide the initial, intensive rehabilitation services and an EN could follow up by providing the ongoing support many individuals need to maintain their work efforts. Among the many changes that reflect this process are the following:

    l If a state vocational agency elects to be paid under the cost reimbursement payment system for a given beneficiary, the beneficiary's ticket will no longer be assigned to that agency. In that situation, the beneficiary may assign the ticket to a different provider of services after the state VR agency has closed his or her case (Regs. §411.135 and §411.140). However, if the beneficiary holds onto the ticket while receiving services from the state VR agency that has elected the cost reimbursement option, the beneficiary will be considered to be “using a ticket,” provided the beneficiary meets all of the related provisions in Subpart C regarding timely progress (Reg. §411.170).

    l For a beneficiary for whom the state VR agency has elected the VR cost reimbursement option, whose ticket has not terminated and who continues to meet the timely progress requirements, the period of “using a ticket” will end with the close of the 90-day period following the date the state VR agency closes the beneficiary's VR case, unless the beneficiary assigns the ticket during this 90-day period (Reg. §411.171).

    l The provisions of the prior rules which indicated that payment may not be made under both the cost reimbursement payment system and an EN payment system based on the same ticket have been removed. A related regulation is changed that will allow for payment to an EN under an EN payment system and payment to a state VR agency under the VR cost reimbursement option with respect to the same beneficiary in certain circumstances (Reg. 411.585).

Financial incentives for Employment Networks

Because the overall number of service providers in the program remains low, the final regulations make a number of changes in Subpart H in order to create greater financial incentive for participation by employment networks (ENs).

Final Reg. §411.525 provides that the total potential payment under the outcome-milestone payment system has been increased from 85% under the prior rules to 90% of the total potential payment under the outcome payment system under the final rules. In addition, Reg. §411.525 clarifies that milestone payments must occur before the beginning of the outcome period, and that once the SSA begins making payments for a Title XVI beneficiary it will continue using the Title XVI payment rates even if the beneficiary later becomes eligible for disability insurance benefits under Title II. Final Regs. §411.525 and §411.535 now provide a two-phased milestone payment system and outcome payments that parallel the steps beneficiaries take toward self-sufficiency.

Phase 1 is modeled on the nine-month trial work period (TWP) provided for Title II beneficiaries. Four milestones at different points of employment retention will be paid when the beneficiary works for a period of time with gross earnings at or above the trial work earnings level. Phase 1 milestones are the only payments that will be the same for both Title XVI and Title II beneficiaries, and these payments will be based on the higher Title II payment calculation base.

Work activity above the trial work earnings level ($670/month in 2008) in the 18 months prior to the first ticket assignment on each ticket may preclude the SSA from paying some or all of the Phase 1 milestones (Reg. §411.535(a)(1)(ii)).

Phase 2 requires a substantial achievement on the path toward full self-sufficiency. The employment outcome triggering a Phase 2 milestone payment is a month where the beneficiary's gross earnings equal or exceed the substantial gainful activity earnings level ($940 in calendar year 2008). During Phase 2, the SSA will make a maximum of 11 monthly milestone payments with respect to a Title II beneficiary and a maximum of 18 monthly milestone payments with respect to a Title XVI beneficiary.

Under the SSA's prior rules, the total value of the four Title XVI milestones is less than 60 percent of the total value of the four Title II milestones. However, under these final rules, the total value of the Title XVI milestones will be 98 percent of the total value of the Title II milestones. The SSA anticipates that these changes will provide an additional incentive for ENs to accept tickets from Title XVI beneficiaries. Final Reg. §411.540 provides the revised payment amounts for milestone payments.

For both Title II and Title XVI beneficiaries, the payment amount for each milestone payment in Phase 1 will be 120 percent of the Title II payment calculation base defined in Reg. §411.500(a)(1). The payment amount for each milestone payment in Phase 2 will be 36 percent of the respective Title II or Title XVI payment calculation base. Final Reg. §411.545 provides the revised payment amounts for outcome payments under the outcome-milestone payment system, which is 36 percent of the respective Title II or Title XVI payment calculation base. Final Reg. §411.550 provides the revised payment rates for outcome payments under the outcome payment system, which is 67 percent of the respective Title II or Title XVI payment calculation base.

The final phase is the outcome payment period, during which beneficiaries are not receiving Social Security disability benefits or federal SSI cash benefits because of work or earnings. Consistent with the discussion above about milestones, the SSA is leaving the Title XVI outcome period at 60 outcome payment months in order to equalize the monetary value of the outcome payments and the total amount of all payments that potentially can be made to an EN with respect to Title II and Title XVI beneficiaries. Final Reg. §411.535(a)(3) provides that a reconciliation payment will be made equal to the total amount of unpaid Phase 1 and Phase 2 milestones that had been available at first ticket assignment if the beneficiary does not achieve all the Phase 1 and Phase 2 milestones prior to the beginning of the beneficiary's outcome payment period.

Using a ticket and timely progress rules

The SSA has added educational or technical training requirements to supplement the work requirements under the timely progress guidelines. It also has revised the work requirements under the guidelines and the documentation and other requirements to simplify the process for determining whether a beneficiary is making timely progress toward self-supporting employment. The SSA has replaced the initial 24-month period with two successive 12-month progress certification periods during which the beneficiary must complete certain work requirements and/or educational or technical training requirements in order to be considered to be making timely progress until the next scheduled progress review (Reg. §411.180).

In final Reg. §411.166(b), the SSA modified the definition of “timely progress toward self-supporting employment” to reflect that a high school diploma or GED certificate obtained in the first 12-month progress certification period counts as timely progress. In addition, the SSA has added a definition of “variance tolerance” in Reg. §411.166(h). Under the variance tolerance, the SSA will consider a beneficiary to have met the requirement for completing a specified amount of post-secondary credit hours in an educational degree or certification program or course requirements in a vocational or technical training program under Reg. §411.180 in the applicable progress certification period if the beneficiary's completion of credit hours or course requirements in that period is within 10 percent of the specified goal.

The SSA believes that these and other changes will provide greater opportunities for beneficiaries to participate in the Ticket to Work program and enhance their potential for a successful outcome.

Program changes driven by disappointment with program outcomes

In a news release accompanying the announcement of the revised regulations, Commissioner Astrue stated, “Thus far, the results of the Ticket to Work program have been less than everyone expected and clearly less than Congress intended. We need to monitor the results of today’s regulation closely, but it is highly likely that Congress will need to revisit the statute in the next few years in order to achieve the goals that Congress intended.” In preparation for the new Ticket to Work program, the SSA is undertaking a major recruitment effort to increase the number of organizations functioning as ENs. The agency also is initiating targeted outreach to promote the program to more beneficiaries and to encourage their participation. In addition, it is presenting the program at national and state conferences and bringing beneficiaries and ENs together at local Work Incentives Seminars (WISE events) throughout the country.

Details of the changes appear in the SSA's notice of proposed rulemaking are published in the May 20, 2008, Federal Register (73 Fed. Reg. 29324).

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