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ANCOR's Ticket To Work Comments (February 23, 2001)

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February 23, 2001

William A. Halter
Acting Commissioner
Social Security Administration
P.O. Box 17703
Baltimore, MD 21235-7703

Sincerely,

Director for Public Policy

Major Issues for Consideration

Subpart A—Introduction

§411.105 What is the purpose of the Ticket to Work Program?

NPRM Proposal: The proposed regulation states that the purpose of the Ticket program is "to expand the universe of service providers available" to eligible Social Security beneficiaries in order to obtain the necessary services "to find, enter, and retain employment".

General Comment: Several provisions in this NPRM clearly go against the purpose stated in §411.105. These provisions include the qualifications for an entity to become an employment network (EN), the design of the payment systems, the presumption of assigning tickets to state vocational rehabilitation (VR) agencies, and reporting requirements for ENs. ANCOR believes that these provisions will preclude and dissuade most vocational and employment providers from participating as ENs in the Ticket program. As currently written, this NPRM will not expand the universe of available, but instead will maintain VR agencies as the single entity serving individuals who want to work. This is precisely the opposite of what the Ticket program was intended to do.

ANCOR Recommendation: ANCOR urges SSA to carefully examine and revise various sections of this NPRM that go against the purpose of the Ticket program, specifically the provisions related to the qualifications of ENs, the design of the outcome payment systems, presumptive assignment of tickets to VR, and EN reporting requirements. Specific recommendations for changes to these provisions are provided in the remainder of ANCOR’s comments.

Subpart B—Tickets Under the Ticket to Work Program

§411.130 How will SSA distribute tickets under the Ticket to Work Program

NPRM Proposal: SSA will distribute tickets in graduated phases across the nation to permit a thorough evaluation of the Ticket program.

ANCOR Comment: ANCOR supports SSA’s roll-out of the Ticket program in phases over a four-year period. ANCOR understands that SSA plans to send tickets to eligible beneficiaries beginning in March 2001. However, as of late February 2001, SSA had not released a request for proposal (RFP) in order for entities to apply as ENs. Distributing tickets to eligible beneficiaries before potential ENs have had time to review their responsibilities under the Ticket program will not give beneficiaries adequate choice of ENs. Beneficiaries will be at a disadvantage and will be discouraged from using tickets because of this lack of available ENs, leaving only VR to take the ticket.

ANCOR Recommendation: SSA should not distribute tickets until an adequate number of ENs is available in each of the first thirteen roll-out states. This will ensure that beneficiaries will have a choice when selecting an EN.

Subpart E—Employment Networks

§411.315 What are the minimum qualifications necessary to be an EN?

NPRM Proposal: To serve as an EN under the Ticket program, an entity must meet specific criteria. This includes using staff who are qualified under applicable certification, licensing, or registration standards that apply to their profession. Or, ENs must use staff that are otherwise qualified based on education or experience, such as by using staff with a college degree in a related field such as vocational counseling, human relations, teaching, or psychology.

ENs must have applicable certificates, licenses, or other credentials if such documentation is required by State law to provide VR services, employment services or other support services in the State.

ANCOR Comment: The minimum qualifications for ENs must be more flexible so that the intent of TTWWIIA and the purpose of the Ticket program will be met. The specifications in the NPRM will restrict the participation of many vocational and employment providers—particularly small providers. It is reasonable to expect where state law requires licensing or credentialing of a profession that the state requirement be met. However, requiring blanket certification or licensure for an entire EN would preclude many vocational and employment providers from participating in the program.

ANCOR Recommendation: State licensure and credentialing should be required only when it is required by state law in order to provide specific services to individuals. SSA must clarify the regulations to read that licensure and credentialing is not required of all ENs, employees of ENs, or entities contracting with ENs. Where licensure or credentialing is not a state requirement, entities should be approved as ENs based on their experience in their area of expertise.

