[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]




 
                  THE SOCIAL SECURITY ADMINISTRATION'S
                           MANAGEMENT OF THE
                         TICKET TO WORK PROGRAM

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON SOCIAL SECURITY

                                 of the

                      COMMITTEE ON WAYS AND MEANS
                     U.S. HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 18, 2004

                               __________

                           Serial No. 108-58

                               __________

         Printed for the use of the Committee on Ways and Means



                    U.S. GOVERNMENT PRINTING OFFICE
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                      COMMITTEE ON WAYS AND MEANS

                   BILL THOMAS, California, Chairman

PHILIP M. CRANE, Illinois            CHARLES B. RANGEL, New York
E. CLAY SHAW, JR., Florida           FORTNEY PETE STARK, California
NANCY L. JOHNSON, Connecticut        ROBERT T. MATSUI, California
AMO HOUGHTON, New York               SANDER M. LEVIN, Michigan
WALLY HERGER, California             BENJAMIN L. CARDIN, Maryland
JIM MCCRERY, Louisiana               JIM MCDERMOTT, Washington
DAVE CAMP, Michigan                  GERALD D. KLECZKA, Wisconsin
JIM RAMSTAD, Minnesota               JOHN LEWIS, Georgia
JIM NUSSLE, Iowa                     RICHARD E. NEAL, Massachusetts
SAM JOHNSON, Texas                   MICHAEL R. MCNULTY, New York
JENNIFER DUNN, Washington            WILLIAM J. JEFFERSON, Louisiana
MAC COLLINS, Georgia                 JOHN S. TANNER, Tennessee
ROB PORTMAN, Ohio                    XAVIER BECERRA, California
PHIL ENGLISH, Pennsylvania           LLOYD DOGGETT, Texas
J.D. HAYWORTH, Arizona               EARL POMEROY, North Dakota
JERRY WELLER, Illinois               MAX SANDLIN, Texas
KENNY C. HULSHOF, Missouri           STEPHANIE TUBBS JONES, Ohio
SCOTT MCINNIS, Colorado
RON LEWIS, Kentucky
MARK FOLEY, Florida
KEVIN BRADY, Texas
PAUL RYAN, Wisconsin
ERIC CANTOR, Virginia

                                 ______

                    SUBCOMMITTEE ON SOCIAL SECURITY

                  E. CLAY SHAW, JR., Florida, Chairman

SAM JOHNSON, Texas                   ROBERT T. MATSUI, California
MAC COLLINS, Georgia                 BENJAMIN L. CARDIN, Maryland
J.D. HAYWORTH, Arizona               EARL POMEROY, North Dakota
KENNY C. HULSHOF, Missouri           XAVIER BECERRA, California
RON LEWIS, Kentucky                  STEPHANIE TUBBS JONES, Ohio
KEVIN BRADY, Texas
PAUL RYAN, Wisconsin

                    Allison H. Giles, Chief of Staff

                  Janice Mays, Minority Chief Counsel

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Ways and Means are also published 
in electronic form. The printed hearing record remains the official 
version. Because electronic submissions are used to prepare both 
printed and electronic versions of the hearing record, the process of 
converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.


                            C O N T E N T S

                               __________

                                                                   Page

Advisory of March 11, 2004, announcing the hearing...............     2

                               WITNESSES

U.S. Department of Education, Troy R. Justesen, Acting Deputy 
  Assistant Secretary, Office of Special Education and 
  Rehabilitation Services........................................    28
Social Security Administration, Martin H. Gerry, Deputy 
  Commissioner, Disabiltiy and Income Security Programs..........    21

                                 ______

Arizona Employment Network Association, Susan Webb...............    80
Benjearlene Nelson, Ticket to Work Participant; accompanied by 
  Ron Rattay, Gulfstream Goodwill Industries, Inc................     8
Charmaine Teri Hancock, Ticket to Work Partcipant................    10
Consortium for Citizens with Disabilities, Paul J. Seifert.......    66
Health and Disability Advocates, John Coburn.....................    84
Integrated Disability Resources, Inc., Tom Foran.................    71
Ticket to Work and Work Incentives Advisory Panel, Sarah Wiggins 
  Mitchell.......................................................    55
Ticket to Work and Work Incentives Advisory Panel, Thomas P. 
  Golden.........................................................    55
VR Services, Richmond Area Arc, Quintin M. Mitchell..............    76

                       SUBMISSIONS FOR THE RECORD

California Department of Rehabilitation, Sacramento, CA, 
  Catherine Campisi, letter......................................    97
Council of State Administrators of Vocational Rehabilitation, 
  Chicago, IL, Robert Kilbury and Louis Hamer, statement.........    98
Indiana Vocational Rehabilitation Services, Indianapolis, IN, 
  Mike Hedden, statement.........................................    99
Louisiana Rehabilitation Services, Department of Social Services, 
  Baton Rouge, LA, James Wallace, statement......................    99
Maryland Division of Rehabilitation Services, Baltimore, MD, 
  Robert A. Burns, letter........................................   100
Massachusetts Rehabilitation Commission, Boston, MA, Elmer C. 
  Bartels, statement.............................................   100
Oklahoma Department of Rehabilitation Services, Oklahoma City, 
  OK, Dan O'Brien, statement.....................................   102
Pennsylvania Office of Vocational Rehabilitation, Harrisburg, PA, 
  Stephen R. Natsui, letter......................................   104
South Carolina Vocational Rehabilitation Department, West 
  Columbia, SC, Larry C. Bryant, statement.......................   105
Tennessee Division of Rehabilitation Services, Nashville, TN, 
  Carl Brown, letter.............................................   106
Texas Department of Assistive and Rehabilitative Services, 
  Austin, TX, Terrell I. Murphy, statement.......................   107
Utah State Office of Rehabilitation, Salt Lake City, UT, Blaine 
  Petersen, letter...............................................   107
Washington Department of Social and Health Services, Division of 
  Vocational Rehabilitation, Lacey, WA, Michael O'Brien, 
  statement......................................................   109
West Virginia Division of Rehabilitation Services, Charleston, 
  WV, statement..................................................   110


                  THE SOCIAL SECURITY ADMINISTRATION'S
                           MANAGEMENT OF THE
                         TICKET TO WORK PROGRAM

                              ----------                              


                        THURSDAY, MARCH 18, 2004

             U.S. House of Representatives,
                       Committee on Ways and Means,
                            Subcommittee on Social Security
                                                    Washington, DC.

    The Subcommittee met, pursuant to notice, at 10:08 a.m., in 
room B-318, Rayburn House Office Building, Hon. E. Clay Shaw, 
Jr. (Chairman of the Subcommittee) presiding.
    [The advisory announcing the hearing follows:]

ADVISORY FROM THE COMMITTEE ON WAYS AND MEANS

                    SUBCOMMITTEE ON SOCIAL SECURITY

                                                CONTACT: (202) 225-9263
FOR IMMEDIATE RELEASE
March 11, 2004
No. SS-8

                       Shaw Announces Hearing on

                  the Social Security Administration's

                Management of the Ticket to Work Program

    Congressman E. Clay Shaw, Jr. (R-FL), Chairman, Subcommittee on 
Social Security of the Committee on Ways and Means, today announced 
that the Subcommittee will hold a hearing on the Social Security 
Administration's (SSA's) management of the Ticket to Work Program. The 
hearing will take place on Thursday, March 18, 2004, in room B-318 
Rayburn House Office Building, beginning at 10:00 a.m.

    In view of the limited time available to hear witnesses, oral 
testimony at this hearing will be limited to the SSA, the U.S. 
Department of Education, and other invited witnesses. However, any 
individual or organization not scheduled for an oral appearance may 
submit a written statement for consideration by the Subcommittee or for 
inclusion in the printed record of the hearing.

BACKGROUND:

    The Ticket to Work and Work Incentives Improvement Act of 1999 
(P.L. 106-170), signed into law on December 17, 1999, established the 
Ticket to Work and Self-Sufficiency Program, expanded the availability 
of health care coverage, and provided for demonstration projects and 
studies. The Ticket to Work Program, administered by the SSA, increases 
choice in obtaining rehabilitation and vocational services, and 
provides greater opportunities for Disability Insurance (DI) and 
Supplemental Security Income (SSI) recipients to receive assistance to 
help them return to work.

    As part of the program, individuals receive a ``ticket'' from the 
SSA, which they may voluntarily assign to their State Vocational 
Rehabilitation Agency (SVRA) or to an Employment Network (EN) of their 
choice. An EN is a public agency or private organization that provides 
employment services, vocational rehabilitation services, or other 
support services necessary to achieve a vocational goal. The ENs are 
paid by the SSA for results, and choose between two payment systems--
one based on the individual no longer receiving cash benefits because 
of work, the other based on attainment of certain vocational 
milestones. The program is being phased in over a 3-year period and 
will be in place nationwide in September 2004.

    Most Social Security DI and SSI adult disability beneficiaries are 
automatically eligible to receive tickets, and to date, almost 7 
million tickets have been issued. Some 40,000 beneficiaries have chosen 
to assign their tickets to service providers. Of these, 10 percent have 
been assigned to one of more than 1,100 ENs and 90 percent have been 
assigned to a SVRA.

    The bipartisan Ticket to Work and Work Incentives Advisory Panel, 
established in law to advise the President, the Congress, and the 
Commissioner of Social Security on issues related to work incentive 
programs, is monitoring the implementation of the ticket program. It 
has expressed growing concerns about the SSA's management of the 
program. In particular, the panel is deeply concerned that too few ENs 
are willing to accept tickets and assist beneficiaries to return to 
work. It's recently issued report to the Congress and the Commissioner 
entitled, ``The Crisis in EN Participation--A Blueprint for Action,'' 
http://www.ssa.gov/work/panel/panel_documents/pdf_versions/
CrisisEnParticipation.pdf made a number of recommendations, including: 
clarify the Ticket Program as a funding source that supplements, rather 
than displaces, other existing funding sources; improve the EN payment 
system and EN claims administration; expand EN and beneficiary 
marketing; and improve EN training and communication.

    In addition, unresolved issues between ENs and many SVRAs may also 
be discouraging ENs from participating in the Ticket Program. These 
issues include: questions regarding automatic ticket assignments to 
SVRAs; pressure for ENs to contract with SVRAs rather than accepting 
tickets themselves; ineffective cooperative agreements between SVRAs 
and ENs; and lack of consumer information.

    In announcing the hearing, Chairman Shaw stated, ``Work--essential 
for individuals with disabilities to achieve their goals and support 
their families--won't happen without an effectively run Ticket to Work 
Program. The Social Security Administration's management of this 
important program must fully meet the needs of those wanting to return 
to work as well as those assisting them in this effort.''

FOCUS OF THE HEARING:

    The Subcommittee will review the SSA's management of the Ticket to 
Work Program, including results achieved to date and challenges 
hampering program success.

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:

    Please Note: Any person or organization wishing to submit written 
comments for the record must send it electronically 
[email protected] along with a fax copy to 
(202) 225-2610, by close of business Thursday, April 1, 2004. In the 
immediate future, the Committee website will allow for electronic 
submissions to be included in the printed record. Before submitting 
your comments, check to see if this function is available. Finally, due 
to the change in House mail policy, the U.S. Capitol Police will refuse 
sealed-packaged deliveries to all House Office Buildings.

FORMATTING REQUIREMENTS:

    Each statement presented for printing to the Committee by a 
witness, any written statement or exhibit submitted for the printed 
record or any written comments in response to a request for written 
comments must conform to the guidelines listed below. Any statement or 
exhibit not in compliance with these guidelines will not be printed, 
but will be maintained in the Committee files for review and use by the 
Committee.

    1. All statements and any accompanying exhibits for printing must 
be submitted electronically to 
[email protected], along with a fax copy to 
(202) 225-2610, in WordPerfect or MS Word format and MUST NOT exceed a 
total of 10 pages including attachments. Witnesses are advised that the 
Committee will rely on electronic submissions for printing the official 
hearing record.

    2. Copies of whole documents submitted as exhibit material will not 
be accepted for printing. Instead, exhibit material should be 
referenced and quoted or paraphrased. All exhibit material not meeting 
these specifications will be maintained in the Committee files for 
review and use by the Committee.

    3. All statements must include a list of all clients, persons, or 
organizations on whose behalf the witness appears. A supplemental sheet 
must accompany each statement listing the name, company, address, 
telephone and fax numbers of each witness.

    Note: All Committee advisories and news releases are available on 
the World Wide Web at http://waysandmeans.house.gov.

    The Committee seeks to make its facilities accessible to persons 
with disabilities. If you are in need of special accommodations, please 
call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four 
business days notice is requested). Questions with regard to special 
accommodation needs in general (including availability of Committee 
materials in alternative formats) may be directed to the Committee as 
noted above.

                                 

    Chairman SHAW. Good morning. Today our Subcommittee will 
examine the Social Security Administration's (SSA's) management 
of the Ticket to Work Program. The Ticket to Work and Work 
Incentives Improvement Act (P.L. 106-170) was signed into law 
in December 1999. The goal of this landmark legislation is to 
remove barriers and increase incentives for individuals with 
disabilities to seek work. These incentives empower 
beneficiaries with choices of job training and placement 
services.
    Prior to enactment of the bill, less than 1 percent of the 
individuals with disabilities receiving Social Security 
Disability Insurance (SSDI) or Supplemental Security Income 
(SSI) left the rolls to return to work. Now the SSA is reaching 
the end of its three-phase implementation plan of this program. 
To date almost 7 million tickets to individuals with 
disabilities in all 50 States have been distributed and all 
program components are operational. This has been no small 
effort and I commend the agency for extraordinary efforts.
    I have a sample of a ticket right here and you can see that 
it allows the ticket holder to obtain employment services by 
turning the ticket to a State Vocational Rehabilitation (VR) 
agency or Employment Network (EN). So far 40,000 tickets have 
been assigned yet 90 percent of these tickets have been 
assigned to State VR agencies and only 10 percent have been 
assigned to ENs. In the Ticket to Work Program choice is 
paramount. To continue to grow the success of the program we 
need to understand why a market of ENs has failed to 
materialize.
    [The information follows:]

    [GRAPHIC] [TIFF OMITTED] T3796A.001
    
    The bipartisan Ticket to Work and Work Incentives Advisory 
Panel has been examining issues relating to the service 
providers marketplace since it first convened. Today we will 
hear the panel's latest recommendation, along with the 
testimony from three ENs that are currently accepting tickets 
and helping the individuals return to work. Although the low 
number of ENs participating in the Ticket to Work Program is 
troubling, we must not lose sight that this program is having a 
positive impact on the lives of many individuals who do have 
disabilities.
    Therefore, I think it is only fitting that our hearing 
begin with the testimony of two individuals who have changed 
their lives by taking advantage of the Ticket to Work Program. 
Following their testimony, we will hear from representatives of 
the SSA and the U.S. Department of Education, and then from 
other key stakeholders. Taking the first step to try to work is 
one of the most difficult decisions someone with a disability 
can make. Our challenge is to ensure that the Ticket to Work 
Program helps make this decision easier, not harder. I look 
forward to hearing the thoughtful counsel of each of our 
witnesses today and I thank you for joining us. Now I would 
yield to the gentleman from Maryland, Mr. Cardin.
    [The opening statement of Chairman Shaw follows:]

 Opening Statement of The Honorable E. Clay Shaw, Jr., Chairman, and a 
          Representative in Congress from the State of Florida

    Good morning. Today, our Subcommittee will examine the Social 
Security Administration's management of the Ticket to Work Program.
    The Ticket to Work and Work Incentives Improvement Act was signed 
into law in December of 1999. The goal of this landmark legislation is 
to remove barriers and increase incentives for individuals with 
disabilities to seek work. These incentives empower beneficiaries with 
choices for job training and placement services.
    Prior to enactment of the bill, less than 1 percent of individuals 
with disabilities receiving Social Security Disability Insurance or 
Supplemental Security Income left the rolls to return to work. Now, the 
Social Security Administration is reaching the end of its three-phase 
implementation plan of this program.
    To date, almost seven million tickets to individuals with 
disabilities in all 50 states have been distributed and all program 
components are operational. This has been no small effort, and I 
commend the Agency for its extraordinary efforts.
    I have a sample of a ticket here and you can see that it allows the 
ticket holder to obtain employment services by turning in the ticket to 
a State Vocational Rehabilitation Agency or an Employment Network. So 
far 40,000 tickets have been assigned, yet ninety percent of these 
tickets have been assigned to State Vocational Rehabilitation Agencies 
and only 10 percent have been assigned to Employment Networks.
    In the Ticket to Work Program, choice is paramount. To continue to 
grow the success of the program, we need to understand why a market of 
Employment Networks has failed to materialize.
    The bipartisan Ticket to Work and Work Incentives Advisory Panel 
has been examining issues related to the service provider marketplace 
since it first convened. Today, we will hear the Panel's latest 
recommendations, along with testimony from three Employment Networks 
that are currently accepting tickets and helping individuals return to 
work.
    Although the low number of Employment Networks participating in the 
Ticket to Work Program is troubling, we must not lose sight that this 
program is having a positive impact on the lives of many individuals 
with disabilities.
    Therefore, I think it is only fitting that our hearing begin with 
testimony from two individuals who have changed their lives by taking 
advantage of the Ticket to Work program. Following their testimony will 
we hear from representatives from the Social Security Administration 
and the Department of Education and then from other key stakeholders.
    Taking the first step to try work is one of the most difficult 
decisions someone with a disability can make. Our challenge is to 
ensure that the Ticket to Work Program helps make this decision easier, 
not harder. I look forward to hearing the thoughtful counsel of each of 
our witnesses today, and thank them for in advance for joining us.

                                 

    Mr. CARDIN. Let me thank Chairman Shaw for calling this 
hearing. It is very important that this Committee follow-up on 
the Ticket to Work Program. I thank you for convening this 
hearing and for calling these panels so that we can hear from 
all of the different stakeholders, from people who are in the 
program, to the agencies that administer it at the Federal 
level, as well as other interested parties.
    The Ticket to Work Program was one of the major 
accomplishments passed by Congress in 1999. It was an effort to 
reward individuals who were willing to take a risk to work. 
They had certain protections while on the disability rolls and 
they would have to give up to enter the employment market. We 
recognized that and passed the Ticket to Work Act to give them 
more opportunity for VR and to provide certain safety nets, 
particularly in regard to their health care benefits. We passed 
the law in 1999. It is now 2004. In my own State of Maryland, 
we just started receiving the tickets in November of 2003. So, 
Mr. Chairman, we do not yet have a lot of experience as far as 
people who are participating in the program. One of our 
objectives today is to determine how we can expedite the 
program and make it as effective as possible.
    When we look at the individuals who are participating in 
the ENs, we find that the success rates are pretty much what we 
had predicted. Yet we think those rates can be even higher, if 
we improve the program's effectiveness.
    So, there is more that we need to do. We have to encourage 
greater participation in the program. We have to provide 
necessary administrative support to the agencies. I am 
concerned that the agencies' budgets have not been realistic 
for carrying out this mission. It has been reported to us that, 
in some instances, the ticket may be replacing access to VR 
services rather than supplementing those programs. That 
certainly was not the intent of Congress.
    No amount of outside assistance can convince beneficiaries 
to attempt to work if they believe that working will lead to a 
loss of vital health benefits and income support before they 
are financially ready. The Ticket Act recognized the importance 
of these incentives in helping beneficiaries work and the 
importance of SSA administering the work rules promptly and 
accurately. Although the SSA has taken some steps in the right 
direction, much remains to be done. Beneficiaries can not yet 
be confident that if they go to work, the SSA will adjust their 
checks in time to prevent a large overpayment of benefits.
    Some of the obstacles can be addressed by the SSA and the 
Department of Education, which are charged with the 
administrative responsibilities. Others may require direction 
or clarification from Congress. This hearing will give us an 
opportunity to hear firsthand how the program is being 
implemented, so that the agencies can take the appropriate 
steps and we, in Congress, can carry out our oversight 
responsibilities.
    Mr. Chairman, I want to raise one additional issue that was 
recently brought to my attention. It is my understanding that 
nearly a decade ago, officials at the SSA were made aware of a 
situation involving more than 500,000 SSI recipients who 
subsequently became eligible for Social Security disability 
benefits. Due to a computer error, these recipients were never 
identified. So, for over the last 10 years there have been 
literally thousands, hundreds of thousands of SSI recipients 
who were entitled to additional payments, but did not receive 
them.
    The SSA is now trying to identify these individuals, but 
because of the lack of administrative support they have had to 
prioritize the group they are going after in trying to correct 
the situation. As a result, in some cases, these corrections 
will not take place for many, many years to come, obviously 
causing a major problem for the people who are entitled to 
additional benefits. I might point out it also affects our 
States, because if these beneficiaries were eligible for SSA 
disability they would have been covered by the Medicare Program 
rather than the Medicaid program. This means that our States 
are overpaying and are entitled to some adjustments.
    Mr. Chairman, I would hope that in the future we would have 
an opportunity to review this issue and to try to expedite the 
process of correcting this error since it has been 10 years and 
we really need to clear up this record and do what is right for 
the beneficiaries and for our States. I look forward to hearing 
the testimony of all the witnesses today and working with the 
Chairman and the Members of this Committee to carry out our 
very important oversight responsibility and to see what we can 
do to make the Ticket to Work Program as effective as possible. 
Thank you, Mr. Chairman.
    Chairman SHAW. Thank you, Ben. We now have our first panel. 
I will introduce Ms. Nelson, and Mr. Collins will introduce Ms. 
Hancock. Benjearlene Nelson is a Ticket to Work participant 
from my own area of West Palm Beach, Florida and she is 
accompanied by Ron Ratty, who is with Gulfstream Goodwill 
Industries (GGI), West Palm Beach, Florida. Ms. Nelson has had 
some pretty rough sledding. She has shown a tremendous amount 
of courage and I think her story should be an inspiration to 
all of us. Mr. Collins?
    Mr. COLLINS. Thank you, Mr. Chairman. It is my pleasure to 
welcome Ms. Teri Hancock from Newnan, Georgia. I spoke with Ms. 
Hancock briefly before the hearing began and she has a very 
impressive resume that I have already read. Just listening to 
her, talking to her, the things that she has overcome based on 
a problem that she had several years ago and would not let it 
be something that would end her desire to be a career person 
again, because she has, as I say, a very impressive resume. She 
also is a very special strong advocate for this program, the 
Ticket to Work, and we appreciate that very much. I think you 
are going to find her testimony very interesting.
    I regret to say, though, that she may be leaving Georgia in 
the very near future. She is formerly from the Washington area 
here and she may be moving back to the city rather than staying 
in some of the rural areas of Georgia. That will be our loss 
but it will be Washington's gain. Ms. Hancock, thank you very 
much for being here and for your testimony. It is very 
impressive, and your background is very impressive, and I know 
your future will be very impressive. Thank you.
    Chairman SHAW. Mr. Rattay will be our first witness.

STATEMENT OF RON RATTAY, GULFSTREAM GOODWILL INDUSTRIES, INC., 
                    WEST PALM BEACH, FLORIDA

    Mr. RATTAY. Thank you. First, let me say that I am 
extremely privileged in having Benjearlene ask me to escort her 
here today. The GGI became an EN in November of 2001; it has 
been in the business of changing people's lives for 
approximately 105 years. We have many programs that are suited 
to individual's specific needs. Basically our mission is, and 
always will be, to help people with disabilities and other 
barriers to return to employment and become working members of 
our communities. So, becoming an EN was a natural transition 
for us. Approximately 7 months ago GGI engaged a fill team to 
implement and launch the Ticket to Work self-sufficiency 
program. We have researched, we have studied, and we learned 
the Ticket to Work self-sufficiency program in order to better 
it toward self-sufficiency.
    With the support of our program manager, Maximus, national 
Industries for the Severely Handicapped (NISH), and, 
specifically, the local West Palm Beach Social Security office 
and the advisory panel, we have moved forward. Today we hold 26 
people, all of whom want to become self-sufficient. Ten of 
these people have succeeded far beyond Substantial Gainful 
Activity (SGA), either in the milestone or outcome status. The 
others are only a job away, and we have yet to scratch the 
surface. We recognize the concerns and issues of the Ticket to 
Work Program but for now GGI continues to be proactive and 
place the needs of our participants first. With this said, 
please allow me to introduce one of our heroes and 
participants, Ms. Benjearlene Nelson.
    Chairman SHAW. Ms. Nelson?

 STATEMENT OF BENJEARLENE NELSON, TICKET TO WORK PARTICIPANT, 
                    WEST PALM BEACH, FLORIDA

    Ms. NELSON. Thank you. I am very honored to be here today. 
My name is Benjearlene Nelson. I am 33 years old. I am a mother 
of two wonderful children, a loving mother--I have a loving 
mother, and I am also the loved one of a very supportive 
family. I am here today to testify for the Ticket to Work 
Program and to let you know how the Ticket to Work has worked 
for me. I am also a Social Security beneficiary. Because of my 
disability, I have had a lot of downfalls in life. It has 
affected me mentally, emotionally and physically
    I am here to let you know that I have always been a striver 
to reach for the hills. Because of my disability, it has taken 
a lot from me, but with the Ticket to Work and GGI, I tell you 
they have given me an inner strength to continue to go on. Back 
in 2002 I was faced to pull out my Ticket to Work. I had 
received it 9 months ahead of time. I looked at it and put it 
away. At the time I was married, had a husband that was 
supporting the family. Because of my disability, I did not feel 
the need to work or to experience the outside world. I had kind 
of put myself in a closet and just felt that I did not need to 
be exposed to the world.
    Back in 2002 my husband, who is an alcoholic, attempted to 
set the house on fire while my children and I were sleeping. By 
the grace of God I am here today. I want to say that at that 
time he was taken away I knew that I had to stand up and step 
out and stand on my own to support my family. I used my Ticket 
to Work. I went to GGI. I told them what my situation was and 
they were there with open arms. Goodwill has given me the 
strength that I needed to stand up. They have encouraged me. 
They have given me confidence and motivation to continue to go 
on and to lead my family as the head of the household.
    I also want to say that I have come to some very low points 
in life where I did not feel that I could accomplish different 
things and in certain areas. I just did not feel that I was 
good enough. Being encouraged through the Ticket to Work and 
GGI, they have just inspired me. A lot of times I went in there 
feeling down and did not know what I can do. I know that I have 
a disability with my eyes, as well, and I had a long road ahead 
of me and I could not even see it. Goodwill has guided me in 
the direction that I needed to be in. Together, I know that 
they are a great team and I also want to say that through the 
Ticket to Work I have achieved a position at Crystal Marketing 
where I am working now, where I am the top seller. I enjoy 
working there. I look forward to moving on and going to better 
places.
    I also want to let you know that without the Ticket to 
Work, I do not think that I would have stepped forward. I do 
not know where I would have been at this point in my life. The 
Ticket to Work gave me courage. They explained the Ticket to 
Work with me. It sounded like a great idea. They have backed me 
the whole way and I just want to say that the Ticket to Work is 
such a great program. It lets you know that they are standing 
behind you. You do not have to worry. I just think that more 
people should know about the Ticket to Work Program who are 
disabled so that they can get their life on the road and 
accomplish some of the things that I have in life.
    [The prepared statement of Ms. Nelson follows:]

Statement of Benjearlene Nelson, Ticket to Work Participant, West Palm 
    Beach, Florida; accompanied by Ron Rattay, Gulf Stream Goodwill 
               Industries Inc., West Palm Beach, Florida

    Let me first say I'm privileged in having Benjearlene ask me to 
escort her and be with her on this very important day.
    Gulfstream Goodwill become an Employment Network in November of 
2001, Goodwill Industries has been ``in the business of changing 
peoples lives'' for about 105 years. We have many programs that are 
geared to the individual's specific needs. Basically, our mission is to 
help people with disabilities and other barriers to employment to 
become self-sufficient, working members of our community. So becoming 
an Employment Network was a natural transition.
    Approximately seven months ago GGI engaged a full time team to 
launch the TTW program. We have researched and studied the TTW program 
in order to make it geared toward self-sufficiency. With the support of 
Maximus, NISH, the local WPB SSA office, and the Advisory Panel we have 
moved forward. Today we hold 26 tickets for people who want to become 
self sufficient. Ten of these people have succeeded far beyond SGA and 
are in the ``milestone'' or ``out-come'' status; the others are only a 
job away.
    We recognize that there are concerns and issues with the TTW 
Program, but for now GGI continues to be proactive and place the needs 
of our participants first.
    With this said, please allow me to introduce to you one of our 
participants Benjearlene Nelson.
How Gulfstream Goodwill Industries and Ticket to Work Helped Me
    It was the night in 2002 that changed my life forever. My husband 
attempted to set our house on fire while my children and I were 
sleeping.
    I am not a person that likes to talk a great deal about misfortune. 
I am not a negative person. It is because of this, and my loving 
Mother, that I have stayed strong.
    I became disabled in 1991. It wasn't until I came down with 
pneumonia in 1995 that the reality of my condition hit me. I lay in the 
hospital and heard the shocking words from my doctor, ``Prepare a 
Living Will. You are not expected to live.'' Because I want to hang on 
long enough for my two children to be able to live without me, I 
fought. And I survived. But I was exhausted, both physically and 
emotionally. I hadn't worked a steady job in fifteen years. The burden 
of supporting Adrian (then 8 years old) and Greivondra (then 6 years 
old) in a fire-ravaged home was overwhelming. To add to this, my 
children and I were forced to jail ``Dad,'' which meant an additional 
fight and family upheaval.
    I reached my lowest point after the arson and attempted murder by 
my husband. I had no energy, no direction, and no future. Looking about 
my room I saw a ``Ticket to Work'' certificate on my dresser that I had 
received about eight months before the fire. I don't believe it was a 
coincidence that I hadn't thrown it away. And it wasn't a coincidence 
that I knew about Goodwill either. I know Goodwill has a reputation for 
``doing good things,'' and I know they help people find jobs.
    I took control again. Meeting with Elizabeth Jennings at Goodwill 
in May of 2003 was a good experience. She gave me encouragement and 
told me that I could get a job right away. I was in an emergency 
situation because I really needed to get a job and fast. There were 
bills to pay and no food to eat. It had to be a job with good pay, but 
one that would allow me to keep my Social Security benefits. To add to 
my worry, I don't have a high school diploma. It felt like I was 
walking another tight rope, and I was scared.
    Goodwill was there for me. Judy Roy took over once Elizabeth 
completed the paper work. I told Judy about my work experience and how 
I always wanted a better education. (I have taken several courses from 
local universities.) Goodwill gave me benefits counseling, and Judy's 
job search produced three job opportunities for me within the first 
week. I decided that I wanted to go to the job interviews alone, even 
though Judy told me that she would go with me. I wanted to prove to 
myself that I COULD! I was offered all three jobs, and I took the one 
that paid the best: a telemarketing job at Kristel Marketing where I 
invite people to a vacation resort in the Poconos.
    Today I look forward, not backward. I have a good job, and achieved 
``Best Sales'' within my company last year. I have two wonderful 
children who know the importance of a good education, and a fantastic 
mom, who has been supportive in the worst of times. And I have my 
Goodwill family.
    It is important to have my Goodwill family because my fight isn't 
over. To keep my disability at bay I am forced to take medication that 
has attacked my joints and liver. I have been diagnosed with Avascular 
Necrosis of the hip and a chronic liver disease. Hip replacements are 
in my future, and I know Goodwill will be there for me again.
    The ``Ticket to Work'' program has proved invaluable to me. Because 
I didn't believe in myself after all that happened to me, I really 
needed a helping hand. I think of Goodwill as offering me a much-needed 
hand up. The Ticket to Work program and Goodwill people gave me a lift 
so I could get up, work and support my children on my own.

                                 

    Chairman SHAW. Thank you, Ms. Nelson. Ms. Hancock?

      STATEMENT OF CHARMAINE TERI HANCOCK, TICKET TO WORK 
                  PARTICIPANT, NEWNAN, GEORGIA

    Ms. HANCOCK. Good morning, everyone. I am Teri Hancock and 
my story is a shade different. I, on the other hand, was at the 
height of my career when my injury happened, and because of 
that, I was in rehabilitation for about 4 years. I was in a 
wheelchair, couldn't walk, and I had to develop my muscles at 
the bottom of my body all over again. Having to learn how to 
walk is quite a task, believe me.
    When you are young and you think you are invincible and you 
have everything to live for, your life goes from sugar to poop, 
and that is the thick of it. When you find yourself in a 
situation where everything is a gray area, you look around--I 
looked around because I wanted my old life back and I was 
willing to do anything to get that old life back. The problem 
was, society would not allow me to have that life back. There 
was no one there to listen, because I had a big white brace at 
the time. Mind you, I have had seven surgeries to correct my 
injury.
    You would be surprised at how you are viewed when you have 
a handicap. Employers do not listen to you. People ignore you. 
You are ostracized. While working at the national Cancer 
Institute after my return to work after the initial injury, I 
was ridiculed, taunted, made fun of, poked fun at, the butt end 
of a joke. For someone that has come from my background, which 
is radio-television, behind the camera, in front of the camera 
mostly, talk show host, it was devastating. My self-esteem went 
to just about zero.
    With my will and determination, I wasn't going to stay 
there long. I was looking for an out. I was looking for a 
helping hand. I was looking for an avenue to stroll that would 
bring me back to where I was. Actually, in the fifth year, I 
got a letter in the mail from Ticket to Work, Social Security. 
I said to myself, hmmm, a government agency. That means they 
are going to be around. I said to myself, an opportunity for 
the government to take a listen to what I have to say. Somebody 
is finally paying attention. I was very happy about that, very 
elated.
    To find the right program--you get a list when you get your 
letter. When I got my list, I went through four--three agencies 
before I found the fourth one. Now, Integrated Disabilities 
Resources (IDR) in Connecticut--I live in Georgia--but not all 
Ticket to Work Program vendors are good, and I will have to 
tell you that. Not everybody does what they are supposed to do. 
There are some that do what they are supposed to do, and they 
are superior. For a win situation for myself, people like 
myself, we need the program to come back into life, to be 
reborn again.
    Now, I worked with a woman by the name of Meg Moran, and 
Meg Moran understood where I was going, where I had come from, 
my level. Others may say to you, well, I want to teach you how 
to write a resume. I can teach you how to write a resume. You 
don't need to teach me that. I can set up an interview. I can 
set up my own interview. I didn't need that. I needed contacts. 
I needed somebody to listen. I needed a voice. They supplied 
the voice. Social Security backed it. The IDR was there to make 
the contacts. I went forward, got it done.
    When you are called terrible names because of your handicap 
or made fun of, which I cannot even repeat the things I was 
called, the only thing you want to do is show them they are 
wrong. Well, I was able to show them that they were wrong with 
Ticket to Work. Not only do I counsel, not only do I counsel 
other people, not only have I written a book, not only do I 
tour with my book, but my self-esteem is back up to 100 
percent. No more big white brace. Ticket to Work listened. They 
heard my cry. There are thousands, probably millions of people 
like myself out there. They need Ticket to Work. They need a 
voice. They need an entry. I am here to say, thank God for 
them, and if you have a position for me at Ticket to Work, 
Social Security, you had better come get me because here I am.
    [Laughter.]
    I can say nothing except the program is a viable program. 
You have, as I said, a million intelligent people out here that 
want to go to work. Yes, we do have people that don't want to 
go to work, but we have so many that still want life. I am 
crying for life for these people, for myself, and I am saying, 
whatever you do, God bless Ticket to Work and that is where we 
want to be. Thank you.
    [Applause.]
    [The prepared statement of Ms. Hancock follows:]

   Statement of Charmaine Teri Hancock, Ticket to Work Participant, 
                            Newnan, Georgia

    The challenge to move forward in life and live it as you once knew 
it after the affects of serious illness or injury, brings about idle 
yet common reflections of what could have been. Living and adjusting to 
life as it now presents itself, challenges the will to live, the 
necessity to thrive, the purpose of one's being and poses the age-old 
question of devastation--why? Or why me?
    One never knows what may lie ahead in life, we live each day in 
health as if it will be there forever. We often times choose to close 
our eyes and minds to what does not directly effect us at that given 
moment but when the unexpected happens and life turns a sharp and 
warningless curve the cold hard vengeance of reality can hit you like a 
brick.
    Which brings us to my own reality. After having had a massive 
cerebral hemorrhage totally out of the blue, while at the height of my 
success, life for me went from sugar to poop! On top of the world one 
day and flat on my back the next, helpless with no relief or hope in 
sight.
    Once I was finally lucid enough to understand the condition I was 
left in immediate depression consumed me, leaving me breathless, lost 
and very alone. I really did not know who I was or what life held for 
me.
    Well, after countless years of rehab, pain staking surgeries, 
endless therapies, never ending questions and people treating you like 
a mangled yarn, I ventured to pick myself up and get back I the race.
    For over four years I tried to break back into the work force on my 
own. Between operations (seven to be exact) the healing process, the 
rehabilitation's, the weakness and the struggle to exist. But at many 
points because of how I was treated by others I viewed myself as less 
than whole, even a waste, and certainly not the person I use to be. I 
questioned who or what had I become anyway? Moreover why was this 
foreigner living in my body invading my wonderful life and when was it 
leaving?
    I wanted to get back in the work force, but doors are often close 
to cripples, people seen as less than perfect, people who's presence 
one might find disturbing. During my period of healing I was indeed one 
of those people.
    Although I held a wealth of knowledge, experience and information, 
it did not matter because my physical presentation was less than 
acceptable (hard on the eye) the public viewed me as less than whole, 
less than perfect.
    I tried to get back into Telecommunications at MCI only to be 
taunted, laughed at and made fun of, always the butt end of a crippled 
joke.
    My self-esteem totally destroyed, my sprit broken. Over and above 
all of this, I was still there inside of this broken body, no one would 
listen or give me the time of day.
    TTW came in my life at a time when I had exhausted every avenue, 
literally. So for me this program was a ``God send'' my rescue from the 
hell of disablement. A real voice, a real person to join forces with. 
After receiving my ticket I view my options, spoke with four venders 
and settled on Integrated Disabilities Resources (IDR). Understand, not 
every ticket holding agency is equipped nor do they really understand 
their job. So IDR was the right choice for me.
    This outfit seemed to understand my level and mindset really 
connecting with me. This is where I linked with an individual who 
seriously wanted to support me and understood my cry for help. This 
woman was Meg Moran of IDR, she saw me as a crop that simply needed to 
be harvested, a bountiful land full of nutrients and aid to bestow.
    I started working Meg at IDR and soon people started listening 
because I now had a connected voice. Using IDR's connections, 
assistance and referral systems, new avenues of opportunity were made 
available.
    In fact, working with one of their consultants (Dan T. Mcaneny) 
opened up a whole new world. Mr. McAneny helped me realize just how 
much I did have to offer; I was amazed with myself once we explored 
just what jewels I did posses. I realized that I had allowed society to 
beat me down like a bush in a rainstorm.
    After working with IDR I took on new challenges and capitalized on 
what I had already had under my belt. As an air personality, I had 
lectured and counseled on radio and television before my injury and 
developed quite a following. While these people were still out there 
and hundreds more, people who needed my help as much as I needed to 
help them for my own esteem. With the help of Dan McAneny I turned my 
lectures into a book, did something constructive and came back into the 
forces of life. Thank goodness for the TTW program.
    Much like myself there are thousands of people who have so much to 
give, so much to share, teach, produce, contribute, so much life to 
still live but with no practical means to display or showcase their 
abilities. Therefore they sit and waste, many are so beat down by the 
barriers of society until they have lost their fight or so terrified of 
rejection until they simply give up and concede.
    So, Social Security developed an incentive program for the 
displaced, handicapped and physically challenged individuals to display 
their capabilities as to redeem their self worth. I think their 
original idea or mindset may have been to get able-bodied people back 
to work, off the system and help relieve the deficit. However the real 
gem of this program is that millions of Americans that lost who they 
use to be before that devastating injury or illness can once again 
become viable, productive, happy salary earning individuals!
    Thus still helping with the world's deficits and financial crunch. 
Which leads into just what having a ticket has done for my life.
    The Ticket to work Program provides an entry back to a productive 
life. It supplies one with direction, hope and guidance granting a 
solid home base to rise from. Because TTW is part of our Government its 
stability speaks for itself, the injured can trust and take refuge in a 
program such as this. Therefore, We really do need TTW and agencies 
with caring hard working advocates for the disabled such as IDR. TTW/
IDR helped save my sanity and got me on track because I certainly could 
not do it alone.
    Please, help me help others get their life back and be productive, 
whole individuals who contribute to the face of this universe.
    Save TTW, help Social Security help its contributors and please 
save the agencies that give human beings back their dignity and self 
worth.