NPRM Proposal: ENs must provide medical and related health services under the formal supervision of persons licensed to prescribe or supervise the provision of these services in the State in which the services are performed.

ANCOR Comment: Requiring ENs to provide medical and related health services is overly burdensome—particularly for small vocational and employment service providers. Such a requirement will limit ENs to those entities that already provide these services.

ANCOR Recommendation: SSA must clarify this provision to read that this provision is not required by all ENs, but only by those ENs who provide medical and related health services.

§ 411.325 What reporting requirements are placed on an EN as a participant in the Ticket to Work program?

NPRM Proposal: ENs are required to report to the Program Manager (PM) information regarding the assignment of tickets, the signing of IWPs and amendments to IWPs by beneficiaries, signed agreements with state VR, and specific outcomes achieved with respect to services provided by an EN on behalf of beneficiaries whose tickets it accepted for assignment.

ENs must meet SSA’s financial reporting requirements, prescribed at §411.325(g), which states that ENs must submit an annual report to the PM that shows the percentage of an ENs budget that was spent on serving beneficiaries with tickets.

Finally, ENs must collect and record such data as required by SSA.

ANCOR Comment: Determining what portion of an organization’s activity is spent serving beneficiaries is neither required in TTWWIIA nor relevant to any of the other reporting requirements required of ENs by SSA. Why would SSA be concerned with the cost of services provided to beneficiaries? SSA should be concerned with beneficiary outcomes, rather than the cost of specific services provided to beneficiaries who return to work and those who do not return to work.

While it is reasonable to require ENs to report the total amount of money spent on services and supports for beneficiaries in the Ticket program, it is unreasonable to require that ENs report this amount in terms of an entity’s entire budget. ENs may provide other services not at all related to the Ticket program; such unrelated information should not be subject to review by SSA. Additionally, ENs may be a consortium of organizations that are not incorporated into one singular business entity and will have no formal operating budget. Developing and submitting a budget dissuades ENs to include multiple partners in order for ENs to provide the broadest range of services.

ANCOR Recommendation: The reporting requirement at §411.325(g) should be deleted. If the provision is not deleted, it should at least be modified so that ENs report only the total number of beneficiaries served and the total cost of services provided to beneficiaries under the Ticket program.

ANCOR Comment: The proposed rule at §411.325(h) does not delineate the data that SSA will require ENs to collect and report. The EN should know up front what data collection and reporting are required by ENs for participation in the Ticket program. Excessive, laborious data collection and reporting requirements may affect an entity’s decision to become an EN because such activities will add to administrative costs—costs that are not included in outcome payments to ENs or reimbursed by SSA. This provision will adversely affect small vocational and employment providers from serving as an ENs because they will not have the staff time nor the resources to devote to data collection and reporting.

ANCOR Recommendation: SSA should require ENs to collect and report only data that is absolutely necessary for the operation of the Ticket program.

Subpart F—State Vocational Rehabilitation Agencies’ Participation

§411.385 What does a State VR agency do if a beneficiary who is applying for services has a ticket available for assignment?

NPRM Proposal: SSA is proposing that, if a beneficiary has a ticket available for assignment and signs an individualized plan for employment (IPE) with a state VR agency, the beneficiary has automatically assigned his ticket to the state VR agency.

ANCOR Comment: Beneficiaries will simply not benefit from this provision. The hallmark of the Ticket program is consumer choice and establishing an automatic default assignment of tickets limits consumer choice. The 1998 amendments to the Rehabilitation Act include a provision for "presumptive eligibility" for VR services for Social Security Disability Income (SSDI) and Supplemental Security Income (SSI) beneficiaries. Therefore, a beneficiary may be eligible for VR services without assigning their ticket. Requiring beneficiaries to assign their ticket to VR—when the beneficiary is already eligible for VR services—will deny the use of the ticket by the beneficiary at a later date. SSA must make a distinction between services provided under the Ticket program and services provided by VR.