                                 

    Chairman SHAW. I can tell you that applause applies to both 
of you ladies. I can't recall a single time in my 24 years of 
Congress where a panel has been applauded.
    [Laughter.]
    Social Security, if you need somebody to sell your stuff, I 
think you have found her.
    [Laughter.]
    Mr. Collins?
    Mr. COLLINS. I told you, Mr. Chairman, she was going to be 
very impressive. I really have no questions other than just to 
thank each of you for being here. You have very humbling 
stories to tell and we appreciate the fact that you had the 
will not to take these roadblocks and let them stand before 
you, but knock them down and get things done, and I would 
appreciate your support for the program and we wish you the 
best in the future, which I know it will be. Thank you.
    Chairman SHAW. Mr. Cardin?
    Mr. CARDIN. Let me join the Chairman in thanking you for 
coming before our Committee. The SSA tells us there are 40,000 
people who have taken advantage of the Ticket to Work. That is 
a small fraction of the number of people who could benefit from 
the Ticket to Work. A lot of times in Congress, we debate 
numbers. We debate dollars. Your testimony has really put a 
face on the issue to us, that we are dealing with real people 
and their lives and affecting their lives. So, we very much 
appreciate your testimony and what it means to us when we work 
for programs that we think can make a difference in people's 
lives. The two of you come from different backgrounds, but it 
was the same program that benefited both of you. You were able 
to take advantage of this program, and I very much appreciate 
the manner in which you expressed that.
    Ms. Nelson, it was very courageous of you to get into this 
program because you knew there were certain risks involved. You 
gave up certain safety nets that were available to you, but the 
importance of work, the importance of being the head of your 
household and taking care of your family, the Ticket to Work 
gave you a chance to use that and to use those talents and we 
thank you for having the courage to move forward. Ms. Hancock, 
as you said, your case was different. You needed the bridge to 
bring you back to be able to use your talents, and the Ticket 
to Work worked for both. So, I think that is really a testament 
to the flexibility of this program, and exactly what we 
intended in Congress. We intended this program to be a ticket 
to be used outside the conventional rehabilitation services 
that were available through the States, that you could use it 
to get the help that you needed to be able to reenter the 
employment marketplace.
    We wanted to be flexible. We wanted to have a variety of 
vendors out there that were available, and I think you have 
raised a very good point, one that I want to make sure we 
follow up on, and that is there are different types of ENs that 
are out there. Some are better than others for your particular 
needs. One of the things we have to make sure that we have 
adequate information so that the ticket is used by the 
recipient in the most effective way in order to accomplish the 
results, and I think your testimony has helped us to focus in 
on that. So, to both of you, we thank you for being here. We 
thank you for your testimony. I can tell you it has a major 
impact on our work.
    Ms. NELSON. Thank you.
    Ms. HANCOCK. Thank you.
    Chairman SHAW. Thank you, Ben. Mr. Hayworth?
    Mr. HAYWORTH. Thank you, Mr. Chairman. Again, let me thank 
the witnesses. Just a couple of questions, and we appreciate 
the testimony. Ms. Nelson, do you have any piece of advice for 
others who are receiving benefits who are just now thinking 
about getting back to work? Is there anything that is just 
really important for people to remember as they take a look at 
this Ticket to Work Program?
    Ms. NELSON. I think that it is very important that they 
look at the Ticket to Work Program, also that it will also 
protect their benefits, their medical. The Ticket to Work is 
there so that you don't have to worry about your benefits or 
your medical. So, that is one thing that is very important if 
they decide to use the Ticket to Work. They don't have to worry 
that their medical will be taken away from them.
    Mr. HAYWORTH. So, the real thing is to emphasize the 
message and expand, and that leads me to Ms. Hancock, a fellow 
broadcaster. I worked in television and many a television news 
director said I had a face for radio. Maybe that is how I ended 
up in the Congress.
    [Laughter.]
    I think we get into the real challenge we are confronting 
today with these hearings, because as our colleague from 
Maryland pointed out, we passed this program in 1999. Now, Mr. 
Chairman and my colleagues, witnesses and others gathered here, 
this is a critical time because we have the irony of some 
really gratifying success stories and we appreciate the 
presence of television cameras here today, and yet the ability 
of folks to take advantage of this seems to be the real 
challenge, to make sure the word gets out.
    Ms. Hancock, I could not help but notice in your testimony 
your willingness, your invitation to the SSA and others to take 
advantage of your background in broadcasting and of your story 
to get the message out. It is a bit unfair, but we have both 
been in the broadcasting business, and sometimes in Washington, 
we get involved in--I am not here to castigate, it is just 
sometimes in the order of doing things. We introduce pilot 
projects to get the word out, and sometimes things are very 
laudable on the surface, but the results are projected a year 
or two down the road, and there may be a lag time that is not 
at all satisfactory. As a fellow broadcaster, what is the best 
way to get the message to the people who are qualified for the 
Ticket to Work? What do you think would be the most effective 
means of communication?
    Ms. HANCOCK. I am so glad you asked that, because I do have 
an answer, and that answer is when people go to apply for their 
disability and you see your counselor there, the Ticket to Work 
needs to be introduced at that juncture because they need to 
know--for example, if you are on short-term disability, we have 
got a program called Ticket to Work. You don't lose anything. 
You don't lose your benefits. You get to work. You have got a 
trial work period. If you can't succeed, you lose nothing. You 
start over. Disability benefits stay. If you go past the 9 
months, then we take the Social Security away. You get back 
into the mainstream of life. It is a win-win situation for all. 
You are helping to stop the deficit in terms of all the moneys 
going out to people that don't really need to be on Social 
Security.
    Let us face it. We have got people, excuse me, that don't 
need to be on Social Security. They are there because they are 
afraid to come back into the workforce, or it is just plain 
easier not to go back to work because you are getting that 
money. You have some people that will stay at that safe house 
because they are lazy. You have got other people, such as the 
two people you have here. We want to get back into society. We 
want to do the right thing.
    If it was simply introduced when you had your review or 
when you had your initial interview, it is an option that is 
open without passing any type of legislative law. It is already 
there. The counselors can simply do it at that point, and let 
you know what your options are. Many people do not read the 
mail. I read the mail. She reads the mail. Many people don't 
open the mail, so the ticket goes in the drawer. The Ticket 
goes in the trash. So, to get it out, you have got to have a 
one-on-one communication with a human being, so the person will 
understand what the ticket is.
    Mr. HAYWORTH. So, job one of the counselor is to bring up 
Ticket to Work?
    Ms. HANCOCK. Absolutely, and the benefits of Ticket to 
Work.
    Mr. HAYWORTH. Ms. Nelson, you want to make a comment on 
that?
    Ms. NELSON. I just want to make a comment as to what she 
said. She is telling the truth, because when I received the 
Ticket to Work, the first place I put it was in the filing 
cabinet. At the time, my husband was there. I didn't read it 
over. I didn't think that I needed it. Nine months later is 
when I pulled it out, and at the time, I wasn't even sure if it 
had expired, or if I was still able to use it. So, I agree with 
her.
    Mr. HAYWORTH. Thank you both very much. Thank you, Mr. 
Chairman.
    Chairman SHAW. Thank you. Just to follow up on that, in 
looking at the Ticket to Work, I don't know whether the Members 
have it in their back-up material, but it is a pretty cold 
document. I think we can do a better job of making it more 
consumer-friendly. When you read it, you don't know if you are 
getting in trouble or what.
    [Laughter.]
    Whether to put it in the filling cabinet or in the round 
filing cabinet.
    [Laughter.]
    I think it is a little intimidating, and I think maybe we 
can do something to help that out. Ms. Tubbs Jones?
    Ms. TUBBS JONES. Thank you, Mr. Chairman. Ms. Nelson, Ms. 
Hancock, on behalf of all of the folks who are receiving SSI 
across this country, I want to thank you for your wonderful 
commentaries and reports. I am interested, even though you are 
not here for this purpose, how, when you made an application 
for disability, how long that took for you. Was it a long 
process? Was there delay? What happened for you? I hate to go 
to another part, and maybe it is not as glorious as your 
commentary, but I need to know that if you could help me out.
    Ms. HANCOCK. Yes. For me, it was short. This is a true 
story. My mother was visiting me in Atlanta, Georgia. We were 
at a CHU facility and a woman saw me, and I was limping. She 
said to me, ``Excuse me, are you receiving Social Security,'' 
and I really ignored her, because I was trying to ignore the 
condition. In fact, I was a little hurt, and I said, ``No, I am 
not receiving,'' because it was one of those things where you 
don't want to be bothered. The injury was too new. So, to make 
a long story short, my mother says, ``Listen to what this woman 
has to say,'' and I did.
    Ms. TUBBS JONES. Mothers always say that, don't they?
    [Laughter.]
    Ms. HANCOCK. So, the woman worked at Social Security and 
she said, ``You need to see me at my office.'' It was almost 
like a Godsend, like a little blessing. I went in and mine 
actually didn't take long at all. When people say they are 
denied, I just went through the process fairly quickly. Within 
3 months, I was getting Social Security. So, I didn't have a 
bad time at all.
    Ms. TUBBS JONES. Where are you from, again?
    Ms. HANCOCK. Washington, D.C.
    Ms. TUBBS JONES. Okay. Thank you. I thought they had some 
other State on there.
    Ms. HANCOCK. I live in Newnan, Georgia.
    Ms. TUBBS JONES. That is what I am saying. Okay. I am not 
totally confused. Great. What about you, Ms. Nelson?
    Ms. NELSON. For me, it didn't take long at all. I was in 
the hospital for about a month and they weren't expecting me to 
live. When I did start to recover, to get better, they did it 
in the hospital so when I returned home, I was eligible for 
Social Security.
    Ms. TUBBS JONES. So, tell me what you are doing right now, 
Ms. Nelson. What type of work are you doing?
    Ms. NELSON. Right now, I work for a marketing company. I 
invite people to a vacation resort in the Poconos, the 
Pennsylvania and New Jersey area.
    Ms. TUBBS JONES. What about you, Ms. Hancock?
    Ms. HANCOCK. Right now, I am mediating, mostly divorce 
cases. Daily, I teach, and I am a master's candidate for 
counseling.
    Ms. TUBBS JONES. If there was one thing, and I am almost 
done, Mr. Chairman, if there was one thing that you would 
improve in addition to how people are noticed of Ticket to 
Work, what would that proposal be for either one of you?
    Ms. NELSON. I would say a lot of people watch television. 
Put it on television.
    Ms. HANCOCK. Yes, they do. That is good.
    Ms. TUBBS JONES. Ms. Hancock?
    Ms. HANCOCK. For me, again, I would build a campaign, an 
actual campaign, because when we campaign and we get things 
done through campaigns, we stir up, again, from the 
broadcasting, we stir up interest.
    Ms. TUBBS JONES. If there was an opportunity for either of 
you to serve on an advisory Committee to the Ticket to Work 
Program, would you consider that?
    Ms. HANCOCK. I would be your girl.
    Ms. NELSON. Yes.
    Ms. TUBBS JONES. Okay.
    [Laughter.]
    Thank you very much, Mr. Chairman.
    Chairman SHAW. Thank you. Mr. Hulshof?
    Mr. HULSHOF. Thanks, Mr. Chairman. I promised Mr. 
Hayworth--he had to step out just for a moment, and I promised 
that we would not ask for a recorded roll call vote on whether 
we believe he has a face for radio.
    [Laughter.]
    Chairman SHAW. We are still wondering if he has a face for 
politics.
    [Laughter.]
    That will teach him to leave the hearing.
    [Laughter.]
    Mr. HULSHOF. I am sure he will be back any minute now. I 
certainly don't have the breadth of experience as the Chairman 
as far as the number of hearings, but I do look around the 
room, and I think of the number of hearings that this 
Subcommittee has had regarding this issue, and I see some 
familiar faces here in the hearing room who have been with us 
working on this issue, actually even back to 1997. I think is 
when we began under a former Chairman, and now Senator, Jim 
Bunning of Kentucky, when he chaired this Subcommittee.
    We have a very active disability community in Central 
Missouri. I will confess that before they brought this issue to 
my attention about things like the income cliff, and things 
like losing health insurance, and things like the barriers and 
obstacles in place to keep people who want to return to the 
workforce and be productive, and the self-esteem and all those 
things, they are the ones who brought it to my attention. So, 
it is great that we can come and talk about a successful 
program, but also then to see what we need to do to make sure 
that this program continues, that we go and recruit others and 
tell others about this very successful program.
    This was an interesting political lesson for me because 
this was the first time I actually got to be on a Conference 
Committee, that is, to work with Senator Kennedy and Rick Lazio 
of New York, again, a former Member, and we were trying to work 
the details of this out. I know that when the bill, the final 
version, there were folks that were concerned about the final 
version, but I think we had a good product. There is my friend 
back.
    [Laughter.]
    So, again, whatever suggestions that you have, and I 
applaud each of you and I know, Ms. Hancock, just as a final 
question, I know you are not here for self-promotion, but where 
can I get your book?
    Ms. HANCOCK. I will send you a copy.
    Mr. HULSHOF. Okay. Thank you, Mr. Chairman.
    Chairman SHAW. Thank you. Mr. Becerra?
    Mr. BECERRA. Thank you, Mr. Chairman, and thank you very 
much for what was compelling testimony. I think you bring real 
life to what we try to do sometimes, so it is nice to see that 
oftentimes policy is put in practice, and it is great to see 
that. I know we are going to have an opportunity to talk to the 
folks from the agencies that are equipped and empowered to 
administer these programs, and hopefully what we can do is try 
to perfect them, because we know that there have been some 
difficulties, whether it is not the best providers being out 
there or just not having the access and to beneficiaries not 
knowing about them. So, we thank you for the testimony and 
appreciate that you shared your stories. Just so you know, my 
understanding is that there is an opening right now with the 
Ticket to Work Program for the Director, so if any of you are 
interested in applying, you might want to consider submitting 
your resume.
    [Laughter.]
    I think Congresswoman Tubbs Jones asked a question that I 
wanted to ask, which was give us your on-the-ground impressions 
of what we should do, and you mentioned two very good ones, the 
publicity campaign, doing something on television, maybe 
through public service announcements. Any other thoughts about 
what we should know about making the program more user 
friendly? The simplest things, just so we know how you all need 
to access the program.
    Ms. NELSON. I think one thing to make the program more user 
friendly is to emphasize on the medical part of it protecting 
medical benefits. That was one of my biggest issues of even 
beginning to work and to continuing to work. We are always 
going to need medical help, and me personally, I know that I am 
going to have hip replacements soon. I never know when I am 
going to need another eye surgery. So, that is always a major 
concern as far as me working at this time.
    I am in training to become supervisor on my job, but at the 
same token, I am afraid to take the position because I know 
with a certain amount of money, the medical benefits are taken 
away and that is one of my biggest concerns. Even with the 
medications I take, it is really a big concern of mine. So, if 
there is some way that you can assure Social Security 
beneficiaries that they will be protected in that aspect, I am 
sure that a lot of people will take advantage of the Ticket to 
Work.
    Mr. BECERRA. Ms. Nelson, have you had or do you have a good 
experience that you can tell us about with regard to VR 
services? Has that continued? Now that you have used the Ticket 
to Work Program, are you still accessing the VR services?
    Ms. NELSON. Yes. Goodwill has helped me. Everything that I 
need, I went to GGI, any encouragement, counseling. Regardless 
as to what it was, I have been to GGI. I consult GGI. I always 
consult Ron Rattay, who has answered all of my questions. If he 
didn't know the answer, he found the answer, and this made me 
feel confident.
    Mr. BECERRA. So, you had a pretty good experience working 
with the agencies involved?
    Ms. NELSON. Yes.
    Mr. BECERRA. Good. Ms. Hancock, I don't know if you have 
anything you would like to add.
    Ms. HANCOCK. I think I have probably said enough. I do want 
to say that she is absolutely right. If we could just alleviate 
the fear of, ``Are we going to lose this?'' People just don't 
understand that you can benefit in a win-win situation, and 
that everything is not taken away from you at once. They think 
if they are working 4 or 5 months, that is 4 or 5 months into 
their ticket period, not understanding that if you start over, 
the whole process starts over, so you are losing nothing. I 
think that should be made more clear. Other than that, I am 
done.
    [Laughter.]
    Mr. BECERRA. Thank you for coming. Mr. Chairman, thank you.
    Chairman SHAW. Thank you. I am going to just read something 
into the record off of an actual Ticket to Work ticket. It has 
been a successful program, I am not knocking it, but I think 
there are many people out there like you two who would avail 
themselves of this instead of being too quick just to throw it 
away or being intimidated by it.
    I am reading right from the ticket. It says, ``This ticket 
is issued to you by the SSA under the Ticket to Work and Self-
Sufficiency Program.'' Now, that has got to mean a lot to 
people who are on disability. ``If you want help in returning 
to work or going to work for the first time, you may offer this 
ticket to an EN of your choosing or take it to your State VR 
agency for services. If you choose an EN and it agrees to take 
your ticket, or if you choose your State agency and you qualify 
for services, these providers can offer you services to help 
you go to work. An EN provides the services at no cost to you. 
The SSA will pay the EN if you assign your ticket to it, and 
the EN helps you go to work and complies with the other 
requirements of the program. An EN serving under the program 
has agreed to abide by the rules and regulations of the program 
under the terms of its agreement with the SSA for providing 
services under the program. Your State agency can tell you 
about its rules for getting services.''
    Now, if you are going to be informed about the program 
after reading this, you have got a sense that I think is rather 
remarkable. I do understand there is a letter accompanying 
this, but I don't have a copy of it. I am sure it gives us a 
lot more information, but, all of us here on this panel have 
been involved in advertising ourselves in political campaigns 
and we would never send out something like this, because it 
would never be read. I think that we must become a little more 
imaginative if we are going to get more people into the 
program. You people have demonstrated, Ms. Nelson and Ms. 
Hancock, you have demonstrated what you can do for yourself.
    This Subcommittee and the entire Committee on Ways and 
Means has, I think, done some wonderful things, and Ticket to 
Work, I think, is another program in which we show that we have 
faith in the human spirit if we just let it fly. You have 
certainly proven that to us. Ms. Nelson, I am really very proud 
to have you. I think you just live outside of my congressional 
district. I checked you out. I don't think you live in my 
district.
    [Laughter.]
    You do live in the West Palm Beach area, which I do 
represent a portion of, and I am very proud to--I will claim 
you as a constituent, even if you live out of the district.
    Mr. BECERRA. So do we.
    [Laughter.]
    Chairman SHAW. California is a stretch.
    [Laughter.]
    I have heard of gerrymandering----
    Mr. BECERRA. We stretch a lot of things in Congress.
    Chairman SHAW. I have heard of gerrymandering, but it 
doesn't go from Palm Beach to Los Angeles.
    [Laughter.]
    Ron, do you have a question?
    Mr. LEWIS. No.
    Chairman SHAW. I want to thank you for being here and 
sharing your story. Hopefully, it will be an inspiration to 
many, and Mr. Rattay, just keep up what you are doing. You are 
obviously doing the right thing and we very much appreciate 
your being here with us this morning.
    Ms. HANCOCK. Thank you for having us.
    Ms. NELSON. Thank you.
    Mr. RATTAY. Thank you.
    Chairman SHAW. Our next panel is made up of Martin Gerry, 
who is Deputy Commissioner, disability and Income Security 
Programs, SSA, and Troy Justesen, who is the Acting Deputy 
Assistant Secretary, Office of Special Education and 
Rehabilitation Services at the Department of Education. We 
welcome both of you back to this panel and we look forward to 
your testimony. As both of you know, we have your full 
testimony and it will be made a part of the record. You may 
proceed as you see fit. Mr. Gerry?

 STATEMENT OF MARTIN H. GERRY, DEPUTY COMMISSIONER, DISABILITY 
  AND INCOME SECURITY PROGRAMS, SOCIAL SECURITY ADMINISTRATION

    Mr. GERRY. Thank you, Mr. Chairman. Mr. Chairman and 
Members of the Subcommittee, as you know, Mr. Chairman, the SSA 
administers both the SSDI, and the SSI programs. These programs 
provide benefits to about 10.5 million Americans with 
disabilities. The Ticket to Work Program allows these 
beneficiaries greater flexibility and expanded choice in 
obtaining the rehabilitation, employment, and other support 
services that they need in order to go to work and to attain 
their employment goals.
    Mr. Chairman, I would like to express my thanks to you, Mr. 
Matsui, and to the other Members of this Subcommittee for all 
of the hard work and support that you have provided in making 
the Ticket to Work Program a reality. I look forward to 
continuing to work together closely with the Subcommittee to 
strengthen the program in a way that builds on our early 
experience and significantly expands participation in the 
program by both our beneficiaries and by ENs.
    In his New Freedom Initiative, President Bush pledged that 
his Administration will work tirelessly to help Americans with 
disabilities become fully integrated into the American work 
force so that they may realize their dreams for meaningful and 
successful careers. The Ticket to Work Program will help us 
tear down many of the barriers that currently prevent Americans 
with disabilities from full participation in the economic 
mainstream of American society.
    With the Ticket to Work Program, beneficiaries have more 
opportunities to obtain employment support services to help 
them reach their employment goals. In addition, the program 
will help us fulfill the promise of the Americans with 
Disabilities Act. Commissioner Barnhart and I are deeply 
committed to achieving the goals of this very important 
program.
    Mr. Chairman, I would like to begin by briefly describing 
how the Ticket to Work Program operates and making some 
comments on where we are in implementation of the program. The 
SSA currently provides benefits under the SSDI and SSI 
Programs, as I said, to approximately 10.5 million Americans 
with disabilities. Under current agency regulations, an SSDI or 
SSI beneficiary with a disability receives a Ticket to Work if 
he or she is between the ages of 18 and 64 and has a medical 
condition that is not expected to improve in the near future. 
Approximately 9.2 million, or a little over 85 percent of the 
10.5 million of all our current beneficiaries with disabilities 
meet this standard.
    Under the act, the SSA enters into agreements with ENs, and 
State VRs. The ENs are qualified State, local, or private 
organizations that offer employment support services. A 
beneficiary who receives a Ticket to Work can choose to assign 
it to the State VR agency or to any EN that provides services 
within his or her community. Together, these agencies serve as 
ticket providers under the program. The act does require that a 
ticket provider accept a measure of risk whenever it agrees to 
provide services to a beneficiary. The ENs and State VR 
agencies may only be paid under the program based on success in 
assisting beneficiaries to secure and maintain employment and 
to move off the disability benefit rolls. An EN might never be 
paid if a beneficiary's cash benefits do not stop as a result 
of work. An EN may decide whether or not to accept the 
assignment of a ticket. State VR agencies incur less risks than 
ENs do because those agencies are already funded and fully 
capitalized through the Rehabilitation Act (P.L. 93-112).
    Once a ticket is assigned by a beneficiary to a ticket 
provider, the beneficiary and the provider jointly develop and 
implement a plan of employment, vocational, or other support 
services designed to lead to and maintain employment. Providers 
may offer these services directly or by entering into 
agreements with other organizations or individuals to provide 
the appropriate services at no cost to the beneficiary. The 
Ticket to Work Act provides three additional incentives to 
encourage work activity by beneficiaries. First, the SSA will 
not schedule a periodic continuing disability review (CDR), for 
a beneficiary who is receiving services from a ticket provider. 
Second, work activity by a beneficiary will not trigger a CDR 
if the beneficiary has received benefits for at least 24 months 
under the Disability Insurance program. Finally, an individual 
whose benefits terminated because of work activity can request 
that benefits start again without having to complete a new 
application for benefits.
    Mr. Chairman, as you know, we have implemented the Ticket 
to Work in three phases and it is currently available in all 
States and U.S. territories. Through February 2004, tickets 
have been mailed to over 6.9 million disabled beneficiaries, 
and by September of this year, the remaining 2.2 million 
eligible beneficiaries will have received a Ticket to Work. As 
of the beginning of this month, 40,441 beneficiaries who had 
received Tickets to Work had assigned them to ticket providers. 
Of this total, 36,525, or approximately 90 percent, have been 
assigned to a State VR agency, and 3,916, or 10 percent, have 
been assigned to an EN. It is interesting, however, to note 
that 30 percent of the ticket assignments have been made in the 
last 5 months. This suggests to me, Mr. Chairman, that there is 
a significant acceleration going on in the use of tickets and 
the assignment of tickets.
    The first milestone payment was made by Maximus in May of 
2002, and the first outcome payment was paid in July of 2002. 
We now have more than 1,600 payments based on the work of 450 
beneficiaries going to 116 ENs and totaling over $530,000. Over 
the last few months, we have received valuable information from 
several sources regarding the initial implementation of the 
Ticket to Work Program. The Ticket to Work Act requires the 
Commissioner to submit periodic evaluation reports of the 
Ticket to Work Program to the Congress. The SSA has contracted 
with Mathematica Policy Research to evaluate the impact of the 
Ticket to Work Program.
    Mathematica has provided a draft of the first in a series 
of evaluation reports, and while Mathematica notes in its draft 
report that, overall, the SSA has made great progress in 
developing a system to assist individuals with disabilities to 
find work and to remain in the work force, it points out that 
most beneficiaries who use the Ticket to Work have assigned 
them to traditional State VR agencies and the ticket 
assignments to ENs have been concentrated among a few. It 
reports that ENs as a group feel that the SSA needs to move 
quickly to make the process friendlier to providers, and I will 
be happy, both to provide the Subcommittee with a copy of the 
final version of this report, which we expect to be available 
shortly, and to brief Members and staff as to its findings.
    The Ticket to Work Act also identifies four groups of 
beneficiaries with disabilities as potentially at risk and 
requires the Commissioner to study the adequacy of incentives 
for ENs to serve people in these populations. To this end, the 
SSA formed an Adequacy of Incentives Advisory Group that has 
been meeting quarterly and will complete its work this spring. 
I think I have attended all but one half-day of their meetings.
    Last fall, the Advisory Group issued an interim report 
recommending regulatory and administrative changes. The 
Advisory Group will also issue a final report, we believe by 
the end of next month, that proposes projects to evaluate the 
effectiveness of adjusted incentives and provides 
recommendations regarding the most promising of these 
incentives. The Ticket to Work Advisory Panel has been a 
valuable partner in studying the Ticket to Work Program and 
making recommendations for improvements. The panel has been 
concerned about the balance between State VR agencies and other 
ENs and about ways in which we can encourage more beneficiaries 
to assign their tickets to ENs. It has also advised us on ways 
to improve our marketing of the program to both beneficiaries 
and potential ENs, provided specific recommendations with 
respect to establishing a core of work-incentive specialists, 
and offered suggestions on a way to reduce the incidence of 
overpayments caused by work.
    Commissioner Barnhart and I believe that it is our mission 
to see that the ticket program lives up to its potential, and I 
think it has great potential to return people to work. Based on 
all of the information that we have received, we have already 
taken a series of actions to improve our return to work 
service. These include steps to simplify the payment process 
for ENs, to increase the pool of ENs, and to improve our wage 
reporting process. We have jointly funded with the U.S. 
Department of Labor new positions in the One-Stop Career 
Centers to help people with disabilities increase their 
employment opportunities and have expanded the pool of SSA 
field employees who are available to answer questions relating 
to return to work, including the employment of 58 full-time 
employees who serve as Area Work Incentive Coordinators.
    I want to thank the Subcommittee for its advice and 
guidance as we work closely with you to develop this approach. 
In summary, Mr. Chairman, our early experience and the 
preliminary evaluation, analyses, and recommendations that I 
summarized earlier have shown us both that the Ticket to Work 
Program can provide beneficiaries with more opportunities to 
obtain employment support services to help them reach their 
employment goals, and also that we need to do more to increase 
program participation and build on program success.
    Finally, I want to thank you, Mr. Chairman, Mr. Matsui, and 
all the other Members of the Subcommittee for showing continued 
dedication to the program. Thanks to that commitment, we look 
forward to providing more beneficiaries with additional 
opportunities and the tools that they need to enter or reenter 
the workforce.
    In addition, I would also like to thank the Subcommittee 
for its work to pass H.R. 743, the ``Social Security Protection 
Act'' (P.L. 108-203). With the provisions in that bill 
regarding SSA demonstration projects, we can move forward with 
our agenda of projects designed to provide alternative return 
to work services. We look forward to working with the 
Subcommittee as we continue our efforts to make the Ticket to 
Work Program a success. I would be happy to answer any 
questions.
    [The prepared statement of Mr. Gerry follows:]

   Statement of Martin H. Gerry, Deputy Commissioner, Disability and 
        Income Security Programs, Social Security Administration

Mr. Chairman and Members of the Subcommittee:

    Thank you for inviting me today to discuss implementation by the 
Social Security Administration (SSA) of the Ticket to Work and Self-
Sufficiency Program (the ``Ticket to Work program'') authorized by The 
Ticket to Work and Work Incentives Improvement Act of 1999 (the 
``Act''), PL 106-170.
    As you know, Mr. Chairman, SSA administers both the Social Security 
Disability Insurance (SSDI) and Supplemental Security Income (SSI) 
programs. These programs provide benefits to about 10.5 million 
Americans with disabilities. The Ticket to Work program allows these 
beneficiaries greater flexibility and expanded choice in obtaining the 
rehabilitation, employment and other support services that they need to 
go to work and attain their employment goals.
    I would like to express my thanks to you, Mr. Chairman, Mr. Matsui, 
and members of the Subcommittee, for your hard work and support in 
making the Ticket to Work program a reality. I know we will continue to 
work together closely to strengthen the program in a way which will 
build on our early successful experience and expand the participation 
we have already seen in the program.
    Commissioner Barnhart and I have been fortunate to participate in 
Ticket to Work program activities throughout the nation. I know that 
she has especially fond memories of kicking off the Ticket to Work 
program in February 2002 alongside the late Senator William Roth. Among 
the other Ticket events she attended that year was one in 
Representative Hayworth's district. In addition, senior agency staff 
have traveled throughout the country to help introduce this program to 
the American people. Today I would like to provide an update on the 
implementation of the Ticket to Work program, and touch on a few 
related issues.

An Overview of the Ticket to Work Program

    First, let me briefly describe how the program works. SSA currently 
provides benefits under the SSDI and SSI programs to approximately 10.5 
million Americans with disabilities. Under current agency regulations, 
an SSDI or SSI beneficiary with a disability receives a Ticket to Work 
if he or she is between the ages of 18 and 64 and has a medical 
condition that is not expected to improve in the near future. 
Approximately 9.1 million, or over 85 percent, of all beneficiaries 
with disabilities meet this standard.
    Under the Act, SSA enters into agreements with Employment Networks 
(ENs) and with State Vocational Rehabilitation Agencies (``State VR 
Agencies''). ENs are qualified State, local, or private organizations 
that offer employment support services. These organizations include 
One-Stop Career Centers established under the Workforce Investment Act 
of 1998; single providers of services; or groups of providers organized 
to combine their resources into a single entity.
    A beneficiary who receives a Ticket to Work can choose to assign it 
to any EN that provides services within the community or to the State 
VR Agency. Together, these organizations are referred to as ``Ticket 
Providers.'' An EN may decide whether or not to accept the assignment 
of a Ticket. The Act requires that an EN accept a measure of risk 
whenever it agrees to provide services to a beneficiary. ENs may only 
be paid based on their success in assisting beneficiaries to secure and 
maintain employment and move off the disability benefit rolls. An EN 
might never be paid if a beneficiary's cash benefits do not stop as a 
result of work. State VR Agencies are receiving approximately $2.6 
billion from the Department of Education for the primary purpose of 
providing employment services to individuals with significant 
disabilities. VR agencies are therefore better capitalized than small 
or new ENs and incur less financial and actuarial risk than ENs serving 
smaller numbers of individuals.
    Once a Ticket is assigned by a beneficiary to a Ticket Provider, 
the beneficiary and the Provider jointly develop and implement a plan 
of employment, vocational, or other support services designed to lead 
to and maintain employment. Providers may provide these services 
directly or by entering into agreements with other organizations or 
individuals to provide the appropriate services at no cost to the 
beneficiary.
    Ticket Providers may be paid based only on their success in 
assisting beneficiaries to secure and maintain employment and move off 
the disability benefit rolls. Where this occurs, an EN may elect to 
receive payment under one of two systems. Under the Outcome Payment 
System an EN will be paid for each month, up to sixty months, in which 
a beneficiary it is serving does not receive cash benefits due to work 
or earnings. Under the Outcome-Milestone Payment System, an EN will 
receive payment when a beneficiary it is serving reaches one or more 
milestones toward self-supporting employment. Under this second
    payment system, the EN will also receive reduced outcome payments 
for each month, up to sixty months, that a beneficiary does not receive 
cash benefits due to work or earnings. The agency has provided up to 
four milestones for which an EN can be paid.
    The Ticket to Work Act provides three additional incentives to 
encourage work activity by beneficiaries. First, SSA will not schedule 
a periodic continuing disability review (CDR) for a beneficiary who is 
receiving services from a Ticket Provider. Second, work activity by an 
SSDI beneficiary will not trigger a CDR if the beneficiary has received 
benefits for at least 24 months. Finally, an individual whose benefits 
terminated because of work activity can request that benefits start 
again without having to complete a new application for benefits.

Implementation of the Ticket to Work Program

    SSA is implementing the Ticket to Work program in three phases. 
During the first phase of the program, from February through October 
2002, about 2.4 million beneficiaries with disabilities in 13 states 
received Tickets to Work. During the second phase, which ran from 
November 2002 through September 2003, we mailed Tickets to 
approximately 2.6 million beneficiaries in 20 additional States and the 
District of Columbia. Then beginning in November 2003, we started 
releasing Tickets to the approximately 4.1 million beneficiaries in the 
remaining 17 States and the U.S. Territories during the third and final 
implementation phase.
    Through February 2004, Tickets have been mailed to over 6.9 million 
disabled beneficiaries. By September 2004, the remaining 2.2 million 
eligible beneficiaries will have been mailed a Ticket to Work, and any 
eligible beneficiary who has yet to receive a Ticket to Work in the 
mail can obtain one by asking for it. To date, we have certified almost 
1,100 ENs to participate in the Ticket program.
    The Act calls for the Commissioner to enter into agreements with 
Program Managers to assist the Agency in administering the Ticket to 
Work program. Among the duties of our Program Manager, Maximus, Inc., 
are recruiting, recommending, and monitoring the ENs selected by SSA to 
provide services; facilitating beneficiary access to the ENs; 
facilitating payment to Ticket Providers; and resolving disputes 
between beneficiaries and Ticket Providers under the program.

Ongoing Operation of the Ticket to Work Program

    As of the beginning of this month, 40,441 SSDI and SSI 
beneficiaries who had received Tickets to Work (``Ticket Holders'') had 
assigned them to Ticket Providers. Of this total, 36,525 (90%) were 
assigned to a State VR Agencies and 3,916 (10%) were assigned to other 
ENs. Approximately 30 percent of ticket assignments have been made in 
the last 5 months.
    The first milestone payment was made by Maximus during May 2002. 
The first outcome payment was paid in July 2002. Through February 2004 
we have made more than 1,600 payments to nearly 120 ENs totaling over 
$530,000 based on the work of 450 beneficiaries.
    Our early experience shows us that the Ticket is already proving it 
can provide beneficiaries with more opportunities to obtain employment 
support services to help them reach their employment goals. It is our 
mission to see that the ticket lives up to its potential to return 
people to work

Evaluation of the Ticket to Work Program

    Section 101(d) of the Ticket to Work Actrequires the Commissioner 
to submit periodic evaluation reports of the Ticket to Work program to 
Congress. SSA has contracted with Mathematica Policy Research, Inc. 
(``Mathematica ``) to evaluate the impact of the Ticket to Work 
program. Mathematica has provided a draft of its first in a series of 
evaluation reports. I will be happy to provide the Subcommittee with a 
copy of the final version of this report which we expect to be 
available shortly, and will also be happy to brief you on its findings.
    Mathematica's preliminary findings are generally consistent with 
our experience with the program. Most beneficiaries who use Tickets to 
Work have assigned them to traditional State VR agencies. Ticket 
assignments to ENs have been concentrated among a few ENs, and the ENs 
as a group feel that SSA needs to move quickly to make the process 
friendlier to providers.
    As Mathematica notes in the draft report, overall, it is clear that 
SSA has made great progress in developing such a system to assist 
individuals with disabilities to find work and remain in the workforce. 
This undertaking, which required SSA to develop new capabilities to 
integrate information
    from the SSI and DI programs, so that beneficiaries work could be 
appropriately considered in determining theirs and their service 
providers eligibility to benefits.

The Work of the Adequacy of Incentives Advisory Group

    The Ticket to Work and Work Incentives Improvement Act of 1999 
identified four groups of people with disabilities as potentially ``at 
risk.'' These groups are: 1) individuals with a need for ongoing 
support and services; 2) individuals with a need for high-cost 
accommodations; 3) individuals who earn a sub-minimum wage; and 4) 
individuals who work and receive partial cash benefits.
    The Act requires the Commissioner to study the adequacy of 
incentives to Employment Networks in the Ticket to Work program for 
serving these four groups of beneficiaries. SSA formed an Adequacy of 
Incentives Advisory Group to help determine the best approach for 
conducting a targeted, in-depth analysis of the ``at risk'' groups. The 
Advisory Group has been meeting quarterly, and will complete its work 
this spring 2004. Last fall, the group issued an interim report, 
``Recommendations for Improving Implementation of the Ticket to Work 
and Self-Sufficiency Program (Regulatory and Administrative Changes).'' 
The group will also issue a final report, which will propose projects 
to evaluate the effectiveness of adjusted incentives and 
recommendations regarding the most promising adjusted incentives.

Recommendations of the Ticket to Work Advisory Panel

    The Ticket to Work Advisory Panel has been a valuable partner in 
studying the program and making recommendations for improvements. They 
too have been concerned about the balance between State VR agencies and 
other ENs, and about ways in which we can encourage more beneficiaries 
to assign their Tickets to ENs. They also advise us on ways to improve 
our public education of the program and how to market the program to 
both beneficiaries and potential ENs.
    We have carefully considered the recommendations of the Panel with 
respect to establishing a corps of work incentive specialists, who will 
be available to advise beneficiaries on the effects of work on benefit 
payments, and on ways to reduce the incidence of overpayments caused
    by work. They recognize, as do we at SSA, that the fear of creating 
overpayments is a powerful disincentive to returning to work that our 
beneficiaries face.

The $1 for $2 Benefit Offset Demonstration

    The Ticket to Work legislation required SSA to test a DI benefit 
offset similar to what is provided in the SSI program. Generally, SSI 
benefits are reduced $1 for every $2 earned over the $65 earned income 
monthly exclusion. Because there is no parallel provision for the DI 
program, DI beneficiaries are often reluctant to attempt work because 
of the abrupt loss of all cash benefits faced if they engage in 
substantial gainful activity.
    Therefore, we plan to conduct a national demonstration project to 
test a $1 reduction in benefits for every $2 in earnings over a certain 
level in the DI program in combination with interventions that offer a 
range of ongoing employment supports, which may include some 
combination of employment services, health care services, 
transportation assistance, training, and other similar supports.
    In addition, we plan to conduct a small-scale process demonstration 
of the benefit offset in four sites. We expect this project to begin 
enrolling participants this fall.

Program Improvements

    I would now like to discuss a number of initiatives we have already 
put in place on a number of fronts to improve our return to work 
services based on all the information that we have received. They 
include simplifying the payment process for ENs, increasing the pool of 
ENs, improving our wage reporting process, and jointly funding with the 
Department of Labor a new position to help people with disabilities 
increase their employment opportunities. I will discuss these in more 
detail.

Work Incentive Specialists
    Section 1149 of the Social Security Act, as enacted by Section 121 
of the Ticket Act requires SSA to establish a corps of specialists 
devoted to issues related to work incentives. We have worked closely 
with Subcommittee staff to develop and implement this concept.
    Commissioner Barnhart has expanded the pool of field employees who 
would be available to answer questions relating to return to work, 
while establishing a dedicated number of employees in each area of the 
region who will serve full time as Area Work Incentive Coordinators 
(AWICs), for a total of 58 employees nationwide. I want to thank the 
Subcommittee for its advice and guidance as we worked closely with you 
to develop this approach.
    AWICs are the focal point of contact for advocates area-wide, and 
serve as ombudsmen. They monitor the area employment support workloads 
and work with the Area Directors to ensure that we effectively manage 
work incentive workloads. In addition, we have trained all of our 
public service employees, including staff in all local Social Security 
offices, on SSA employment support programs. AWICs work with other 
staff to develop any area training needs to maintain the level of 
expertise on work incentives for all direct contact employees and they 
are a ready resource for providing accurate information to those 
employees when questions arise.

An Improved EN Payment Process
    Because many ENs found the payment process too cumbersome, we have 
developed a new, simpler process for paying them. Under the new 
process, SSA will pay ENs upon receiving a certification from the EN 
that a Ticket Holder is still working, provided that the EN initially 
submits return to work evidence. Prior to this change, ENs were 
required to send in evidence of the work, such as pay stubs, monthly. 
Now ENs have several options for requesting payments on either a 
monthly or quarterly basis without needing to submit pay stubs.

Expanded Choice of Employment Networks
    In order to attract sufficient providers of employment services and 
in concert with Maximus, we have conducted 90 Employment Network 
Opportunity Conferences across the country. We did this so 
beneficiaries will enjoy the degree of choice when selecting an EN that 
the Congress envisioned when the Act was passed. These events were 
attended by more than 8,000 individuals, representing 6,100 
organizations. To date, 483 conference attendees have applied to become 
employment networks. In addition, Maximus has made presentations about 
the Ticket to Work program at nearly 300 events nationwide and 
delivered the message to 20,000 different organizations and 50,000 
individuals through 250,000 distinct contacts. We will continue to seek 
out EN recruitment opportunities and process improvements so we may 
offer more choices for our beneficiaries who want to work.
    Because we learned that the lack of upfront funding was a barrier 
to EN participation, SSA has developed an EN capitalization initiative 
that helps ENs locate and apply for additional funding to support their 
efforts.

Eliminating Barriers and Disincentives
    Overpayments to beneficiaries with disabilities attempting to work 
are a major barrier to participation in the Ticket to Work program. 
Disability recipients who try to return to work deserve to know that 
their work information will be processed right away to prevent large 
overpayments that are a burden to the recipient as well as an important 
program integrity issue. Accurate and prompt wage report processing is 
critically important.
    The Social Security Protection Act of 2004 (P.L. 108-203) imposes a 
requirement for a work report receipt, and we expect that our current 
software, known as the Modernized Return to Work, or MRTW, and our PC-
CDR processes that field offices have been using, should be able to 
fulfill that requirement. The issue of handling work reports is a major 
priority of Commissioner Barnhart, and we expect several new processes 
to have a positive impact on the problem, reducing both overpayments 
and the work disincentives caused by the threat of such overpayments.
    In January 2004, we began a phased rollout of our eWork application 
for controlling and processing disability work activity and work CDR 
workloads. It replaces the stand-alone MRTW and PC-CDR that I have just 
mentioned. The eWork system automates and simplifies the processing of 
work issues in Title II disability cases; its key functional areas are 
workload management and control, case development, adjudication and 
decision-making, notices and forms, and automated mainframe systems 
inputs. In summary, eWork connects all of the separate pieces to the 
whole through an electronic interface usable by authorized personnel 
nationwide and work to minimize the occurrence of overpayments due to 
work..

Expansion of Work Opportunities
    Over the last 18 months, SSA has worked closely with the Department 
of Labor's Employment and Training Administration and its State and 
local partners to jointly fund the establishment of a new position, the 
Disability Program Navigator. Approximately 110 Navigators have been 
hired to work in DOL One-Stop Career Centers in 14 states. A key role 
for Navigators is to help people with disabilities to increase their 
employment opportunities. Locating of the Navigator in the One-Stop 
Career Centers provides an important link to local employers in 
fulfilling this role. Navigators will also facilitate access to 
programs and services that impact successful entry or reentry into the workforce. This includes access to housing, transportation, health care, 
and assistive technologies as needed to effectively participate in training services or for successful placement in employment.
    SSA is also continuing to use the Employer Assistance Referral 
Network (EARN) managed by the Department of Labor's Office of 
Disability Employment Policy and the Ticket to Hire, a specialized 
subunit of EARN that matches employers with job ready candidates from 
the Ticket to Work program.

Conclusion

    Finally, I thank you, Mr. Chairman, Mr. Matsui, and all the members 
of the Subcommittee, for showing continued dedication to the Ticket to 
Work program. Thanks to that commitment, we look forward to providing 
more beneficiaries with the additional opportunities and tools they 
need to enter or reenter the workforce.
    In addition, I would like to thank you for your work to pass H.R. 
743, the Social Security Protection Act of 2004(P.L. 108-203). Because 
of the provisions in the bill regarding SSA demonstration projects, 
including ensuring that projects can continue to move beyond this 
December, we can move forward with our agenda of projects designed to 
provide alternative return to work services.
    I would also like to acknowledge the valuable input we have 
received from the Ticket Advisory Panel and the Social Security 
Advisory Board. We are committed to achieving the goal set by Congress 
to improve access to jobs for Americans with disabilities. I believe, 
and I am sure you will agree, that the nation benefits greatly when all 
of its citizens have the opportunity to make the most of their talents. 
We look forward to working with you as we continue our efforts to make 
the Ticket to Work program a success.

                                 

    Chairman SHAW. Thank you. Mr. Justesen?

    STATEMENT OF TROY R. JUSTESEN, ACTING DEPUTY ASSISTANT 
   SECRETARY, OFFICE OF SPECIAL EDUCATION AND REHABILITATION 
             SERVICES, U.S. DEPARTMENT OF EDUCATION

    Mr. JUSTESEN. Thank you, Mr. Chairman and the Committee for 
having me here today and for having me join my colleague, 
Martin Gerry from SSA, of which we are developing a very strong 
relationship between the SSA and the Department of Education to 
implement the success of the ticket program with the VR 
Services Program.
    The State VR Program is the Nation's longest-running public 
employment program serving people with disabilities. In its 80-
plus-year history of the program, over 10 million individuals 
with disabilities have achieved employment through the VR 
Program. Each year, approximately 220,000 individuals go to 
work with the help of the VR Program. Based on a recent study 
of this program, approximately 85 percent of individuals with 
disabilities who get jobs maintain employment at least 3 years 
after they have been employed and their hourly wage increase 
over this same 3-year period is over 78 percent.
    Social Security recipients and beneficiaries presently 
account for about one-fourth of the total VR caseload 
nationwide, but each State agency's caseload varies depending 
on the unique characteristics of the State, the flexibility of 
the VR Program, and referral sources within the State. For 
example, in California 43 percent of its individuals with 
disabilities served through the VR Program, there are also SSDI 
and SSI beneficiaries, whereas in Wisconsin, only 8.6 percent 
of individuals whose cases were closed received SSI or SSDI 
benefits.
    Other factors, such as VR's requirements to serve 
individuals with the most significant disabilities when there 
are insufficient funds to serve all eligible individuals may 
also have an impact on the number of SSI and SSDI beneficiaries 
served by the VR Program. Further, the 1998 amendments to the 
Rehabilitation Act requires VR agencies to presume eligibility 
for individuals who have already been determined eligible for 
SSI and SSDI services. State VR agencies are a significant 
partner in implementing the options available in the Ticket to 
Work Program for many individuals with disabilities. As of this 
March, and you know this, Mr. Chairman, you said this earlier, 
40,950 tickets have been assigned by SSI and SSDI recipients. 
Over 90 percent of those issued tickets are assigned to VR 
agencies.
    Since the passage of the Ticket to Work legislation, the 
Office of Special Education and Rehabilitative Services 
(OSERS), the office within the Department of Education charged 
with working with VR State agencies, has held training programs 
for State VR agency staff during SSA's roll-out phase of the 
ticket program in order to facilitate success of the program. 
In addition to providing ongoing training to State VR agencies, 
OSERS is committed to continuing its work with the SSA to help 
evaluate the ticket program and the role State VR agencies play 
in this overall program.
    To this end, we at the Department of Education have been 
working very closely with the SSA to complete a Memorandum of 
Understanding which will be allow for both agencies to share 
and link valuable data concerning individuals with disabilities 
who are served by both of these programs. We are doing this 
because we can better determine the long-term benefits of the 
VR Program and its relationship to the overall ticket program. 
We know there are several issues that have arisen regarding the 
program interactions between VR Programs and private and public 
ENs. One complication is that the Rehabilitation Act requires 
VR agencies to seek comparable services and benefits from other 
providers, which may include ENs. The issue of comparable 
services is discussed in greater length in my written 
testimony, but let me just say that we recognize the importance 
of collaboration on this issue and we will work with all of our 
partners to provide guidance on this issue and to resolve the 
concerns.
    Second, many of our private ENs have expressed concern 
regarding agreements that are required when private ENs refer 
ticket holders to a State VR agency for services. It is our 
understanding at the Department of Education that in the 
majority of cases, these agreements are regarded by both 
parties as fair and inclusive of the principle of shared risk 
and reward. However, we recognize that some agreements may not 
reflect the principles of true partnerships and fairness. We 
are committed to continuing our work with the SSA to provide 
guidance to the State agencies and other ENs on this issue and 
are hopeful that we can continue to work together to be able to 
resolve issues regarding these agreements.
    Third, we, and particularly I, Mr. Chairman, want you to 
know that we have heard of many concerns about ENs competing 
with State VR agencies for ticket assignments. It is important 
to recognize that State VR agencies have a long history that 
predates the ticket program with most ENs operating today. 
Without the assistance of Community Rehabilitation Programs 
that are now ENs, the success of the program I mentioned 
earlier would not have been possible. I would like to highlight 
a couple of beneficial aspects of our continuing dialog between 
the advocacy community regarding the ticket program. Since its 
inception, the Ticket Advisory Panel continues to be a main 
conduit of information for us at the Department of Education. 
From the panel, we have learned what is working and what needs 
to be improved.
    For example, as a result of our work with the panel, we 
have seen a need to more closely monitor the cooperative 
agreements between the State agencies and private ENs and we 
are working with the initial 13 States in the program to 
examine their agreements and provide feedback to Social 
Security and with Social Security and with the Members of your 
Committee. As we are learning more about the implementation of 
the ticket program, we understand that there is more that needs 
to be done to improve the participation of both beneficiaries 
in the program and private and public ENs. This is a vital 
effort. It is an area particularly important to the Department 
of Education and we hope this information that we have provided 
you today in my extended written comments and our continuing 
work with Social Security will improve the ticket program, and 
more importantly, improve the lives of people with 
disabilities. I am happy to be here, and I am also happy to 
take any questions you have. Thank you, Mr. Chairman.
    [The prepared statement of Mr. Justesen follows:]

     Statement of Troy R. Justesen, Ed.D., Acting Deputy Assistant 
  Secretary, Office of Special Education and Rehabilitation Services, 
                      U.S. Department of Education

    Mr. Chairman, members of the Committee, thank you for the 
opportunity to appear before you today to discuss the Ticket-to-Work 
program. I am pleased to join you and my colleague, Martin Gerry, to 
discuss the Ticket-to-Work program and its relationship to the State 
Vocational Rehabilitation (VR) Services Program administered by the 
Department of Education. The Office of Special Education and 
Rehabilitative Services (OSERS) is committed to working with the Social 
Security Administration (SSA) to ensure the effective implementation 
and success of the Ticket-to-Work program.
    The State VR Services Program is the nation's longest-running 
public employment program serving individuals with disabilities. In our 
80-plus year history, over ten million individuals served by VR have 
achieved employment. Each year, approximately 220,000 individuals go to 
work with the help of VR. Based on a recent longitudinal study of the 
State VR Services Program, approximately 85 percent of the individuals 
who obtain jobs maintain employment for at least three years after 
leaving the program. The longitudinal study also found that these 
individuals increased their average hourly wage from $7.56 to $13.48 
per hour, a 78 percent increase in earnings over the same three-year 
period.
    As you may know, Social Security beneficiaries account for 
approximately one-fourth of the total VR caseload. It should be noted, 
however, that the Rehabilitation Act of 1973, which authorizes the 
State VR program, provides substantial flexibility to States. Because 
of this flexibility, the referral sources and the characteristics of 
each State agency's caseload vary. For example, in California, 43 
percent of individuals whose cases were closed in Fiscal Year 2002 
after receiving VR services were Supplemental Security Income 
recipients and/or Social Security Disability Insurance (SSI/DI) 
beneficiaries, while in Wisconsin, only 8.6 percent of individuals 
whose cases were closed in Fiscal Year 2002 after receiving VR services 
received SSI and/or SSDI. Other factors, such as the Rehabilitation 
Act's requirement that States give priority to individuals with the 
most significant disabilities when there are insufficient funds to 
serve all eligible individuals, may have an impact on the number of SSI 
recipients and SSDI beneficiaries served.
    The 1998 Amendments to the Rehabilitation Act reflected Congress' 
desire to provide seamless access to VR services for SSI recipients and 
SSDI beneficiaries. The Amendments required State VR agencies to 
presume VR eligibility for individuals who receive SSI and/or SSDI. 
Presumed eligibility allows individuals who have already gone through 
the arduous Social Security benefit-eligibility process to avoid 
providing similar information to State VR agencies in order to be 
determined eligible for VR services.
    Since the start of the Ticket program, State VR agencies have been 
a significant partner in implementing options under the Ticket program 
for individuals with disabilities. As of March 8, 2004, a total of 
40,950 tickets have been assigned by SSI recipients and SSDI 
beneficiaries. Just over 90% of those Tickets (36,972) were assigned to 
VR agencies. It is clear how important the State VR Services Program is 
to the success of the Ticket-to-Work program.
    Since the passage of the Ticket-to-Work and Work Incentives 
Improvement Act (TWWIIA), we have held training programs for State VR 
agency staff as Social Security conducted its three-phase ``roll-out'' 
of the Ticket program. At each training session, we brought together 
SSA staff, SSA's Ticket Program Manager (Maximus), and State VR agency 
staff to discuss emerging issues and to build long-term relationships 
designed to facilitate the return to work of individuals with 
disabilities. We have recognized throughout the early implementation 
phases of the Ticket-to-Work program that there is a critical need for 
on-going discussions across Federal programs and we are committed to 
keeping the dialogue open. We monitor and provide updates via several 
listservs that are dedicated to the interaction between State VR 
agencies and the Ticket program. We are hopeful that, in the future, 
joint training opportunities for State VR agency staff and private 
Employment Networks (ENs) will be possible.
    In addition to providing ongoing training to State VR agencies, 
OSERS is committed to working with SSA to conduct research and 
evaluation of the Ticket program and the involvement of State VR 
agencies in the program, as well as other issues affecting the ability 
of individuals with disabilities to achieve employment outcomes. To 
this end, we are completing a Memorandum of Understanding, or MOU, with 
SSA, which will allow both agencies to share and link data concerning 
individuals with disabilities served by both the VR program and SSA. By 
linking this data, SSA and OSERS can better determine the long-term 
outcomes for SSI and SSDI beneficiaries who receive services through 
the VR and Ticket programs.
    The Ticket program unquestionably presents new challenges to OSERS 
and the State VR Services Program, and we have a great deal more work 
to do as we attempt to redefine our role and those of our State 
partners. Several issues have arisen regarding program interactions 
between the VR programs and the private Employment Networks (ENs) and 
we are working with SSA to address these issues.
    First, many private ENs are concerned about the impact of the 
``comparable services and benefits'' requirement under the 
Rehabilitation Act when they and the State VR agency are jointly 
serving the same individual. With only a few exceptions, section 
101(a)(8)(A)(i) of the Act requires the State VR agency to determine 
whether a comparable service or benefit is available from any other 
program to an eligible individual with a disability prior to providing 
a VR service. The VR Regulations (34 CFR 361.5(b)(10)) define a 
``comparable service or benefit'' as a service available from another 
public source, health insurance or employee benefit that is (1) 
available when the individual needs it, and (2) is commensurate with 
the service that the individual otherwise would receive from the VR 
agency. Therefore, if an individual is served by both the State VR 
agency and a public-funded EN, then VR can consider services provided 
by the EN that are available and commensurate with the services that 
would be provided by the VR agency to be a ``comparable benefit or 
service.'' Let me give you an example. An EN that receives public 
funding may provide general job-placement services. However, if that EN 
does not have experience in providing job-placement services to 
individuals with severe and persistent mental illnesses, then the EN's 
job-placement services may not meet the specific needs of such an 
individual. In that circumstance, the State VR agency may not consider 
the EN's job-placement services to be ``commensurate'' and, therefore, 
not a comparable benefit or service. So, VR could then provide the job-
placement service to the individual. We will continue to work with SSA 
to provide guidance to State VR agencies on this issue.
    A second issue is that many private ENs have expressed concern 
regarding agreements that are required when a private EN refers a 
Ticket holder to a State VR agency for services. These agreements are 
called for by TWWIIA. It is our understanding that, in a majority of 
States, these agreements are regarded by both parties as fair and 
inclusive of the principle of shared risk and reward. However, we also 
recognize that some agreements may not reflect the principles of true 
partnership and fairness. We are committed to working with SSA to 
provide State agencies and other ENs with guidance on this issue. 
Office of Management and Budget Circular A-87 may affect these 
agreements in regard to proportionality of effort by various parties. 
However, we are hopeful that together SSA and OSERS will be able to 
resolve issues that arise in this regard.
    Third, some private ENs have made statements that they do not wish 
to ``compete'' with State VR agencies for Ticket assignments. It is 
important to recognize that, typically, State VR agencies have long 
histories that pre-date the Ticket program with most ENs operating 
today. Without the assistance of community rehabilitation programs that 
are now ENs, the successes of the VR program that I mentioned earlier 
would not have been possible. We value our EN partners and recognize 
the need for their participation, not only for the services they 
provide, but also for the choice of service provision that their 
participation ensures Ticket holders.
    Now that I have enumerated some of the challenges we face in moving 
forward with the implementation of the Ticket program, I would like to 
take a moment to highlight what I consider to be a truly beneficial 
byproduct of continued dialogue with the advocacy community regarding 
this new program. Since its inception, the TWWIIA Advisory Panel has 
been a main conduit of information for us. From the Panel, we at OSERS 
have learned about what in the VR/EN relationship is working and what 
needs to be improved. Without the meaningful exchange that occurs 
regularly between OSERS and the Panel, we would be at a distinct 
disadvantage in determining areas of concern as well as aspects of the 
VR/Ticket interface that are working well.
    As a result of our interaction with the Panel, we have seen a need 
to more closely monitor the cooperative agreements between State VR 
agencies and private ENs. We have just started that effort. We are 
working closely with the 13 State VR agencies that were involved in the 
first-phase roll-out of the Ticket-to-Work Program and we are examining 
their agreements with ENs and providing feedback on those agreements. 
We hope to provide our findings to both SSA and the TWWIIA Advisory 
Panel.
    What we are all learning as we implement the new Ticket program is 
that more needs to be done to improve the participation of both 
beneficiaries and private ENs in this vital effort. I hope that the 
information I have provided today will assist you in your work with the 
Ticket program. Again, I thank you for the opportunity to share our 
experiences to date. OSERS and our partners in the State VR Services 
Program stand ready to do our part to facilitate the successful 
employment of Ticket holders.
    I will be happy to answer any questions that you may have.

                                 

    Chairman SHAW. Thank you very much. Mr. Gerry, you heard 
Ms. Nelson, her testimony, and one of the things that she was 
emphasizing was making these programs known to other people and 
she mentioned that it would be good to put some of this stuff 
on television. Now, I don't know what extent you can. People 
are griping about us talking about Medicare and the drug bill 
on television. Has any thought been given to, in some way, 
getting more of this information out through the media?
    Mr. GERRY. Yes, Mr. Chairman. Perhaps what I might do is 
explain. We have entered into a contract with Fleischman-
Hillard, which is a large public relations consulting firm, to 
design--and they are in the process of creating, a strategic 
plan for this very question of how we effectively communicate, 
not only with beneficiaries, but also potential ENs.
    Over a 2-year period they are conducting telephone 
interviews with beneficiaries and with other stakeholders. They 
are trying to figure out the most effective way, and it goes to 
your comments earlier about the design of the ticket and the 
kind of language that is used. They are really trying to figure 
out how to get the message across in the most effective way. 
Now, part of that would obviously be what medium you would use 
and part of it would be what you would say in terms of the 
content. They are developing a national marketing strategy and 
materials that we would use.
    We really believe that given the importance of this task 
and the ticket itself, it was important to get people who are 
really experts to help us do this design. So, that is the 
process that we are involved in. That task order was met on 
September 30 of last year, so we are about 6 months into the 
process now. My sense of what is going on is it has been very 
positive. I think we are getting some insights, and we are 
continuing to have dialogs with other organizations, which we 
do believe is very important. On the other hand, as you 
mentioned, without getting people with that kind of expertise 
to give us advice, television advertising is very expensive and 
it has, at least recently, become somewhat controversial. So, 
we thought it important to do it as quickly as we could, but to 
do it prudently, as well, and so we are trying to balance these 
two tasks.
    Chairman SHAW. I would say one of the things you have to do 
is to try to make a determination of people with disabilities 
that are not in the work force, how do they spend their day. I 
would say that you will probably find out that a large part of 
that day is sitting in front of the television set. Then, what 
are they watching? That would be something. So, you can be very 
selective as to where you put it. Of course, cable is always an 
inexpensive option. I think, too, I think one of the most 
effective ways you can do it is to get people like Ms. Nelson 
and Ms. Hancock to get on the television and say, ``If I can do 
it, you can do it.'' It just gets people thinking.
    Mr. GERRY. Like everyone else in the room, I was very much 
moved by what they had to say and I certainly would agree with 
that point. We are not going to sit and wait for this period to 
go by. We expect to get feedback throughout the process from 
Fleischman-Hillard and I would certainly be happy to take up 
that specific topic with them.
    Chairman SHAW. I think the ticket--I have been very 
critical of this, and in all fairness, I don't know what else 
is in the envelope, but just looking at this, it is a document 
that I think is not very understandable in the verbiage and I 
think it can be jazzed up considerably with some kind of 
illustration on it, such as somebody gainfully employed while 
sitting in a wheelchair or with crutches or showing obvious 
signs of blindness or another type of disability.
    Mr. GERRY. I have to say, Mr. Chairman.
    Chairman SHAW. I applaud you for getting the advertising 
agency or public relations agency involved in it because these 
programs have to be sold to people and they are getting 
courage. I can tell you, if you are on disability, probably 
every time you get something from the Social Security office 
that you know is not a check, you probably hold your breath 
when you open the envelope. It is kind of like getting 
something from the IRS that is unexpected. I think we all have 
experienced having to open that envelope to see what is in 
there. I just think that we can go a long way toward helping 
them. Mr. Collins?
    Mr. COLLINS. Thank you, Mr. Chairman. I just wonder what 
the postage is to mail those. Mr. Gerry, what did you think 
about Ms. Hancock's idea that when an individual files, that 
they be given the information at that point of contact with 
Social Security?
    Mr. GERRY. Well, I thought it was an interesting idea. The 
Ticket to Work Program, of course, applies to beneficiaries so 
that we could explain when someone filed an application, what 
their options would be if they were to become a beneficiary. 
Under the statutory language, I think we can only actually make 
the program available to beneficiaries.
    Now, we do have an early intervention demonstration which 
we have been in the process of designing and will actually 
start in the next 3 or 4 months that really focuses on 
applicants and is designed to try to help people who might not 
wish to continue even to pursue their application because they 
might be able to go to work through a somewhat parallel 
structure. I think the only problem right now would be, 
although we could explain the Ticket to Work, there is no way 
that we could offer the ticket itself until someone actually 
became a beneficiary. Although we heard good stories about how 
long it took from the panelists, sometimes, obviously, it takes 
a much longer period of time.
    I think everything we know about the psychology of people 
in the population that we serve would strongly argue that the 
earlier we can make an offer of assistance in returning to 
work, probably the better in terms of what will happen, but we 
would be somewhat constrained right now by the statutory 
requirement that only beneficiaries can be served.
    Mr. COLLINS. You don't have to be a beneficiary to be given 
the information.
    Mr. GERRY. Absolutely not.
    Mr. COLLINS. All right. That is probably too simple. Ms. 
Hancock also mentioned that she went through three ENs before 
finally finding one in Connecticut, I believe it was, that 
would actually listen to her. What kind of feedback have you 
had from others in this same area?
    Mr. GERRY. We certainly have had all kinds of feedback. We 
have had people who are very happy with the EN, and that was 
true of obviously one of the panelists who preceded us, and 
others who were dissatisfied and changed. I think it is 
inherent in the choice model. I think what the Congress wanted 
us to do is to maximize the opportunity for people to choose, 
and as a result of that, although we do through Maximus review 
the applications from people who are ENs, there is likely to be 
a pretty significant variation out there in terms of not just 
the ability of people to relate to particular beneficiaries but 
the kinds of services and strategies that they offer. That 
seems to me to be kind of inherent in the way the program was 
designed, in that the idea was to get as much competition and 
choice as possible.
    Mr. COLLINS. Do we have any method, are we putting in place 
any method to keep some statistics on these ENs?
    Mr. GERRY. Yes. We do collect information about the ENs and 
we are developing strategies for tracking payments. What we 
haven't attempted to do, and again, it would be a question of 
how consistent it is with the overall goal of the statute, is 
to try to do any kind of qualitative assessment of ENs. Now, 
these are risk-bearing activities, so when the ENs accept 
tickets, they do put money out to provide services, which, if 
they are not successful, they wouldn't receive payment.
    Of course, we also have in our regulations rules that say 
that not only do ticket holders have a choice of ENs, but they 
can discharge them, and as the witness testified, can change. 
So, we have really been, frankly, looking at the market as the 
primary way in which ENs who would better serve our 
beneficiaries would be the ENs people choose and keep. We have 
also assumed that if they are not successful in providing those 
services, they won't be paid, so that their incentive should be 
for ENs to be as responsive as they can. I am not arguing that 
is always true.
    Mr. COLLINS. You mentioned Ticket Tracker. I was just 
looking at the Georgia statistics here earlier. There have been 
285,000-plus tickets issued in Georgia. Assigned to State VR 
agencies, 780; assigned to ENs, 181, for a total of 961, or 
0.34 of 1 percent.
    Mr. GERRY. I am looking at the same numbers, Mr. Chairman.
    Mr. COLLINS. The number I don't see is how much success 
have we had with the 961?
    Mr. GERRY. I don't have that information--I would be happy 
to provide it for the record--broken down by State. I can talk 
about.
    Mr. COLLINS. This is broken down by State.
    Mr. GERRY. That is, and I don't know specifically.
    Mr. COLLINS. Would that be an important statistic, to keep 
track of that?
    Mr. GERRY. I think it sounds to me like it would be an 
important statistic----
    Mr. COLLINS. It would be some good information. Is Ms. 
Hancock the only one in Georgia?
    Mr. GERRY. As I indicated, Mr. Collins, I don't know.
    Mr. COLLINS. You don't know, do you?
    Mr. GERRY. No, I don't.
    Mr. COLLINS. Well.
    Mr. GERRY. I will find out and make it available.
    [The information follows:]

    The following information is through March 29, 2004:


----------------------------------------------------------------------------------------------------------------
                                                                      SVRA Payments
                                                                         for Work                    EN Payment
                                             Tickets       Tickets       Activity       Tickets       for Work
                  State                      Issued      Assigned to      *(Cost      Assigned to    Activity/#
                                                            SVRA        Reimb.)/#         ENs      Beneficiaries
                                                                      Beneficiaries
----------------------------------------------------------------------------------------------------------------
Alabama                                      89,065         160              2            22              0
----------------------------------------------------------------------------------------------------------------
 Alaska                                      14,770          70              0             2              0
----------------------------------------------------------------------------------------------------------------
Arizona                                     167,662         463              4           272             81
----------------------------------------------------------------------------------------------------------------
Arkansas                                    136,370          97              5           100              0
----------------------------------------------------------------------------------------------------------------
California                                  369,343         968             13           156              1
----------------------------------------------------------------------------------------------------------------
Colorado                                    102,854         385              1            36              5
----------------------------------------------------------------------------------------------------------------
Connecticut                                  94,787         530              2            28              3
----------------------------------------------------------------------------------------------------------------
Delaware                                     26,990         493              5            14              5
----------------------------------------------------------------------------------------------------------------
District of Columbia                         20,729          61              1            25              0
----------------------------------------------------------------------------------------------------------------
Florida                                     581,072       2,836             58           463             45
----------------------------------------------------------------------------------------------------------------
Georgia                                     287,627         911             22           184             11
----------------------------------------------------------------------------------------------------------------
Hawaii                                       11,016           8              0             4              1
----------------------------------------------------------------------------------------------------------------
Idaho                                        14,851         126              0             7              0
----------------------------------------------------------------------------------------------------------------
Illinois                                    389,456       4,850             65           256             45
----------------------------------------------------------------------------------------------------------------
Indiana                                     191,759         365              0            53              1
----------------------------------------------------------------------------------------------------------------
Iowa                                         86,467         755             13            59             11
----------------------------------------------------------------------------------------------------------------
Kansas                                       71,129         251              1            63              3
----------------------------------------------------------------------------------------------------------------
Kentucky                                    252,598         353              6            45              5
----------------------------------------------------------------------------------------------------------------
Louisiana                                   200,537       1,246              2            67              4
----------------------------------------------------------------------------------------------------------------
Maine                                        24,086          92              0             6              0
----------------------------------------------------------------------------------------------------------------
Maryland                                     51,688          60              8            32              0
----------------------------------------------------------------------------------------------------------------
Massachusetts                               240,821         694             29           125             16
----------------------------------------------------------------------------------------------------------------
Michigan                                    358,958       3,061              8           154             16
----------------------------------------------------------------------------------------------------------------
Minnesota                                    47,910         102              1            29              0
----------------------------------------------------------------------------------------------------------------
Mississippi                                 160,833         233              0           138              9
----------------------------------------------------------------------------------------------------------------
Missouri                                    213,754         485              1           154             11
----------------------------------------------------------------------------------------------------------------
Montana                                      28,265         156              1             2              0
----------------------------------------------------------------------------------------------------------------
Nebraska                                     17,052         103              0             2              0
----------------------------------------------------------------------------------------------------------------
Nevada                                       57,053         251              0           115            419
----------------------------------------------------------------------------------------------------------------
New Hampshire                                37,339          33              1            11              1
----------------------------------------------------------------------------------------------------------------
New Jersey                                  219,116         398              1            87              7
----------------------------------------------------------------------------------------------------------------
New Mexico                                   64,345          67              1            19              2
----------------------------------------------------------------------------------------------------------------
New York                                    721,629       7,844             24           426             59
----------------------------------------------------------------------------------------------------------------
North Carolina                              125,719         244              0            19              0
----------------------------------------------------------------------------------------------------------------
North Dakota                                 15,289          16              0             7              0
----------------------------------------------------------------------------------------------------------------
Ohio                                        148,667       1,594              1            20              0
----------------------------------------------------------------------------------------------------------------
Oklahoma                                    132,799       1,597              7            20             48
----------------------------------------------------------------------------------------------------------------
Oregon                                      108,967         282              0            75              8
----------------------------------------------------------------------------------------------------------------
Pennsylvania                                173,216         432              0            32              0
----------------------------------------------------------------------------------------------------------------
Rhode Island                                 16,290          12              0             4              0
----------------------------------------------------------------------------------------------------------------
South Carolina                              185,861       1,461             21            95              8
----------------------------------------------------------------------------------------------------------------
South Dakota                                 20,327         347              0             1              0
----------------------------------------------------------------------------------------------------------------
Tennessee                                   256,261       1,041              6           330             13
----------------------------------------------------------------------------------------------------------------
Texas                                       209,248         186              6            99              0
----------------------------------------------------------------------------------------------------------------
Utah                                         15,321         105              0             0              0
----------------------------------------------------------------------------------------------------------------
Vermont                                      22,643         500              1             4              2
----------------------------------------------------------------------------------------------------------------
Virginia                                    222,186         621              3           154             12
----------------------------------------------------------------------------------------------------------------
Washington                                   68,673          76              0            45            125
----------------------------------------------------------------------------------------------------------------
West Virginia                                48,671          48              0             5              0
----------------------------------------------------------------------------------------------------------------
Wisconsin                                   162,498       2,044              1           150             33
----------------------------------------------------------------------------------------------------------------
Wyoming                                       4,979           4              0             0              0
----------------------------------------------------------------------------------------------------------------
*data for the period 1/01/2002 through 2/29/2004


                                 

    Mr. COLLINS. Well, one-third of 1 percent assigned to 
either one the EN or the State VR agency, but that leaves 99 
and two-thirds percent tickets issued and never followed up on.
    Mr. GERRY. Well, they haven't been assigned. Let me just 
suggest that----
    Mr. COLLINS. They have been issued.
    Mr. GERRY. They have been issued. It is accurate, they 
haven't been assigned. They may still be assigned. We do note, 
and one of the findings that Mathematica had in its preliminary 
report is that for a variety of reasons, people do wait, and 
actually, we heard that from one of the witnesses, often many 
months, I think an average of 10 or 11 months, before they 
actually use the ticket. So, it isn't necessarily true that 
that is going to be all of the tickets that are assigned.
    Mr. COLLINS. The whole goal of the whole program is to get 
people back to be active in the workplace if that is their 
desire to do so, but the follow-up oftentimes to something that 
is in the mail, follow-up like I believe it was Ms. Nelson put 
hers on the dresser and found it after the fire.
    Mr. GERRY. We are planning.
    Mr. COLLINS. I think there are a lot of loose ends that you 
learn as you go. You are learning. I appreciate your time.
    Mr. GERRY. Thank you.
    Chairman SHAW. Mr. Gerry, I got a little bit of 
clarification from Kim Hildred while you were answering Mr. 
Collins's questions. Obviously, you can't offer someone a 
Ticket to Work if they are not a beneficiary, because by 
definition, you have got to be a beneficiary before you can get 
a ticket, and that is certainly a reasonable part of the 
legislation. However, when somebody is advised that they have 
been approved for disability, are they advised--now, I assume 
they are advised through the mail?
    Mr. GERRY. Yes, they receive a notice.
    Chairman SHAW. At that point, do they receive any 
information on the Ticket to Work?
    Mr. GERRY. I don't believe so.
    Chairman SHAW. This would be a good time to let them know 
that this doesn't have to be a permanent part of their life and 
that we do have ways for them to escape the dependency of SSI 
if they feel able to go into the workplace.
    Mr. GERRY. I would like to check on that, Mr. Chairman. I 
am not sure of the answer to that, that is, whether we----
    Chairman SHAW. I would say when somebody is advised that 
they have been approved, you have got their attention, and they 
are probably going to read very carefully anything you send to 
them and I think that is important. Ms. Tubbs Jones?
    Ms. TUBBS JONES. Mr. Chairman, thank you very much. Mr. 
Gerry, Mr. Justesen, good morning. I wasn't here at the early 
part of your testimony because I took a few moments to call the 
Vocational Guidance and Rehabilitation Services Center in 
Cleveland, Ohio, to kind of get a feel for what is going on 
with them and their ability to provide Ticket to Work. They 
said they were referred 25 Ticket to Work folks but were only 
able to take 1 because of the situation of the other 24 people 
that were referred, but a young woman by the name of Nora Owens 
gave me about 7,000 things she wanted to tell you, but I told 
her I didn't have that much time.
    [Laughter.]
    Before I get to what Nora talked about, I understand how 
difficult it is sometimes to administer large programs like 
this particular program. What I might suggest to you, that you 
find the media agency that the Administration used to do 
prescription drug benefits and have them do the work that you 
need to do to do media for the people on disability, because 
they were able to turn it out real quick. I believe that this 
issue is as important as the prescription drug benefit, and the 
people who are receiving disability across this country would 
love to hear about Ticket to Work as quickly as the others did. 
I say that tongue-in-cheek, but I really am sincere about it. I 
am confident that the people who are representatives in this 
audience kind of agree with me, as well.
    From the Cleveland Vocational Guidance and Rehabilitation 
Services, one of the issues raised is that, for example, if 
they receive a person referred for a particular service, they 
get a fee-for-service for whatever the referral is. Very seldom 
will they get a referral like a State agency referral where 
they have the opportunity to get a longer term payment and that 
the reason that a number of the smaller agencies are not ENs is 
because the payment is so long in coming, you deliver a service 
and it is 9 months, 2 years down the line, that they are not 
able to get the service. I am going to just put on two or three 
of these points and then you can use the rest of my 5 minutes 
to respond.
    The other problem that they seemed to say, for example, the 
need for someone who is ultimately given a Ticket to Work to be 
able to do a Medicaid buy-in. They gave me, for example, a 
young man who was an excellent computer person, but his medical 
service needs far exceeded anything that he would be able to 
pay or receive in their health care program and that he ought 
to be able to work as many hours as he would like to work and 
they ought to be able to employ him as many hours as they can 
without him being put in the position to be removed from the 
program because there are a limited number of hours he can work 
and a limited amount of money that he could pay. They said that 
if he, in fact, could work full-time, he could make $40,000 or 
$50,000 a year, but he still would need the supplemental 
benefit of a Medicaid buy-in.
    I talked about the small agencies. I talked about the 
Medicaid. The first point they made was that the way it is 
operated or the payment for the services through Ticket to Work 
makes it exceptionally costly to provide some of the services 
and that a review of how services are provided and how they are 
paid might make a better use of dollars.
    Finally, she said to me that if, in fact, you got, for 
example, 10 Ticket to Works, that the referral to a Ticket to 
Work EN really reduces the number of dollars that a State 
agency actually gets to provide VR services so that, in 
essence, instead of providing additional services for those 
with disability, we are supplanting some of those services with 
these services instead of extending the service. I asked a lot 
of questions, put a lot out there, but you are free to use the 
rest of the time to do what you can do to respond to my 
questions.
    Mr. JUSTESEN. Thank you.
    Ms. TUBBS JONES. I used all my time, Mr. Chairman? Doggone 
it.
    [Laughter.]
    Maybe you can write back to me.
    Chairman SHAW. Go ahead.
    Mr. JUSTESEN. First of all, Congresswoman, I counted 15 
questions.
    [Laughter.]
    Ms. TUBBS JONES. I am a trial lawyer.
    [Laughter.]
    Mr. JUSTESEN. Well, first of all, the State of Ohio is 
under an order of selection with regard to the VR Services 
Programs which, in a nutshell, means that when the State 
agency's funds are not sufficient enough to serve all 
potentially eligible consumers of the VR system, the State must 
prioritize a service to those individuals with the most 
significant disability. In addition, I want to say that.
    Ms. TUBBS JONES. Are any other States like that?
    Mr. JUSTESEN. I think there are--it is in the early 
twenties. We can supply you with those exact facts.
    [The information follows:]

             ORDER OF SELECTION STATUS FOR STATE VR AGENCIES
                               2004--FINAL
------------------------------------------------------------------------
   TOTAL 80
   agencies       ORDER OF SELECTION 42 agencies    NO ORDER 38 agencies
------------------------------------------------------------------------
Region I        Connecticut G; Maine G & B;         Connecticut B;
                 Massachusetts G; Rhode Island;      Massachusetts B;
                 Vermont G                           New Hampshire;
                                                     Vermont B
------------------------------------------------------------------------
Region II       New Jersey G; Virgin Islands        New Jersey B; New
                                                     York G & B; Puerto
                                                     Rico
------------------------------------------------------------------------
Region III      Delaware B; Maryland;               Delaware G; District
                 Pennsylvania; Virginia G & B;       of Columbia
                 West Virginia
------------------------------------------------------------------------
Region IV       Georgia; Kentucky G & B;            Alabama; Florida G &
                 Mississippi; North Carolina G;      B; North Carolina
                 Tennessee                           B; South Carolina G
                                                     & B
------------------------------------------------------------------------
Region V        Indiana; Illinois; Minnesota G;     Michigan G & B;
                 Ohio; Wisconsin                     Minnesota B
------------------------------------------------------------------------
Region VI       Arkansas G & B; Louisiana; New      New Mexico G; Texas
                 Mexico B; Oklahoma                  G & B
------------------------------------------------------------------------
Region VII      Iowa G; Kansas; Missouri G;         Iowa B; Missouri B;
                 Nebraska G                          Nebraska B
------------------------------------------------------------------------
Region VIII     Colorado; North Dakota; Wyoming     Montana; South
                                                     Dakota G & B; Utah
------------------------------------------------------------------------
Region IX       Arizona; California; Hawaii         American Samoa;
                                                     CNMI; Guam; Nevada
------------------------------------------------------------------------
Region X        Oregon B; Washington G              Alaska; Idaho G & B;
                                                     Oregon G;
                                                     Washington B
------------------------------------------------------------------------
Changes from previous year: Indiana, Virginia G, and Virginia B moved to
  an order.
    Of the 24 general VR agencies: 14 (58 percent) were on an order
    Of the 24 agencies serving blind individuals: 7 (31 percent) were on
  an order
    Of the 32 combined VR agencies: 21 (66 percent) were on an order
    Revised Dec 2004


                                 

    Ms. TUBBS JONES. Thank you.
    Mr. JUSTESEN. John Connelly is the State VR Director for 
the State of Ohio and is a very good resource with us at the 
Federal level and with Social Security in working through some 
of these challenges that are unique to the State of Ohio. Let 
me also say before Martin answers more of the technical 
questions, since I am 2 months on the job from moving over from 
the White House that individuals with disabilities who receive 
SSI--who are recipients of SSI or SSDI beneficiaries are 
presumed eligible for VR services. That is regardless of their 
choosing to use their ticket for other public or private EN 
providers. In other words, individuals in Ohio with significant 
disabilities, or the most significant disabilities, are 
entitled to the services that the State ER agencies provide and 
make available regardless of their use or choice to use the 
ticket options that they have available to them. I will turn it 
over to Martin to be more specific on your questions.
    Mr. GERRY. Thanks, Troy. The first point that I wrote down 
was that agencies don't become ENs because it takes too long to 
get paid, and that is a serious problem. That is to say that 
there is risk involved in this program and there is a need, of 
course, for agencies that are providing services who accept a 
ticket to finance the initial provision of those services in 
hopes that they will be paid later when an individual achieves 
SGA, then goes off benefits and then for a period of time 
payments are made. So, it is, in fact, fairly common to hear 
from smaller agencies that might be interested in becoming ENs 
that the period of time and the way in which payments are set, 
the amount of those payments, is a disincentive.
    The issue of capitalization, obviously, what the VR 
agencies have is an advantage in that they have money. They 
have a flow of money under the Rehabilitation Act that allows 
them to, in effect, front the cost of some of these services in 
the hopes that they will collect under the program. So, I think 
one of the things that we have been looking at and one of the 
things we have been getting advice on from several of the 
organizations that I mentioned, the Advisory Panel and others, 
is the need to really look carefully at the payments, the way 
we have set the payments, the amounts of the payments, things 
that we could do that would make it at least more attractive 
for ENs, where they could be paid at least earlier.
    The capitalization problem is a much tougher one for us in 
that we want to help, we want to see if we can provide as many 
inducements to others to provide initial capital, but it is not 
something that we are really able to do under the statute as it 
is drafted. I do think it is a significant problem, and I think 
that what you heard on the telephone, which was probably 
something we could have heard in several other States----
    Ms. TUBBS JONES. Mr. Chairman, Mr. Gerry, thank you very 
much. In deference to my colleagues, you have been very 
generous with time. I would be willing to accept my answers in 
writing at a subsequent time, Mr. Chairman. Thank you, Mr. 
Gerry.
    [The information follows:]

    Ms. Tubbs Jones: And that the reason that a number of the smaller 
agencies are not ENs is because the payment is so long in coming. You 
deliver a service, and it's 9 months, 2 years down the line, that 
they're not able to get the service.
    The SSA has taken aggressive steps to address the need to get 
timely payments to ENs by establishing a Certification Payment Request 
Process. The Certification Payment Request Process allows ENs to submit 
a signed written statement that the ticket holder's work and earnings 
are sufficient to warrant outcome payments, in lieu of having to 
provide proof of the ticket holder's earnings, ENs can request payments 
under the Certification Payment Request Process after a ticket holder 
meets specific work requirements and has achieved a level of earnings 
from employment to qualify an EN for outcome payments. This new process 
can be used either on a monthly or quarterly basis. The SSA will pay 
outcome payments based on the EN's certification, unless our records 
indicate that the Ticket holder is receiving cash disability benefits.
    In addition, the SSA launched the Employment Network Capitalization 
Initiative in September 2002. Through this initiative, our Program 
Manager, MAXIMUS, has been training ENs on how to identify and secure 
alternative funding sources. Such funding can be used by ENs to cover 
the costs of services to beneficiaries under the ticket program until 
such time as the EN receives payments based on the employment outcomes 
achieved. In addition to offering training online, MAXIMUS has 
conducted a series of regional seminars (with five completed, and 3 
more planed for 2004) and distributed an Employment Network 
Capitalization Resource Directory to all ENs.
    Ms. Tubbs Jones: The other problems that they seem to say--for 
example, the need for someone who is ultimately given a Ticket to Work 
to be able to do a Medicaid buy-in.
    An SSI beneficiary may keep Medicaid benefits while he/she is 
working if his/her earnings e insufficient to replace SSI cash 
benefits, Medicaid benefits, and publicly funded healthcare that would 
be lost due to those earnings. We use a formula that includes the SSI 
Federal benefit rate (FBR) plus the average per capita Medicaid 
expenditures for each state to calculate the amount of earnings that is 
considered sufficient to replace all benefits that could be lost, The 
resultant figure is called the threshold amount and is different for 
each State. As long as a person earns under their state's threshold 
amount, he/she will keep Medicaid eligibility. In some states, a person 
could earn $40,000 and still be under the threshold amount.
    If a person's earnings are higher than the threshold amount for 
his/her State, we can calculate individualized threshold amount if he/
she has medical expenses that are higher than the State's average per 
capita Medicaid expenditures. In calculating an individualized 
threshold, we use the person's actual medical expenses instead of the 
state's per capita Medical expenditures to determine the amount of 
earnings that are sufficient to replace all benefits. If that person's 
earnings are below his/her individualized threshold amount, he/she will 
keep Medicaid benefits.
    States have the option of providing Medicaid coverage to people 
with disabilities whose earnings are too high to qualify under other 
rules (such as under the SSI threshold amount). A state may extend 
Medicaid coverage to working people with disabilities between ages 16 
and 65 who have income limits to allow a working person with a 
disability to buy into Medicaid. At least 27 states have a Medicaid 
buy-in program.
    Ms. Tubbs Jones: the way it's operated, or the payment for the 
services through Ticket to Work, makes it exceptionally costly to 
provide some of the services and that a review of how services are 
provided and how they're paid might make it better--a better use of 
dollars.
    Section 1148(h) of the Social Security Act provides that ENs will 
be paid under the Ticket to Work Program on the basis of outcomes and/
or milestones achieved by beneficiaries using their tickets in going to 
work and achieving self-sufficiency. The total payment available to an 
EN is limited to the amount of outcome payments available over 60 
months, in addition tomilestone payments (and reduced outcome payments) 
if the EN elects the outcome-milestone payment system.
    Section 1148(c) of the Act provides a State VR agency witha choice 
of receiving payment for serving beneficiaries using their tickets 
either on the same basis as an EN, or on the basis of reimbursement for 
the cost of services provided to beneficiaries by the State VR agency. 
e total reimbursement payable to a State VR agency under the cost 
reimbursement system is limited to the estimated savings to the trust 
funds and general revenues which will result in the rehabilitated 
beneficiary leaving the beneficiary rolls. This choice is not available 
under the Act to ENs.
    Ms. Tubbs Jones: the referral to a Ticket to Work EN really reduces 
the number of dollars that a State agency actually gets to provide VR 
services. So that, in essence, instead of providing additional services 
or those with disability, we're supplanting some of those services with 
these services instead of extending the service.
    The Ticket to Work and Work Incentives Advisory Panel and other 
observers of the Ticket to Work Program have noted that services and 
supports provided by other programs should. be combined with, rather 
than offset by, services and supports provided by the Ticket to Work 
Program.
    We are working with the Office of Special Education and 
Rehabilitation Services in the Department of Education, as well as 
other agencies including the Center for Medicare and Medicaid Services, 
to ensure that the Ticket to Work, State VR programs, and other 
programs work together to ensure that our beneficiaries are provided 
with the services and supports they need to return to work and attain 
self-sufficiency.

                                 

    Chairman SHAW. Thank you. Mr. Hayworth?
    Mr. HAYWORTH. Thank you, Mr. Chairman. Deputy Commissioner 
Gerry, Mr. Justesen, thank you both for being here. Deputy 
Commissioner Gerry, please extend my good wishes to 
Commissioner Barnhart. It was great, because she came to 
Arizona. We had the first Tickets to Work in Arizona. If could 
just say, and we all lived happily ever after, that would be 
delightful, but we are in, as we documented earlier, really the 
challenging phase, from the notion of drafting a bill, seeing 
the good work of folks, and on conference Committees, having it 
voted out of both Houses, having it signed into law, and now 
implementation.
    We heard from the previous panel the challenges of letting 
people know the word and emphasizing what has happened here. 
You touched on in answering the question, Deputy Commissioner 
Gerry, about the marketing firm or the firm that is developing 
a marketing strategy, but I have heard from representatives of 
ENs on our next panel, there is a real concern that even with 
this contract, it will take at least 2 years for the SSA to 
implement a full-blown marketing campaign.
    Now, here is the problem we have in Arizona. We have 
already seen the number of ENs accepting tickets drop from 27 
to just a handful, in part because there seems to be no demand. 
The ENs need help now. I appreciate the professionalism that a 
marketing firm can bring, but is there not an interim step that 
could be taken? What can be done now to get the word out to the 
folks about Ticket to Work?
    Mr. GERRY. Thank you, Mr. Hayworth. There are things that 
we are doing now. I think it is a combination of both you 
mentioned the ENs that are dropping out and it is a concern 
that we have. Part of it is the whole question of what 
beneficiaries now--the whole question of providing information 
and prompting beneficiaries.
    I think we also have to look at the other problem I was 
just talking about with Ms. Tubbs Jones, which is that one of 
the things we have envisioned, of course, was ENs coming in who 
had contacts with beneficiaries because they were organizations 
that routinely served those beneficiaries. So, the more we 
could bring ENs that had those kinds of contacts, the more 
likely we would be able to get beneficiaries. So, I think it is 
both of those issues together.
    The other thing I would have to say, having worked with the 
populations of people for many years who are being served by 
the program, is that there is a trust factor that we have to 
overcome. The history of the relationship between the SSA and 
some of our beneficiary groups has not necessarily engendered 
trust in the likelihood of what is going to happen and we have 
to sell the reality of the ticket, as we know it really is to 
people who have had reasons to be concerned about what will 
happen. So, we have to overcome that.
    I think word of mouth is probably something that is going 
to have to go a long way in doing that. I think what really 
happens when you have those kinds of problems often is you need 
successes and then you need people talking to other people 
about the successes. So, I think it is all three of those 
things. I didn't mean to suggest that we were going to wait 2 
years to do anything about it. What I really wanted to suggest 
is that we are 6 months into a 2-year activity to really come 
up with a national marketing plan. Now, we have been doing a 
lot of conferences around the country. We have been doing a lot 
of talking to organizations. I won't read the numbers. I would 
be happy to provide them for the record.
    [The information follows:]

      The SSA has been working on outreach and marketing 
activities to raise the public's awareness about the Ticket to Work 
Program through;
      Partnering with the Department of Labor's Office of 
Disability Employment Policy to use their Employer Assistance Referral 
Network (EARN) and a specialized subunit of EARN, named Ticket to Hire, 
which specializes in matching employers with job ready candidates from 
the Ticket to Work Program. Ticket to Hire links employers to 
Employment Networks in their community that have job-ready candidates.
      Partnering with other agencies to expand awareness and 
understanding of the Ticket legislation, Ticket to Hire, and other 
employment supports, including the Office of Personnel Management, the 
U.S. Chamber of Commerce, and the Department of Education.
      Publishing Ticket to Work success stories in newsletters, 
electronic publications and on websites such as the Office of 
Employment Support Program's ``Work Site'' and MAXIMUS' Web site. We 
also share success stories with numerous disability organizations for 
use in their publications and websites.
      Participating in conferences, meetings and forums that 
promote the hiring of people with disabilities.
      Maintaining the Internet ``Work Site'', http://
www.socialsecuritv.aov/work, that educates and provides resources to 
people interested in the Ticket to Work and other employment supports 
for people with disabilities. The ``Work Site'' has an entire section 
dedicated to Ticket to Work information for beneficiaries, advocates 
and service providers. This includes Frequently Asked Questions, 
statistics on Ticket assignments and directories of ENs, Benefits 
Planning, Assistance, and Outreach organizations and Protection and 
Advocacy organizations.
      Contracting with The Arc of the United States to provide 
an analysis and evaluation of beneficiary data to determine how to 
segment markets and target beneficiaries with marketing efforts to 
maximize participation in the Ticket to Work Program.