Additionally, because VR is only required to show nine months of a beneficiary’s employment at or above SGA in order to close a beneficiary’s case and receive reimbursement for services, a beneficiary may find himself still receiving cash benefits and needing further supports and services to work. However, because the ticket was automatically assigned to VR, the beneficiary is without a ticket and cannot receive additional vocational and employment services.

ANCOR Recommendation: SSA must strike this entire provision. Automatic assignment of tickets to VR is totally anathema to choice, to the purpose of the Ticket program, and to TTWWIIA.

§411.420 What information should be included in an agreement between an EN and a State VR agency?

NPRM Proposal: SSA is proposing that as part of the broad agreement between an EN and a State VR agency, the agreement must stipulate "the terms and procedures under which the EN will pay VR for providing services".

ANCOR Comment: Stipulating that ENs will pay VR presumes that this will always be the case. Currently, the opposite is true in many instances. Presuming in regulation that ENs will pay VR for services also assumes that VR and the Ticket program pay for the same services, when in fact, they do not. The Ticket program was created to help finance long-term supports and services so that an individual may return to work—supports and services for which VR agencies are unable to pay and receive reimbursement.

This provision requiring the terms and procedures under which ENs will pay VR for services was struck from the final version of the authorizing legislation prior to it passing the House of Representatives in 1999, as agreed upon by National disability organizations, staff of the House Ways and Means Committee, as well as SSA, the Rehabilitation Services Administration, and the Department of Education. A provision that was deleted from the legislation should not now be resurrected in the regulations.

ANCOR Recommendation: SSA should strike this provision. If, however, SSA does not strike the provision, a concurring provision should be inserted into the final regulations. The concurrent provision should require the state VR agency to have an agreement stipulating the terms and conditions under which VR will pay the EN for providing services.

Subpart H—Employment Network Payment Systems

ANCOR Comment: SSA is already aware of the significant concerns within the disability community about design of the employment network payment systems—particularly the milestone-outcome payment system. ANCOR wishes to join those who have already expressed strong reservations over the various aspects regarding the payment of ENs. As currently designed, the payment systems serve to restrict beneficiary choice, disadvantage those beneficiaries who are the hardest to serve, and dissuade many vocational and employment providers—particularly small providers—from becoming ENs.

Of all of ANCOR’s concerns with this NPRM, the provisions governing the EN payment systems are the greatest concern. These provisions, along with the provisions regarding qualifications of ENs are the crux for the success of the Ticket program. Congress intended for the Ticket program to benefit individuals with disabilities who want to work. If SSA is truly committed to making this program work, the agency must revise this entire subpart. Entities that accept the responsibilities associated with being ENs and serve beneficiaries who wish to work must be adequately compensated. Without adequate payment systems in place, there will be no ENs—outside of VR—to serve beneficiaries with tickets. The concept of choice will be thwarted and TTWWIIA will fail to accomplish its purpose of getting individuals with disabilities to work.

ANCOR Recommendation: Major changes must be made to all sections of Subpart H for the Ticket program to be successful and for the purpose of TTWWIIA to be accomplished. SSA must improve the payment systems so that vocational and employment service providers are encouraged to participate as ENs and so that all individuals with disabilities—including individuals with the most significant disabilities—can benefit from the Ticket program. SSA must consult with vocational and employment service providers—including providers that have experience with outcome-milestone payment systems—and re-design the proposed payment systems.

§411.500(a) Definition of the payment calculation base

NPRM Proposal: SSA defines the payment calculation base (PCB) as the average payments made to all SSI/SSDI beneficiaries during the previous calendar year who are between 18 and 65 years of age, are not concurrent SSI/SSDI beneficiaries, and who are in current pay status for the month in which the payment was made.

ANCOR Comment: The PCB drives the monthly outcome and outcome-milestone payments to ENs. SSA has chosen the most conservative basis for defining the PCB.