    In addition, MAXIMUS, the SSA's Program Manager for the Ticket to 
Work Program, is Marketing the ticket program to prospective employment 
networks. Their primary marketing vehicle has been the Employment 
Network Recruitment Fair. Through December 00.3, MAXIMUS had held 90 of 
these events, at least one in every State and Puerto Rico, employment 
Network Recruitment Fairs allowed MAXIMUS to reach more than 8,000 
individuals representing nearly 6,400 different organizations. In 
addition, by invitation
    MAXIMUS made presentations at more than 200 other events. The 
combination of onsite marketing with direct mail and telephone outreach 
has resulted in MAXIMUS delivering the ticket program message to about 
50,000 individuals, representing approximately 20,000 different 
organizations. In total, MAXIMUS has made over 250,000 distinct 
contacts. This presents a ratio of about 200 direct outreach contacts 
to each Employment Network proposal received.

                                 

    Maximus has made a lot of presentations, and we are 
significantly working on our field offices. That is a place 
where we can have right now some significant impact--it has 
come up two or three times already. As we talk to our 
beneficiaries, we could be saying more about the ticket. We 
could be giving out more information.
    I mentioned in both my written and oral testimony that we 
have hired 58 Area Work Incentive Coordinators. Those are in 
our areas within the 10 regions that we have, and one of their 
major tasks is to train our staff in the field offices who come 
into daily contact with our beneficiaries to talk about the 
ticket and to answer questions about the program. That is 
pretty important, and probably ultimately one of the crucial 
things we need to do, which is to change the culture of our 
field offices so that these capabilities are there. Is it going 
to happen overnight? I wish I could say yes. I think where we 
have these people in place, we see significant differences. I 
think that is an important strategy, as well. I would be very 
interested in any other specific things that we can do as we 
get this marketing plan. It is not that we don't have an 
interest in it or that we aren't willing to devote resources to 
it, but it is not clear to me precisely how we should do it.
    Mr. HAYWORTH. I thank you for that, and as I was listening 
to you talk, I thought about a marketing slogan for a certain 
sports attire firm that is three words that I think is really 
important here. ``Just do it.''
    [Laughter.]
    Just do it. The most basic things are here, and I have to 
admit we understand Congress is a deliberative body. You talked 
about the trust factor. One of the problems we have is if 
Congress is a deliberative body, I don't know how we describe 
the pace of the bureaucracy. It is glacial. Despite the best of 
intentions, we have a glacial pace here. So, to the extent that 
we bring, I like to think, light and maybe a little heat from 
Arizona, we appreciate the efforts, but my friend Susan Webb 
will be on the following panel. For purposes of full 
disclosure, she is my friend from Arizona and obviously part of 
ENs and part of the EN Association in the State of Arizona, but 
she made this point to me earlier this morning.
    If Binder and Binder and other Social Security attorneys 
can advertise on television day in, day out, over and over 
about getting people onto benefits, why can't the SSA advertise 
at least as often to get people off benefits and back into the 
world of work? A comment, a thought on that from either of you 
gentlemen?
    Mr. GERRY. I tried to address earlier the question of 
television advertising, which is not without controversy and 
also not without expense. I don't mean that in some penny-
pinching sense, but as a practical matter. One of the things I 
hope that we will get is a recommendation on how to do that. It 
would not be difficult to spend $50 or $100 million to do 
ineffective television advertising.
    Mr. HAYWORTH. Maybe I will just talk to the Arizona 
Association of Broadcasters saying, hey, if you are receiving 
Social Security disability and need to go back to work, why not 
find out about the Ticket to Work Program? You can keep your 
medical benefits and go back to work. Contact your counselor 
for more information. Ta-dah. There it is, and it didn't take 
me 2 years to explain that, and I can get that right to the 
Arizona Broadcasters Association. I appreciate the good 
efforts, and I am not here to beat you up. I really do. I just 
believe we have got to get moving to get the word to folks, and 
I thank you.
    Chairman SHAW. We are going to have to move on to Mr. 
Becerra.
    Mr. BECERRA. Thank you, Mr. Chairman. Commissioner Gerry, 
Mr. Justesen, thank you very much for your testimony. Let me 
ask a quick question. How much did the Fleischman and Hilliard 
contract cost the SSA and the taxpayers?
    Mr. GERRY. It is about $900,000 for 2 years.
    Mr. BECERRA. You might want to explore paying Fleischman 
and Hilliard the way you pay the ENs. Maybe they will act a 
little faster and give us more outcome if they know that they 
don't get paid until they have some outcome.
    Mr. GERRY. If we can get it consistent with the statute, I 
am sure we will do that.
    Mr. BECERRA. It might be tough. I know that you receive no 
resources to administer this Ticket to Work Program. First, I 
want to mention something that I mentioned to the Commissioner 
when she was last here. You all do yeoman's work. You have what 
is a large agency, but you deal with tens of millions of people 
and beneficiaries, so first and foremost, to all the people who 
work very hard at the SSA, we want to say thank you very much.
    In that hearing that we had last week with the 
Commissioner, she mentioned that her budget request was half-a-
billion dollars higher than what the Bush Administration 
allocated in its budget. Obviously, tough times. We are in 
deficit so everyone is having to tighten the belt, but given 
that the SSA is receiving less money than it asked for from the 
Administration and given that you never received any new 
resources to try to administer the Ticket to Work Program, how 
can you tell us that you will be able to deal with some of the 
bureaucratic delays that have been raised by my colleagues and 
others and that you have identified with fewer resources?
    Mr. GERRY. First, let me just say for the record, although 
I wasn't present during the Commissioner's testimony, actually, 
had the agency received what the President requested from the 
Congress, this budget problem that you are talking about 
wouldn't have existed. The problem was not what we received 
from the Administration or from the Office of Management and 
Budget but, frankly, what we received from the Congress.
    Mr. BECERRA. So, we need to do.
    Mr. GERRY. The President's budget request for 2004 was 
significantly higher than that approved by Congress.
    Mr. BECERRA. So, a clear message, then. I hope all of us 
then in Congress will hear that.
    Mr. GERRY. I just wanted to clarify where the shortfall 
came from.
    Mr. BECERRA. Clarion call. Make sure we are clear.
    Mr. GERRY. We appreciate very much the efforts of this 
Subcommittee.
    Mr. BECERRA. I want to make sure there is no doubt. Let the 
buck stop where it should. If you are not getting the resources 
that you should have, then Congress has to do more to allocate 
resources so you can have the personnel to administer the 
programs properly.
    Mr. GERRY. Well, I certainly would agree with that. I think 
the Commissioner has also testified that she is very pleased 
with the 2005 budget as proposed by the President, which is a 
substantial increase, 6.5 percent----
    Mr. BECERRA. Well, remember, she also said that she is 
going to have to put off implementing some of her programs to 
try to reduce the backlog in disability determinations because 
she is not getting what she asked for. So, while she may be 
pleased, I suspect if we had a chance to give her a couple of 
drinks in private times, she would probably tell us something a 
little differently, as well.
    [Laughter.]
    Mr. GERRY. I think if she is displeased, it may be with the 
outcome of the appropriations process in the Congress, not with 
the President's request.
    Mr. BECERRA. The whip has to be used both ways.
    Mr. GERRY. As far as your question about our ability to do 
the work, I think we have the resources. I would not want to 
leave the impression with the Subcommittee that the problems 
that we are encountering in the ticket program that we need to 
overcome are resource-driven. I don't think that is the 
situation.
    Mr. BECERRA. I want to make sure, then. You are not going 
to come back to us later on and say, we just didn't have the 
personnel. So, let me get to another question. Is it correct to 
say that for the last 7 months, the Ticket to Work Program has 
been without a Director?
    Mr. GERRY. No. It would be incorrect to say that. There has 
been an acting Associate Commissioner throughout that entire 
period.
    Mr. BECERRA. Not a permanent Director.
    Mr. GERRY. That is right, and we are.
    Mr. BECERRA. How long have we had an Acting Director?
    Mr. GERRY. We have had an Acting Director since, I believe, 
September.
    Mr. BECERRA. When do you think we will have someone?
    Mr. GERRY. Actually, it is an acting Associate 
Commissioner, to be accurate.
    Mr. BECERRA. When do you think, Commissioner, that we will 
have a permanent individual in that position?
    Mr. GERRY. We have permanent people there, Mr. Becerra, but 
the position will be filled, I think as a result of the posting 
we have right now. The position is being posted. I think it was 
alluded to earlier in the hearing. I am not sure whether it 
closes tomorrow or a week from tomorrow, but that is roughly 
the timeframe.
    Mr. BECERRA. Okay. Do you think?
    Mr. GERRY. I would anticipate we would have an Associate 
Commissioner who would be selected within the next month.
    Mr. BECERRA. That is good to know. The ENs, a question for 
you. Of the 1,100 that have participated, how many of them are 
nonprofits?
    Mr. GERRY. I don't know that. I would have to provide that 
for the record.
    [The information follows:]

    Approximately 75% of the 1,137 Employment Networks currently 
available to assist beneficiaries are not-for-profit.

                                 

    Mr. BECERRA. Could you get that for me, because it seems 
that one of the difficulties that we are having, and I am not 
sure if there is an easy way to resolve it, is that the ENs 
don't get paid until after they have a positive outcome, and 
for a lot of folks, it is tough to go that long before you get 
some dollars in for the services you have been providing.
    Now, I don't want to put a further burden on a nonprofit, 
but nonprofits tend to run under very tight budgets and often 
they get their funding from various sources in lump sums, so 
they sometimes have to go periods without a regular source of 
income flowing in. Since they are nonprofits, their status 
depends on their abiding by Federal laws.
    I am wondering with a nonprofit as opposed to a for-profit, 
which has to generate the moneys to continue to pay employees 
and stay in business, that maybe there is an opportunity to 
work with nonprofits where you can come up with a creative 
system of payment where you might not be able to do it with a 
for-profit, because if a for-profit ultimately goes under, we 
all lose because they can claim bankruptcy and we will never 
get the money, but a nonprofit, if it goes under, chances are 
it is going to have a tough time ever reenergizing itself and 
asking for nonprofit status from the Federal Government again.
    So, I am wondering if there may be some work that we can 
do. Obviously, Goodwill Industries does tremendous work in so 
many different areas, and I bet you they could use 10 times the 
budget they do all the work on. Again, not to impose something 
on Goodwill or any of these other noble nonprofits, but maybe 
there is a way to address the payment problems you have with 
the EN by working with the nonprofits that aren't trying to 
make the buck to make a living but are doing this because of 
the charitable and noble purpose behind it and work out a 
creative way to find a way to fund these ENs in a way that 
keeps them going and adds more of these ENs to the system, 
because it seems like if you are only going to live with 1,100 
of them, it is always going to be tough nationwide to let the 
beneficiaries have that full sense of who is out there, who can 
help them. I put that out there. Maybe if you can let us know 
later on how many of these nonprofits are out there, that would 
be very helpful.
    Mr. GERRY. If I can just make one comment.
    Mr. BECERRA. Yes, sir.
    Mr. GERRY. You mentioned in passing about living with the 
1,100, and I am not satisfied that we have adequately recruited 
ENs. I think that the number is perhaps less crucial than the 
reality of what is actually available to our beneficiaries. 
There are still significant areas of this country where there 
isn't a good competitive market available. The 1,100 are not 
evenly distributed around the country and they don't serve all 
of the beneficiary groups.
    So, I just didn't want to pass by the idea that that is 
enough or that I would imply that it is enough. I think we have 
to really do a better job of reaching out to ENs. The other 
observation I make is that I don't believe anywhere in the 
statute Congress differentiated within the category of ENs, and 
that could create some difficulty in trying to come up with 
separate payment schemes, but I am perfectly willing to look at 
the options.
    Mr. BECERRA. Just to look at it. I don't know, either, but 
I am just wondering if because they operate under different 
scenarios, that maybe we can do that. Mr. Chairman, if I can 
ask one last question, I will make it very quick. The notice to 
beneficiaries, I thought Ms. Hancock made a great suggestion of 
providing the information upon first point of contact, which is 
when the then-applicant for benefits first reaches the SSA, no 
telling whether the person will actually qualify for the 
benefits. It seems to make perfect sense to just give the 
notice up front and say, by the way, should you end up 
qualifying for these benefits, we hope that you will consider 
the possibility of returning to work at some point soon and 
here is your Ticket to Work. Maybe you don't have the authority 
right now, but is there any reason why the SSA would not want 
to consider that?
    Mr. GERRY. I don't think it is a question of authority. I 
think it is an interesting idea and I would be happy to look 
into it. I think we have the legal authority to do it. I would 
be happy to pursue it and give you a more complete answer.
    [The information follows:]

    While we cannot issue a ticket to an individual who is not yet a 
beneficiary, we believe that providing information about the program as 
early as possible to applicants who might later become eligible for the 
Ticket program is an excellent idea and are considering various ways to 
ensure that accurate information is offered to individuals so that they 
can make sound decisions about work activity.

                                 

    Mr. BECERRA. Mr. Chairman, thank you very much.
    Mr. HULSHOF [presiding]. Let me announce there are votes 
upcoming and there are some Members on the next panel that 
actually have flights to catch, so, if Members could try to 
confine their remarks to the time allotted, I would appreciate 
it. I am going to make a quick comment and a question, taking 
my time. I appreciate, Mr. Justesen, in your testimony you 
recognize--you are absolutely correct that State VR agencies do 
have long histories that predate the ticket program and most of 
the ENs today, but I also appreciate that you in that same 
paragraph on page 6 of your testimony state unequivocally that 
you value the EN partners and recognize the need for their 
participation, not only for the services that they provide, but 
for the choice of service provisions that they offer.
    If you mention in Columbia, Missouri, the name Advent 
Enterprises, everybody immediately understands that this is a 
private VR service that has a good relationship with the State 
VR, and so I appreciate that. Mr. Gerry, I know that we have 
beaten you up a bit about the fact that 90 percent of the 
tickets are being assigned to the State VR agencies, only 10 
percent to the ENs. The only comment I would have, and you set 
out a number of reasons why that is the case, what I wanted to 
just reiterate in anticipation of the next panel, there are 
those that are expressing the burdens of the payment process. 
One referred to it as, I think, quote, ``administrative drag,'' 
and I enlisted that term from the next panel, which forces 
these ENs to spend time and their resources dealing with 
Maximus, and/or the agency rather than helping the 
beneficiaries, and a couple of examples that seemed to be a bit 
egregious, let me ask if you agree.
    Twenty-thousand dollars due from the agency 3 to 12 months 
or longer. I recognize what you said earlier about 
capitalization and some of the smaller networks, and yet 
waiting for that amount of funds for any private agency seems 
to be a pretty substantial burden, or some citing the fact that 
they spend more money and staff time to collect the payment 
than the payment amount. I know, again, you have talked about 
Maximus briefly. What can you do or the SSA do to address their 
concerns on administrative drag?
    Mr. GERRY. We actually have been doing several things, and 
in my written testimony, I provide a little more detail about 
this. On the payment collection issue, I think we have done 
some things that make it much easier, much less time consuming, 
and, frankly, less expensive for ENs. We have changed our 
administrative procedures. We used to require a much more 
rigorous verification of ongoing employment. In other words, we 
had the issue of pay stubs. We had expectations that 
beneficiaries would continue to provide evidence on a monthly 
or quarterly basis that they were continuing to be employed. 
Now, many beneficiaries, once they are employed, don't 
particularly want to go back and forth to the EN and that makes 
perfectly good sense. So, we have actually changed our 
administrative procedures to allow some of the good faith 
verification that the EN is not aware of any change in the 
employment status rather than requiring the collection of pay 
stubs.
    Now, that is a big change in terms of the amount of work 
that has to go on. So, the first time that a payment is 
claimed, we want some proof that the individual went to work, 
but we are not requiring that kind of documentation for all of 
the payments, and we have also created three or four different 
ways in which payments can be made, either quarterly or 
monthly, and we have given choices to the ENs of how to 
basically manage the payment process.
    So, those are efforts to try to make it easier, and I think 
on the pay stub collection of information front, we have done a 
pretty good job of eliminating a lot of the problems. The 
staggering and the timing of payments, the amounts of the 
payments, those are problems that we are actively reviewing. I 
think Congress intended in the legislation that the 
Commissioner look at that, and we are doing that right now.
    Mr. HULSHOF. A last comment and then I will yield briefly 
to Mr. Pomeroy, then Mr. Brady. Even before the ticket program 
was signed into law, this Subcommittee has actually been 
concerned about overpayments. We have had hearings on this 
issue. Each time, overpayments has been one of the serious 
concerns, and so I also wanted to, at least on the record, 
express that matter. Mr. Pomeroy?
    Mr. GERRY. If I can just comment, and I will do it briefly.
    Mr. HULSHOF. Okay.
    Mr. GERRY. I have a lot of detail about what we are doing 
right now in terms of some of the systems changes, but I want 
to say for the record that this is a matter of the highest 
priority to the Commissioner and to me personally. I think we 
have to move and we have to move extremely quickly on the 
overpayment problem. I think it is one of the most serious 
barriers to getting people to work and I think that even though 
it has been accelerated, it is something that we cannot just 
leave to the routine changes of our systems, and wait for that. 
I think we are looking at as many different ways as we can 
right now to make that problem disappear because I think it is 
a serious problem.
    Mr. HULSHOF. There are those in the audience nodding their 
heads in assent to that statement. Mr. Pomeroy?
    Mr. POMEROY. Thank you, Mr. Chairman. Years ago, I spoke to 
the North Dakota Mental Health Association and a young woman 
followed me out and explained to me her situation. She was a 
nurse who no longer could work because of a bipolar disorder 
and she desperately needed an SSA disability determination for 
the medicine that she required, but when she didn't work, her 
condition got worse and she was just desperate to get to work. 
So, when we passed this Ticket to Work, I thought of her and I 
thought of that situation and I was thrilled about the 
potential.
    I look at the chart. North Dakota has got 22 people that 
have actually been able to access this, and needless to say, 
that is so far short of what my hope and expectation was for 
this program. I don't recall a program where I have been as 
excited about the launch of it and disappointed about the mid-
term implementation of it.
    So, from both sides of the dais here, we have given one 
message, and that is we can do a better job of getting this 
program available to people whose lives will turn around if 
they have access to it and can fully implement it. I couldn't 
have been more impressed by the initial panel this morning as 
an indication of what can happen to people when they can get 
back to work. I am looking at the Advisory Committee's 
recommendations to you and among their recommendations, they 
call for congressional action to make it clear that Congress 
did not intend to make beneficiaries ineligible for the full 
range of services from VR, Medicaid, or other Federal and State 
programs. To me, that ought not take an additional act of 
Congress. Isn't it pretty clear from Ticket to Work legislation 
that this is to be additive, not a zero-sum game in terms of 
these benefits?
    Mr. GERRY. I am a recovering lawyer, Mr. Pomeroy, and I 
don't want to give you a legal opinion about it, particularly 
because I think it applies probably partly to the 
Rehabilitation Act. In other words, I think when Troy was 
talking earlier about provisions of the Rehabilitation Act, 
which we don't administer, the Department of Education 
administers, there are provisions there about comparable 
benefits that have been interpreted in different ways. It is up 
to the Department of Education, of course, to interpret that 
statute, but it is, of course, up to the Congress what the 
content of that statute is and what that means.
    So, the question which you are raising involves partly the 
SSA and Ticket to Work, but it also involves the question of 
what acceptable practice under the Rehabilitation Act would be, 
and that is really a question that I am not prepared to answer. 
I think it is an important question, and Troy, I don't know if 
you want to try to respond, or----
    Mr. JUSTESEN. You asked a complex question, Congressman, 
and one which is very important to the Rehabilitation Services 
Administration that is under my office and its interaction 
between that statute, the Rehabilitation Act, and the Ticket to 
Work and Work Incentives Improvement Act, and that is one in 
which we would be happy to supply for the record a more----
    Mr. POMEROY. I actually will want from both agencies a 
clear explanation of where Congress needs to clarify, if 
clarification is needed. Just specifically on this one, Mr. 
Justesen, to follow up, if I can get this straight. If a 
beneficiary assigns a ticket to an EN, is he or she still 
entitled to VR services under the Rehabilitation Act if the 
EN's services are not comparable to what was being provided by 
VR?
    Mr. JUSTESEN. As I understand your question, the answer is 
yes.
    Mr. POMEROY. They are still entitled to compensation, 
because the education.
    Mr. JUSTESEN. They are entitled to services and benefits 
under VR.
    Mr. POMEROY. Services, right. I am sorry, wrong word. 
Services and benefits. Are you monitoring States to make 
certain that they are implementing the VR Act (P.L. 105-220) in 
that fashion?
    Mr. JUSTESEN. Yes, and it is important for us, as I said in 
my comments earlier, that we are valuing the input from the 
Advisory Board, the Ticket Advisory Board, and our 
collaboration with Social Security. Anecdotally, we have 
received in the Department of Education communications, 
concerns expressed by advocates and others throughout the 
country that this is an issue in which we in the Rehabilitation 
Services Administration under the Department of Education need 
to pay particular attention to. We are doing that.
    Mr. POMEROY. Great.
    Mr. JUSTESEN. It is important for us to make sure that each 
of the three phases, and we are beginning with the first 13, of 
review of the agreements between the State VR agencies and 
other public and private ENs, to make sure that individuals 
with disabilities are protected under the Rehabilitation Act as 
well as the opportunity for them to benefit under the ticket 
program.
    Mr. POMEROY. That is terrific, because what this is about 
is an additional level of support to get people back to work, 
not just another source of funding to then have other funding 
withdrawn.
    Mr. JUSTESEN. As I said, I will be happy to submit for the 
record a clear explanation of this issue. Individuals with 
disabilities, regardless of their option of exercising the 
ticket, if they are individuals who receive SSI benefits or 
SSDI benefits, those individuals are presumed eligible for VR 
services without the need in the past to have completed a great 
deal of extra paperwork to be eligible for both programs.
    Mr. POMEROY. As you do supply that information, I would 
like you to reference the Advisory Committee's recommendation. 
I am not trying to at all point fingers at anybody. If Congress 
has more clarification to do, let us go ahead and do it. I am 
not, frankly, at all certain that we do. I believe that it is 
relatively clear on what has been enacted already.
    Mr. JUSTESEN. Perhaps. I would be happy to submit it for 
the record.
    Mr. POMEROY. All right.
    [The information was not received at the time of printing.]
    Mr. JUSTESEN. Let me tell you, I don't think, and we don't 
take in any way your questions to be those of criticism. These 
are areas of partnership building for us at all of the Federal 
agency levels and one of the efforts we need to do at the 
Federal agency levels is model interaction and interagency 
implementation of the ticket program even better than we have 
done in the past, and I think we are making efforts to do that.
    Mr. POMEROY. The only final question--I asked a lot of 
questions, comments--this business of getting this marketed in 
an effective way so that people that might avail themselves of 
these services know that they can is just terribly important. I 
right now extend an invitation to SSA to have a meeting with me 
in North Dakota. Hopefully, with media coverage, we will be 
able to get the word out on it. We have about the lowest rate 
of participation in the entire country, and I know that does 
not reflect the work ethic of North Dakotans on disability 
payments. They want to get off. We have got a program to get 
them off. I will personally work with you to do that.
    Mr. JUSTESEN. I would be happy to accept your invitation 
right now. I have actually worked in North Dakota on the 
Special Education Program and know a little bit about the 
population. I certainly would be happy to do that. I am sure 
Commissioner Barnhart would.
    Mr. POMEROY. Terrific. We look forward to it, and we are 
coming into springtime, so it is not even that bad of a draw.
    [Laughter.]
    Thank you very much. I yield back.
    Mr. BRADY [presiding]. Thank you, Congressman. 
Commissioner, Secretary, the Ticket to Work Program is a great 
concept. It is real important that it succeed and it is 
appropriate at this hearing that we focused a lot because of 
the roll-out on process, but let us conclude the panel with 
this question. We are at different phases in different areas. 
For our customers, for our clients, for the ones we really want 
to serve, what are the results so far for those especially 
choosing ENs? Are the disabled getting services more tailored 
to their individual needs? Are they getting them better or 
faster or in a way that helps them get to the workplace sooner? 
For those, we are really concerned. They happen to be our 
employers, as well. What are the results for them so far?
    Mr. GERRY. Let me see if I can set the stage to answer that 
question by going back to where we were before the ticket and 
where we had consistently two-tenths of 1 percent of our 
beneficiaries leave our rolls for reasons other than death. I 
can't testify they all went to work, but some significant 
number of the two-tenths of 1 percent. That is where we were. 
That is where we have been for 20 years. That was the status 
quo that the ticket changed.
    I think it is important to remember that that is where we 
were because the ticket has, I think, had significant effects 
on that as demonstrated. Specifically, we have about 670 people 
that we are paying, that have generated EN payments. So, it is 
people who are working, that have been working for some time, 
that are off cash benefits. While that doesn't sound like a 
huge number of people, even out of the 40,000, we have to 
remember where we are in the process, because in order to be 
paid, you have to have worked for a significant period of 
time--in the case of VR, it is 9 months, and in the case of the 
ENs, it is an even longer period of time. So, I expect that 
number to expand fairly significantly over the next year or 
two.
    Now, I think that is impressive compared to where we 
started. Is it what Congress looked for as the outcome or the 
final effect? No. I think we have to work on a lot more things 
in order to make this program work. I think in reading the 
statute, as I read it anyway, and looking at the legislative 
history, I think Congress knew that we were going to learn a 
lot as we implemented the statute, and what the Commissioner is 
dedicated to, and I am, too, is to make changes as soon as we 
learn, not to wait, not to hesitate, but to do it and to do it 
with this Subcommittee. There may be things that ultimately 
have to come back to the Subcommittee and say, these are 
statutory issues.
    We are, at this point, trying to do everything we can 
within the Commissioner's regulatory authority, and in some 
cases, I mentioned even changing administrative procedures. So, 
I think, yes, there are real people who are getting real 
benefits and I think that there is real promise and that the 
vision that this Subcommittee had when it passed the ticket is 
the right vision and one that we can reach. I just think we 
are, as you say, we are at a critical point in time and I think 
that we have to do--and I can pledge to you on the behalf of 
the agency what we are doing is trying to think about all the 
changes we can make or recommend to the Congress that would 
really make this program work more successfully.
    I think the one concern I have is that we have to keep 
going back to who the program is supposed to work for, and that 
is the beneficiaries. The fundamental issue is the choice of 
beneficiaries of different kinds of services that will allow 
them to achieve their employment goals, and that is what I keep 
reminding myself of, because we can get drawn off on other 
interests.
    Now, to have a vibrant and an active set of ENs and to have 
VR agencies become competitive. What we really want is not to 
repeat the two-tenths of 1 percent experience that we had 
before, but through competition to see good things happening. 
So, instead of seeing VR agencies as associated with a program 
that hasn't produced much in the past, they would become part 
of a new program where they actively compete and cooperate. I 
think that is what we want and what we want to achieve, but I 
am very optimistic that we are going to get there. I just don't 
want to over-promise or over-commit. At the same time, we 
couldn't be more dedicated to getting there.
    Mr. BRADY. Thank you, Commissioner. I appreciate it. Mr. 
Secretary?
    Mr. JUSTESEN. It is important for the Committee to 
understand, and I know that you do, but I want to reemphasize 
this, that the success of the Ticket to Work Program is not 
solely on the shoulders of the SSA. They are the lead. We at 
the Department of Education look to the SSA to provide us with 
guidance on how to best implement the Ticket to Work Program. 
The VR Services Program administered at the Department of 
Education is a very important partner, together with the 
Department of Labor's efforts, that are new in terms of our 
understanding how this evolution has evolved for us to all 
begin to work together at the Federal level.
    The VR Program has an important component and access in the 
advocacy community that may well be the primary access for 
entry into the world of employment. The Social Security may not 
always be in all cases. We have a large Independent Living 
Advocacy Program in which we partner that with the VR Services 
Program that is a vital first entry point for many individuals 
who may later become recipients of SSI or SSDI in which we are 
looking to build on that partnership and, frankly, we haven't 
done as well as we could, but the Secretary of Education, 
Secretary Paige, is very interested in our efforts to increase 
the employment opportunities for people with disabilities and 
we look forward to doing that.
    Mr. BRADY. Thank you. I think this is important because my 
experience is everything looks perfect on paper in Washington, 
D.C. How it works in life is usually a whole different matter. 
Staying on top of it to make it work the right way is our job, 
so, thank you, panelists. We appreciate it.
    Mr. BRADY. The next panel, I would like to invite up at 
this point. Thank you for being here today. We have with us 
Sarah Wiggins Mitchell, who is Chair of the Ticket to Work and 
Work Incentives Advisory Panel; Tom Golden, who is a member of 
the same panel; Paul Seifert, Social Security Task Force, 
Consortium for Citizens with Disabilities (CCD); Tom Foran, 
Vice President of Integrated Disability Resources (IDR); 
Quintin Mitchell, who is Director of VR Services in Richmond; 
Susan Webb with the Arizona Employment Network Association; and 
John Coburn, Staff Attorney for Health and Disability Advocates 
in Chicago, Illinois. In that order, why don't we begin with 
Sarah Wiggins Mitchell for her 5-minute statement.

STATEMENT OF SARAH WIGGINS MITCHELL, CHAIR, TICKET TO WORK AND 
 WORK INCENTIVES ADVISORY PANEL; AND THOMAS P. GOLDEN, MEMBER, 
       TICKET TO WORK AND WORK INCENTIVES ADVISORY PANEL

    Ms. WIGGINS MITCHELL. Thank you, Mr. Chairman, and good 
afternoon. On behalf of the Advisory Panel, we would like to 
thank you for this opportunity to speak to you today. The panel 
appreciates the support this Committee demonstrates for people 
with disabilities and the SSA disability programs. We have 
submitted written testimony for the record and now will simply 
be highlighting some of the points we made in that testimony.
    The panel believes that the ticket program has much 
unrealized potential. Beneficiaries are showing interest in the 
program in two ways. Forty thousand people have assigned their 
tickets to receive VR and employment support services. In 
addition, the program manager, Maximus, received over 23,000 
calls about the ticket in the month of February alone and over 
10 million hits were made to their Ticket to Work website in 
the calendar year 2003.
    The support programs established by the Ticket Act are also 
proving to be very successful. Almost 100,000 beneficiaries 
have sought information and assistance from the Benefits 
Planning and Assistance and Outreach Program (BPA&O). The SSA's 
customer satisfaction survey supports what the panel has been 
hearing from beneficiaries across the country. The BPA&O 
services are excellent and essential to people with 
disabilities who want to work. The panel was pleased that the 
BPA&O and PABS Programs were reauthorized in H.R. 743 and 
thanks this Committee for their hard work in passing that 
legislation.
    The establishment of the Area Work Incentive Coordinator 
(AWIC) position within the SSA is a very positive development. 
The panel was very pleased that SSA decided to create a 
position that is permanent and devoted full-time to work 
incentive duties as part of their internal core of work 
incentive specialists. The panel has heard positive testimony 
and comments regarding the AWIC positions and hopes that SSA 
will expand the number of AWIC positions to meet the enormous 
demand for their services.
    Mr. GOLDEN. While the SSA is making some progress in a 
number of areas, the panel has serious concerns in three key 
areas which threaten the success of the ticket program. Of most 
concern to the panel is the current low participation of ENs. 
As you are aware, the panel issued a report last month 
entitled, ``The Crisis in EN Participation: A Blueprint for 
Change.'' Central to this report is the assumption that 
recruiting and retaining a large number of ENs is crucial to 
accomplishing the primary Stated goal of the ticket program, 
giving people with disabilities a real choice in rehabilitation 
and employment.
    Our report identified a number of issues that are causing 
providers not to participate or to drop out of the program 
altogether. These are the need for Congress to clarify that the 
ticket program should be used as a supplemental, rather than a 
substitute, funding source; the design of the EN payment 
system; the inadequacy of provider incentives, the 
administration of claims for payment; marketing; EN training; 
and the treatment of American Indian VR Programs. While all of 
these issues are important, I will briefly discuss only two.
    The design of the payment system for the ticket program and 
the administration of claims for payment by ENs pose immediate 
threats to the success of the program, placing too much 
financial risk on ENs, who must make large investments up front 
and wait a long time for payments. The panel has recommended 
moving more of the payment into the first 12 months of 
employment, increasing the payment to greater than 40 percent 
of the average benefit amount, reducing the difference between 
milestone and outcome payments, and increasing the sum of 
payments for SSI to equal that of the payments for SSDI.
    Second, the requirements SSA places on ENs to make a claim 
for and receive payment are burdensome and costly. SSA not only 
does not make payments to ENs in a timely manner, sometimes 
taking up to 120 days, but also has established a quarterly 
payment schedule. Finally, the panel is concerned that SSA has 
yet to undertake a demonstration project addressing any of 
these issues. These administrative problems must be addressed 
without delay.
    The second major area hindering the success of the program 
is the lack of marketing and public education about the program 
itself. Over the past 3 years, the panel has repeatedly 
recommended that SSA undertake a national coordinated marketing 
and public education campaign to increase awareness of and 
interest in the program. While the panel is pleased that SSA 
has awarded a contract for the design of a strategic marketing 
plan, no actual marketing plan will have been implemented until 
the plan is completed. The panel urges SSA to move forward 
quickly with other interim marketing activities such as 
possibly sending a reminder letter to beneficiaries who have 
received a ticket in the past and not used them, or other 
suggestions that were made by our esteemed panel earlier today.
    Finally, the panel is concerned about the insufficient 
training SSA field staff receive about SSA work incentives and 
the ticket program. The panel continues to hear stories of 
beneficiaries who received inaccurate information about work 
incentives from SSA field staff. Receiving bad information can 
cause a person not to make a job attempt, to receive an 
overpayment, or to be forced to stop working altogether. It 
also increases mistrust and fear. This situation is 
unacceptable to the panel and Americans with disabilities.
    The Ticket Act requires the SSA to have staff available and 
accessible that possess a thorough understanding of the work 
incentives and are able to provide this information to 
beneficiaries who want to work. As Stated earlier, AWICs 
represent the best type of customer service. However, the 
training received by AWICs does not seem to filter down to the 
Work Incentive Liasons and other field staff. We urge SSA to 
expand the training available to all SSA field staff and put in 
place quality assurance measures.
    Ms. WIGGINS MITCHELL. In conclusion, the panel believes the 
ticket program has great potential to help many people with 
disabilities improve their lives by going to work. While it is 
still early in the implementation process, the failure of SSA 
to take steps to immediately address the concerns outlined in 
this statement could have a dire effect on the success of the 
program. Thank you again for your opportunity to speak with you 
today. Normally, I would say we would be happy to stay and 
answer questions, but my colleague and I need to be in other 
areas of the country and are going to have to leave.
    Mr. BRADY. That is fine.
    Ms. WIGGINS MITCHELL. We would be glad to answer in writing 
any questions that you would have for the panel.
    Mr. BRADY. Thank you. Have a safe trip.
    Ms. WIGGINS MITCHELL. Thank you.
    Mr. BRADY. I noticed that I don't think either of you took 
a breath during your----
    [Laughter.]
    I thought, man, things are speeding up in this room now.
    [Laughter.]
    So, anyway, we appreciate you being here. Thank you.
    Ms. WIGGINS MITCHELL. Thank you very much again.
    [The prepared statement of Ms. Wiggins Mitchell follows:]
    [The prepared statement of Mr. Golden follows:]

  Statement of Sarah Wiggins Mitchell, Chair, Ticket to Work and Work 
                       Incentives Advisory Panel

Introduction
    The Ticket to Work and Work Incentives Advisory Panel (the Panel) 
would like to thank Chairman Shaw for holding this hearing. The Panel 
appreciates the Committee's high level of interest in ongoing oversight 
regarding the Ticket Program and the other important programs and 
policies of the Ticket to Work and Work Incentives Improvement Act. The 
Panel would also like to take the time to recognize the support this 
committee demonstrates for people with disabilities and the Social 
Security Administration Disability programs.

Good News
    The Panel believes that the Ticket Program is a very popular 
program with still much unrealized potential. Advocates for people with 
disabilities at the national and grassroots levels are very supportive 
of this program and are working with their Federal partners to make the 
program succeed.

Positive Sign: Consumer Interest
    Consumers are also showing great interest in the program. Forty 
thousand people have assigned their tickets to receive vocational 
rehabilitation and employment support services. While only about 4000 
of those are with Employment Network providers, or what we call ENs, 
that is a big number for the short time that the Ticket Program has 
been around. This is especially true given the fact that the roll out 
of the Ticket program was delayed and is not yet completed. The rest of 
the Tickets have been assigned to State Vocational Rehabilitation 
agencies.
    Even beneficiaries who have not assigned a Ticket are very 
interested in finding out about the program. The Program Manager, 
Maximus, received over 23,000 calls in the month of February alone. 
Almost 20,000 of those were inquiries made by or on behalf on 
beneficiaries with interest in the Ticket program. In addition, MAXIMUS 
reports that during calendar year 2003, over 10 million hits were made 
to the Ticket to Work website.

TWWIIA Support Programs are Excellent
    The support programs established by the Ticket to Work and Work 
Incentives Improvement Act are also proving to be very successful. 
Almost 100,000 beneficiaries have sought information and assistance 
from the benefits planning assistance and outreach program, or BPAO. 
The results of the customer satisfaction survey that were just released 
by the Social Security Administration supports what the Panel has been 
hearing from beneficiaries across the country: BPAO services are 
excellent and essential to people with disabilities who want to work. 
Eighty nine percent of those surveyed rated the service they received 
as excellent, very good, or good. And, the percent of the people who 
reported they were working jumped by 19 % subsequent to their contact 
with the BPAO. The Panel is pleased that the BPAO program was 
reauthorized in HR743 and thanks this Committee for their hard work in 
passing that legislation.
Positive Implementation Step: Area Work Incentive Coordinator
    The establishment of the Area Work Incentive Coordinator, or AWIC, 
position within SSA is a very positive development in implementation of 
the Ticket program, as well as in the overall administration of work 
incentives. The Panel is very pleased that SSA decided to create a 
position that is permanent and devoted full time to work incentive 
duties as part of their internal corps of work incentives specialists. 
The Panel has repeatedly heard very positive testimony and comments 
regarding the dedicated and skilled SSA employees that fill the AWIC 
positions. As we all know, the provision of accurate and timely 
information on work incentives is a critical factor in making people 
feel secure in their attempt to go to work. AWICs help to make that 
happen for SSA beneficiaries. The Panel hopes that SSA will expand the 
number of AWIC positions to meet the enormous demand for their 
services.

Three Areas of Concern
    While the Agency is making good progress, the Panel has serious 
concerns in three key implementation areas that threaten the success of 
the Ticket Program. Of most concern to the Panel is the current low 
participation of ENs. Second, we are concerned about the lack of public 
education and marketing of the Ticket Program to beneficiaries, their 
families, and ENs. A third major area of concern is the inadequate 
training provided to SSA field staff about work incentives in general, 
and the Ticket Program specifically.

Concern One: EN Participation
    As you probably know, the Panel issued a report last month on the 
crisis in EN participation and its potential impact on the Ticket 
Program. The Executive Summary of that report is included at the end of 
this statement (beginning on page 8).
    Central to this report is the assumption that recruiting and 
retaining a large number of active ENs is a critical factor in 
accomplishing the primary stated goal of Ticket Program--giving people 
with disabilities a real choice in rehabilitation and employment 
services. Our report identified a number of issues related to the 
structure of the Ticket Program that are causing providers not to 
participate as ENs or to drop out altogether. These are: the need for 
Congress to clarify that the Ticket Program should be used as a 
supplemental, rather than a substitute, funding source; the design of 
the EN payment system; the inadequacy of provider incentives; the 
administration of claims for payment; marketing; EN training; and the 
treatment of American Indian VR programs.
    Finally, the Panel is concerned and puzzled that in the fourth year 
of the Ticket Program, SSA has yet to undertake a demonstration or 
pilot project addressing some of these issues especially the payment 
issue. The problems outlined below in the Executive Summary must be 
addressed without delay to make the Ticket Program more attractive to 
current and potential ENs and to ensure that current ENs to remain in 
the program.

Concern Two: Marketing and Public Education
    The second major area the Panel believes maybe hindering the 
success of the program is the lack of marketing and public education 
being conducted by SSA in support of the program. The Panel has 
repeatedly recommended that SSA undertake a national coordinated 
marketing and public education campaign in order to increase awareness 
of and interest in the Ticket program. Currently, beneficiaries are 
informed only once about the Ticket Program and they may not be 
informed at all about other TWWIIA provisions and work incentives. The 
only marketing material most beneficiaries receive on the Ticket 
Program is a letter describing the program when the Ticket is being 
rolled out, or when they first become eligible for benefits.
    The Panel is pleased that SSA has awarded a contract for the design 
of a strategic marketing plan for the program that will be completed 
this year. However, in the meantime, many ENs report having trouble 
finding people willing to assign their Tickets and many beneficiaries 
and local advocates remain completely in the dark about the Ticket 
program and the other work incentives. Although these SSA contracting 
efforts are very positive steps, the Panel is concerned that the next 
year or two will be devoted to planning marketing efforts rather than 
actual marketing of the Ticket Program. Extensive planning activities 
may delay implementation of a national marketing plan even further. The 
Panel believes it is reasonable to expect that marketing would occur 
prior to, or during, the rollout of a new program, not after.
    The Panel urges SSA to move forward quickly with other marketing 
activities, such as sending reminder letters to all people who have 
received but not yet used their ticket.