This definition of the PCB includes individuals who were on SSA’s cash benefit rolls for any part of the preceding calendar year and individuals on SSI who are receiving reduced cash payments under Section 1619(b) of the Social Security Act. By including both of these groups, the result is a substantially lower PCB. If SSA retains the current conservative calculation of the PCB, which lowers monthly outcome payments to ENs, vocational and employment service providers will not be inclined to serve SSI beneficiaries—which traditionally includes individuals with the most significant disabilities. In addition, because the PCB—which drives the payment systems—is too low, ENs will not elect the outcome-milestone payment system. The outcome-milestone payment system was established, in fact, to attract small vocational and employment providers to participate in the Ticket program and to encourage ENs to serve individuals with severe disabilities.

ANCOR Recommendation: SSA must increase the PCB amount in order to establish adequate outcome and milestone-outcome payments to ENs.

§411.525 How are the EN payments calculated under each of the two EN payment systems?

NPRM Proposal: SSA proposes that an EN is eligible for a monthly outcome payment when SSDI/SSI cash benefits "are not payable to the individual because of work or earnings".

ANCOR Comment: TTWWIIA states at §101(h)(2)(b) that the outcome payment method shall "provide a schedule of payments to an employment network…for each month…for which benefits are not payable because of work or earnings" [emphasis added]. Under this proposal, however, SSA would not pay an EN for serving a SSI beneficiary until complete cessation of cash benefits. Clearly, the law does not require the complete cessation of cash benefits to a SSI beneficiary in order for an EN to be paid. ANCOR believes that if Congress had, indeed, required complete cessation of benefits in order for outcome payments to be made to ENs, the law would have specifically stipulated as such.

Requiring cessation of all cash benefits places SSI beneficiaries at a disadvantage because discourages EN for serving them. Under current law, there is a $2-for-$1 cash offset for SSI beneficiaries. This cash offset, which is a work incentive, will now serve as a disincentive. SSI beneficiaries will be required to earn a higher monthly income than SSDI beneficiaries do before an outcome payment is made to the EN. Consequently, ENs will be discouraged from serving the SSI population, leaving only VR to serve these individuals—a situation Congress sought to rectify by enacting TTWWIIA.

ANCOR Recommendation: SSA must restructure the proposed outcome-milestone payment system for SSI beneficiaries in order to account for existing work incentives. SSA should allow outcome payments to ENs when the amount of earnings by a SSI beneficiary partially reduces the SSI cash benefit.

NPRM Proposal: Under the proposed outcome-milestone payment system, an EN’s total potential payment is about 85% of the total that would have been potentially payable under the outcome payment system for the same beneficiary.

ANCOR Comment: The purpose of the milestone-payment system is to ensure that small vocational and employment service providers—like many ANCOR members who serve individuals with the most significant disabilities—will be encouraged to participate as ENs. It was expected that the regulations would set the outcome-milestone payment as close as possible to the outcome payment amount. SSA’s proposal fails to do this.

While TTWWIIA requires that the outcome-milestone payment be less than the outcome payment system, the 15% disparity between the outcome and the outcome-milestone payment systems is too great to attract small vocational and employment service providers. This disparity will not result in ENs serving individuals with significant disabilities. Many private providers will not have the financial resources necessary to pay for the costs of services that a beneficiary may require before beginning work.

ANCOR Recommendation: SSA must eliminate the huge disparity between the outcome payment amount and the outcome-milestone payment amount, except for the minor reduction as required by TTWWIIA.

§411.530 How will the outcome period payments be reduced when paid under the outcome-milestone payment system?

NPRM Proposal: Under the outcome-milestone payment system, outcome payments made to ENs for each of the first 12 outcome payment months is reduced by an amount equal to 1/12^th of the milestone payments already made based on a ticket.