Concern Three: Training
    The final area that is of most concern to the Panel is the 
insufficient training SSA field staff receive about work incentives and 
the Ticket Program. The Panel has heard in public testimony across the 
country, stories of beneficiaries who have received inaccurate 
information about work incentives from SSA staff in the field office. 
Receiving bad information can cause a person not to make a job attempt, 
to receive an overpayment, or to be forced to stop working. It also 
increases mistrust and fear. This situation is unacceptable to the 
Panel and Americans with disabilities. Every SSA field office should 
have accessible and available staff that possess a thorough 
understanding of the work incentives and be able to provide accurate 
basic information to SSA beneficiaries with disabilities who want to 
work.
    On that note, the Panel wants to again recognize the very positive 
step the Agency took in the creation of the AWIC position as part of 
their internal corps of work incentive experts. This represents the 
best type of customer service. The AWICs received good basic training 
(two full weeks) and many of them were former Employment Support 
Representatives (with six weeks of training). AWICS are reported to be 
very knowledgeable and highly regarded in the field and by 
beneficiaries.
    There are not nearly enough AWICs to be available to answer every 
question beneficiaries have but the training that AWICs have received 
on SSA work incentives and the Ticket Program is exemplary. SSA cannot, 
however, rely on AWICs to provide all information and advice to 
beneficiaries on work incentives and the Ticket Program. SSA created a 
filter down, train the trainer approach to build their corps of 
internal work incentive specialists. AWIC's train Work Incentives 
Liaisons (or WILs), the people who provide information on work 
incentives on top of their regular duties in the field office. WILs 
receive their limited training from the AWICs and then are expected to 
train the remainder of the field office staff. SSA work incentives and 
their interaction with the Ticket Program are very complicated and 
technical topics. The problem with SSA's current strategy is that the 
necessary knowledge does not seem to filter down to the claims 
representatives and service representatives who are answering 
beneficiary questions about work incentives on a day-to-day basis. We 
trust that SSA will make more intensive training, along the lines of 
what AWICs receive, available to all SSA field staff.

Conclusion
    The Panel believes the Ticket Program has great potential to help 
many people with disabilities improve their lives by going to work. 
This statement outlines a number of concerns the Panel has about SSA's 
administration of the Ticket Program. While it is still early in the 
implementation process of this new program, the failure of SSA to take 
steps immediately to address these concerns may have a dire effect on 
the success of the program.

The Crisis in EN Participation: A Blueprint for Action (February 2004)
Executive Summary
    Thousands of people with disabilities and their advocates shared a 
dream that the Ticket to Work and Work Incentives Improvement Act of 
1999 (the Act) would greatly expand employment opportunities for people 
on the Social Security Administration (SSA) disability rolls. Three 
years after enactment of the law, it is clear that their dream is 
faltering. The Ticket to Work and Self-Sufficiency Program (Ticket 
Program) is failing to recruit the anticipated numbers of new 
employment service providers, called Employment Networks (ENs). In 
addition, those enrolled as ENs are serving only a fraction of the 
beneficiaries thought to be interested in participating in the Ticket 
Program. Nearly 1,000 providers have enrolled in the program, but only 
about one-third of those operating have accepted any tickets. The Panel 
believes that without immediate attention to the very real problems 
affecting EN participation, the Ticket Program will fail. The Panel 
urges Congress and the Commissioner to act quickly on the following 
recommendations.

Issues and Recommendations

    Ticket Program as a Supplemental Funding Source_ENs are uncertain 
about whether and how they can use funds from other public sources to 
serve ticket holders and have chosen not to actively participate in the 
Ticket Program because of fear of losing other stable funding sources.

Recommendations

      Congress should develop statutory language that clearly 
articulates its original intent that the Ticket Program's outcome and 
milestone payments should provide additional resources to assist 
beneficiaries in attaining and retaining employment. In general, the 
Panel believes that Congress did not intend to make beneficiaries 
ineligible for the full range of services from vocational 
rehabilitation (VR) programs, Medicaid, or other Federal and State 
programs by making them eligible for the Ticket Program.
      Congress should direct the Commissioner to implement the 
Ticket Program as a complement to the traditional SSA VR Reimbursement 
Program, paying State VR agencies for up-front services and paying ENs 
for long-term employment outcomes.
      As part of the mandated evaluation of the Ticket Program, 
the Commissioner should conduct an assessment of the Ticket Program and 
the SSA VR Reimbursement Program, running in combination, to determine 
whether that approach produces better long-term, cost-effective 
outcomes than the historical VR Reimbursement Program alone, and to 
ensure the financial viability of running the two programs in 
combination.

    The EN Payment System_Two problems in the EN payment system 
discourage the active participation of many providers: (1) the payment 
system places too much financial risk on ENs and (2) the payment system 
provides significantly lower reimbursements to ENs for serving 
Supplemental Security Income (SSI) recipients than for serving Social 
Security Disability Income (SSDI) beneficiaries.

Recommendations

      The Commissioner should immediately modify the EN payment 
system to move more of the payment into the first 12 months of 
employment and reduce the difference between the milestone and outcome 
payments.
      The Commissioner should test two or three creative 
approaches that place more up-front financial risk on SSA but, if 
successful, could significantly increase Ticket Program participation 
by both ENs and beneficiaries, thereby increasing long-term savings to 
SSA.
      Congress should amend the statute to permit payments to 
ENs to be set at a level greater than 40 percent of average benefits 
for both SSDI and SSI beneficiaries and after the statutory change the 
Commissioner should implement an increase in EN payments for 
beneficiaries of both programs.
      Congress should amend the statute to permit the Ticket 
Program to increase the sum of payments available for serving SSI 
recipients to a level equal to the sum of payments available for 
serving SSDI beneficiaries.
      The changes to the EN payment system should be 
implemented as quickly as possible.

    Adequacy of Provider Incentives_Because little is known about 
outcome payments for providers, the Act authorizes the Commissioner to 
review, refine, and alter the payment system to ensure that it provides 
adequate incentives for ENs to serve beneficiaries and produce savings 
to the program. Despite major problems with the payment model, no 
alterations have been made to the original program payment system. The 
Commissioner has established an advisory group on Adequacy of 
Incentives (AOI) to assist SSA with the design of a workable payment 
system, including financial incentives to serve four groups of 
beneficiaries with special needs that were referenced in the Act.

Recommendations

      The Commissioner should implement a modified EN payment 
system that generally incorporates the principles outlined in the AOI 
Advisory Group's interim report. (The Panel supports the principles in 
the report but has not endorsed a specific model.)
      For any new payment system to be successful, the 
Commissioner must first implement the Panel's recommendations relating 
to the EN payment system and EN claims administration.
      The Commissioner and Congress should make clear in 
statute and in program regulations that payments to ENs must supplement 
funding from other public programs (such as State VR, Mental Health, 
Medicaid, Housing and Urban Development, Department of Labor) and 
should not pay for services for which beneficiaries are already 
eligible.

EN Payment Claims Administration_Two factors compound the financial 
        risk and working capital problems of Employment Networks: (1) 
        long-term tracking of beneficiary earnings is labor intensive 
        and administratively burdensome for ENs and (2) there are often 
        long delays in processing EN claims for payment.

Recommendations

      Once a beneficiary has been certified as employed above 
the substantial gainful activity (SGA) level or leaves cash benefit 
status, the Commissioner should continue to pay the EN on a monthly 
basis as long as the beneficiary remains in zero benefit status and the 
EN has not yet received 60 months of outcome payments, or until the 
beneficiary requests a new EN.
      The Commissioner should refine the EN payment claims 
processing system to ensure timely payments to ENs within businesslike 
timeframes. A widely accepted business standard for turnaround time on 
receivables is 30 days.

    Marketing to ENs and to Beneficiaries_To date, there is no national 
marketing plan for the Ticket Program and the Program is not well 
understood by the vast majority of beneficiaries or by those who 
influence a beneficiary's decision to attempt work. Further, ENs spend 
considerable time explaining the Program and dispelling misconceptions. 
Also, the lack of marketing contributes to the insufficient demand for 
EN services. However, SSA has recently awarded contracts to support 
development of a strategic marketing plan and EN marketing and 
recruitment efforts. The Panel has made numerous recommendations to the 
Commissioner on this issue in past reports.

Recommendation
    The Commissioner should create opportunities for the Panel to (1) 
review the work plans and proposed activities under the strategic 
marketing plan contract and the project designed to improve EN 
participation and (2) engage in a dialogue with the contractors and 
relevant SSA staff so that the Panel can provide timely and substantive 
input on these marketing activities.

    EN Training and Communication_There is inadequate training, 
technical assistance (TA), and timely information available to ENs. 
Existing TA and training resources are inadequate, nonuniform, 
piecemeal, uncoordinated, and of varying quality, with no coordinated 
means for ENs to identify and share best practices.

Recommendations

      The Panel, in partnership with the Commissioner, should 
convene a meeting of key stakeholders to develop a national training 
and communications conference for all ENs.
      The Commissioner should appoint a working committee to 
develop the plan for this training conference and to develop the 
overall strategy for bringing together a broad-based coalition of 
stakeholders to oversee and sponsor the event. Panel members should be 
active participants.

    American Indian VR Program Eligibility for the SSA VR Reimbursement 
Program_Despite having to meet the same service standards as State VR 
agencies, American Indian Vocational Rehabilitation (AIVR) programs 
operated by Tribal Nations programs are not exempt from the Ticket 
Program EN application process and are excluded from the traditional 
SSA Reimbursement Program for State VR agencies.

Recommendation
    Congress should amend the statute to permit AIVR programs operating 
under section 121 of the Rehabilitation Act to participate in Ticket to 
Work in a manner equivalent to State VR agencies; that is, they should 
be exempt from the EN application process and be subject to the same 
reimbursement rules.

                                 

    Statement of Thomas P. Golden, Member, Ticket to Work and Work 
                       Incentives Advisory Panel

Introduction
    The Ticket to Work and Work Incentives Advisory Panel (the Panel) 
would like to thank Chairman Shaw for holding this hearing. The Panel 
appreciates the Committee's high level of interest in ongoing oversight 
regarding the Ticket Program and the other important programs and 
policies of the Ticket to Work and Work Incentives Improvement Act. The 
Panel would also like to take the time to recognize the support this 
committee demonstrates for people with disabilities and the Social 
Security Administration Disability programs.

Good News
    The Panel believes that the Ticket Program is a very popular 
program with still much unrealized potential. Advocates for people with 
disabilities at the national and grassroots levels are very supportive 
of this program and are working with their Federal partners to make the 
program succeed.

Positive Sign: Consumer Interest
    Consumers are also showing great interest in the program. Forty 
thousand people have assigned their tickets to receive vocational 
rehabilitation and employment support services. While only about 4000 
of those are with Employment Network providers, or what we call ENs, 
that is a big number for the short time that the Ticket Program has 
been around. This is especially true given the fact that the roll out 
of the Ticket program was delayed and is not yet completed. The rest of 
the Tickets have been assigned to State Vocational Rehabilitation 
agencies.
    Even beneficiaries who have not assigned a Ticket are very 
interested in finding out about the program. The Program Manager, 
Maximus, received over 23,000 calls in the month of February alone. 
Almost 20,000 of those were inquiries made by or on behalf on 
beneficiaries with interest in the Ticket program. In addition, MAXIMUS 
reports that during calendar year 2003, over 10 million hits were made 
to the Ticket to Work website.

TWWIIA Support Programs are Excellent
    The support programs established by the Ticket to Work and Work 
Incentives Improvement Act are also proving to be very successful. 
Almost 100,000 beneficiaries have sought information and assistance 
from the benefits planning assistance and outreach program, or BPAO. 
The results of the customer satisfaction survey that were just released 
by the Social Security Administration supports what the Panel has been 
hearing from beneficiaries across the country: BPAO services are 
excellent and essential to people with disabilities who want to work. 
Eighty nine percent of those surveyed rated the service they received 
as excellent, very good, or good. And, the percent of the people who 
reported they were working jumped by 19% subsequent to their contact 
with the BPAO. The Panel is pleased that the BPAO program was 
reauthorized in HR743 and thanks this Committee for their hard work in 
passing that legislation.

Positive Implementation Step: Area Work Incentive Coordinator
    The establishment of the Area Work Incentive Coordinator, or AWIC, 
position within SSA is a very positive development in implementation of 
the Ticket program, as well as in the overall administration of work 
incentives. The Panel is very pleased that SSA decided to create a 
position that is permanent and devoted full time to work incentive 
duties as part of their internal corps of work incentives specialists. 
The Panel has repeatedly heard very positive testimony and comments 
regarding the dedicated and skilled SSA employees that fill the AWIC 
positions. As we all know, the provision of accurate and timely 
information on work incentives is a critical factor in making people 
feel secure in their attempt to go to work. AWICs help to make that 
happen for SSA beneficiaries. The Panel hopes that SSA will expand the 
number of AWIC positions to meet the enormous demand for their 
services.

Three Areas of Concern
    While the Agency is making good progress, the Panel has serious 
concerns in three key implementation areas that threaten the success of 
the Ticket Program. Of most concern to the Panel is the current low 
participation of ENs. Second, we are concerned about the lack of public 
education and marketing of the Ticket Program to beneficiaries, their 
families, and ENs. A third major area of concern is the inadequate 
training provided to SSA field staff about work incentives in general, 
and the Ticket Program specifically.

Concern One: EN Participation
    As you probably know, the Panel issued a report last month on the 
crisis in EN participation and its potential impact on the Ticket 
Program. The Executive Summary of that report is included at the end of 
this statement (beginning on page 8).
    Central to this report is the assumption that recruiting and 
retaining a large number of active ENs is a critical factor in 
accomplishing the primary stated goal of Ticket Program--giving people 
with disabilities a real choice in rehabilitation and employment 
services. Our report identified a number of issues related to the 
structure of the Ticket Program that are causing providers not to 
participate as ENs or to drop out altogether. These are: the need for 
Congress to clarify that the Ticket Program should be used as a 
supplemental, rather than a substitute, funding source; the design of 
the EN payment system; the inadequacy of provider incentives; the 
administration of claims for payment; marketing; EN training; and the 
treatment of American Indian VR programs.
    Finally, the Panel is concerned and puzzled that in the fourth year 
of the Ticket Program, SSA has yet to undertake a demonstration or 
pilot project addressing some of these issues especially the payment 
issue. The problems outlined below in the Executive Summary must be 
addressed without delay to make the Ticket Program more attractive to 
current and potential ENs and to ensure that current ENs to remain in 
the program.

Concern Two: Marketing and Public Education
    The second major area the Panel believes maybe hindering the 
success of the program is the lack of marketing and public education 
being conducted by SSA in support of the program. The Panel has 
repeatedly recommended that SSA undertake a national coordinated 
marketing and public education campaign in order to increase awareness 
of and interest in the Ticket program. Currently, beneficiaries are 
informed only once about the Ticket Program and they may not be 
informed at all about other TWWIIA provisions and work incentives. The 
only marketing material most beneficiaries receive on the Ticket 
Program is a letter describing the program when the Ticket is being 
rolled out, or when they first become eligible for benefits.
    The Panel is pleased that SSA has awarded a contract for the design 
of a strategic marketing plan for the program that will be completed 
this year. However, in the meantime, many ENs report having trouble 
finding people willing to assign their Tickets and many beneficiaries 
and local advocates remain completely in the dark about the Ticket 
program and the other work incentives. Although these SSA contracting 
efforts are very positive steps, the Panel is concerned that the next 
year or two will be devoted to planning marketing efforts rather than 
actual marketing of the Ticket Program. Extensive planning activities 
may delay implementation of a national marketing plan even further. The 
Panel believes it is reasonable to expect that marketing would occur 
prior to, or during, the rollout of a new program, not after.
    The Panel urges SSA to move forward quickly with other marketing 
activities, such as sending reminder letters to all people who have 
received but not yet used their ticket.

Concern Three: Training
    The final area that is of most concern to the Panel is the 
insufficient training SSA field staff receive about work incentives and 
the Ticket Program. The Panel has heard in public testimony across the 
country, stories of beneficiaries who have received inaccurate 
information about work incentives from SSA staff in the field office. 
Receiving bad information can cause a person not to make a job attempt, 
to receive an overpayment, or to be forced to stop working. It also 
increases mistrust and fear. This situation is unacceptable to the 
Panel and Americans with disabilities. Every SSA field office should 
have accessible and available staff that possess a thorough 
understanding of the work incentives and be able to provide accurate 
basic information to SSA beneficiaries with disabilities who want to 
work.
    On that note, the Panel wants to again recognize the very positive 
step the Agency took in the creation of the AWIC position as part of 
their internal corps of work incentive experts. This represents the 
best type of customer service. The AWICs received good basic training 
(two full weeks) and many of them were former Employment Support 
Representatives (with six weeks of training). AWICS are reported to be 
very knowledgeable and highly regarded in the field and by 
beneficiaries.
    There are not nearly enough AWICs to be available to answer every 
question beneficiaries have but the training that AWICs have received 
on SSA work incentives and the Ticket Program is exemplary. SSA cannot, 
however, rely on AWICs to provide all information and advice to 
beneficiaries on work incentives and the Ticket Program. SSA created a 
filter down, train the trainer approach to build their corps of 
internal work incentive specialists. AWIC's train Work Incentives 
Liaisons (or WILs), the people who provide information on work 
incentives on top of their regular duties in the field office. WILs 
receive their limited training from the AWICs and then are expected to 
train the remainder of the field office staff. SSA work incentives and 
their interaction with the Ticket Program are very complicated and 
technical topics. The problem with SSA's current strategy is that the 
necessary knowledge does not seem to filter down to the claims 
representatives and service representatives who are answering 
beneficiary questions about work incentives on a day-to-day basis. We 
trust that SSA will make more intensive training, along the lines of 
what AWICs receive, available to all SSA field staff.

Conclusion
    The Panel believes the Ticket Program has great potential to help 
many people with disabilities improve their lives by going to work. 
This statement outlines a number of concerns the Panel has about SSA's 
administration of the Ticket Program. While it is still early in the 
implementation process of this new program, the failure of SSA to take 
steps immediately to address these concerns may have a dire effect on 
the success of the program.

The Crisis in EN Participation: A Blueprint for Action (February 2004)
Executive Summary
    Thousands of people with disabilities and their advocates shared a 
dream that the Ticket to Work and Work Incentives Improvement Act of 
1999 (the Act) would greatly expand employment opportunities for people 
on the Social Security Administration (SSA) disability rolls. Three 
years after enactment of the law, it is clear that their dream is 
faltering. The Ticket to Work and Self-Sufficiency Program (Ticket 
Program) is failing to recruit the anticipated numbers of new 
employment service providers, called Employment Networks (ENs). In 
addition, those enrolled as ENs are serving only a fraction of the 
beneficiaries thought to be interested in participating in the Ticket 
Program. Nearly 1,000 providers have enrolled in the program, but only 
about one-third of those operating have accepted any tickets. The Panel 
believes that without immediate attention to the very real problems 
affecting EN participation, the Ticket Program will fail. The Panel 
urges Congress and the Commissioner to act quickly on the following 
recommendations.

Issues and Recommendations

Ticket Program as a Supplemental Funding Source_ENs are uncertain about 
        whether and how they can use funds from other public sources to 
        serve ticket holders and have chosen not to actively 
        participate in the Ticket Program because of fear of losing 
        other stable funding sources.

Recommendations

      Congress should develop statutory language that clearly 
articulates its original intent that the Ticket Program's outcome and 
milestone payments should provide additional resources to assist 
beneficiaries in attaining and retaining employment. In general, the 
Panel believes that Congress did not intend to make beneficiaries 
ineligible for the full range of services from vocational 
rehabilitation (VR) programs, Medicaid, or other Federal and State 
programs by making them eligible for the Ticket Program.
      Congress should direct the Commissioner to implement the 
Ticket Program as a complement to the traditional SSA VR Reimbursement 
Program, paying State VR agencies for up-front services and paying ENs 
for long-term employment outcomes.
      As part of the mandated evaluation of the Ticket Program, 
the Commissioner should conduct an assessment of the Ticket Program and 
the SSA VR Reimbursement Program, running in combination, to determine 
whether that approach produces better long-term, cost-effective 
outcomes than the historical VR Reimbursement Program alone, and to 
ensure the financial viability of running the two programs in 
combination.

The EN Payment System_Two problems in the EN payment system discourage 
        the active participation of many providers: (1) the payment 
        system places too much financial risk on ENs and (2) the 
        payment system provides significantly lower reimbursements to 
        ENs for serving Supplemental Security Income (SSI) recipients 
        than for serving Social Security Disability Income (SSDI) 
        beneficiaries.

Recommendations
      The Commissioner should immediately modify the EN payment 
system to move more of the payment into the first 12 months of 
employment and reduce the difference between the milestone and outcome 
payments.
      The Commissioner should test two or three creative 
approaches that place more up-front financial risk on SSA but, if 
successful, could significantly increase Ticket Program participation 
by both ENs and beneficiaries, thereby increasing long-term savings to 
SSA.
      Congress should amend the statute to permit payments to 
ENs to be set at a level greater than 40 percent of average benefits 
for both SSDI and SSI beneficiaries and after the statutory change the 
Commissioner should implement an increase in EN payments for 
beneficiaries of both programs.
      Congress should amend the statute to permit the Ticket 
Program to increase the sum of payments available for serving SSI 
recipients to a level equal to the sum of payments available for 
serving SSDI beneficiaries.
      The changes to the EN payment system should be 
implemented as quickly as possible.

Adequacy of Provider Incentives_Because little is known about outcome 
        payments for providers, the Act authorizes the Commissioner to 
        review, refine, and alter the payment system to ensure that it 
        provides adequate incentives for ENs to serve beneficiaries and 
        produce savings to the program. Despite major problems with the 
        payment model, no alterations have been made to the original 
        program payment system. The Commissioner has established an 
        advisory group on Adequacy of Incentives (AOI) to assist SSA 
        with the design of a workable payment system, including 
        financial incentives to serve four groups of beneficiaries with 
        special needs that were referenced in the Act.

Recommendations

      The Commissioner should implement a modified EN payment 
system that generally incorporates the principles outlined in the AOI 
Advisory Group's interim report. (The Panel supports the principles in 
the report but has not endorsed a specific model.)
      For any new payment system to be successful, the 
Commissioner must first implement the Panel's recommendations relating 
to the EN payment system and EN claims administration.
      The Commissioner and Congress should make clear in 
statute and in program regulations that payments to ENs must supplement 
funding from other public programs (such as State VR, Mental Health, 
Medicaid, Housing and Urban Development, Department of Labor) and 
should not pay for services for which beneficiaries are already 
eligible.

EN Payment Claims Administration_Two factors compound the financial 
        risk and working capital problems of Employment Networks: (1) 
        long-term tracking of beneficiary earnings is labor intensive 
        and administratively burdensome for ENs and (2) there are often 
        long delays in processing EN claims for payment.

Recommendations

      Once a beneficiary has been certified as employed above 
the substantial gainful activity (SGA) level or leaves cash benefit 
status, the Commissioner should continue to pay the EN on a monthly 
basis as long as the beneficiary remains in zero benefit status and the 
EN has not yet received 60 months of outcome payments, or until the 
beneficiary requests a new EN.
      The Commissioner should refine the EN payment claims 
processing system to ensure timely payments to ENs within businesslike 
timeframes. A widely accepted business standard for turnaround time on 
receivables is 30 days.

Marketing to ENs and to Beneficiaries_To date, there is no national 
        marketing plan for the Ticket Program and the Program is not 
        well understood by the vast majority of beneficiaries or by 
        those who influence a beneficiary's decision to attempt work. 
        Further, ENs spend considerable time explaining the Program and 
        dispelling misconceptions. Also, the lack of marketing 
        contributes to the insufficient demand for EN services. 
        However, SSA has recently awarded contracts to support 
        development of a strategic marketing plan and EN marketing and 
        recruitment efforts. The Panel has made numerous 
        recommendations to the Commissioner on this issue in past 
        reports.

Recommendation
    The Commissioner should create opportunities for the Panel to (1) 
review the work plans and proposed activities under the strategic 
marketing plan contract and the project designed to improve EN 
participation and (2) engage in a dialogue with the contractors and 
relevant SSA staff so that the Panel can provide timely and substantive 
input on these marketing activities.

EN Training and Communication_There is inadequate training, technical 
        assistance (TA), and timely information available to ENs. 
        Existing TA and training resources are inadequate, nonuniform, 
        piecemeal, uncoordinated, and of varying quality, with no 
        coordinated means for ENs to identify and share best practices.

Recommendations

      The Panel, in partnership with the Commissioner, should 
convene a meeting of key stakeholders to develop a national training 
and communications conference for all ENs.
      The Commissioner should appoint a working committee to 
develop the plan for this training conference and to develop the 
overall strategy for bringing together a broad-based coalition of 
stakeholders to oversee and sponsor the event. Panel members should be 
active participants.

American Indian VR Program Eligibility for the SSA VR Reimbursement 
        Program_Despite having to meet the same service standards as 
        State VR agencies, American Indian Vocational Rehabilitation 
        (AIVR) programs operated by Tribal Nations programs are not 
        exempt from the Ticket Program EN application process and are 
        excluded from the traditional SSA Reimbursement Program for 
        State VR agencies.

Recommendation
    Congress should amend the statute to permit AIVR programs operating 
under section 121 of the Rehabilitation Act to participate in Ticket to 
Work in a manner equivalent to State VR agencies; that is, they should 
be exempt from the EN application process and be subject to the same 
reimbursement rules.

                                 

    Mr. BRADY. Mr. Seifert?

   STATEMENT OF PAUL J. SEIFERT, SOCIAL SECURITY TASK FORCE, 
           CONSORTIUM FOR CITIZENS WITH DISABILITIES

    Mr. SEIFERT. Thank you, Mr. Chairman. I am testifying today 
on behalf of the CCD and Work Incentives Task Forces. The CCD 
is a national organization representing over 100 disability 
organizations, membership organizations of people with 
disabilities, provider organizations, a good many people who 
are participating in the ticket program and a good many 
organizations providing those services as ENs. It was with a 
great deal of support from the disability community and, of 
course, bipartisan support from Congress that the ticket 
legislation passed in 1999. However, an array of factors, we 
believe, have kept the ticket program from meeting its full 
potential and we have four areas of concern that we would like 
to mention today.
    As previously mentioned, the reimbursement schedule for ENs 
is wholly inadequate, and is creating a major barrier to ENs 
who want to participate in the program. There are issues 
between State VR agencies, ENs, and beneficiaries that have 
resulted in many potential ENs not participating in the program 
and beneficiaries unknowingly assigning their tickets to VR, 
overly burdensome reporting requirements on EN and State VR 
agencies in order to receive reimbursement, and as I think has 
been gone over in great detail, poor marketing to ENs in terms 
of recruitment and a lack of awareness about the ticket among 
SSA beneficiaries, not to mention the other work incentives.
    I want to talk about the reimbursement scheme, and just 
skip right to our proposals. First of all, we think Congress 
should eliminate the statutory requirement that the milestone 
outcome payment system pay less than the outcome payment only 
system. Congress should clarify that a partial reduction of 
benefits under the SSI Program for working SSI beneficiaries 
is, in fact, an outcome, deserving a payment to an EN, maybe 
not the full amount, but certainly that is something we want to 
reward and not penalize.
    Congress should shorten the period in which outcome 
payments are made and should raise the percentage of the 
average monthly benefit used to determine payments to ENs. 
Waiting 60 months for the full repayment is just too long for 
most small nonprofits to capitalize expenses over that period 
of time. Fourth, the SSA should increase the value of the 
milestone payments and allow the partial payment for some work 
that is under the SGA level. Again, we endorse the 
recommendations of the Employment Network Work Group that the 
panel put together and also the Adequacy of Incentives Work 
Group report which will be coming out shortly.
    The interplay between State VR agencies and beneficiaries 
and ENs is another area of concern to us and has been a concern 
ever since this legislation was developed. Quite frankly, we 
believe Congress needs to repeal the language that requires 
agreements between ENs and VR agencies. Second, we think that 
the legislative language should be enacted that prohibits VR 
agencies from collecting ticket payments from ENs who refer 
beneficiaries to State VR agencies. We think that Social 
Security ought to pay VR its cost reimbursement under its 
current situation, and keep the ticket intact so ENs can regain 
or at least get reimbursed for the payments and services that 
they provide over the 60-month period for which a beneficiary 
has deposited that ticket.
    The marketing issue is one that we discussed with Social 
Security in the early rollout of the ticket, and one that we 
had several concerns with. First of all, we were worried that 
the tickets would roll out before enough ENs were signed up, 
and part of the reason why so few tickets are being deposited 
or so many are being deposited with VR agencies is we rolled it 
out so fast that there aren't enough ENs to potentially provide 
enough services to all the people who may want them.
    Number two, mailing the ticket to beneficiaries was 
probably not the best marketing device. Beneficiaries get 
essentially two things from Social Security, a check and bad 
news, and probably since this was not a check, at best it was 
probably kept in a drawer or on top of a dresser somewhere 
where it might be gotten later or forgotten. So, that was 
probably not the best technique. In addition, the cost of 
mailing out millions of these tickets was probably prohibitive 
and not the best use of the agency's resources. We believe that 
use of the advocacy community to advertise the ticket as well 
as the other work incentives, the use of television and radio 
public service announcements would do a lot to promote the use 
of the ticket among beneficiaries, and a more aggressive 
strategy for signing up ENs plus a modification of the payment 
and reimbursement schedule will convince more smaller 
nonprofits to get involved in the program.
    It was touched on briefly by Mr. Hulshof, but the issue of 
overpayments is a staggeringly frightening phenomena for anyone 
who has ever experienced it and it has got to be dealt with. It 
not only affects ENs in the sense that when an overpayment is 
made, a payment to an EN is not being made when it should be, 
but perhaps most significantly, beneficiaries are stuck having 
to repay at times tens of thousands of dollars of benefits they 
were not supposed to get even when they have reported their 
earnings to Social Security in accordance with the statute. 
Worse than that, beneficiaries have to pay taxes on the 
overpayment that they get and they can't pay it out of the 
benefits they get. So, we have imposed an additional tax burden 
on a working beneficiary for getting an overpayment they are 
not supposed to get. Now, they can always file for 
reimbursement in a later tax year, but do we really have to do 
this to people who are trying to work?
    In conclusion, we believe the ticket has a great deal of 
potential. We think these modifications will go a long way to 
help the ticket realize that potential. We applaud the agency 
for its rapid and extraordinary rollout and we hope that some 
adjustments are forthcoming. Thank you.
    [The prepared statement of Mr. Seifert follows:]

 Statement of Paul J. Seifert, Social Security Task Force, Consortium 
                     for Citizens with Disabilities

    Mr. Chairman, Mr. Matsui, members of the Subcommittee, my name is 
Paul J. Seifert. I am the Director of Government Affairs for the 
International Association of Psychosocial Rehabilitation Services 
(IAPSRS) and today I am testifying on behalf of the Consortium for 
Citizens With Disabilities (CCD) Work Incentives and Social Security 
Task Forces. CCD is a coalition of nearly 100 national organizations 
advocating on behalf of people with physical, mental, and sensory 
disabilities. On behalf of CCD I thank you for this hearing to examine 
the Social Security Administration's management of the Ticket to Work 
program.
    With a great deal of support from the disability community and near 
unanimous, bi-partisan support in both the House and Senate, Congress 
enacted and President Clinton signed into law the Ticket to Work & Work 
Incentives Improvement Act (TWWIIA) in December 1999. This legislation 
was designed to expand the rehabilitation services and health care 
coverage for Social Security beneficiaries who want to go back to work. 
A key component of the TWWIIA legislation is the Ticket-to-Work 
Program.
    There are high expectations in both the disability community and 
among members of Congress for the Ticket to Work program. And though 
those expectations have not been fully realized, a couple of key 
positive points should be mentioned. First, SSA should be recognized 
for their rapid regulatory development and rollout of the Ticket 
program. The first tickets were issued to beneficiaries a little over 
two years after passage of the legislation, and today just four years 
after the final regulations were approved, beneficiaries in every 
state, the District of Columbia and the territories are able get a 
Ticket to Work. This is an extraordinary accomplishment given that the 
Ticket to Work is a brand new program that required the creation of a 
new Office of Employment Support Programs within SSA and the hiring or 
reassignment of many SSA staff.
    Second, while much criticism has been leveled at the Ticket Program 
for its real or perceived failures the fact is, when compared to the 
old SSA Alternate Provider (AP) Program, more people are using the 
Ticket and SSA is making payments to more Employment Networks for 
serving more beneficiaries than they did under the old AP program. The 
numbers speak for themselves. Under the AP Program only 428 private 
agencies participated. Today 1,100 Employment Networks are 
participating in the Ticket. Under the old AP program only about 15 
successful outcomes were achieved resulting less than $50,000 in 
payments to providers. As of March 17, 2004, the Ticket has paid 
$583,000 in payments have been made to 160 ENs for serving 473 
beneficiaries.
    However, the standard for success was not merely to do better than 
the AP program, but rather to significantly expand the array of 
employment services for people with disabilities and increase the 
resources available to provide those services. Unfortunately, an array 
of factors has kept the Ticket from reaching its full potential. Those 
factors are 1) a wholly inadequate EN reimbursement schedule that is 
keeping potential ENs from participating and keeping most of those who 
do participate from taking Tickets, 2) issues between State Vocational 
Rehabilitation Agencies and ENs and beneficiaries have resulted in many 
potential ENs deciding to not participate and has beneficiaries 
unknowingly assigning their Tickets to State VR, 3) overly burdensome 
reporting requirements on ENs seeking reimbursement, and 4) poor 
marketing to ENs and a lack of awareness about the Ticket among SSA 
beneficiaries.

REIMBURSEMENT IS INADEQUATE

    Reimbursement under the Ticket to an EN occurs when a beneficiary 
who has assigned their Ticket goes to work and no longer receives cash 
benefits. Small milestone payments are available to the EN and paid 
when the beneficiary's work effort reaches Substantial Gainful Activity 
for a certain period of months. The outcome payments are spread out 
over 60 months, payable for a month whenever the beneficiary is not 
receiving cash benefits. The payments are calculated as forty percent 
of the average monthly SSI and SSDI benefit.
    SSA's payment methodology has several flaws. ENs who choose to 
receive milestone payments (all but a couple have chosen milestones) 
have their total payment cut by fifteen percent compared to the 
outcome-only payment scheme. No upfront funding means ENs must 
capitalize all the costs until the person is working above SGA and then 
completely off cash benefits and the milestone payments are too small 
to be attractive to ENs. The policy of requiring SSI beneficiaries to 
go completely off cash benefits ignores that many SSI beneficiaries who 
offset much of their SSI benefit through work generate much savings 
that ENs get no credit for under the current payment scheme developed 
by SSA.
    Participation by ENs will continue to be weak unless they can 
foresee a more reasonable level of payment made in a more timely 
fashion.
    We propose several improvements: 1) Congress should eliminate the 
statutory requirement that the milestone-outcome payment system pay 
less than the outcome-only payment system, 2) Congress should clarify 
that a partial reduction of benefits under the SSI program is an 
``outcome'' deserving of some reward to ENs, 3) Congress should shorten 
the period in which outcome payments are made and raise the percent of 
average monthly benefit used to determine payments to ENs, and 4) SSA 
should increase the value of the milestone payments and allow partial 
payment for some work that is under the SGA level.

STATE VR AGENCIES, ENs and BENEFICIARIES

    The interplay between State VR agencies, ENs and beneficiaries was 
a concern from the day the first Ticket legislation was developed. 
State VR agencies have developed stand alone, take it or leave it, one 
size fits all agreements for ENs in their states. These agreements all 
contain one common provision--the full and total repayment of all of 
VR's costs out of the ENs ticket payment by an EN who refers a 
beneficiary to VR. In two states we found the VR agency demanded a 
percentage of the ENs ticket reimbursement ABOVE the state VR agencies 
actual costs. In two other states the VR agency has required ENs to 
join the state VR agency's ``Employment Network.'' It was hoped by 
advocates that the Ticket would supplement existing VR funds for 
employment services, not supplant those funds.
    In addition, in one state we found examples of state VR counselors 
who had failed to file the beneficiaries Ticket when the beneficiaries 
went to VR for services. As a result, the beneficiary was not eligible 
the Continuing Disability Review (CDR) protections Congress 
incorporated into the Ticket and the person was denied that protection. 
Fortunately the action taken by local Protection and Advocacy program 
was able to stop the CDR and restore the protection afforded under the 
Ticket.
    Finally, in an SSA document known as ``Transmittal 17,'' SSA has 
essentially allowed state VR agencies to involuntarily assign a 
beneficiary's ticket apparently without their knowledge or signed 
consent. Furthermore, we just discovered that the Florida state VR 
agency is going back through their case files and retroactively 
assigning the Tickets of every person who had received VR's services 
after February 2002 without notice to the beneficiary and regardless of 
whether the beneficiary had intended to assign that Ticket to VR or 
not.
    It is abundantly clear that, after more than two years of Ticket 
roll out, no resolution of the issues between state VR agencies and ENs 
and beneficiaries is in sight. Further, the Rehabilitation Services 
Administration (RSA) and SSA have been unable to resolve matters at the 
federal level. However, we want to also be clear that it would be 
unfair to vilify VR agencies. The Federal-State VR Program remains 
woefully under funded given its broad mission and the number of people 
who seek VR services. One example of the strain on the system is the 
number of cases VR counselors must handle. It is not uncommon for a 
state VR counselor to be assigned 150 to 200 cases. This strain is 
unlikely to ease as state budgets tighten. Consequently, we hope the 
recommendations below will both make the Ticket more successful and 
help State VR agencies play a more significant part.
    We urge Congress to amend the Ticket program by eliminating the 
requirement that there be agreements between ENs and state VR agencies 
when the EN refers a beneficiary to VR. Congress should adopt language 
prohibiting state VR agencies from requiring ENs who refer clients to 
state VR from demanding repayment from the EN. Most significantly, a 
recommendation of the Adequacy of Incentives Work Group that was 
created under the TWWIIA law would allow cost reimbursement for state 
VR agencies separately from the Ticket program, and would thus keep 
intact the Ticket for the beneficiary's use.

EN REPORTING REQUIREMENTS and OVERPAYMENTS

    Payment under the Ticket program occurs when the beneficiary is no 
longer receiving benefits. Because SSA is unable to verify in a timely 
way the wages and income of working beneficiaries or former 
beneficiaries, SSA is requiring ENs to produce the beneficiary's wage 
verification for each month the EN is requesting a payment. The EN 
payment request system leaves major difficulties for the vast majority 
of ENs. Those ENs who are using the Milestone/Outcomes payment system 
still must turn in copies of pay stubs until the beneficiaries reach 
zero cash benefit. This means that they may be faced with one to two 
years or more of collecting pay stubs. Current ENs and potential ENs 
need to know that a reliable system exists to provide payments for 
their successful efforts.
    In addition, because SSA does not stop checks to working 
beneficiaries in a timely fashion, many beneficiaries continue to 
receive benefits that SSA should have stopped, even when the 
beneficiary has reported their income to SSA. The few people who figure 
out this problem just put the money in the bank and wait for SSA to ask 
for it back, a request that may come years later. The vast majority of 
beneficiaries simply believe the money is theirs and spend it, then 
don't have it when SSA demands repayment. Often times calls to SSA 
offices are of little help or the wrong information is given. These 
overpayments often go one for months and sometimes years and total tens 
of thousands of dollars. More astounding is the fact that beneficiaries 
must pay taxes on the overpayments they receive. An adjustment can be 
made in later tax years, but must we really put beneficiaries though 
this?
    Public Law 108-203, which President Bush recently signed on March 
2nd, calls on SSA to issue ``receipts'' whenever a beneficiary reports 
earnings to SSA. This receipt may well help a beneficiary waive an 
overpayment, but it does not solve the tax problems facing 
beneficiaries or the payment issues facing ENs. Worse, overpayments 
reinforce the fears that many beneficiaries have about returning to 
work.
    We call on Congress to allocate resources to SSA to put an end to 
their inability to process earnings reports. With overpayments causing 
massive problems for beneficiaries and ENs, it is time to act 
decisively on this issue.

PROMOTING THE TICKET and RECRUITING ENs

    SSA's plan to mail Tickets to beneficiaries was viewed skeptically 
by advocates. The cost was high and we know that beneficiaries would be 
apt to ignore the mailings without knowing more about the work 
incentives, vocational services and employment options. Also, to date 
while the TWWIIA legislation has provided over seventy-five million to 
states to start their Medicaid Buy-in programs, all ENs received was a 
burdensome application form, a fight with their state VR agency, and a 
stingy reimbursement scheme. The wonder isn't that too few ENs have 
signed up or that they are taking too few Tickets, the real wonder is 
that any signed up at all and that they take any Tickets.
    To do better SSA must make real changes in the program. SSA should 
make use of the networks of advocacy groups and PSAs on radio and TV to 
advertise the Ticket to beneficiaries and non-traditional potential 
ENs. Most of all, more must be done to explain the Ticket and the work 
incentives to beneficiaries. Early results show that the Benefits 
Planning Outreach and Assistance program, as well as the Protection and 
Advocacy program, are a success. It is time for Congress to 
dramatically increase funding for these effective programs. Finally, 
Congress unintentionally excluded Vocational Rehabilitation Programs 
for American Indians from participating in the Ticket program.

Disabled Adult Child Benefits

    KWe want to thank this Subcommittee and Congress for resolving a 
problem in the way the Title II work incentives, including the Ticket 
program, affect people who receive Disabled Adult Child (DAC) benefits. 
P.L. 108-203, has a provision to extend indefinitely the time-frame for 
a DAC beneficiary to re-enter the Title II program with DAC benefits if 
the individual is still disabled and the termination was due to work 
over the SGA level. When this provision becomes effective in October 
2004, people receiving DAC benefits will no longer be faced with the 
potential permanent loss of DAC benefits if they are at first 
successful in leaving the rolls due to work but later need to return to 
the Title II program.
    We urge the Subcommittee to consider addressing the situation of 
people who are on the SSI program who are likely to receive DAC 
benefits in the future when their parents retire, die, or become 
disabled. If the individual with disabilities earns income above the 
SGA level before applying for DAC benefits, access to DAC benefits may 
be permanently barred. This is a substantial work disincentive for 
people who are severely disabled during childhood and who may need the 
benefits earned for them by their parents. But for the fact that their 
parents have not yet retired, died, or become disabled, they stand in 
the same position as those for whom the provision was included in P.L. 
108-203. We would be happy to work with the Subcommittee to explore 
possible solutions to this problem.
    There is one remaining work disincentive for people who qualify for 
DAC benefits that could be resolved through regulatory change. We 
understand that SSA's interpretation regarding the value to be placed 
on a worker's work effort (regarding whether it exceeds SGA or not) is 
different for people in supported employment depending upon whether the 
individual is supported directly by an employer or whether the 
individual is supported by services from an outside source, such as a 
state-funded supported employment agency. As a result, an individual's 
work effort could be found to exceed SGA when the support is from a 
third party while that same work effort could be found not to exceed 
SGA when the support is from the employer. From the perspective of the 
individual, this is an arbitrary distinction. Further, there may be 
additional complications in that the nature and scope of the support 
provided to the individual may be misunderstood when making the 
valuation of work effort. For instance, while the individual may be 
performing the actual task (bagging groceries, assembling a package, 
etc.), it may be that the individual would be unable to perform the 
task without the help of the job coach in ensuring that the individual 
arrives at work on time properly attired, that he/she interacts 
appropriately with customers and co-workers, and that he/she remains 
focused on the assigned job tasks, among other things. We believe that 
this is an area that needs further examination if work incentives are 
to work as intended by TTWWIIA. We urge the Subcommittee to collaborate 
with SSA to ensure resolution of this problem.
    In conclusion, the Ticket program is full of potential, but that 
potential can only be realized with action by Congress and SSA to make 
the necessary changes. We knew that it would take time to shape this 
program into a successful effort and that changes large and small would 
be needed. We are on the right track but it is time make those changes 
as mentioned earlier.
    Again thank you Mr. Chairman, and members of the Committee, for the 
opportunity to testify on this important issue.

                                 

    Mr. BRADY. Thanks for racing through that and giving us a 
lot of good information. Tom?

 STATEMENT OF TOM FORAN, VICE PRESIDENT, INTEGRATED DISABILITY 
            RESOURCES, INC., BLOOMFIELD, CONNECTICUT

    Mr. FORAN. Thank you. I represent IDR. We are the EN that 
Ms. Hancock worked with. I would like to share with you some of 
our experiences with the ticket program to date which is a bit 
of a good news/bad news scenario. Currently, we have about 162 
active tickets from 30 different States. We are negotiating 
ticket assignments with an additional 400 beneficiaries. We 
have 65 people currently employed, 35 of them over SGA. We are 
on target to return an additional 120 beneficiaries back to 
work by the end of 2004. We have received over 5,000 inquiries 
from beneficiaries interested in returning to work and we have 
invested over $1.3 million into the ticket to Work Program 
structure to allow us to handle a large number of 
beneficiaries.
    On the bad news side, we have earned about $50,000 in 
payments to date. We have only been paid about $22,000. We have 
several outstanding payments due from November of 2002. We 
spend in many instances as much in time and energy to collect 
our first payment as the first payment amount. Administrative 
drag can be mind-numbing at times. Due to the negative cash 
flow and the administrative burden that we experience on a day-
to-day basis, we have had to turn away over 4,000 beneficiaries 
who wanted to return to work that we just could not afford to 
provide services to.
    Without some change in the payment structure and the 
administration of the program, we may be forced to shut down in 
the near future, at least for beneficiaries who our only source 
of revenue is from the Ticket to Work Program. However, given 
all that, we do think this program has tremendous potential. 
You heard this morning from individuals who have been served 
already. We are regularly serving folks. This is an exciting 
program. It really hurts my staff personally to have to turn 
people away. They get very, very upset with me when I tell them 
we can't work with certain folks.
    We fully support the recommendations that were laid out in 
the Ticket to Work and Work Incentives Advisory Panel report, 
``The Crisis in EN Participation: A Blueprint for Action.'' We 
would actually suggest taking the recommendations a step 
further by implementing the payment structure that was outlined 
from the Adequacy of Incentives Group in the interim report 
from September of 2003, basically moving about 25 percent of 
the payments into the first year of service, which is when the 
majority of expenses are incurred.
    We feel the key to success of this program is really 
basically a demand and supply issue. The first piece, 
obviously, is creating demand amongst beneficiaries for return 
to work services, and Susan Webb will be talking a bit more 
about that. So, I am not going to touch on that right now. On 
the supply side, we currently have over 1,000 ENs. However, 
only about a third of them are actively taking tickets and I 
would like to know what the definition of actively taking 
tickets is. If it is one or two tickets, I would not call that 
being an active EN.
    Two critical issues that we have already heard today are, 
one, the amount and the duration of the negative cash flow that 
is created. As I said before, we have invested over $1.3 
million and we have only earned about $50,000. If we shut down 
today and only served the people that we would be working with 
and they were successful in returning to work or remaining at 
work for the full 60 months, we probably would be almost close 
to break even, but trying to convince an investor to wait 60 
months is a pretty hard thing to do. They get very impatient.
    The other issue is the lack of access to capital for ENs. 
Typically, an EN has no collateral to take to a bank and get a 
loan. Additionally, the risk is too great, the negative cash 
flow too high, and there is no history to the program to show 
demonstrated success to attract venture capital. Our suggestion 
would be, one, to adopt the changes in the payment structure. 
Two, create some type of loan guarantee program or tax credit 
program whereby investors who take the risk in this program are 
rewarded down the road with tax credits.
    There are many other improvements that can be made to this 
program. However, without addressing these two critical issues 
for ENs, which is really the supply side of the whole equation, 
addressing those issues is tantamount to fixing or setting an 
individual's broken leg after an accident when they are 
actually in cardiac arrest. The ENs will not be here 6 months 
from now. I know I won't be. I don't think Susan Webb will be 
if some changes aren't made soon. I think this would be a 
tremendous loss to the program, to have the experienced ENs who 
have already gone through the process drop out of the programs 
because they can no longer fund it.
    Some of the other suggestions we have are, again, 
increasing the administrative efficiency. Help Maximus change 
their focus from purely recruiting new ENs, that ultimately 
don't become active, into the system, to making the existing 
ENs successful. I think that is a critical thing. Reducing the 
administrative drag, increasing the efficiencies, increasing 
the supports to them. Educating beneficiaries on the quality 
active status of ENs. Right now, a beneficiary gets a list of 
about 20 to 30 ENs that are serving their area with no idea 
whether those ENs are actually taking tickets or what their 
track record is. I don't look at that as choice. I look at that 
as a bunch of phone calls that a beneficiary has to make and 
just get disappointed over and over again.
    So, in conclusion, if we can provide more information to 
the beneficiaries about what is out there and provide them with 
successful ENs, I think you will start seeing a significant 
amount of momentum being generated, and again, success always 
breeds success. Thank you very much.
    [The prepared statement of Mr. Foran follows:]

     Statement of Tom Foran, Vice President, Integrated Disability 
                Resources, Inc., Bloomfield, Connecticut

    Thank you for the opportunity to provide testimony today. 
Integrated Disability Resources (IDR) is one of the largest national 
Employment Networks (EN). IDR's experience with the Ticket to Work 
program to date is a good news/bad news story.
    The good news is, we:

      Have 161 active tickets assigned from beneficiaries in 30 
different states
      Are negotiating ticket assignment with over 400 
additional beneficiaries
      Have returned 65 beneficiaries (40% of active tickets) to 
work with 35 of them already over SGA
      Are on target to return an additional 120 beneficiaries 
to work by 12/31/2004
      Have invested over $1,300,000 in the TTW program to date
      Have received over 5,000 inquiries from beneficiaries 
interested in returning to work

    On the surface, this appears to be a very successful program. 
However, without some significant changes in the program's design and 
administration we will be forced to stop accepting tickets resulting 
from new inquiries, which of course is the bad news side of our story. 
Given our success rate in helping individuals return to work, this 
would also be bad news for the SSA. To date, we:

      Have earned only $50,000 compared to the $1,300,000 
investment mentioned above. Of this $50,000
          $7,000 is on beneficiaries who will not provide us 
with their pay stubs
          $21,000 has been received from Social Security
          $20,000 is due from Social Security much of this has 
been outstanding for three to twelve months or longer (as of our last 
EN payment report from Maximus we have 2 open requests for payment that 
are with the SSA field office from November of 2002)
      .Often have had to spend more money in staff wages to 
physically collect the first payment than the amount of the payment 
itself.
      Have spent an enormous amount of time managing 
unrealistic beneficiary expectations (e.g. ``buy me a $100,000 tractor 
trailer'' or ``pay for my college education'')
      Have experienced an incredible amount of ``administrative 
drag'' that requires us to spend valuable resources dealing with 
Maximus and or the SSA, instead of helping beneficiaries execute their 
individual work plans. We suggest implementing:
          On-line access to information from Maximus for:
              Status of a ticket regarding its ability to be 
assigned
              Past history of a beneficiary's ticket to 
determine if multiple ENs will need to share payments
              Status of payment requests
          Automated reimbursement processes
              Currently, each EN must create its own billing 
and ticket tracking system instead of having Maximus maintain one 
online system.
              Follow-ups with SSA field offices are sporadic 
and not automated
              The milestone portion of the payment process 
still requires pay stubs as documentation.
          Have had to ``screen out'' over 4,000 interested 
beneficiaries. Initially, we were willing to work with a much higher 
percentage of interested beneficiaries but have determined that due to 
capital restraints caused by the reimbursement structure and process, 
we need to limit the scope of our program.
          Will soon have to stop working with beneficiaries for 
whom our only source of revenue is the Ticket to Work program. This 
represents about 90% of our active tickets.

    While our situation and current level of participation is tenuous, 
it is important to note that we feel with some relatively moderate 
changes, the TTW program can be a tremendous success for both the SSA 
and its beneficiaries.
    We strongly support the changes suggested in the Ticket to Work and 
Work Incentives Advisory Panel's February, 2004, Advice Report to 
Congress and the Commissioner of the Social Security Administration The 
Crisis in EN Participation--A Blueprint for Action. In fact we 
recommend taking it one step further, and suggest adopting the payment 
system outlined in the Adequacy of Incentives (AOI) Advisory Group's 
September, 2003 Interim Report.
    The AOI Advisory Group suggested moving a significantly greater 
portion of the TTW payments into the first 12 months and decreasing the 
threshold of success for milestone payments to a $600 earnings level.
    Modeling the AOI suggested payment structure revealed that our 
earned revenue to date would have been closer to $80,000. While this is 
still nowhere near our overall investment in the program, it 
dramatically reduces our negative cash flow on any one beneficiary 
allowing us to reinvest in serving more beneficiaries sooner.
    What follows is IDR's perception of the issues diminishing the 
success of the program and our suggestions for change. It is our belief 
that the success of the Ticket to Work program comes down to its 
ability to create both demand and supply.
    Demand for return to work services must be created within the 
beneficiary population. Once created, there needs to be an adequate 
supply of return to work services from quality employment networks.

Demand
    Experience has shown us that the mailing of tickets to 
beneficiaries creates a significant amount of interest and demand for 
return to work services. We regularly see a dramatic spike in inquiries 
for services from beneficiaries seven to fourteen days after each batch 
of ticket mailings.
    For states in which the mailings are completed (phase one and two 
states) we see a drop in the volume of inquiries that correlates 
closely with the amount of time since the last mailing.
    Given the success of the mailings to date, we suggest regular re-
mailings to beneficiaries encouraging them to consider returning to 
work. These mailings could be as simple as a postcard including success 
stories and reminding them of the incentives in place to help them in 
the return to work process.
    For EN's that are limited to serving phase one and two states, the 
time to execute these re-mailings is now. Without them, the few 
successful ``local'' EN's may go out of business.

Supply
    While the demand for return to work services appears to be 
relatively easy to create, the supply is critically low. In general, 
beneficiaries tend to identify the list of EN's serving their area and 
begin contacting EN's at the top of the list (typically an alphabetical 
listing) to see what is available.
    IDR is typically mid-way through an alphabetical listing of 30 to 
50 EN's serving a beneficiary's area. By the time they get to us, 75% 
of the beneficiaries are completely frustrated by the process. With 2/3 
of EN's listed not actively taking tickets, a beneficiary has typically 
received no response from 12 to 30 EN's before reaching IDR!

Supply Issues
    The overwhelming issues driving EN's to either stop or never begin 
serving beneficiaries are:

      The negative cash flow created by the current program 
design; and
      The lack of access to working capital.

    Most EN's do not have the collateral to qualify for a loan and the 
payback time, lack of historical results and overall risks are too 
great to attack venture capital.

The Solution
    To ensure an adequate and effective supply of return to work 
services for motivated beneficiaries the negative cash flow and overall 
risk to EN's needs to be dramatically reduced, while increasing access 
to working capital. Implementing the AOI Advisory Group's suggested 
payment structure, or something similar, will go along way in reducing 
the negative cash flow issue.
    Access to capital can be accomplished through the use of loan 
guarantees and or tax credits for qualified investments in the TTW 
program. For example, the State of Connecticut has a program in place 
that provides a dollar for dollar tax credit to investors that invest 
in new businesses that create insurance jobs within the state.

Other Suggested Improvements

      Providing more information and/or education to 
beneficiaries would facilitate greater participation in the program and 
help improve its overall effectiveness. Areas of concern are:
          Each EN's status in regard to its ability to accept 
new tickets and its track record in serving beneficiaries
          What a beneficiary can expect from an EN
          Clarity regarding the types of return to work 
services to expect from and EN. We have found that many individuals 
request unrealistic programs, such as funding a four-year college 
education or the purchase of a $100,000 tractor-trailer, and feel that 
managing expectations would improve the success of the program and save 
time on the part of the EN.
      Change Maximus' focus from recruiting more EN's to making 
the existing EN's more successful, which will in turn make recruiting 
EN's easier. Areas to consider are:
          Improve the administrative efficiency of the program 
with more on-line reports and processes
          Provide training by successful EN's to inactive EN's 
improving their likelihood of success
          Establish and support regional EN associations to 
foster communication and the sharing of best practices
      Congress should set a clearly defined target for reducing 
the Social Security roles and identify the entities that are 
accountable for attaining this goal. We suggest setting the goal for 
job placements at a minimum range of 5 to 10% of the current 
beneficiary population with incentives in place for success above this 
level.

    Thank you again for the opportunity to testify today.

                                 

    Mr. BRADY. Thank you, sir. Quintin, welcome. The microphone 
is yours, sir.

   STATEMENT OF QUINTIN M. MITCHELL, DIRECTOR, VR SERVICES, 
             RICHMOND AREA ARC, RICHMOND, VIRGINIA

    Mr. MITCHELL. Thank you. I am Quintin Mitchell. Thank you 
for the opportunity, Mr. Chairman. I am Director of 
Rehabilitation Services for Richmond Area ARC in Richmond, 
Virginia. Our agency became a--upon reviewing the Ticket to 
Work incentive, one of the motivating factors of ARC to become 
an EN was having the opportunity to provide employment services 
to individuals who want to work and become self-sufficient, 
additionally, provide a non-traditional referral base to ticket 
holders or individuals who have the appropriate skill set to 
filing the positions we have open and other jobs in the 
community.
    Our agency has traditionally serviced the Mentally Retarded 
population. However, other areas of service provision includes 
individuals with diagnoses of mental illness, autism, 
developmental delay, brain trauma, and individuals with 
physical disability. Our agency's NISH contracts have provided 
the opportunity to service a vast array of individuals. 
Individuals' backgrounds include undergraduate and graduate 
degrees as well as persons who are Ph.D. candidates. When 
positions become available within our organization, individual 
ticket holders are encouraged to apply when their skill set 
matches the advertised position.
    Since ticket participants don't have to use their tickets, 
we have found that those who elected to do so really have the 
incentive to work because they aren't forced to. There are many 
participants who want to get off the benefit rolls and this 
desire benefits not only participants, but also other sources, 
as well. Employees who are in need of skilled, reliable 
employees, ENs who have the resources to provide employment and 
other related services, and the reduction of benefits being 
paid out by SSA are all win-win situations.
    Richmond ARC's initial experience with the Ticket to Work 
Program was that of being bombarded by ticket holders wanting 
employment services. We began providing services in March of 
2003. To date, we have screened over 340 calls from individuals 
who wanted us to provide employment services. While this may 
not be an astronomical number by comparison with other ENs, 
however, in Virginia, we have billed for the most milestones, 
which is 15, which Tina Chang, Financial Director for Maximus, 
provided me with the information the day before yesterday.
    We have accepted and have been assigned so far, 90 ticket 
holders. Holding orientation twice per month at two locations 
has resulted in meeting the needs of individuals who don't have 
the means to come to our facility. As of this date, the need to 
conduct intakes more frequently has resulted in weekly one-on-
one consultations as well as screenings. In order to meet the 
various needs of the ticket holders, we have elected to 
implement features in the orientation to expedite the process. 
Initially, as tickets began to roll out in Virginia, calls 
jammed the switchboard. Now all inquiries are routed either to 
the employment specialist or me with an extension just for 
ticket holders. ARC makes it a policy to return calls promptly.
    Additionally, recruitment is not limited to just call ins. 
We also are viewing the monthly disk of ticket holders that 
Maximus supplies and send letters of introduction to a random 
sampling of the unassigned ticket holders, specifying what 
services we provide and inviting them to an orientation. 
Employment specialists also post flyers at the local SSA office 
or to the Metro Richmond networking meeting, participates in 
focus groups and job fairs, and have been fortunate enough to 
be the recipient of marketing expertise by the leadership of 
Metro Richmond organization. Additionally, an advertisement is 
placed in the Employment Guide publication by our agency at our 
expense.
    It should also be noted that no additional staff was hired 
in order to meet the undertaking. Even though no additional 
staff was hired, the ARC still meets the presenting needs of 
all inquiries and works toward effectively and efficiently 
addressing areas of concern that most have about their benefits 
and how they may be affected. Maximus has provided much support 
and endless help in maneuvering through the maze of red tape we 
have encountered in many instances.
    While there are many positives in the Ticket to Work and 
Self-Sufficiency Program, there are also obstacles that impede 
and deter ticket holders from participating in this program. 
Unfortunately, some ticket holders have elected, after having 
gone through the screening, the interviewing, counseling, 
placement on the job, to leave their jobs in some cases, decide 
against being employed at all because of the lack of critical 
information having been provided to them by SSA.
    It has been our experience that most ticket holders are 
unaware of the most basic information concerning their benefits 
and how they can be affected and/or knowledge of work 
incentives. This information now has become part of our 
orientation process when we meet with the ticket holder.
    Some of the problems that impede and interrupt the 
provisions of services for our agency to the ticket holders 
revolve around the lack of information provided to them by the 
SSA. A few examples that we have encountered and continue to 
encounter are SSA has provided inaccurate and sometimes 
inconsistent information to the ticket holders. An example is a 
ticket holder was told that there was an application for the 
1619(b) by an SSA individual but they couldn't find it, while 
another person told the ticket holder there was no such 
application.
    Inconsistency of providing EN payment processing report so 
as not to know the status of receiving payment for services 
already rendered. ticket holders who have been working before 
contracting services with our agency have not been informed 
that they were required to turn in their pay stubs. This lack 
of information causes the individual to be in overpayment and 
the EN doesn't receive payment. Not notifying beneficiaries 
that they are not eligible for benefits, but a check is still 
mailed and/or deposited in the beneficiary in overpayment. The 
lack of advertising or marketing in the SSA office about the 
Ticket to Work Program. Our agency has taken initiatives to go 
down to the SSA buildings and place flyers and posters at our 
own expense.
    The Ticket to Work Self-Sufficiency Program is a viable 
entity to beneficiaries who want to work. However, identifying 
and rectifying the problems that impede a successful placement 
of individuals in jobs has to be addressed. The potential for 
other agencies becoming an EN is sometimes thwarted by the lack 
of manpower, resources, and investment coupled with the slow 
turnaround time and being paid for the services that they 
provide. Having had the opportunity to provide services to wide 
range of individuals who have the desire and initiative to be 
gainfully employed and the continuation of inquiries regarding 
our employment services are all indicators that the ticket 
program can be a success. In order to facilitate this success, 
it is absolutely essential that all stakeholders work 
collaboratively and consistently.
    In closing, I thank you for this opportunity to share our 
agency's experiences with the Ticket to Work Self-Sufficiency 
Program. It is my hope that after identifying these areas of 
concerns that impact the ticket holder in an adverse manner, we 
can move forward toward a resolution.
    [The statement of Mr. Mitchell follows:]

 Statement of Quintin M. Mitchell, Director, Vocational Rehabilitation 
            Services, Richmond Area Arc, Richmond, Virginia

    Mr. Chairman, Members of the Committee, my name is Quintin M. 
Mitchell and I am Director of Rehabilitative Services for the Richmond 
Area Arc in Richmond, Virginia. Thank you for the invitation for me to 
comment on Social Security Administration's management of the Ticket to 
Work and Self-Sufficiency Program.
    I would like to take a brief moment to provide some background 
information on how our agency elected to become a participating 
Employment Network (EN).
    Upon reviewing the Ticket to Work initiative, one of the motivating 
factors of Richmond Area Arc to become an EN was having an opportunity 
to provide Employment Services to individuals who want to work and 
become self-sufficient. Additionally, it provides a non-traditional 
referral base and the Ticket-holders are individuals who have the 
appropriate skill set for filling positions that we have open, and 
other jobs in the community. Our agency has traditionally serviced the 
M.R. population. However, other areas of service provision includes 
individuals with diagnosis of M.I., autism, developmentally delayed, 
brain trauma and individuals with physical disabilities.
    Our agency's NISH contracts have provided the opportunity to 
service a vast array of individuals. Individual's backgrounds include 
undergraduate and graduate degreed persons as well as Phd. Graduates.
    When positions become available within our organization individual 
Ticket-holders are encouraged to apply when their skill set matches the 
advertised position.
    Since Ticket participants don't have to use their Ticket we have 
found that those who have elected to do so really have the incentive to 
work because they aren't forced to. There are many participants who 
want to get off the benefit rolls and this desire benefits not only the 
participants but other sources as well. Employers who are in need of 
skilled, reliable employees, ENs who have the resources to provide 
Employment and other related services and the reduction of benefits 
being paid out by the Social Security Administration (SSA) are all win-
win situations.
    Richmond Area Arc's initial experience with the Ticket to Work 
Program was that of being bombarded by Ticket-holders wanting 
Employment Services. We began providing services in March of 2003. To 
date we have screened over three (340) hundred forty calls from 
individuals wanting us to provide Employment Services. While this may 
not be seen as an astronomical number by comparison with other ENs, 
however, in Virginia, we have billed for the most Milestones, fifteen 
(15). (Tina Chang, Financial Director for Maximus). We have accepted 
and have been assigned, so far, ninety (90) Ticket-holders. Holding 
Orientation twice per month at two (2) locations has resulted in 
meeting the needs of individuals who do not have the means to come to 
our facility. As of this date the need to conduct Intakes more 
frequently has resulted in weekly one-on-one consultations/screenings.
    In order to meet the various needs of the Ticket-holders we have 
elected to implement features in the orientation to expedite the 
process. Initially, as Tickets began to rollout in Virginia, calls 
jammed the switchboards. Now all inquiries are routed either to the 
Employment Specialist or me with an extension just for Ticket-holders. 
ARC makes it a policy to return all calls promptly. Additionally, 
recruitment is not limited to call-ins of inquiries. We also, after 
viewing of the monthly disk of Ticket-holders, that Maximus supplies, 
sends letters of introduction to a random sampling of the unassigned 
Ticket-holders, specifying what services we provide and inviting them 
to an orientation. Employment Specialists also post flyers at the local 
SSA office, attend the Metro Richmond networking meetings, participates 
in focus groups and job fairs and have been the fortunate recipient of 
marketing expertise by the Leadership Metro Richmond organization. 
Additionally, an advertisement is placed in the Employment Guide 
publication.
    It should also be noted that no additional staff was hired in order 
to meet this undertaking. Even though no additional staff was hired, 
the ARC still meets the presenting needs of all inquiries and works 
towards effectively and efficiently addressing areas of concerns that 
most have about their benefits and how they will be affected.
    Maximus has provided much support and endless help in maneuvering 
through the maze of red tape we have encountered in many instances.
    While there are many positives in the Ticket to Work and Self 
Sufficiency Program there are also obstacles that impede and deter 
Ticket-holders from participating in the program. Unfortunately, some 
Ticket-holders have elected, after having gone through screening, 
interviewing, counseling and placement on the job, to leave their jobs 
and in some cases, decide against being employed at all because of the 
lack of critical information having been provided to them by S.S.A.
    It has been our experience that most Ticket holders are unaware of 
the most basic information concerning their benefits and how they can 
be affected and/or knowledge of Work Incentives. This information, now, 
has become a part of the orientation process when we meet with the 
Ticket-holder.
    Some of the problems that impede and interrupt the provision of 
services, for our agency, to Ticket-holders, revolve around the lack of 
information provided to them by the Social Security Administration. A 
few examples that we have encountered, and continue to encounter are:

    1.  S.S.A. has provided inaccurate and sometimes inconsistent 
information to Ticket-holders. Ex.: Ticket-holder was told there was an 
application for 1619b by S.S.A. but they couldn't find it while another 
person told the Ticket-holder there was no application.
    2.  Inconsistency of providing EN Payment Processing Report so as 
not to know the status of receiving payment for services rendered.
    3.  Ticket-holders, who have been working before contracting 
services with our agency, have not been informed that they were 
required to turn in their pay stubs. This lack of information causes 
the individual to be in overpayment and the EN doesn't receive payment.
    4.  Not notifying beneficiary that they are not eligible for 
benefits, but check is mailed/deposited and beneficiary is in 
overpayment.
    5.  The lack of advertisement/marketing in the S.S.A. office 
building about the Ticket to Work Program.

    The Ticket to Work Self Sufficiency Program is a viable entity to 
beneficiaries who want to work. However, identifying and rectifying the 
problems that impede the successful placement of individuals in jobs 
has to be addressed.
    The potential for other agencies becoming an E.N. is sometimes 
thwarted by the lack of manpower, resources, and investment coupled 
with the slow turnaround time of being paid for the services they 
provided.
    Having had the opportunity to provide services to a wide range of 
individuals, who have the desire and initiative to be gainfully 
employed, and the continuation of inquiries regarding our Employment 
Services are all indicators that the Ticket Program can be a success. 
In order to facilitate this success it is absolutely essential that all 
stakeholders work collaboratively and consistently.
    In closing, I thank you for this opportunity to share our agency's 
experiences with the Ticket to Work Self Sufficiency Program. It is my 
hope that after identifying

areas of concerns, that impact the Ticket-holder in an adverse manner, 
we can move towards resolution.
    Ticket to Work can be a beneficiary's best option.

                                 

    Mr. HAYWORTH [presiding]. Thank you, Mr. Mitchell, for your 
testimony from someone from Virginia. I turn to a fellow 
Arizonan, Susan Webb. Welcome.

      STATEMENT OF SUSAN WEBB, ARIZONA EMPLOYMENT NETWORK 
                 ASSOCIATION, PHOENIX, ARIZONA

    Ms. WEBB. Mr. Chairman from the great State of Arizona, it 
is always good to see you. My name is Susan Webb and I am the 
Director of Arizona Bridge to Independent Living (ABIL) 
Employment Services in Phoenix, Arizona, and I am here today on 
behalf of the Arizona EN Association. I want to thank you for 
the opportunity to testify today on behalf of the association. 
In general, our association agrees with the outcomes and 
recommendations of the EN Summit that was sponsored last May by 
the Ticket to Work Advisory Panel. We believe that several 
issues that were identified during that summit contribute to 
the current lack of participation among ENs nationwide.
    Those issues are, first, high capitalization costs and 
risks; second, inadequate payment structure and pay stub 
processing burdens; third, the need for comprehensive training 
and technical assistance for EN staff; and fourth, the need for 
a national marketing campaign conducted by SSA to motivate 
beneficiaries to contact ENs about the program. We believe that 
all of these issues are equally important and their solutions 
must be implemented concurrently for the ticket program to 
sustain itself and achieve the goals that you, Mr. Chairman, 
were very, very adamant about when this legislation first 
passed. However, my testimony today is designed to focus solely 
on the marketing issues.
    I, however, would remind you, as some of my colleagues have 
been testifying, I feel the need to say that some of the 
information that has come forward, for example, there has been 
$523,000 paid out in payments to ENs nationally, there are 
1,100 existing ENs. We understand about a third are accepting 
tickets in some form. I want to make the point that our little 
agency, 1 EN out of 1,100, has received $71,000 of that 
$523,000 and we have about another $20,000 pending. For one EN 
to be representing that much of the outcome is very disturbing. 
There is something wrong. Even though I feel very fortunate to 
be here to give my opinion, I think that somehow we are in the 
trenches here and I think we need to be heard in terms of what 
we are saying about these four major areas, and they need to be 
solved concurrently and right now. So, I just wanted to make 
that point very strongly.
    Arizona is one of the first 13 States to implement the 
Ticket to Work Program. It is now more than 2 years since the 
tickets were first distributed in our State. I would disagree 
with some of the comments made about--I think Martin Gerry may 
have made this comment, actually. During the initial phases of 
the ticket rollout, there were approximately 27 ENs signed up 
in our State. Today, there are only a handful left that are 
accepting tickets. I talked to one of my colleagues in Tucson 
just before coming here and he told me he accepted one ticket 
last month. Is that an active EN out of the handful? That is 
certainly not going to get those 150,000 ticket holders in 
Arizona off the rolls and back to work.
    We believe the reasons for this statewide rescission are 
several. However, many have simply stopped taking tickets due 
to the lack of sufficient demand by beneficiaries to justify 
maintaining the qualified staff they need to do this work. 
Since the initial ticket mailing, beneficiary inquiries to ENs 
have dropped to just a trickle. They are just not even on the 
radar screen with this anymore.
    I guess this is where I probably want to take issue with 
Martin Gerry, and that is that we are seeing in the trenches, 
honest-to-goodness ENs out there doing this work. As a Center 
for Independent Living, our center since 1981 has served 
primarily people with significant disabilities. Those are not 
the people coming forward in the ticket program. It is the 
people that have job skills and experience and much to offer an 
employer. They are coming forward. They are not the ones that 
go to organizations like ours. They don't go to disability-
related stuff. They don't hang out at the field offices, as I 
believe one of the--in fact, I believe it was Clay Shaw who 
said that, in fact, these people are sitting in their living 
rooms and that is where we need to get to them, hence the 
reason for my testimony today.
    The members of our EN association recognized this problem 
more than a year ago and we decided to pool our resources to 
market the program. We began by making cold calls from the 
compact disk we receive monthly from Maximus. Unfortunately, 
this yielded very, very little return on our investment. 
Beneficiaries refused to talk to us because they thought we 
were telemarketers and they wanted us to take them off our call 
list. Then, those who did talk to us were totally unfamiliar 
with the program and required an average of 15 minutes per 
call, which is very, very expensive for any EN to be able to 
undertake that kind of activity. Even though there is benefit 
to that, it is not a solid return on investment because very 
few of those people end up being actual ticket users.
    We then decided to approach the SSA about a piggyback 
approach. We knew that the SSA was going to be doing something 
and we were very, very pleased that they were very willing to 
work with us and to talk with us, and we have been doing that 
systematically. As a result of those teleconferences we have 
had, we conducted some focus groups and I would have to again 
disagree with my colleague, Paul Seifert, that, in fact, from 
the focus group what came out loudly and clearly was that if 
they get a letter from the SSA, they do read it, even if it is 
only because they fear bad news.
    So, our association recommends the following: that the SSA 
be allocated the resources to send reminder letters or 
postcards about the Ticket to Work Program at least once 
annually and to stagger those in one-twelfths, so, that it 
doesn't create this up front demand and then nothing toward the 
end of the year.
    Second, we believe the notices should direct ticket holders 
to contact their local BPA&O Program and should be specific 
about that BPA&O Program in their area. The reason for that is 
because our local BPA&Os contact which ENs are currently 
accepting tickets and so that beneficiaries are not forced to 
call from a long list of ENs just to be told, ``I am sorry, we 
are not participating anymore.'' Thirdly, we believe that the 
SSA should begin distributing the interim reminders to 
beneficiaries in the year one rollout States no later than June 
this year. Year two States could begin in June of next year, 
and year three States in 2006 if SSA hasn't begun a national 
campaign by that time.
    I want to make one final comment, and that is that we have 
read the statement of work for the 2-year marketing contract to 
Fleischman-Hillard. We believe it is excellent. The problem is, 
2 years will mean 3 and a half years into this program and we 
will only have a pilot done by then. We will be dead in the 
water. We will not be an EN by that time without something done 
in the interim.
    Although I applaud the response from the SSA, I applaud the 
statement of work in that contract, we are a rollout State in 
year one; and last month, I received 24 inquiries from 150,000 
tickets, and we are the number one EN in the country. Something 
has got to be done, and I encourage SSA and this body to work 
together to find the money to do that. Thank you, Mr. Chairman.
    [The prepared statement of Ms. Webb follows:]

   Statement of Susan Webb, Arizona Employment Network Association, 
                            Phoenix, Arizona

    Thank you for the opportunity to provide testimony on behalf of the 
Arizona Employment Network (EN) Association. In general, our 
association agrees with the outcomes and recommendations of the 
Employment Network Summit sponsored last May by the TWWIIA Advisory 
Panel. We believe that several issues identified during that Summit 
contribute to the current lack of participation by ENs nationwide. 
Those issues are 1) high capitalization costs and risks; 2) inadequate 
payment structure and pay stub processing burdens; 3) the need for 
comprehensive training and technical assistance for EN staff; 4) the 
need for a national marketing campaign conducted by SSA to motivate 
beneficiaries to contact ENs about the Ticket to Work Program.
    We believe all of these issues are equally important and their 
solutions must be implemented concurrently for the TTW Program to 
sustain itself and achieve the goals Congress intended when it 
overwhelmingly passed the TWWIIA legislation. However, my testimony 
today will focus solely on the marketing issues.
    Arizona is one of the first 13 states to implement the TTW Program. 
It is now more than two years since tickets were first distributed in 
our state. During the initial phases of ticket rollout there were 
approximately 27 ENs on the approved list. Today there are only a 
handful left who are accepting tickets. There is only one ENs in the 
Tucson metropolitan area accepting only a small number of tickets any 
longer. Tucson is the second largest metro area in our state with more 
than 850,000 residents and 16% of our state's population. We believe 
the reasons for this statewide rescission are several; however, many 
have stopped taking tickets due to the lack of sufficient demand by 
beneficiaries to justify maintaining the necessary qualified staff to 
do so. Since the initial ticket mailing beneficiary inquiries to ENs 
have dwindled to a trickle.
    The members of our EN Association recognized this problem more than 
a year ago. We decided to pool our resources to market the program. We 
began by making cold calls from the CD we receive monthly from MAXIMUS. 
Unfortunately, this yielded very little return on our investment. 
Beneficiaries refused to talk to us and asked us to take them off our 
``call lists'' as they thought we were telemarketers. Those who did 
talk with us were not familiar with the ticket program and required an 
average of 15 minutes per call. While there is value in such calling as 
it certainly gives beneficiaries good information, it does not result 
in solid return on investment for the EN in terms of signed-on, 
qualified ticket users.
    We then decided to approach SSA about a ``piggyback'' approach; 
that is, if SSA did some sort of marketing, our ENs could follow up 
with the necessary contacts. That approach would strengthen SSA's 
marketing efforts and be less resource-intensive for ENs. We are 
pleased that SSA staff has been very responsive to us in this regard 
and we have participated in several teleconferences with them to pursue 
the idea. From those teleconferences our association's marketing 
committee agreed to conduct focus groups among our existing ticket 
users to determine what marketing activities caused or would cause them 
to respond to the program. We completed those focus groups, and our 
final report of the outcomes is attached to this testimony.
    Last September SSA awarded a two-year contract to a marketing firm 
to design a marketing plan. We have reviewed the statement of work and 
believe the end result will be a good one. However, at the end of the 
two-years of that contract, only a pilot program will have been 
completed. There is no time frame stipulated as to when an actual full-
blown national campaign will be implemented. Arizona and the other 
first-year rollout states will have been implementing the ticket 
program for 3\1/2\ years when the pilot is completed. Without an 
effective, interim marketing campaign we fear the TTW program will be 
dead by then.
    Our Association recommends the following:

    1.  SSA should be allocated the resources to send reminder letters 
or post cards about the TTW Program at least once annually to all 
current ticket holders. \1/12\ of the notices should be distributed 
monthly to even out the demand upon MAXIMUS, ENs, BPAOs, PABBS and SSA 
Field Offices. This will ensure better service to beneficiaries.
    2.  The notices should direct ticket holders to contact their local 
BPAO program and should include the specific BPAO contact information 
for their area/state. The BPAOs will track which ENs in their 
communities are currently accepting tickets and will give contact 
information to beneficiaries only for those ENs who have indicated that 
they are currently accepting tickets. The BPAOs should be allocated 
appropriate resources to accommodate this additional demand.
    3.  SSA should begin distributing the interim reminders to 
beneficiaries in the year-one rollout states no later than June of this 
year. Year two states could begin in June of next year and year three 
states in June of 2006 if there is no comprehensive, national marketing 
campaign developed and implemented by that time.

    We believe an interim plan as outlined above will have the 
following benefits:

    1.  Rekindle beneficiary demand and interest in the Program. The 
initial mailing generated significant inquiries from beneficiaries. We 
believe periodic reminders will generate at least as much response and 
will capture potential participants who might not have been ready to 
work during the initial rollout.
    2.  Increased beneficiary demand could create interest by ENs to 
accept tickets again, thus improving the choice among providers as 
originally envisioned by Congress.
    3.  Periodic reminders will help beneficiaries accept the ``new'' 
SSA culture that Social Security Disability programs are not early 
retirement, but are in fact offering ways for individuals and their 
families to become self-supporting.
    4.  Provide TTW Program information in beneficiaries' living rooms 
rather than requiring them to go to disability-related or public 
service-related locations to get the information. Our focus group 
respondents stressed the fact that they always read mail they get from 
SSA, even if it is only because they fear bad news.
    5.  Having local BPAOs be the initial point of contact will relieve 
that burden from MAXIMUS and will take advantage of the excellent 
training and skills that have been demonstrated by the BPAOs across the 
country.

    In conclusion, I am posing a question to the Social Security 
Subcommittee that I have asked many times and have yet to receive an 
answer:
    If Binder and Binder and other social security attorneys can 
advertise on TV day in, day out, over and over about getting people 
ONTO benefits, why can't SSA advertise at least as often to get people 
OFF benefits? This is especially puzzling since the money that pays for 
those attorneys' ads comes directly from the SSA Trust Fund.
    Once again, on behalf of the Arizona Employment Network Association 
we thank you for the opportunity to comment.

                                 

    Mr. HAYWORTH. I thank you very much for your testimony, 
Susan. Now we turn to Mr. Coburn.

    STATEMENT OF JOHN V. COBURN, STAFF ATTORNEY, HEALTH AND 
            DISABILITY ADVOCATES, CHICAGO, ILLINOIS

    Mr. COBURN. Thank you, Mr. Chairman. Thank you for the 
opportunity to share our organization's recommendations on how 
to improve the Ticket to Work Program. I actually as I got up 
here realized going last, I get to tie up some of the loose 
ends and get us going so that we can continue on.
    The Health and Disability Advocates is my employer and they 
are the convener of the Midwest Employment and Training 
Partnership. The Partnership currently has roughly 80 active 
members and is comprised of employment and training service 
providers participating in the Ticket to Work Program in Region 
V, which includes Illinois, Indiana, Michigan, Minnesota, Ohio, 
and Wisconsin. Also participating in the Partnership are the 
SSA-funded BPA&O projects and the Protection and Advocacy for 
Beneficiaries of Social Security projects.
    As you might suspect, our first policy recommendation is to 
enhance the payment system for ENs. This is key to the 
viability of this program, and you heard on the panel today 
that recommendation. The Partnership fully endorses the 
recommendations of the Adequacy of Incentives Advisory Group 
and the EN Summit which is mentioned in the panel report you 
received. Second, the Partnership strongly recommends that SSA 
abandon its sub-regulatory Transmittal 17 and completely 
disconnect cost reimbursement to State VR agencies from ticket 
assignment. This is a clear point that I want to make today. We 
believe that this policy is directly contrary to the intent of 
Congress and the authorizing statute. State VR agencies rely on 
a projected amount of SSA reimbursement as a base for their 
annual budgets. As a result of Transmittal 17 and SSA policy, 
many State VR agencies have been put into the position of 
having to aggressively seek tickets from beneficiaries just to 
meet their annual budget.
    I think this explains the enormous differential, with 90 
percent VR ticket assignment and 10 percent private EN, along 
with the payment system. I think it also, I suspect, may 
account for the increase recently in ticket participation. I 
think that the State VR agencies have been assigning more 
tickets and I would submit that we need to look into that to 
see, is it that there are more ticket participants coming 
forward to participate in this program, or has the State VR 
agency under Transmittal 17 submitted the tickets for 
assignment, and that is accounting for the increase.
    The problem with not separating cost reimbursement from the 
ticket assignment is that you have a system right now as it 
stands with these statistics that 10 percent of the 
beneficiaries are participating in, which is the system 
Congress intended to create, a system that is designed to 
assist beneficiaries in leaving the Social Security rolls. The 
other 90 percent are potentially--we don't know--participating 
in the pre-Ticket Act cost reimbursement system, which does not 
have as its ultimate goal the leaving of the beneficiary rolls. 
Cost reimbursement has a different standard for payment. If 
this continues, the Ticket Act will never come close to 
reaching its goal of doubling the number of beneficiaries 
leaving the Social Security rolls because of employment.
    Another recommendation from our Partnership which was 
mentioned today is that SSA has to immediately address this 
problem with overpayments. We heard testimony today about how 
long it is taking on claims administration. I think that 
Maximus and SSA have been doing a good job on their part in 
claims administration by passing some new policies that deal 
with quarterly reporting. However, in order to get paid, that 
still has to go through the SSA reporting system at the local 
offices, which still is not modernized and still is not up to 
date in all circumstances.
    The Partnership recognizes that SSA is working toward 
modernizing the current worker reporting system and that this 
will take time. In the interim, SSA can make minor operation 
changes to speed up this process. We heard mention today about 
the recently retooled Work Incentive Liaison in the local SSA 
offices. The Partnership believes that it should become a 
specific job duty of each of these Work Incentive Liaisons to 
take the ticket participant work histories and work on those 
cases. The Partnership also recommends that SSA set up a system 
for itself where claims with proper documentation have a 30-day 
turnaround in order to keep them viable.
    Since launching the Midwest Employment and Training 
Partnership in June of 2003, Health and Disability Advocates 
has received an overwhelming number of requests for training or 
technical support from employment service providers on topics 
ranging from what is the ticket program, what are these 
regulations, how does this work, to requests for assistance in 
building a service model that ensures successful and 
financially feasible participation in the Ticket to Work 
Program. Fortunately, we do have some private foundation 
funding to do some of this, but our limited funding will not 
meet this need. Based on this experience, the Partnership 
recommends that a technical assistance and training system 
built off of the current existing SSA-funded technical 
assistance and training systems be created.
    Finally, I want to briefly mention the Chicago Ticket to 
Work Pilot Program that we are going to be starting here in a 
few months. We created this pilot and secured funding for it 
from the City of Chicago and the Illinois Division of 
Rehabilitation Services. The pilot is designed to demonstrate 
to you as a committee, SSA, and others how an adequate payment 
system with up front funding can result in the positive 
outcomes that the Ticket to Work legislation intended. The 
project's payment system is based upon and resembles the up 
front payment system recommended by the AOI Advisory Group and 
the EN Summit. We have created this project to put into action 
what everybody has been saying about the payment system, and we 
hope that SSA will follow our lead. Thank you.
    [The prepared statement of Mr. Coburn follows:]

    Statement of John Coburn, Staff Attorney, Health and Disability 
                      Advocates, Chicago, Illinois

    Chairman Shaw and Members of the Committee--
    I thank you for the opportunity to share our organization's 
recommendations on how to improve the Ticket to Work program. I work 
for the Health & Disability Advocates, a national policy and advocacy 
group headquartered in Chicago, Illinois. The Health & Disability 
Advocates (HDA) is the convener of the Midwest Employment and Training 
Partnership (Partnership). The Partnership currently has roughly 80 
active members and is comprised of employment and training providers 
and state Vocational Rehabilitation agencies (VR) that are 
participating as Employment Networks (ENs) in the Social Security 
Administration's (SSA) Region V, which includes Illinois, Indiana, 
Michigan, Minnesota, Ohio and Wisconsin. Also participating in the 
Partnership are the SSA-funded Benefits Planning Assistance & Outreach 
(BPAO) and Protection & Advocacy for Beneficiaries of Social Security 
(PABSS).
    Today I am going to share with you policy recommendations developed 
by the Partnership. I will also talk to you about the Chicago Ticket to 
Work Pilot, a project that our organization has developed to 
demonstrate a more integrated and responsive payment model for 
Employment Networks.
    As you might suspect, our first policy recommendation is to enhance 
the payment system for Employment Networks. You will hear from many 
today about the need to change the payment structure, so I will not 
dwell on this in my testimony. The Partnership fully endorses the 
recommendations of the Adequacy of Incentives Advisory Group for 
structuring the payment system on gross wages, with some payment upon 
job placement, and allowing payment for partial self-sufficiency. It is 
our belief that you will never get adequate participation from 
employment and training providers outside of the traditional state 
vocational rehabilitation model without changing the current payment 
system. The current payment structure provides no financial incentives 
for providers to become active ENs. Until the Ticket Work Program 
payment structure is on par with how state vocational rehabilitation 
services are funded and how services under the Workforce Investment Act 
are funded, the Ticket to Work Program will always be subpar.
    As our second policy recommendation, the Partnership strongly 
recommends that SSA change how it compensates state VR under the Ticket 
to Work Program. The current SSA policy--explained in SSA Transmittal 
17--often only allows cost reimbursement to state VR agencies on those 
cases in which individuals have assigned their Ticket to that state VR 
agency. We believe that this policy is directly contrary to the intent 
of Congress and the authorizing statute.
    State VR agencies rely on a projected amount of SSA reimbursements 
as a base for their annual budgets. As a result of Transmittal 17, many 
state VR agencies have been put into the position of having to 
aggressively seek Tickets from beneficiaries just to meet their annual 
budget. This creates an employment and training services environment 
where state VR is given little or no encouragement, nor reward, for 
creating innovative partnerships with other employment training service 
providers or the private sector.
    The numbers bear this out--there are 3,978 (10%) beneficiaries 
participating in a system that Congress intended to create, a system 
that is designed to assist beneficiaries in leaving the Social Security 
roles. The other 36,972 (90%) beneficiaries are potentially (and most 
likely) participating in the pre-TTWWIIA cost reimbursement system, a 
system that does not base payment upon assisting a beneficiary in 
leaving the roles. If this continues, TWWIIA will never come close to 
reaching its goal of doubling the number of beneficiaries leaving the 
Social Security roles because of employment.
    Our next policy recommendation is that the SSA immediately address 
the inadequacy of its work reporting system to eliminate problems with 
overpayments. The work reporting system must be drastically improved to 
assure the maintenance of up-to-date records on work history. If it 
does not improve, Employment Networks can face significant payment 
delays. It only takes a few experiences with payment delays and 
complications for a service provider to decide continued participation 
in the Ticket to Work Program is not worth it. In addition, problems 
with this work reporting system continue to discourage beneficiaries 
from seeking employment, which diminishes interest in seeking services 
from the Ticket to Work Program.
    The Partnership recognizes that SSA is working toward modernizing 
the current work reporting system and that this will take time. Prior 
to achieving full modernization, the Partnership believes SSA can make 
minor operation changes to improve EN claims administration. We suggest 
that SSA give the recently re-tooled Work Incentives Liaisons in the 
local SSA offices the specific job duty of maintaining ticket 
participant's work activity. Upon assignment of a ticket, the EN should 
be notified of the name and contact information of the local Work 
Incentive Liaison assigned to that ticket holder's case. With this 
information, the EN could follow up with the local Work Incentive 
Liaison if payment is not made in a timely manner. The Partnership also 
recommends that SSA provide payment on EN claims with proper 
documentation within 30 days of submission.
    The last recommendation I will share with you today deals with the 
lack of technical assistance and support available to those Employment 
Networks currently trying to make a success of the Ticket to Work 
program. Since launching the Midwest Employment and Training 
Partnership in June of 2003, HDA has received an overwhelming number of 
requests for training or technical support from employment service 
providers on topics ranging from the Ticket to Work Program regulations 
to building a service model that ensures successful and financially 
feasible participation in the Ticket to Work Program. Fortunately, we 
have private foundation funding to do some of this, but our limited 
funding will not meet the need. Based on this experience, the 
Partnership recommends that a technical assistance and training system 
built off of the existing SSA-funded technical assistance and training 
system be created. The system must be built on a regional and local 
level so that employment service providers can receive services without 
extensive travel costs and lost staff time. Such a model will also 
foster information sharing and replication of promising practices among 
ENs.