ANCOR Comment: This proposal to recapture milestone payments within the first 12 outcome payment months will, once again, harm small vocational and employment service providers. Their monthly outcome payments will be lower in the first year, preventing them from recouping any of the up-front costs of supports and services they provide so that beneficiaries can enter the workforce. This approach is in direct contrast to the purpose of the outcome-milestone payment system.

ANCOR Recommendation: SSA should amortize the recapture of milestone payments over the full 60-month outcome payment period.

§411.535 What are the milestones for which an EN can be paid?

NPRM Proposal: SSA is proposing two milestones for which an EN can be paid. Both of the milestones occur after the beneficiary starts to work. The first milestone is paid when the beneficiary has worked at or above the substantial gainful activity (SGA) amount for three months during a 12-month period; the second is paid when the beneficiary has worked at or above SGA for seven months within a 12-month period.

ANCOR Comment: The number of milestones is completely inadequate. It is also inappropriate to tie milestone payments to ENs to a beneficiary’s work at or above SGA. Small vocational and employment service providers will not be encouraged to be ENs nor will ENs be encouraged to serve individuals with the most severe disabilities. Preparing an individual to work is important and should be recognized as such. It may take over three years before an individual works at or above SGA. Because milestone payments are tied to SGA, an EN may have to wait over three years before a milestone payment is made. This is particularly true for ENs that provide supports and services to individuals with severe disabilities. Many ENs will not be able to wait over three years before they recoup some of their up-front costs if milestone payments tied to SGA and outcome payment amounts are inadequate.

ANCOR Recommendation: SSA must be flexible in setting milestones for which ENs can be paid. SSA should provide a greater number of milestones and set milestones prior to beneficiaries beginning work and earning SGA.

§411.540 What are the payment amounts for each of the milestones?

NPRM Proposal: SSA proposes that milestone payments occur at the third and seventh month of SGA, with such payments set at $470 and $940 for SSDI beneficiaries and $300 and $600 for SSI beneficiaries.

ANCOR Comment: The value of the milestone payments is much too low and will not serve to incentivize providers to select the outcome-milestone payment system.

Experience in establishing successful milestone payments already exists. For example, Oklahoma has run demonstration projects using milestone payments. Oklahoma’s project demonstrates that a total milestone system must pay at least $3,500 to attract vocational and employment service providers. Yet, SSA is proposing less than $1,000 in milestone payments to ENs for SSI beneficiaries. This disparity in pay between what Oklahoma has successfully demonstrated and what SSA is proposing assures that ENs will not elect this payment system

ANCOR Recommendation: SSA must increase the amount of milestone payments to ENs. Together with the recommendations made at §411.535, SSA should construct a variety of models for milestone payments with varying milestones and payment amounts. The models could be tested in the 13 initial roll-out states to determine the number of milestones and the milestone payments necessary to attract a variety of ENs. These models should include small employment and vocational providers and providers who serve individuals with the most significant disabilities.

§411.545 What are the payment amounts for outcome payment months under the outcome-milestone payment system?

NPRM Proposal: SSA is proposing to pay increasingly greater monthly outcome payments to ENs over the 60-month payment period. The total outcome-milestone payment amounts are $14,127 for SSDI beneficiaries and $8,976 for SSI beneficiaries.

ANCOR Comment: The monthly outcome payments, based on a faulty PCB, are totally inadequate to those necessary to attract ENs. Additionally, SSA is proposing to backload payments to ENs, such that the monthly outcome payments in the first twelve-month period are three times lower than those in the fifth twelve-month period. Inadequate monthly outcome payments and backloading outcome payments, in addition to the insufficient milestone payments and the proposal to recoup milestone payments within the first twelve-month period, only serve to further discourage and dissuade ENs from choosing this payment system—a system established to encourage broad participation of vocational and employment service providers in the Ticket program.

ANCOR Recommendation: The monthly outcome payment amounts in the outcome-milestone payment system must be spread evenly over the 60-month payment period.

§411.575 How does the EN request payment for milestones or outcome payment months achieved by a beneficiary who has assigned a ticket to an EN?