Chicago Ticket to Work Pilot
    I will use the balance of my time to talk the Chicago Ticket to 
Work Pilot Project designed to demonstrate to you, SSA, and others how 
an adequate payment system can result in the positive outcomes that the 
TWWIIA legislation intended. Health & Disability Advocates and other 
members of the Partnership have successfully engaged the Chicago 
Mayor's Office for People with Disabilities, Chicago Mayor's Office of 
Workforce Development, and the Illinois Department of Human Services--
Division of Rehabilitation Services to pilot an up-front payment system 
for ENs in the city of Chicago.
    The Chicago Ticket to Work pilot is slated to begin in April or May 
of 2004, and will be the only project of its kind in the country that 
combines municipal and state dollars. The purpose of this pilot is to 
demonstrate a payment system that provides ENs with guaranteed payment 
within the first year of placement, encourages active participation by 
ENs and, more importantly, results in successful transitions to self-
sufficiency. The Pilot Project will be implemented as follows. Through 
a neutral application process, three ENs serving residents of Chicago 
will be chosen to participate in the Project. These three ENs will be 
eligible to receive payment on 8 to 10 of their assigned tickets. Upon 
placing one of these ticket holders in competitive employment, the EN 
will receive $2000. After 6 months of successful placement, the EN will 
receive another $2000. Upon completion of one year of successful 
employment, the EN will receive $1000. After this, the Employment 
Network will continue to be paid by the Social Security Administration 
through the current payment system.
    Each EN will be assigned to work closely with one of the Department 
of Labor/Social Security Administration-funded Disability Program 
Navigators (DPN) and/or the Department of Labor-funded Work Information 
Navigator (WIN). The DPN and/or WIN will provide recruitment and 
referral services to the EN. The EN will only be paid under the Pilot 
Project for tickets assigned as a result of a referral from the DPN 
and/or WIN. Through this requirement, the Project hopes to build new 
and lasting relationships between the Employment Network and the One-
Stop Center system.
    Many stakeholders and experts have stated that the payment 
structure needs to change for TWWIIA to meet its goals. We have created 
this Project to put into action what so many have said and hope that 
SSA will follow our lead.
    Mr. Chairman, and members of the committee, I thank you for your 
time and welcome any questions you may have.

                                 

    Mr. HAYWORTH. Thank you, Mr. Coburn. I appreciate that you 
appreciate the importance of going last and the advantage of 
tying everything up. All of you on this third panel should 
know, and I think you do after listening to the discussion 
today, your testimony, all of your testimony, is very important 
to us and was used to inform us as we brought your issues to 
Mr. Gerry and Mr. Justesen. As we continue to move through this 
process to the implementation and to ensure the effectiveness 
of Ticket to Work, we will be continuing to monitor and be 
calling on you again in the future, because we are at a 
critical juncture in this program. Your testimony today is very 
much appreciated and we thank you for it. With that, this 
hearing of the Subcommittee on Social Security is adjourned.
    [Whereupon, at 12:52 p.m., the hearing was adjourned.]
    [Questions submitted from Chairman Shaw to Mr. Gerry, Mr. 
Justesen, Mr. Foran, Mr. Mitchell, and Mr. Coburn, and their 
responses follow:]

    Questions from Chairman E. Clay Shaw, Jr. to Mr. Martin H. Gerry

    Question: Why are 90 percent of tickets being assigned to State VR 
(VR) agencies and only 10 percent to Employment Networks (ENs)? The 
Subcommittee has heard concerns about the payment system for ENs since 
the SSA first proposed it over 2 years ago. When will the SSA address 
this and how?
    Answer: Section 1148(h)(5) of the Social Security Act requires the 
Commissioner to review the EN payment systems and alter them to better 
provide incentives for ENs to assist beneficiaries to enter the 
workforce, while providing for appropriate economies. Based on this 
authority, we are considering changes in the payment system.
    The SSA also h as taken aggressive steps to address the need to get 
timely payments to ENs by establishing a Certification Payment Request 
Process. The Certification Payment Request Process allows ENs to submit 
a signed written statement that the ticket holder's work and earnings 
are sufficient to warrant outcome payments, in lieu of having to 
provide proof of the ticket holder's earnings. ENs can request payments 
under the Certification Payment Request Process after a ticket holder 
meets specific work requirements and has achieved a level of earnings 
from employment to qualify an EN for outcome payments. This new process 
can be used either on a monthly or quarterly basis. SSA will pay 
outcome payments based on the EN's certification, unless our records 
indicate that the ticket holder is receiving cash disability benefits.
    Question: A procedural directive, known as ``Transmittal 17'' from 
the SSA requires VR agencies to be assigned a ticket before they can 
receive any reimbursement for costs from the SSA. Many argue that this 
requirement denies ticket holders the right to make an informed choice. 
Also, since the budgets of VR agencies often rely on income from the 
SSA, many believe that VRs are aggressively seeking ticket assignments, 
rather than creating partnerships with ENs so that beneficiaries can 
receive services from both a State VR provider and an EN. What is the 
SSA doing to resolve this issue?
    Answer: The operating guidelines issued to the State VR agencies in 
Transmittal Number 17 are based on the policies in the Social Security 
Regulations. The Social Security Regulations require that each State VR 
agency must participate in the Ticket to Work Program by accepting 
ticket assignments if it wishes to receive payments from SSA for 
serving beneficiaries who are issued tickets. (A State VR agency can 
receive payment under the cost reimbursement system for the cost of 
reasonable and necessary services provided to a beneficiary who has not 
been issued a ticket.) This ensures that all beneficiaries with tickets 
receiving services from State VR agencies will receive the same 
protection from continuing disability reviews based on their employment 
that are provided to beneficiaries receiving services from ENs.
    The pamphlet that we provide to beneficiaries with their tickets 
allows them to make an informed choice by explaining that they will be 
assigning their tickets when they sign a plan. Beneficiaries also 
receive a letter after they assign their ticket. This letter tells them 
their ticket has been assigned and includes a fact sheet with 
information about continuing disability review protection. In addition, 
a beneficiary whose ticket has been assigned to a State VR agency 
retains the opportunity under the Social Security Regulations to choose 
to unassign the ticket and reassign it to receive services from an EN.
    We are working with the Rehabilitation Services Administration to 
foster better partnerships between the State VR agencies and ENs when 
they provide services to beneficiaries with tickets.
    Question: Given that less than 1 percent of disabled beneficiaries 
return to work, it is easy to understand why field office staff in 
1,800 offices across the country, buried in other work, can't stay 
current with their understanding of how work and work incentives affect 
benefits. Given advances in technology, why doesn't the agency 
centralize expertise in a cadre of experts to ensure beneficiaries get 
the right answer the first time? Couldn't these individuals also help 
address work reports to avoid overpayments?
    Answer: Since the Ticket to Work and Work Incentives Improvement 
Act was implemented, SSA has worked to establish a corps of trained, 
accessible, and responsive specialists within the agency who specialize 
in disability work incentives. At the Regional level, the Plan for 
Achieving Self Support (PASS) cadre members have been participating in 
this effort, along with Public Affairs Specialists and other field 
personnel.
    In May 2003, the Area Work Incentives Coordinator (AWIC) position 
was established. The AWIC position is a full-time permanent position 
and is part of SSA's approach to assist beneficiaries with disabilities 
to obtain accurate and timely information regarding work, and to 
expeditiously process work reports and other disability work-issue 
workloads.
    Work Incentives Liaison (WIL), located directly in local offices, 
train all direct-service personnel on SSA's disability employment 
support programs. WILs have the technical background to provide 
improved service and information related to SSA's employment support 
programs to SSA beneficiaries, applicants, advocates and service 
providers.
    The SSA has ongoing automation enhancements directed to improving 
work incentive workloads. SSA is currently in the process of 
implementing an application called eWork, which will enable SSA to 
provide better, more timely service by consolidating work reporting and 
documentation on one, universally available system. eWork will also 
generate a work report receipt and provide improved management 
information, workload controls and processing tools for work incentive. 
Our automation enhancements c ombined with our establishment of a 
network of experts will help ensure work reports will be addressed 
timely, thereby avoiding overpayments.
    Question: The Ticket Advisory Panel recommends that Congress 
clarify in law that the ticket program should be used as a 
supplemental, rather than a substitute-funding source. In other words, 
that Congress did not intend to make beneficiaries ineligible for the 
full range of services from VR programs, Medicaid, or other Federal and 
State programs by making them eligible for the ticket program. Can you 
provide more details about the genesis of this recommendation and your 
reactions to it?
    Answer: The Ticket to Work and Work Incentives Advisory Panel has 
noted that services and supports provided under other programs should 
be combined with, rather than offset by, services and supports provided 
by the Ticket to Work Program. They also reported that some ENs have 
chosen not to participate in the Ticket to Work Program because they 
are uncertain about whether and how they can use funds from these other 
sources to service ticket holders. We are working with other agencies, 
including the Rehabilitation Services Administration and the Centers 
for Medicare and Medicaid Services, to ensure that the guidance they 
provide is clear and does not unnecessarily restrict the use of their 
program funds when the Ticket to Work Program offers additional 
assistance to a beneficiary.

   Questions from Chairman E. Clay Shaw, Jr. to Dr. Troy R. Justesen

    Question: A procedural directive, known as ``Transmittal 17'' from 
the SSA requires State VR (VR) agencies to be assigned a ticket before 
they can receive any reimbursement for costs from the SSA. Many argue 
that this requirement denies ticket holders the right to make an 
informed choice. Also, since the budgets of State VR agencies often 
rely on income from the SSA, many believe that State VR agencies are 
aggressively seeking ticket assignments, rather than creating 
partnerships with employment networks (ENs) that allow a beneficiary to 
receive services from both a State VR provider and an EN. What is the 
Department of Education doing to resolve this issue and encourage 
partnerships between State VRs and private ENs?
    Answer: For purposes of this question, SSA's ``Transmittal 17'' 
requires two things: 1) VR can assign an individual's ``ticket'' to 
itself if the individual has been determined eligible for the VR 
program, has signed an agreed-upon Individualized Plan for Employment 
(IPE) with the VR agency, and has not yet assigned the ticket to 
another Employment Network (EN); and 2) VR (or any EN) must have an 
assigned ``ticket'' before VR can receive payment, including the 
traditional cost-reimbursement payment method, for VR services rendered 
under the Ticket-to-Work program. My answer to your question is lengthy 
and technical because the issues you have raised involve complicated 
interrelationships between two complex programs. I would like to assure 
you that ``Transmittal 17'' and its various implications and effects as 
they are now understood are under close joint review by the Department 
and SSA. Above all, we must remain focused on the larger purpose of 
enabling and assisting consumers with disabilities to achieve the 
dignity, sense of self-worth and capacity for social and economic 
contributions to society. Good policies will lead to good jobs.
    The Ticket to Work and Work Incentives Improvement Act (TWWIIA) is 
designed to give consumers more options when seeking employment-related 
services. To this end, TWWIIA gives consumers the right to assign the 
ticket to the EN of their choice. This means that the individual can 
assign the ticket to the VR agency or to an EN that will accept it. 
However, Transmittal 17 removes this choice in certain circumstances, 
namely when the individual has a ticket that he/she has not yet 
assigned and seeks services from the VR agency. Transmittal 17 advises 
the VR agencies that individual consent is not required to make the 
assignment in this scenario. To accomplish the assignment of the ticket 
in this case, Transmittal 17 advises VR agencies to submit the 
signature page of the IPE to Maximus, the contractual program manager 
for the Ticket-to-Work program. Maximus then treats the assignment as 
voluntary on the basis of the signed IPE. This situation has caused 
some advocates to argue that individuals are being denied the ability 
to choose an EN as required by TWWIIA.
    The principle of informed choice is a central theme throughout the 
State VR services program. section 102(d)(4) of the Rehabilitation Act 
1973, as amended (Rehabilitation Act), requires that a State VR 
agency's written policies and procedures must ``provide or assist 
eligible individuals in acquiring information that enables those 
individuals to exercise informed choice under this title in the 
selection of--(A) the employment outcome; (B) the specific VR services 
needed to achieve the employment outcome; (C) the entity that will 
provide the services; (D) the employment setting and the settings in 
which the services will be provided; and (E) the methods available for 
procuring the services.'' Because of these requirements of the 
Rehabilitation Act and an individual's right to choose an EN under 
TWWIIA, we have advised State VR agencies to discuss openly the options 
available to the individual with regard to choosing an EN. We have 
advised State VR agencies to inform SSI recipients and SSDI 
beneficiaries holding unassigned tickets that the IPE signature can be 
interpreted as the individual's willingness to assign his or her ticket 
to the State VR agency. In doing this, we believe the State VR agencies 
are operating within the requirements of both the Rehabilitation Act 
and TWWIIA in ensuring that the individual has the opportunity to 
exercise informed choice.
    The issue of payment is interrelated to the issue of ticket 
assignment because TWWIIA authorizes payment for services rendered to 
the EN holding the assigned ticket. The payments are incentives for ENs 
and VR agencies to assist SSI recipients and SSDI beneficiaries to 
become employed. ENs can choose to receive payments under the Outcome 
system or the Milestone/Outcome system. VR agencies have a third 
payment option; that of receiving payment pursuant to the traditional 
cost-reimbursement method authorized by the Social Security Act. 
However, Transmittal 17 appears not to distinguish among these three 
payment methods. It requires that the EN or VR agency have the assigned 
ticket before being able to seek any payment (including cost-
reimbursement) from SSA. For this reason, ENs and VR agencies are 
anxious to get a ticket assigned as soon as possible.
    Certainly some State VR agencies have come to rely on income from 
the traditional cost reimbursement payment system, as you mention. VR 
agencies use this income to supplement the formula grant funds received 
from the Department of Education. The amount of SSA cost 
reimbursements, as a percentage of the overall VR agency budget is 
relatively small, however, the level of such reimbursements varies 
widely among VR agencies as a percentage of the total agency budget. A 
few agencies, particularly active and successful in SSA 
rehabilitations, receive higher levels of reimbursement. Because 
Transmittal 17 seems to have subsumed the traditional cost 
reimbursement option under the Ticket-to-Work program, VR agencies are 
on an equal footing with the other ENs with regard to needing an 
assigned ticket in order to be eligible for payment at a later date. 
Thus, VR agencies and other ENs need to make concerted efforts to 
inform individuals about the ticket assignment process.
    Question: The Ticket to Work Advisory Panel has found that some 
State VR agencies have determined that the ``comparable services and 
benefits'' requirement under the Rehabilitation Act prevents them from 
providing services to Social Security Disability Insurance and 
Supplemental Security Income recipients who assign their ticket to a 
private EN. Can you explain how the Department of Education will work 
with State VR agencies to provide the maximum amount of services 
available under the law? Do you believe that any legislative changes 
are needed to the Rehabilitation Act to allow for ENs and State VR 
agencies to coexist and complement each other as envisioned under the 
Ticket to Work Act, or can needed change be accomplished through 
regulation?
    Answer: We are not aware of any State VR agency that has refused as 
a general practice to provide services to an SSI recipient or SSDI 
beneficiary who has assigned his/her ticket to a private EN. However, 
we are aware that State VR agencies in certain circumstances are asking 
that the private ENs holding the ticket provide some of the necessary 
services as a ``comparable service and benefit.''
    Section 101(a)(8)(A)(i) of the Rehabilitation Act requires the VR 
agency, except in very limited circumstances, to determine whether 
comparable services and benefits exist prior to providing services to 
an eligible individual. The VR regulations define ``comparable services 
and benefits,'' in pertinent part, as those services and benefits 
``that are--(A) provided or paid for, in whole or in part, by other 
Federal, State, or local public agencies. . . .; (B) available to the 
individual at the time needed to ensure the progress of the individual 
toward achieving the employment outcome. . . .; and (C) commensurate to 
the services that the individual would otherwise receive'' from the 
State VR agency (34 CFR 361.5(b)(10)). This means that VR must 
determine whether another appropriate source can provide the services 
that VR otherwise would provide in accordance with the individual's IPE 
in a timely manner. As you know, the intent behind this requirement was 
to ensure that VR funds could be maximized in order to meet the needs 
of more eligible individuals, especially those with the most 
significant disabilities.
    We do not view a ticket by itself as representing a comparable 
service and benefit. Nor do we consider the fact that an individual has 
assigned his/her ticket to a private EN by itself as constituting a 
comparable service and benefit under the Rehabilitation Act. However, 
we do consider the ticket as being a comparable service and benefit 
under the Rehabilitation Act when: 1) the individual has assigned the 
ticket to an EN; 2) the EN has listed the service in its own 
individualized work plan (developed between the EN and the individual) 
pursuant to TWWIIA requirements; 3) the EN is capable of providing a 
service that is listed on the individual's IPE; 4) the service offered 
by the EN is commensurate to the service that otherwise would be 
provided by the State VR agency; and 5) the EN is capable of providing 
the service when it is needed by the individual. If any of the above 
factors are not met, the ticket does not constitute a comparable 
service and benefit for purposes of the VR program. In that instance, 
assuming comparable services and benefits do not exist from another 
source, the State VR agency should provide the services pursuant to the 
IPE.
    Our interpretation encourages a cooperative effort between both the 
VR agencies and the ENs to serve individuals as effectively as possible 
while maximizing funds from each program. We will continue to provide 
technical assistance to the State VR agencies to ensure that the search 
for comparable services and benefits does not result in a delay in 
services to individuals. We also will continue to remind State VR 
agencies that the requirement for seeking comparable services and 
benefits should be done in such a manner to ensure cooperation among 
programs serving individuals with disabilities.
    As a policy matter we recognize that the intent of the Ticket 
program is to establish a cadre of rehabilitation service providers, in 
addition to the traditional VR services program present in every State 
that can provide multiple opportunities and pathways for SSI recipients 
and SSDI beneficiaries to obtain the services necessary for gainful 
employment. For decades, the VR program has been essentially the sole 
public program assisting individuals with disabilities to achieve 
gainful employment. The current situation in which the potential for 
competition between VR agencies and ENs for both clients and payments 
from SSA is new and the implications are not fully understood.
    The Department has not taken a position on the need for a 
legislative change. However, we are aware the current Senate Bill (S. 
1627) reauthorizing the Work force Investment Act 1998 (which includes 
the Rehabilitation Act in Title IV) proposes clarifying language on 
comparable benefits.
    We must defer to SSA concerning regulatory changes governing the 
Ticket program, but we will of course work with SSA if changes are 
proposed.
    Question: It has been reported that private providers perceive that 
if they sign up to be an EN, their current relationship with their 
State VR agency may be jeopardized. It has also been reported that some 
current VR clients were threatened with termination from VR if they did 
not assign their ticket to the VR agency, or worse, weren't informed 
that they could be better served by taking their ticket to elsewhere 
versus staying on a waiting list at the VR agency. This is deeply 
disappointing and completely opposed to the goals of the ticket 
program. Have you heard similar allegations? Are they true? If so, what 
are you doing to address the situation?
    Answer: I am not aware of any individual threats concerning 
termination of clients or willful ``noninformation'' about ticket 
options being provided to VR clients. However, if complaints are 
brought to our attention we will certainly respond to them.
    State VR agencies have typically had longstanding cooperative or 
purchaser-vendor relationships with many, if not most ENs. Thus, it is 
understandable that some providers could be concerned about the 
potential for jeopardizing their relationship with the VR agency. 
However, perceptions that a relationship ``may be jeopardized'' provide 
little basis for investigation in the absence of specific complaints. I 
have heard anecdotal references similar to the allegations you have 
mentioned. However, no documented and specific examples have been 
brought to my attention. However, we will work with our colleagues at 
SSA to address any specific complaints that may be presented.
    Question: As you mention in your testimony, many EN perceive that 
negotiated agreements they have entered into with the State VR agencies 
do not reflect the principles of true partnership and fairness. This is 
especially a concern given the low percentage of tickets assigned to 
ENs. When do you plan to complete your review of all agreements between 
the State VR agencies and ENs?
    Answer: TWWIIA authorizes ENs and VR agencies, when serving mutual 
consumers, to share payments received from SSA when the two entities 
have developed an agreement that outlines how services will be provided 
and income shared. ENs and VR agencies may, of course, enter into a 
wide range of agreements for various purposes for their mutual benefit.
    We are aware that some ENs, including some VR agencies, believe the 
agreements they have developed do not reflect the principles of true 
partnership and fairness. This has prompted OSERS to begin reviewing 
these agreements. Although there is no legal requirement for us to 
conduct this review or for the VR agencies to submit these agreements 
to us, we believed such a review would be helpful in order to get a 
better understanding of the actual working relationships between State 
VR agencies and ENs.
    We are currently reviewing agreements that were developed by ENs 
and VR agencies in the 13 first-phase States. We hope to review all 
available agreements within the next 6 months. We will provide the 
Subcommittee with a report of our findings once our review and analysis 
are completed.

       Questions from Chairman E. Clay Shaw, Jr. to Mr. Tom Foran

    Question: Can you share with me on average, what are the costs of 
returning an individual to employment? Even with adjustments to the 
milestone payments, can employment networks cover their costs and still 
make a reasonable profit, given the potential total payment of $16,740 
for Social Security beneficiaries and $10,620 for Supplemental Security 
Income beneficiaries?
    Answer: Because of the tremendous variation in costs, at the 
individual level, giving an average cost may be less meaningful than 
focusing on the second part of this question. We've seen beneficiaries 
that are able to return to work with an outlay of only several hundred 
dollars. We've also seen others that would require more than $50,000 
and even at that level the success is not guaranteed.
    When looking at the second part of your question it is important to 
understand the effects of:

      The time value of money on payments,
      The cost of Maximus and SSA imposed administrative costs 
(drag),
      Success rate in returning beneficiaries to work,
      Once at work the effect of beneficiaries dropping out of 
the work force due to death, economy related work force reductions, 
choice and worsening of their physical state.

    Additionally, we need to define ``reasonable profit'' which is 
directly tied to the source and cost of capital.
    Once all of these parameters are determined a present value of 
future cash flows can be created to determine the amount of resources 
that can be provided to any one individual in the return to work 
process. An employment networkthen looks for beneficiaries that can be 
returned to work with that level of resources.
    Taking into account the above items, IDR has estimated the present 
value of future payments per successful ticket as follows:

      SSDI current milestone structure = $2,800
      SSI current milestone structure = $1,420
      SSDI with AOI workgroup suggested changes $3,800
      SSI with AOI suggestions (diff. Reflects lower success 
rate) $3,000

    With the current dramatically lower payments for SSI beneficiaries, 
we feel the risk/reward is too great and therefore do not work with SSI 
only beneficiaries. Under the current milestone structure only 1 in 25 
beneficiaries that contact us meet our screen of being a SSDI 
beneficiary with a 75% likelihood of successful full-time return to 
work for $2,800 in time and services.
    We believe it is dangerous to use a cost figure that represents an 
average per individual placement, however. We fear that policy makers 
will use such a number to reduce payouts for the program without 
realizing the actual costs to operate the program include far more than 
just the cost of an individual placement. The aggregate program costs 
for screening all the people who never actually deposit their ticket as 
well as the people we are never actually able to place represents the 
majority of the costs incurred to operate a successful employment 
network.
    Additionally, for the reasons mentioned above, a significant 
percentage of those who are placed for whom we are eligible for a 
milestone/outcome payment will never actually achieve 60-72 months of 
employment. It is also impossible to compute the total cost of any 
placement at this time since the ticket program is so new. For example, 
we do not know the cost or amount of future services that will be 
required to help those ticket users who are working now stay at work. 
Consequently, the total possible payout for any one beneficiary (i.e. 
$16,750 for SSDI and $10,620 for SSI) not only has to cover our costs 
and generate a reasonable profit for those we actually place but also 
must cover the aggregate costs incurred for all the people we do not 
place.
    We believe placement rates could be increased by restructuring the 
payment system. By changing to the AOI workgroup recommended payment 
structure we estimate we would be able to work with 1 in 10 to 1 in 15 
beneficiaries. By removing much of the administrative drag we would 
likely be in 1 in 8 to 1 in 12 ranges. Improving access to capital 
(reducing cost) would also allow us to work with more beneficiaries.
    So, yes it is possible for an employment network to earn a fair 
profit at the $16,740 (or current $17,170) total payment for SSDI 
beneficiaries. The question is how many beneficiaries is an employment 
network able to serve?
    When IDR decided to become an employment network, we planned to do 
so on a significant scale. Our initial plans were to serve 2,000 plus 
beneficiaries per year. Our infrastructure was built to handle at least 
that amount.
    Unfortunately, given the level of screening we have to do to deal 
with unexpected issues like administrative drag and lack of appropriate 
education given to beneficiaries on the Ticket to Work Program it is 
unlikely we will come anywhere near our goal without improvements in 
the program.
    Question: What has been your experience in working with the State 
VR agencies? What suggestions do you have for improvements?
    Answer: Our main office is in Connecticut and we have had a very 
positive experience in dealing with Connecticut's Bureau of 
Rehabilitation Services. The problem we face in dealing with other 
State VR agencies is that each state takes a different approach with 
different agreements in dealing with EN's. To be honest, we made the 
decision early on that it was not worth the time and expense to enter 
into negotiations with each state and simply refer beneficiaries to 
their State VR agency if we can't help them.
    We would be much more likely to work on a collaborative basis with 
other State VR agencies if there was a uniform agreement applicable to 
all states.
    It is important to note the comments we get from beneficiaries 
about their experiences with State VR agencies. In general, they 
revolve around frustrations the beneficiaries have with not being 
served by State VR for the following reasons:

      Lack of funding
      The beneficiary not having a disability ``severe'' enough 
to be assisted
      The waiting list for services is ``years'' long
      Rehab Counselors don't get back to the beneficiary for 
months on end

    Another suggestion would be to more strongly encourage State VR to 
focus their limited resources on providing services designed to get 
beneficiaries ``job ready'' under the existing cost reimbursement 
program and to rely on EN's to provide the placement services under the 
ticket program.
    Although some more traditional ENs have recommended operating the 
ticket program payment system similarly to the cost-reimbursement 
scheme currently in use with State VR, we believe that such a plan 
would create more administrative burden ``proving'' to SSA that the 
costs for which we are requesting reimbursement are legitimate. 
Further, it would designate a bureaucratic approach to the types of 
services provided rather than the ``whatever it takes'' approach we are 
free to use under the current Ticket structure. This has been 
demonstrated clearly by the Projects with Industry programs that exist 
today. Originally, they were intended to be more community and 
employer-focused. However, because of the manner in which PWIs are 
funded and monitored their programs today are so restricted that they, 
too, are not able to place as many people as they could if their 
program contained more flexibility.
    Question: What can be done to assist recipients who want to use 
their Ticket in selecting one employment network from the often long 
list of employment networks available to recipients?
    Answer: Provide adequate and timely information on each employment 
network servicing their area. Examples of information/services to 
provide include items currently tracked by Maximus such as:

      Tickets assigned to date
      Tickets unassigned by ENs
      Tickets unassigned by beneficiary
      Number of successful placements to date

    Regularly updated (at least monthly) list of what EN's are still 
active
    Offer workshops via the BPAOs on how to choose an EN and what an EN 
and a consumer can offer each other.
    I want to emphasis that the information provided needs to be 
readily available information that Maxims is ALREADY collecting. Asking 
EN's report and track additional statistics will only add to the 
administrative drag and reduce resources available to provide services 
to beneficiaries.

  Questions from Chairman E. Clay Shaw, Jr. to Mr. Quintin M. Mitchell

    Question: Can you share with me on average, what are the costs of 
returning an individual to employment? Even with adjustments to the 
milestone payments, can employment networks cover their costs and still 
make a reasonable profit, given the potential total payment of $16,740 
for Social Security beneficiaries and $10,620 for Supplemental Security 
Income beneficiaries?
    Answer: On average the costs of returning an individual to 
employment, for our agency, is $15,819.00. This figure is at the low 
end. Even with adjustments to the milestone payments, it is a very slim 
margin for our agency to cover cost and still make a profit.The profit 
is really not a reasonable one.
    Question: What has been your experience in working with the State 
VR agencies?What suggestions do you have for improvements?
    Answer: Our agency has opted not to work with the State VR agencies 
in our area. From the start of this initiative we decided that working 
with the State Voc Rehab would not be in our best interest, 
economically or providing the Ticket participants with expedient 
service delivery.
    Question: What can be done to assist recipients who want to use 
their Ticket in selecting one employment network from the often long 
list of employment networks available to recipients? 
    Answer: One approach to assist recipients who want to use their 
Ticket in selecting one employment network from the often long list of 
EN.s available is to narrow the list to their service area within 30 
miles. We are finding that more and more Ticket holders are contacting 
our agency, which is outside of our service delivery area. To 
accommodate these individuals we have set up satellite meeting space in 
that area and travel to meet them on an as needed basis. Because of 
fewer E.N. participation and more Ticket participants, slim margin of 
profit and already stretched staff it is becoming increasingly more 
challenging to ensure that the program is successful.

    Questions from Chairman E. Clay Shaw, Jr. to Mr. John V. Coburn

    Question: Can you share with me on average, what are the costs of 
returning an individual to employment? Even with adjustments to the 
milestone payments, can employment networks cover their costs and still 
make a reasonable profit, given the potential total payment of $16,740 
for Social Security beneficiaries and $10,620 for Supplemental Security 
Income beneficiaries?
    Answer: The cost of returning an individual to employment can vary 
greatly depending on many factors, including but not limited to, the 
nature of the individual's disability, the individual's employment 
history, and the individual's education and experience. In addition to 
the costs expended to assist a particular individual in returning to 
work, there are general overhead costs associated with actively 
participating as a provider in the Ticket to Work Program. These costs 
may include staff costs associated with performing intake, staff costs 
associated with assessing an individual's service needs prior to 
accepting their ticket, marketing of the Ticket to Work Program, and so 
forth. These costs are incurred on all individuals who contact the 
agency, including individuals who the agency may ultimately decide not 
to serve under the Ticket to Work Program.
    In order to develop response to your questions, I polled members of 
the Midwest Employment and Training Partnership (Partnership). I have 
received several different responses with a range of costs for 
employment and training services One Employment Network, which serves 
exclusively blind individuals, stated that the average cost per 
individual to train, educate, and place the individual in competitive 
employment ranged from $35,000 to $40,000. This was the highest amount 
reported. On the lower end, another agency that works with a cross-
disability population reported that it was currently costing about 
$2000 per individual to place a person in competitive employment 
through the Ticket to Work Program. This figure does not include what 
it may or may not cost to keep the person in competitive employment 
throughout the Ticket to Work payment timeline, nor does it include 
some of the overhead costs mentioned previously. A third agency that 
works with younger adults reported an average cost of between $5000 and 
$6000 to obtain employment, with follow-up services costing 
approximately $3000 per year. Finally, another agency, which works with 
a cross-disability population, reported a range of $5200 to $12,000 to 
assist an individual in returning to work with 3 months of intensive 
follow-up services.
    So, our experience has been that there is a great variance in 
expenditures needed to assist a person in securing and maintaining 
employment. However, in almost all cases, the greatest percentage of 
these expenditures are incurred by agencies prior to and upon placement 
in competitive employment. Therefore, adjustments in the milestone 
payments to further increase the funds available during the beginning 
of the employment services process will increase the ability of 
Employment Networks to accept more Tickets.
    The current total payment system under the Ticket to Work Program 
will not make it possible to serve all beneficiaries. For some 
beneficiaries, payments of $16,740 or $10, 620 will never cover the 
expenditures required in order to return them to employment. However, 
these amounts, if paid out in a greater percentage during the first 
year, would make it financially feasible for Employment Networks to 
accept more Tickets and increase their participation over time.
    Question: What are the one or two most significant benefits of the 
upcoming City of Chicago Pilot that represent an improvement over the 
current Ticket to Work payment systems for employment networks?
    Answer: In the Midwest, we have learned that Employment Networks 
have been hesitant to meaningfully participate in the Ticket to Work 
Program because the agency must bear all the costs associated with the 
placement of the individual in employment. And, even after incurring 
these costs, the Employment Network may never receive payment if it is 
not successful, or the EN receives payments over a significant period 
of time at very low rates. Quite simply, the current system of payment 
requires agencies to incur costs that it cannot carry for the period of 
time it must wait in order to be reimbursed. To be frank, the current 
Ticket to Work milestone and outcome payment model is not a strong 
business model that will bring new players into the system much less 
attract many of the experienced employment and training providers to 
this new program.
    First and foremost, the City of Chicago Pilot (CCP) provides the 
Employment Networks with a significant income to cover their cost of 
service within the first year of a ticket participant's employment. The 
Employment Networks can be assured of reimbursement of at least some of 
their costs at placement ($2000), when the greatest costs have been 
incurred. In addition, subsequent payments of $2000 at 6 months and 
$1000 at 1 year allow the Employment Networks to recoup a larger amount 
of their overall costs within a short period of time. This is done 
without discouraging the Employment Networks from continuing to work 
with the individual over the next 5 years as Employment Networks will 
continue to receive payments from the SSA system after the first year 
if the individual maintains employment.
    Second, the CCP allows for payment to the Employment Network within 
the first year without requiring the individual to earn Substantial 
Gainful Activity (SGA) or greater within that first year. Employment 
Networks believe that the process of returning an individual to full-
time employment at or above SGA can often be accomplished over time. 
For some individuals, particularly those receiving SSI benefits with no 
work history, securing employment at or above SGA can best be 
accomplished by first gaining some work experience, sometimes at a 
part-time level. For other individuals, the best way to return them to 
work at or above the SGA level is to first allow them to work at any 
level, gain confidence in their ability to maintain employment, and 
address their fears about returning to work and losing their cash 
benefits. Once this is done, the transition to full-time, self-
sustaining employment is the next natural step and the Employment 
Networks can realistically assist them in getting there.
    The current payment system will not pay the Employment Networks 
during the time in which they are gradually assisting the individual in 
gaining full-time employment. Therefore, it is not financially feasible 
for the Employment Networks to work with the large group of 
beneficiaries described above. On the other hand, the CCP makes 
payments to Employment Networks when they assist the individual in 
gaining competitive employment, regardless of that person's employment 
income. This is done without losing sight of the ultimate goal---self-
sustaining employment. The Employment Networks must still create a plan 
for returning the individual to self-sufficiency, as required by 
current SSA regulations, and will receive payments through the SSA 
system when they do so.
                               __________
    [Questions submitted from Mr. Matsui to Dr. Justesen, and 
his responses follow:]
    Question: If a Social Security beneficiary assigns a ticket to an 
Employment Network, is he or she still entitled to services and 
benefits under title I of the Rehabilitation Act? Please describe the 
interpretation of ``comparable benefits and services'' as it relates to 
the ticket program. Are state agencies complying with this requirement 
of the Rehabilitation Act with respect to Social Security beneficiaries 
who have been assigned tickets? Is your agency monitoring state's 
compliance with this requirement?
    Answer: VR is an eligibility program rather than an entitlement 
program but Social Security beneficiaries are deemed presumptively 
eligible. Assignment of a ticket to an employment network does not 
limit an individual's potential eligibility for VR services. That 
eligibility is governed by the Rehabilitation Act.
    Section 101(a)(8)(A)(i) of the Rehabilitation Act requires the VR 
agency, except in very limited circumstances, to determine whether 
comparable services and benefits exist prior to providing services to 
an eligible individual. State VR agencies must comply with this 
requirement as a matter of law, and it is to the advantage of the 
agencies to do so because use of third-party resources allows the 
agencies to serve more clients or provide enhanced services. The 
Rehabilitation Services Administration is currently reviewing 
agreements that were developed by ENs and VR agencies in the 13 first-
phase States and hopes to review all available agreements within the 
next six months. The reviews will necessarily involve consideration of 
the use of comparable benefits.
     The VR regulations define ``comparable services and benefits,'' in 
pertinent part, as those services and benefits ``that are--(A) provided 
or paid for, in whole or in part, by other Federal, State, or local 
public agencies. . . .; (B) available to the individual at the time 
needed to ensure the progress of the individual toward achieving the 
employment outcome. . . .; and (C) commensurate to the services that 
the individual would otherwise receive'' from the State VR agency (34 
CFR 361.5(b)(10)). This means that VR must determine whether another 
appropriate source can provide the services that VR otherwise would 
provide in accordance with the individual's IPE in a timely manner. As 
you know, the intent behind this requirement was to ensure that VR 
funds could be maximized in order to meet the needs of more eligible 
individuals, especially those with the most significant disabilities.
    We do not view a ticket by itself as representing a comparable 
service and benefit. Nor do we consider the fact that an individual has 
assigned his/her ticket to a private EN by itself as constituting a 
comparable service and benefit under the Rehabilitation Act. However, 
we do consider the ticket as being a comparable service and benefit 
under the Rehabilitation Act when: 1) the individual has assigned the 
ticket to an EN; 2) the EN has listed the service in its own 
individualized work plan (developed between the EN and the individual) 
pursuant to TWWIIA requirements; 3) the EN is capable of providing a 
service that is listed on the individual's IPE; 4) the service offered 
by the EN is commensurate to the service that otherwise would be 
provided by the State VR agency; and 5) the EN is capable of providing 
the service when it is needed by the individual. If any of the above 
factors are not met, the ticket does not constitute a comparable 
service and benefit for purposes of the VR program. In that instance, 
assuming comparable services and benefits do not exist from another 
source, the State VR agency should provide the services pursuant to the 
IPE.

Question: A number of concerns have been raised about whether the 
        ticket program may be replacing, rather than supplementing, 
        other pre-existing publicly funded services such as VR services 
        provided under Title I of the Rehabilitation Act. The intent of 
        Congress in enacting the ticket program was not to deny access 
        to these other services. Does Congress need to clarify the law? 
        If so, where?
    Answer: State VR agencies are serving the great majority of persons 
holding tickets and seeking services. Experience to date with 
implementation does not support concerns about the ticket program 
replacing services such as VR. This is unsurprising because the VR 
agencies are well-established entities with operating capital provided 
by their formula grants from the Department. The Department has not 
taken a position on the need for any legislative change. We would in 
any event expect to work closely with but defer to SSA as the 
administering agency if legislative recommendations are to be 
developed.