NPRM Proposal: SSA is proposing to require ENs to submit proof of a beneficiary’s work or earnings sufficient enough for SSA to determine that the agency may stop the beneficiary’s cash benefits and pay an outcome payment to the EN.

ANCOR Comment: This income reporting requirement for ENs externalizes a long-standing problem at SSA—the agency’s inability to accurately and expeditiously track earnings and adjust benefits accordingly. SSA must not force ENs to perform the work of SSA. SSA must correct this problem of overpayments to ensure that ENs are not burdened with this laborious requirement and that beneficiaries, who are attempting to work and end their reliance on cash benefits, are not penalized with overpayment of benefits.

ANCOR Recommendation: SSA must develop a better means of tracking and reporting earnings of beneficiaries in order to pay ENs. SSA must not rely on ENs to carry out the agency’s job and to correct a long-standing problem within the agency.

§411.597 Will SSA periodically review the outcome payment system and the outcome-milestone payment system for possible modifications?

NPRM Proposal: SSA will periodically review payment systems under the Ticket program.

ANCOR Comment: There are serious issues with the entire outcome-milestone payment system, as outlined above in the sections in Subpart H. As proposed, the outcome-milestone payment system does nothing to attract small vocational and employment service providers nor does it attract providers to serve individuals with the most significant disabilities. The proposed payment system does not provide adequate incentives for ENs to assist beneficiaries to enter the workforce. It serves only to discourage and dissuade these providers from electing the outcome-milestone payment system—contrary to the purpose for which it was created.

ANCOR Recommendation: SSA is urged to immediately exercise its authority to review the design of the outcome-milestone payment system so that it does include adequate incentives for ENs to assist beneficiaries who want to work.

Additional Issues for Consideration

§411.125 Who is eligible to receive a ticket under the Ticket to Work Program?

NPRM Proposal: SSA is proposing that individuals eligible to receive a ticket must be between 18 and 65 years of age.

ANCOR Comment: This proposal excludes those individuals under 18 years of age who have disabilities and could benefit from using a ticket. Many private providers work with transitioning youth who would benefit from vocational and employment services at this young age. Providing tickets to these individuals would ensure they receive appropriate vocational and employment services and are prepared to enter the workforce. Arbitrarily postponing their ticket eligibility until they have had a re-determination at age 18 will only delay the provision of services, lessen the likelihood of employment success, and increase their reliance on cash benefits as adults.

ANCOR Recommendation: SSA should determine which individuals under age 18 will most likely remain on SSA’s rolls after their re-determination and issue these individuals a ticket.

§411.180 What is considered timely progress toward self-supporting employment?

NPRM Proposal: SSA has proposed a process to measure if an individual is making "timely progress" toward meeting his employment goals established in the individual work plan (IWP)

ANCOR Comment: This proposal lacks flexibility and will discourage ENs from serving individuals with severe disabilities if the EN believes the individual will not meet the proposed definition of "timely progress". There must be flexibility, allowing for a reasonable modification of the specific criteria constituting "timely progress" for individuals who are making progress toward their goals, but whose progress does not fit with the established standards.

ANCOR Recommendation: SSA should incorporate flexibility into this section by allowing ENs, at the approval of the PM, to deem the individual’s progress as equivalent to the required number of months of work at SGA.

§411.250 How will SSA evaluate the PM?

NPRM Proposal: SSA will periodically conduct a formal evaluation of the PM to assess the performance of the PM in a number of areas. SSA’s Project Officer will perform the evaluation.

ANCOR Comment: The proposal states that SSA will perform the evaluation and examine several areas, including customer satisfaction. However, the proposal makes no mention of ENs and beneficiaries providing input on SSA’s evaluation of the PM.

ANCOR Recommendation: SSA should consult with all stakeholders in the Ticket program, including ENs and beneficiaries, so that they may provide information as appropriate to assist SSA in evaluating the performance of the PM.