                                 

    [Submissions for the record follow:]

                            California Department of Rehabilitation
                                       Sacramento, California 95815
                                                     March 30, 2004
Chairman E. Clay Shaw, Jr.
Subcommittee on Social Security
1102 LHOB
Washington, DC 20515

Dear Congressman Shaw:

    As the Director of the California Department of Rehabilitation 
(DOR) I want to take this opportunity to provide written testimony for 
the official record of the above referenced hearing. This testimony 
will provide some information on DOR's activities relevant to the 
implementation of the Ticket to Work Program specifically as they 
relate to Transmittal 17 of the SSA VR Provider Handbook and the 
development of agreements between DOR and Employment Networks (EN).
    Several months prior to Ticket rollout in California, DOR convened 
a Ticket to Work Workgroup that consisted of field and management 
staff, community partner agencies and several constituency groups 
representing a unified approach to DOR's role in the Ticket to Work 
Program. The workgroup was charged with the task of extensively 
reviewing Social Security Administration's Ticket to Work (TTW) 
regulations and policies related to TTW including the Transmittal 17 
document. In addition, the workgroup carefully researched, studied and 
compared policies implemented by first and second round ticket states. 
As a result, the workgroup developed guidance and procedures consistent 
with the TTW regulations and Title I of the Rehabilitation Act of 1973, 
as amended.
    Transmittal 17 of Social Security Administration's (SSA's) Vocation 
Rehabilitation (VR) Provider Handbook allows for the ``automatic'' 
assignment of a Ticket to State VR agencies when a consumer signs the 
Individualized Plan for Employment (IPE). The SSA's position has been 
that if a beneficiary receives a Ticket and then enters into an IPE 
they have decided to use their Ticket. California DOR does not practice 
this ``automatic'' ticket assignment. A statement has been added to our 
IPE template to emphasize the voluntary nature of the Ticket and 
consumer informed choice. All consumers eligible or potentially 
eligible for a Ticket are provided verbal and written information on 
TTW program including a fact sheet that emphasizes that TTW is a 
voluntary program. Finally, guidance has been developed so that DOR 
counselors review and revisit TTW with each consumer at the time of 
progress and annual reviews.
    Concern has been raised about the various EN/VR agreements 
requiring full repayment of the entire VR costs out of the EN ticket 
payments and the reported ``one size fits all agreements.'' State 
Vocational Rehabilitation (VR) agencies have been working with SSA 
beneficiaries under a reimbursement program legislatively authorized by 
the Social Security Act since 1981. Under this reimbursement program 
SSA reimburses State VR agencies for reasonable and necessary service 
costs incurred in assisting consumers who engage in employment with 
earnings equal to or above SSA's standard for substantial gainful 
activities (SGA) for at least 9 months. Indirect and tracking costs are 
also reimbursed. The annual SSA Reimbursement report for Federal Fiscal 
Year 2003 indicates SSA realizes savings from this program. In FY 2003 
$84.6 million dollars were reimbursed to VR agencies nationwide. SSA 
projected the savings in benefits to be $458.7 million dollars.
    As is true for many state VR agencies, DOR has come to rely on 
these reimbursements to maintain ongoing programming. The TTW program 
has introduced a new way of doing business. With an estimated 1,000,000 
Tickets scheduled to be released in California by September 2004, DOR 
certainly supports increased consumer choice and the addition of EN's 
to provide services. California's EN Agreement only requires the EN to 
reimburse DOR at the rate of 50% of each payment received from SSA 
until DOR's direct costs (not indirect and tracking costs) are 
reimbursed or until DOR has received 50% of all payments, whichever is 
first. Furthermore, DOR does not ask for more than 50% of the total 
payments the EN receives.
    Finally, California DOR supports the proposals that have been made 
by others to this hearing and the Ticket to Work Advisory Panel for SSA 
to create a dual payment system in which state VR agencies continue to 
be reimbursed for services provided to assist beneficiaries in 
preparing for and entering the labor market. EN's then will be paid for 
the long-term follow up and support for beneficiaries to maintain their 
employment and freedom from reliance on cash benefits.
    California DOR appreciates this opportunity to provide testimony. 
We look forward to future collaboration in improving the TTW program 
and support your ongoing efforts to help make this program a success 
for beneficiaries with disabilities.
            Sincerely,
                                                  Catherine Campisi
                                                           Director

                                 

     Statement of Robert Kilbury and Louis Hamer, Council of State 
     Administrators of Vocational Rehabilitation, Chicago, Illinois

    In Illinois there are 60 ENs with 32 ENs having an active agreement 
with State VR. Since the Ticket program started two years ago in 
Illinois we have gone from 73 ENs to 60 ENs now. Many ENs have stopped 
taking the Ticket assignment from customers. Most community based 
providers have attributed the lack of Tickets accepted due to the 
payment system. In Illinois we do have an agreement that was developed 
with cooperation with community providers. The EN agreement calls for 
State VR to pay for services and to eventually receive payment back for 
its cost once the EN receives payment from SSA. The EN will keep any 
monies received over State VR's cost. In most cases it could be a large 
sum. Illinois does not ask for any cost reimbursement above what it 
pays out.
    "Transmittal 17" allows State VR to submit the Ticket Registration 
Form (TRF1365) along with a copy of the signed IPE signature page for 
assignment when the customer does not sign the TRF1365. The customer is 
informed by State VR that by signing the IPE (Plan) they are assigning 
their Ticket to VR. In Illinois we only submit in this manner with the 
customer's approval. This is no different than when a customer goes to 
an EN and signs a Individual Work Plan (IWP), they are in essence 
assigning their Ticket to that EN. This happens and not all customers 
are informed they have assigned their Ticket to that EN. In Illinois 
over 98% of all Tickets to date have been submitted with customer 
signature on the TRF1365.
    It is very unfair to vilify State VR agencies over the Ticket 
program. In Illinois not every customer that comes through the door is 
a SSA recipient. The funds captured from SSA reimbursement goes back 
into the pool to pay the cost for all it's customers, including SSA 
recipients. State VR does indeed continue to be woefully under-funded. 
The amount of reimbursement has been steadily shrinking over the last 
two years with a large reduction expected again this year.
    We disagree with the recommendation of eliminating the requirement 
that there be agreements between ENs and State VR agencies when the EN 
refers a beneficiary to VR unless SSA allows cost reimbursement for 
State VR agencies separately from the Ticket program.
    Illinois State VR spent significant resources the first year 
training staff, hiring Ticket operators, setting-up a Ticket Cost 
Center and meeting with ENs in development of the EN agreement. We 
continue to spend large amounts training staff on SSA revisions and 
communicating with Maximus and customers who have no intent to return 
to work. This program would be most effective if there were unlimited 
funding for State VR with some additional funds for ENs. Since there is 
no endless trail of money, SSA should not consider changing the system 
to reward ENs that are able to cherry-pick it's customers. We must 
remember that State VR must work with every customer that comes through 
the door.
    Making further changes to provide more incentives to return to work 
would benefit customers more. Give the customer to try to work for a 
year if they assign there ticket and allow them to keep all their 
benefits would open the door to more customers making a real attempt to 
get off benefits, not making ENs rich on the backs of the customer.

                                 

 Statement of Mike Hedden, Indiana Vocational Rehabilitation Services, 
                         Indianapolis, Indiana

    In regard to the Hearing on March 18, 2004, the testimony given 
does not accurately reflect the situation in Indiana. Indiana has 
invested significant resources in its training of Vocational 
Rehabilitation Counselors. We have held several training seminars 
explaining the Ticket program as well as developing detailed intake 
procedures, flow charts and updating our computer system. We do not use 
a ``stand alone, take it or leave it, one size fits all agreement'' 
with the ENs with whom we have Memorandums of Understanding. Our 
agreement with ENs states that ``both the IWP and the IPE will be 
written by the respective party in a manner, consistent with law, to 
reinforce common goals, policies and procedures for Ticket customers 
referred by the EN to VRS.'' Our agreements do not necessarily require 
full and total repayment of all of VR's costs. Our reimbursement 
agreement states that VRS will be reimbursed by the EN for all actual 
service costs provided through VRS at the rate of 50% of all outcome or 
milestone payments to the EN until VRS is reimbursed for all actual 
service costs (these costs do not include the costs associated with VR 
Counselor time or in support of the VR Counselor). In other words, once 
an EN begins to receive payments, VR is entitled to 50% of each payment 
received until service costs are paid in full or until no further 
payments are made to the EN. The EN, in other words, will always 
receive 50% of the total payments and may receive more than 50% once 
VR's costs are reimbursed. If payments to the EN stop prior to full 
service costs being reimbursed to VR, VR expects no further 
reimbursement from the EN.

                                 

    Statement of James Wallace, Louisiana Rehabilitation Services, 
         Department of Social Services, Baton Rouge, Louisiana

    Louisiana Rehabilitation Services (LRS) has taken a very active 
role in promoting Ticket to Work (TTW) in the state of Louisiana. Our 
agency, which is located in a second phase Ticket rollout state, began 
training our personnel statewide in 2001. The agency has done follow-up 
training in 2002. Louisiana Rehabilitation Services (LRS) personnel 
also participated in providing training to beneficiaries, potential 
Employment Networks (ENs), and other entities in 2002 in conjunction 
with the Medicaid Buy In (MBI) program. The MBI training was repeated 
in 2003 with LRS participation. Furthermore, the agency was involved in 
statewide teleconference training in 2003.
    In our agency training, beneficiary options with special emphasis 
on informed choice to the consumers was stressed. Additionally, the 
training stressed that Rehab Act guidelines preclude denying services 
to any eligible consumer even if a Ticket is assigned to another 
entity.
    The LRS does have EN agreements with four Employment Networks 
throughout the state. The agreements do call for Ticket assignment to 
LRS and payment to the EN on typically a fee-for-service basis. LRS 
would be reimbursed under the traditional cost method. Any excess 
payments from Social Security would be split on a 50/50 basis.
    The LRS has neither solicited ENs nor coerced them into 
partnerships to ``control competition.'' ENs in the state appear to be 
reluctant to accept Ticket assignments because of the uncertainty and 
duration in payment and tracking. ENs and LRS negotiated so that in 
instances where the EN can independently serve the recipient, that 
recipient will not be referred to LRS. That said, current TTW 
procedures do allow appeals to Maximus and Social Security when Ticket 
assignment and payment is in question.
    The LRS, as a whole, is as well trained or in many cases better 
trained on Ticket issues, including informed choice, as any other 
entity in the state. In our state, as in many others, LRS has over 90% 
of the Ticket assignments. It is our viewpoint that Ticket indifference 
is due to the payment system for ENs and the burdensome administrative 
and tracking system. Further the lack of marketing to recipients by ENs 
contributes to the very low number of cases handled through them.
    Thank you for the opportunity to respond to this very topical 
subject.

                                 

                       Maryland Division of Rehabilitation Services
                                          Baltimore, Maryland 21201
                                                     March 31, 2004
The Honorable Benjamin L. Cardin
Member of Congress
2207 Rayburn HOB
Washington, DC 20515

    I want to respond to testimony that was provided by the Consortium 
of Citizens with Disabilities (CCD) at the March 18th hearing convened 
by the House Social Security Subcommittee on SSA's Ticket-to-Work 
program. The comments of Paul Seifert stating ``State VR agencies have 
developed stand alone, take it or leave it, one size fits all 
agreements for ENs in their states'', comes as a shock to this 
administrator of the Maryland VR program. Let me assure you that Mr. 
Seifert's statement could not be further from the reality of what has 
occurred in our state.
    First, Maryland Division of Rehabilitation Services (DORS) 
implementation planning was guided by the following principles:

      Persons with disabilities in Maryland are entitled to the 
opportunities, rights and remedies afforded under Title I of the 
Rehabilitation Act regardless of ticket status or assignment.
      Maryland DORS implementation will foster the goals of the 
Ticket-to-Work legislation: to expand service delivery capacities; and 
provide greater choice to ticket-holders to prepare for and obtain 
employment.
      Implementation will occur in a manner that is fiscally 
responsible and fair to ticket-holders, our community partner agencies 
and DORS.

    We have steadfastly adhered to those principles throughout the 
process.
    Second, Maryland DORS initiated an interagency implementation team 
to ensure that our roll-out strategies were consistent with our 
principles. Representatives from a number of community rehabilitation 
programs participated on the state team in addition to representatives 
from Maryland's benefits planning assistance and outreach (BPAO) 
organizations; the Client Assistance Program; and the state's 
protection and advocacy program.
    Third, Maryland does not have a ``one size'' agreement with ENs but 
rather varies the agreement based on which entity will provide the 
Ticket-to-Work administrative functions. We also tailor specific 
elements of the agreements to the unique relationship we have with each 
provider.
    While disagreeing categorically with Mr. Seifert's comments 
regarding implementation of the Ticket-to-Work for Maryland, I agree 
with his support of a recommendation of the Adequacy of Incentives Work 
Group. The current design of Ticket-to-Work by the Social Security 
Administration is seriously flawed. I strongly support the Work Group 
recommendation to reestablish cost reimbursement for state VR agencies 
separate from the Ticket-to-Work program and thereby keep intact the 
Ticket option for the consumer.
    I appreciate your consideration of these comments, and would ask 
that this letter be submitted as part of the official record of the 
hearing. Please do not hesitate to call me if you need additional 
information. Thank you.
            Sincerely,
                                                    Robert A. Burns
          Assistant State Superintendent in Rehabilitation Services

                                 

Statement of Elmer C. Bartels, Massachusetts Rehabilitation Commission, 
                   Boston, Massachusetts Introduction

    The Massachusetts Rehabilitation Commission (MRC) thanks Chairman 
Shaw for the opportunity to provide the Committee with its comments 
concerning the implementation of the programs of the Ticket to Work and 
Work Incentives Improvement Act, with particular attention focused upon 
the Ticket Program. Massachusetts was among the first states to roll 
out the Ticket Program and the MRC has actively worked to fashion a 
collaborative system of specialized training, support, and placement 
services with the state's community rehabilitation program providers, 
working as Employment Networks, in an effort to maximize choice and 
value for its consumers.

BPAO Program Success
    The Benefits Planning Assistance and Outreach Program (BPAO) has 
been an unqualified success in Massachusetts. The MRC operates its 
``Project IMPACT'' BPAO program in partnership with state independent 
living programs, non-profit community based organizations, and One-Stop 
Career Centers. The collaboration has resulted in referrals exceeding 
expectations and the development and implementation of over 1600 
benefits plans. Reauthorization of the Program in HR 743 will have a 
direct and positive impact on the employment efforts of hundreds of 
individuals with significant disabilities in the Commonwealth.
Traditional Cost Reimbursement and the Ticket Program
    A tension has existed in the Ticket program since the issuance of 
the first SSA instructions concerning State Vocational Rehabilitation 
Program participation in the Ticket Program and the continued relevance 
of the SSA/VR cost reimbursement program. That tension has continued to 
grow during the first several years of program implementation and it 
threatens to undermine the Ticket Program's potential for success.
    From the time the idea of the Ticket Program was first discussed in 
Congress, the CSAVR and interested state programs have emphasized the 
need to preserve the successful and vitally important SSA/VR cost 
reimbursement program. We believe that the SSA has promulgated policy 
regarding the administration of the Ticket Program, through its 
regulations and Transmittal 17 that is contrary to the intent of 
Congress, the language of TWWIIA, and the law as it relates to the 
administration of the VR cost reimbursement program. The Ticket Program 
has great potential to stimulate creative collaboration among community 
rehabilitation providers and state VR agencies. That collaboration 
could result in increased choice, quality, and funding for SSI/DI 
recipients interested in obtaining and retaining employment. However, 
as others have stated in their testimony, the programs working to 
assist individuals with disabilities to obtain real and meaningful work 
are woefully under-funded. A Ticket Program designed to redistribute 
rather than supplement existing funds is destined to fail. The work 
that State VR agencies and community rehabilitation providers perform 
is difficult, it is important, and it has real value to people with 
disabilities. It can be improved upon but what is good must be 
maintained. The threat of a new program diverting scarce funding from a 
collaborative system of proven effectiveness causes apprehension and at 
times conflict rather than promoting enthusiastic and creative 
participation.
    It is in the interest of the Social Security Administration, ENs, 
State Vocational Rehabilitation Programs and most importantly people 
with significant disabilities hoping to work, that this tension be 
relieved. Congress and the SSA should make it clear that the Ticket 
Program and the VR cost reimbursement program complement one another; 
supplement one another, and together work to creatively address the 
needs of individuals with disabilities seeking to maximize their 
economic independence.

How the Ticket Program and VR Cost Reimbursement Program Could Together 
        Improve the Prospect of Long Term Employment for Individuals 
        With Disabilities
    The State VR Program is mandated to provide an eligible individual 
with any service described in an individualized plan of employment 
necessary to assist them in preparing for, securing, retaining, or 
regaining an employment outcome that is consistent with the strengths, 
resources, priorities, concerns, abilities, capabilities, interests, 
and informed choices of the individual. It is neither uncommon nor 
unrealistic for many individuals with significant disabilities to seek 
and obtain costly vehicle modifications or payments for the costs of 
college degrees from the State VR Program. Yet, such expectations are 
justifiably viewed as unrealistic or beyond the scope of the capacity 
of ENs to address.
    Many individuals with disabilities require long-term ongoing 
supportive services to enable them to successfully obtain and retain 
employment. Long-term supports to employment are often beyond the scope 
of services available to consumers from the State VR agency. Community 
rehabilitation providers, serving as ENs, have the expertise and staff 
to provide this necessary and relatively low cost on the job service to 
individuals with disabilities. All that is needed is a funding 
mechanism. In Massachusetts, we have developed some means by which we 
are able to support these activities. However, the need is only 
partially met.
    A Ticket payment mechanism that supports EN efforts to provide the 
services necessary to ensure that individuals with disabilities are 
able to retain employment, complimented by a VR reimbursement system 
funding the up front costs associated with all aspects of individuals 
preparing for and obtaining employment, will undoubtedly result in 
increased, long-term, quality employment for SSI/DI recipients who 
desire increased social and economic autonomy.

In Conclusion
    The TWWIIA BPAO Program has been a tremendous success. There has 
been positive cooperation among state and community based partners that 
has resulted in an impressive number of consumer referrals with a very 
high level of consumer satisfaction. The reauthorization of the BPOA 
Program is a very positive development.
    It is not the belief of the MRC that a lack of interested and 
qualified Employment Networks is threatening the success of the Ticket 
Program. 1,100 ENs is a sizeable network of service providers. It is 
our belief that ENs make business decisions based upon their assessment 
of what is in their and their consumers' best interests. A Ticket 
Program that secures the funding base of ENs, through the preservation 
of the VR cost reimbursement program, and provides ENs an opportunity 
to expand existing services and resources, through a Ticket payment 
system that funds the provision of long term support services, will go 
a long way toward assuring the success of the Ticket Program.
    Thank you again for providing the Massachusetts Rehabilitation 
Commission with the opportunity to share with you some of its concerns 
regarding the operation and improvement of the Ticket to Work Program.

                                 

    Statement of Dan O'Brien, Oklahoma Department of Rehabilitation 
                   Services, Oklahoma City, Oklahoma

    Chairman Shaw, Ranking Member Matsui and Members of the 
Subcommittee, thank you for holding this Hearing to evaluate the state 
of Ticket to Work implementation. The Oklahoma Department of 
Rehabilitation Services was one of the 13 initial rollout states for 
the Ticket to Work in 2002.
    The reality of the Ticket from the street level perspective is that 
the system is broken and if not fixed will go the way of the failed 
Alternate Participant (AP) Program. Most of the problems have been 
predictable and the Adequacy of Incentives (AOI) Interim Report and the 
Ticket Panel's Employment Network (EN) Summit report summarize both the 
problems and make workable recommendations for solutions. We would 
encourage Congress and SSA to adopt their recommendations forthwith 
before any more potential energy is squandered. As they say in 
Oklahoma, beneficiaries are beginning to wonder if they have been sold 
a ``pig in a poke'', at this point the Ticket seems long on promise and 
short on delivery.
    It is our position that there is a substantial consensus among 
experts and EN's alike that the Ticket can be salvaged if quick and 
decisive action is taken soon. The market based competitive model 
envisioned for the Ticket was undone by the lack of funding of the 
Ticket payment structure. Baring a huge influx of new funding, a 
blended funding approach, using existing resources to complement the 
Ticket, is the only logical solution. The AOI Committee recommendations 
(report link below), which operationalize this approach, should be 
implemented rapidly and to the fullest extent possible.

    http://www.dri.uiuc.edu/research/p03-08h/interim_report_03-08h.pdf

    Oklahoma DRS has made every effort to ensure the Ticket's success 
in Oklahoma. To that end we conducted the following activities:
    Recrkuitment of EN's: When the Ticket legislation passed the DRS 
agency assumed that it would be structured as complementary to the 
traditional VR reimbursement program, much like the AOI study group has 
recently recommended. We recruited our traditional partners in 
delivering Supported Employment, a total of 26 Community Rehabilitation 
Programs, to be Alternate Providers under the previous SSA return to 
work program. It was our understanding that these organizations would 
be grand fathered into the Ticket EN system, thus ensuring Oklahomans a 
health EN network once the Ticket rolled out. However, SSA decided not 
to grandfather in the AP providers and required them to resubmit an 
application. The combination of this paperwork burden with the low 
rates of payment resulted in few of our CRP recruits becoming EN's. 
Those that did complete the paperwork have not been active. The primary 
problem is the low payment rates, the Ticket milestone payments 
represent a small fraction of what it costs for CRP/EN's to provide 
Supported Employment services. Implementation of the AOI Interim Report 
recommendations #1, to increase Milestone payments and allow payment 
for partial self-sufficiency, and #3 known as the Partnership Plus, 
would address the EN underfunding/undercapitalization problems that are 
restricting the Ticket's EN provider systems growth.
    Ticket Outreach Pilot: Under an SSA state partnership grant, 
Oklahoma DRS piloted an assertive outreach/marketing effort combined 
with Work Incentive education and choice of vendor using a vocational 
voucher, similar to the Ticket but better funded. Beginning in 1999 and 
ending in 2003 the ODRS developed systems for recruiting, educating on 
work incentives and providing Job Coaching services to beneficiaries 
with a Mental Health diagnosis. The techniques developed under this 
grant were used to develop the procedures described in #3 through #7 
below.
    Required Benefits Planning: Supported Employment Contractors are 
required to provide benefits planning assistance to all beneficiaries 
who are placed in a job.
    Active Recruitment of Ticket holders: Oklahoma DRS created a Ticket 
Unit that works with the Workforce system to actively recruit Ticket 
holders. Since February 2002 the Ticket staff have invited all callers 
to the agency toll free Ticket hotline to Ticket Orientation meetings 
held at the Workforce One Stop Centers. Thousands of Ticket holders 
received basic work incentive training at a One Stop to enable them to 
make use of their Ticket and plan their return to work.
    Expected Eligibility Process: Oklahoma DRS developed an expedited 
eligibility process for Ticket holders that resulted in determination 
of eligibility and assignment to a VR/VS counselor within 3-5 days 
after application. This is significantly faster than the normal 
paperwork processing time prior to the Ticket rollout.
    Training of DRS Staff: All DRS staff including front line staff 
received training on the Ticket to Work and the agencies assertive 
collaboration with Workforce on Ticket rollout.
    Direct Marketing of the Ticket with the Disability Program 
Navigators: The DRS and Workforce system have recently collaborated on 
a pilot direct Marketing campaign designed to reinvigorate the Ticket. 
Beginning in February and ending in April 2004 a pilot is being 
conducted where every Ticket holder in a suburban county near Oklahoma 
City is being invited to attend a Ticket Orientation meeting at the 
Local Workforce One Stop conducted by the Disability Program Navigator. 
In addition the SSA funded Benefits Planner, SSA's Area Work Incentive 
Coordinator and local VR staff are present to answer questions about 
available work incentives. This effort has received excellent feedback 
from those involved and will be evaluated for it's expansion potential.
    We share the CCD's concern, expressed in Paul Siefert's written 
testimony, about SSA's rule on automatic assignment of the Ticket. As 
one of our staff has said, ``We don't make the rules, we just abide by 
them.'' SSA considers the signature on the IPE to be an indication that 
an individual decided to use the ticket to obtain services from the 
State VR Agency. SSA memos state ``. . . the Ticket is assigned when 
the IPE (VR Individualized Plan for Employment) is signed.'' The 
separation of the Ticket and Reimbursement systems, as recommended by 
the AOI study group, would resolve this problem.
    SSA reimbursement funds, over $100 million per year nationally, 
provide services to thousands of additional beneficiaries each year. 
Loss of reimbursement funds, as is happening this year across the 
country, primarily due to the slow economy, reduces our ability to 
serve beneficiaries. The VR system is the only part of the Ticket 
system that is providing a significant level of services. SSA seems to 
be in the process of dismantling the Reimbursement program without 
having a working system to replace it. The logical step is to cross 
breed the two systems, as the AOI group has recommended, which will 
correct the deficiencies in both systems.
    Our agency has collaboratively developed an EN agreement with our 
EN/CRP partners, which both parties consider fair. Any funds recouped 
under these agreements, strictly a theoretical case as to date there 
are none, would allow the agency to serve additional SSA beneficiaries. 
Our VR-EN agreement only requires EN's to pay VR 50% of payments 
received from SSA under the Ticket up to the amount actually expended 
by VR on direct client services. Theoretically, as no shared cases have 
been developed, this is only necessary in the small minority of cases 
where beneficiaries actually leave the SSA rolls. It is our 
understanding that only one out of 14 beneficiaries who have work 
activity ever leave the rolls, so most likely DRS will only receive any 
reimbursement in less than 7% of the cases where we expend money. And 
most beneficiaries do not work the entire 60 months of the outcome 
period. Therefore DRS, hypothetically, would expend an average of 
$10,000 per case and on 93% of the cases get nothing back from the EN 
and on 7% of the cases would get back considerably less than the cost 
of services. One would not be far wrong if you said this argument is 
much ado about nothing.

                                 

                   Pennsylvania Office of Vocational Rehabilitation
                                     Harrisburg, Pennsylvania 17102
                                                  November 24, 2004
Kim Hildred
Majority Staff Director
1025 Connecticut Avenue NW
Suite 205
Washington, DC 20036

Dear Kim:

    The Pennsylvania Office of Vocational Rehabilitation (OVR) takes 
exception to the testimony provided by Paul Seifert on March 18, 2004 
to the House Social Security Subcommittee on Social Security's 
Management of the Ticket to Work Program. OVR has invested a lot of 
time, energy and resources into the Ticket to Work program in order to 
maintain and continue the partnerships we have established over the 
past years with other employment programs, schools, agencies and 
facilities.

Employment Network Referral Agreements

    A committee composed of representatives from the Pennsylvania 
Association of Rehabilitation Facilities (PARF) and OVR staff spent 
considerable time developing an agreement that met with the approval of 
the committee. The federal guidelines established for Social Security 
reimbursement were followed when determining reimbursement for services 
provided. OVR's agreement does require repayment of services provided 
whereby OVR receives fifty percent of each payment that the Employment 
Network (EN) collects from Social Security until repaid. However, OVR 
does not require repayment from the EN if the EN takes a loss on a 
Ticket customer. OVR only receives payment from the EN if the EN 
receives a payment.

Training and Outreach

    OVR has invested significant resources to provide outreach and 
training to the community and OVR staff about the Ticket to Work 
Program. Individual training programs were designed and directed 
specifically to OVR staff. In addition to training staff, the OVR 
Ticket to Work Coordinator has presented to special interest groups, 
advisory councils, schools, parents and Career Link staff. Many of 
these presentations have been co-presented with members from the 
Benefits Program Assistance and Outreach Programs, Social Security and 
Employment Networks.
    A letter has or will be sent to all OVR Pipeline cases as Tickets 
are distributed informing them of the program. Included in the mailing 
is a Fact Sheet that explains the Ticket program and the choices 
available.

Transmittal #17

    OVR does not involuntarily assign a beneficiary's Ticket without 
his/her knowledge. OVR is following the guidelines established by 
Social Security in Transmittal #17.
    OVR counselors have been instructed to discuss the assignment of 
the Ticket per Social Security regulations. In addition, a form has 
been developed for counselors to give the beneficiary that specifically 
addresses the assignment of the Ticket when the Individual Plan of 
Employment is signed.

Employment Networks

    OVR staff has reported that there are beneficiaries coming to OVR 
with their Ticket, as other ENs have not accepted them for services. 
Some of the reasons for refusal include:

      Ticket holders only want to work part time
      The EN doesn't have the resources to provide the services 
needed
      Lack of EN providers
      EN can receive direct payment for services from OVR 
faster than through Social Security
      If customer isn't employment ready, they are referred to 
OVR

    OVR strives to facilitate and maintain viable working relationships 
with agencies, schools, rehabilitation facilities, employers and all 
other entities interested in providing services to people with 
disabilities. Partnering with others is an intricate link in providing 
quality services to those we serve.
            Sincerely,
                                                  Stephen R. Nasuti
                                                 Executive Director

                                 

Statement of Larry C. Bryant, South Carolina Vocational Rehabilitation 
               Department, West Columbia, South Carolina

    Based on the hearing that took place on March 18, 2004 regarding 
the Social Security Administration's (SSA's) Management of the Ticket 
to Work Program, it is evident that the concerns regarding the Ticket 
to Work program continue to escalate. The South Carolina Vocational 
Rehabilitation Department believes that the successful services that 
the state vocational rehabilitation departments are providing to social 
security beneficiaries are being over looked due to the unresolved 
issued that have resulted from the 1999 Ticket to Work and Self-
sufficiency legislation. Therefore, we feel that it is necessary to 
provide written documentation regarding the positive services to social 
security beneficiaries that take place in South Carolina.
    Since the program's inception in 1999, the South Carolina 
Vocational Rehabilitation Department has actively supported the 
program. Our agency has invested a significant number of resources to 
train our staff regarding the ticket program and the impact that this 
program has on social security beneficiaries who desire to obtain 
independence through employment. Not only do we feel that our staff 
members should be educated about the ticket program, we feel strongly 
that our clients should have a full understanding of the program and 
work incentives that go along with it. Therefore, we request that ALL 
of our applicants and existing clients in the VR program who are 
receiving SSI and/or SSDI meet with a Benefit Specialist to discuss 
these issues. We encourage this regardless of ticket ``assignability.''
    Our agency is especially proud of the relationship that we have 
developed with our local Social Security offices. During the roll out 
phase of the ticket program in our state, we invited Social Security 
staff to attend and present at our ticket to work training sessions. 
Currently, we are working closely with the Work Incentive Coordinator 
in our state to provide additional ticket training in our 22 local 
offices located through the state. We feel that this relationship with 
SSA exemplifies the importance that South Carolina Vocational 
Rehabilitation Department places on providing services to the social 
security beneficiaries of South Carolina.
    We are also in the process of fostering a positive working 
relationship with the Employment Networks that serve South Carolina. We 
feel that it is necessary to develop an Employment Network (EN)/
Vocational Rehabilitation (VR) agreement that caters to the needs of 
the client not to the needs of ``reimbursement.'' It is our intention 
to provide the best services to social security beneficiaries as 
possible. Therefore, as we establish agreements with Employment 
Networks, not only will they outline an agreed method of payment, but 
most importantly shared service provisions. We do not agree with a 
``take it our leave it, one size fits all'' attitude toward EN/VR 
agreements. Service provision is our number one priority. The 
reimbursement that we receive is to supplement our services to social 
security beneficiary, not to supplant these services. Again, our 
client's needs and employment objectives drive the services provided to 
them. We encourage input from employment networks and other agencies 
regarding service provision for our clients. I will say, however, that 
the negative attitude displayed by other entities regarding Vocational 
Rehabilitation and Ticket to Work activities has been discouraging.
    As the Ticket to Work program continues to evolve, we feel that it 
is imperative to continue obtaining input from all parties who have 
been affected by this legislation. Resolutions to the issues 
surrounding the ticket program need to occur quickly in order to 
maintain the highest quality of service to social security 
beneficiaries.

                                 

                      Tennessee Division of Rehabilitation Services
                                         Nashville, Tennessee 37248
                                                      April 1, 2004
The Honorable E. Clay Shaw, Jr.
Chairman
Subcommittee on Social Security
U.S. House of Representatives
1102 Longworth House Office Building
Washington, DC 20515

Dear Chairman Shaw:

    On March 18, 2004, the Subcommittee on Social Security held a 
hearing on the Social Security Administration's Management of the 
Ticket to Work Program. The Division of Rehabilitation Services (DRS), 
with Tennessee Department of Human Services, would like to submit 
written comments for the hearing record in rebuttal to testimony 
presented by Mr. Paul J. Seifert, with the Social Security Task Force, 
Consortium for Citizens with Disabilities.

Staff Training on the Ticket Program

    Tennessee DRS State Office staff has traveled the state training 
its field counselors on the Ticket to Work Program. The agency also 
trains all new Vocational Rehabilitation (VR) Counselors on the Ticket 
to Work Program as part of its New Counselor's Training. Additionally, 
the agency often and regularly communicates to its staff updated and 
important information on this subject.
Informing SSA Beneficiaries of the Ticket Program

    A couple of months before the Ticket to Work Program was to be 
implemented in Tennessee, the agency sent out thousands of letters to 
its SSI/SSDI clients informing them of the forthcoming Ticket Program. 
The letter explained the program and pointed out that this new program 
was soon to start up in Tennessee. Clients were told that they may be 
getting a ``ticket'' to use to help enable them to get employment. 
Clients were told about the options they would have in choosing service 
providers, as well about the CDR benefit in using the Ticket.

The Agreement with Employment Networks

    The agency has a standard Employment Network agreement that is 
applicable to all those ENs who wish to partner with the agency. There 
are currently five such agreements in place in Tennessee. No EN has 
voiced any concern to the State Office about the contents of this 
Agreement.
    According to the Ticket to Work regulations, if an EN holds a 
ticket on an individual that they want to refer to a state VR agency, 
they must first have an agreement in place with that agency. The 
agency's agreement with ENs allows these referrals to be made under the 
ticket rules.
    As partners under the agreement, the Ticket Program lets the EN and 
the state VR agencies decide how they wish to share the Ticket payments 
from SSA.
    Tennessee's agreement with their EN partners lets the state VR 
agency recover monies it spends in serving the EN referrals. The money 
comes through a percentage of the periodic payments the EN gets from 
SSA via the EN payment system. This way, the EN always gets a portion 
of the SSA payment and the state VR agency gets a portion up until the 
state VR agency recovers its actual costs in serving the individual. 
The state VR agency receives no monies above its actual costs.

A Possible Solution

    Most state VR agencies across the nation would possibly welcome the 
recommendation of the Adequacy of Incentives Work Group--i.e., that 
cost reimbursement be made to state VR agencies separately from the 
Ticket Program, with the Ticket money going to ENs serving the 
beneficiary. In his testimony, Mr. Seifert seems to support this 
recommendation. This solution lets state VR agencies recover their 
costs and lets ENs receive money via the Ticket Program.
            Sincerely,
                                                         Carl Brown
                                             Assistant Commissioner

                                 

   Statement of Terrell I. Murphy, Texas Department of Assistive and 
                 Rehabilitative Services, Austin, Texas

    I would like to take a moment to comment on the March 18, 
2004 Hearing on the Social Security Administration's Management 
of the Ticket to Work Program.
    The Department of Assistive and Rehabilitative Services 
(DARS) administers the public vocational rehabilitation program 
in Texas. DARS has invested a significant amount of time and 
other resources in order to train VR counselors about the 
Ticket program. We have responded to numerous calls from 
consumers inquiring about the program, and do our best to 
explain not only the program but also the options available to 
them. We routinely refer consumers to the Benefits Planning 
Assistance and Outreach programs around the State, and 
encourage consumers to contact other Employment Networks (EN) 
in Texas so they can make informed decisions regarding the 
service provider that can best meet their individual needs.
    We originally developed a template for an EN agreement 
based on models from other States. This template basically 
required full repayment of VR's costs. For example, when VR 
expends less than $10,000 on a beneficiary referred by an EN 
that holds the beneficiary's ticket assignment, VR may ask for 
50 percent of the EN's outcome payments until VR has received 
full reimbursement for the services purchased for that 
beneficiary. For cases where VR expends more than $10,000, VR 
may seek a greater percentage of the EN's outcome payments. Our 
rationale was that it was in the best interest of our consumers 
for us to reclaim as much money as possible in order to be able 
to serve additional consumers. Our experience has been that 
Employment Networks have demonstrated little interest in 
entering into this type of agreement. As a result, we have 
initiated a process to meet with representatives from 
Employment Networks to discuss creating an agreement that would 
be more suitable.
    Our goal is to work cooperatively with Employment Networks 
and all other interested individuals and organizations in order 
to best meet the employment needs of individuals with 
disabilities.

                                 

                                Utah State Office of Rehabilitation
                                         Salt Lake City, Utah 84114
                                                      April 1, 2004
Committee on Ways and Means
U.S. House of Representatives
1102 Longworth House Office Building
Washington D.C. 20515

Dear Honorable Congressmen E. Clay Shaw Jr. and Members of the 
Subcommittee,

    In regard to the March 18th Hearing on the Social Security 
Administrations management of the Ticket to Work program, we 
respectfully provide the following input.
    We applaud the efforts of Congress and Social Security to create 
work incentives for individuals with disabilities. These new provisions 
have created countless opportunities for individuals who otherwise 
would not have engaged in work activity. We respect an individual's 
right to choose how and whether rehabilitation services will be 
provided. Furthermore, we support the efforts of Congress, the Social 
Security Administration and the Ticket to Work Advisory Panel to make 
improvements to the Ticket to Work program. It is due to our interest 
in helping make this program a viable and affable program for 
beneficiaries and Employment Networks (EN's) (including State 
Vocational Rehabilitation Agencies), that we want to ensure Congress 
have access to accurate information regarding states implementation of 
the Ticket to Work program.
    Many of the concerns regarding the Ticket to Work program have been 
well documented over the past two years. Others have not. The Utah 
State Office of Rehabilitation (USOR) agrees with the recommendations 
made recently by the Ticket to Work Advisory Panel. The problems 
associated with low EN participation have been attributed to the high 
amount of risk involved in assigning tickets with little or no hope for 
claiming any payment from Social Security. However USOR feels that EN 
participation has not been affected in the manner espoused by Mr. 
Seifert. In Paul Seifert's testimony, he asserts that ``State VR 
agencies have developed stand alone, take it or leave it one size fits 
all agreements for EN's in their states''. He further asserts that 
these agreements ``require full and total repayment of all of VR's 
costs''. In the state of Utah, we have conducted focus groups with our 
EN's to explore the fairness of our draft agreement. The Employment 
Networks were given a draft copy of the agreement and encouraged to 
make comments. We have maintained the position that EN's in our state 
are not obligated to sign any agreement, and we have encouraged them to 
draft their own agreements for our consideration. Furthermore, we have 
conducted countless focused training sessions in conjunction with our 
Area Work Incentive Coordinator to ensure that EN's were up to date on 
the provisions of the Ticket to Work legislation and to empower them to 
draft their own agreements. We held our own ``EN recruitment'' 
symposium and dedicated almost \1/2\ day to discuss creative 
partnerships. Despite our outreach efforts and openness to creative 
partnerships, none of the EN's have submitted an EN agreement for our 
consideration and have unanimously agreed to sign the agreement posed 
by our agency.
    The reasons cited by the EN's remain consistent with earlier and 
well documented implementation issues with the Ticket to Work program. 
The EN's in Utah are afraid of the financial risk involved in accepting 
tickets, with or without VR as a partner. The EN's in Utah including 
USOR meet periodically to discuss ticket issues and to provide general 
support to each other. At all times, this has been done in a spirit of 
cooperation and collaboration, not just between USOR, but also among 
all seven of the Utah EN's. On one occasion, one of the EN's called the 
Ticket to Work coordinator at USOR to ask her technical assistance in 
assigning a ticket to his EN. She walked him through the process of how 
he could assign a ticket to his company. In the end, the EN made the 
decision not to accept the ticket, and referred the individual to VR 
because he felt that the administrative work associated with the ticket 
was burdensome. Our state has worked hard to create a healthy working 
relationship with Employment Networks, and to emphasize the importance 
of those relationships in our own staff training.
    Frankly, we are offended by Mr. Seifert's testimony to the 
contrary.
    In further testimony, Paul Seifert criticizes the state VR agencies 
who failed to register tickets in a timely fashion, with the 
unfortunate circumstance of benefits being reduced (and later restored) 
for a beneficiary. We would just like to assure Congress as well as Mr. 
Seifert that our state database system allows us to track where all our 
tickets are during the entire assignment process. We have created an 
electronic system of completing the SSA1365 form and recording when the 
ticket is actually assigned by Maximus thereby hoping to alleviate any 
of the potential problems mentioned in testimony.
    Finally, Mr. Seifert addresses transmittal 17. The Utah State 
Office of Rehabilitation shares concern over this policy decision made 
by the Social Security Administration. Informed Consent has been a 
guiding force in our daily operations prior to Ticket to Work, and 
remains integral to our Ticket policy and procedure today.
    During the first two years of the Ticket Implementation process I 
chaired the Council of State Administrations of Vocational 
Rehabilitation (CSAVR) Committee on Social Security Relationships. The 
committee had numerous meetings with SSA, RSA and others to identify 
issues and seek solutions regarding implementation problems associated 
with the Ticket to Work and Work Incentives Act. Quarterly 
teleconferences were held between the states currently implementing the 
ticket, CSAVR, RSA, and SSA to determine how the ticket was being 
implemented and to provide technical assistance. In addition CSAVR, SSA 
and RSA sponsored national training conferences prior to each group of 
states that were implementing the Ticket program. Even before the 
ticket program began, CSAVR was providing input to SSA and Congress 
regarding these issues. In the last four years, upper management from 
SSA and Maximus have participated in every CSAVR conference.
    Contrary to Mr. Seifert's testimony, it has been my observation 
that State VR agencies have bent over backwards to assist in the 
development of the ticket program. Yes, a few states have made some 
mistakes which have been corrected. In the final analysis the Ticket 
program would be dead in the water without the State VR agencies.
    The State of Utah is still in early implementation phase. There 
have only been 11,698 tickets mailed thus far, with 72 tickets 
assigned. Utah, like other states has made great preparations for this 
program. We are hopeful that measures will be taken to ensure the 
success of this program. We support the recommendations made by the 
Adequacy of Incentives Advisory Committee and as well, the Ticket to 
Work Advisory Panel recommendations. We urge Congress to seek input 
from all states regarding Ticket to Work Implementation. The Ticket to 
Work and Work Incentive Improvement Act holds much potential for job 
seekers with disabilities, but to realize the potential of this program 
we must work together to overcome the barriers rather than pointing 
fingers. The Utah State Office of Rehabilitation is committed to 
working with Congress and the Social Security Administration in 
realizing the potential of this important program.
            Respectfully,
                                                    Blaine Petersen
                                                 Executive Director

                                 

   Statement of Michael O'Brien, Washington Department of Social and 
    Health Services, Division of Vocational Rehabilitation, Lacey, 
                               Washington

    Mr. Chairman, Mr. Matsui, and members of the House Social Security 
Subcommittee, I am writing on behalf of Washington State Division of 
Vocational Rehabilitation (DVR) in order to provide written testimony 
in connection with the hearing on the Social Security Administration's 
implementation of the Ticket to Work and Self-Sufficiency Program, 
authorized under the Ticket to Work and Work Incentives Improvement Act 
of 1999.
    I am writing in response to the comments made in Mr. Seifert's 
testimony under the heading ``State VR Agencies, Employment Networks 
(ENs) and Beneficiaries.'' Mr. Seifert's written testimony states: 
``State VR agencies have developed stand-alone, take-it-or-leave-it, 
one-size-fits-all agreements for ENs in their states. These agreements 
all contain one common provision--the full and total repayment of all 
of VR's costs out of the EN's ticket payment by an EN who refers a 
beneficiary to VR.''
    This is not our practice in Washington State. The fact is, we want 
and need ENs. Washington State has a capacity issue and we believe ENs 
can assist in addressing this issue. Our agreements with ENs do not 
require more than a forty percent reimbursement to DVR on a shared 
Ticket. We have provided technical support to the local Workforce 
Development Councils to assist them in becoming Employment Networks. We 
are in the process of providing training on Ticket and work incentives 
to One-Stop staff. We will be holding focus groups this spring with ENs 
to figure out what else can be done to assist them.
    Washington State DVR took an active role a year prior to the phase 
three roll-out in order to ensure that Ticket was successful in our 
State. We formed an interagency Ticket Advisory Group whose purpose was 
to prepare the state for Ticket, to encourage and support the 
development of Employment Networks, and to ensure that work incentives 
were understood throughout the system so that customers would take 
advantage of the incentives. Sixteen of DVR's staff have gone through 
the SSA certification to become benefits planners. Washington State DVR 
developed its own training modeled after the SSA training and has 
trained one third of its staff in benefits planning.
    The Ticket Advisory members also have coordinated numerous joint 
and solo presentations on Ticket to Work, SSA work incentives, and the 
Medicare Buy-In program. Washington State DVR sponsored and coordinated 
two spring conferences on Ticket to Work to encourage EN development. 
Those conferences were attended by over 400 people. Washington State 
DVR paid for national experts on Ticket to speak.
    Under the leadership of Washington State DVR, this committee 
developed a Ticket brochure with basic information on Ticket that could 
be used system wide, as well as a Ticket brochure for transition 
students. We compiled a list of frequently asked questions which is 
posted on all partners' websites. We currently are planning six one-day 
conferences statewide that will enable customers to better understand 
Ticket and the related work incentives.
    Washington State DVR set up a toll-free line that anyone with a 
Ticket question can call. What we are finding is that, as a state, 
there is a serious problem of Ticket holders having nowhere to use 
their Ticket. Few ENs in our state are accepting Tickets and many 
Ticket holders are very frustrated. Unfortunately, DVR cannot be the 
answer because we are in ``order of selection'' and have a long waiting 
list.
    Mr. Seifert, in his testimony, faults VR agencies for delaying or 
failing to assign a beneficiary's Ticket, resulting in the beneficiary 
being subjected to a Continuing Disability Review (CDR). I would like 
to state that this does not occur in Washington State. We have made it 
very clear to Ticket holders and DVR staff that a Ticket is assigned 
only when the 1365 form and the Individualized Plan for Employment 
(IPE) is signed. We have held four statewide trainings on the Ticket 
program, and 31 additional trainings at every DVR office in the state 
to insure our staff understands when and how a ticket is assigned.
    However, there is a problem. Transmittal 17 states that a 
beneficiary's signature on the IPE indicates that the beneficiary has 
decided to use the ticket to obtain services from the State VR agency, 
if the ticket is assignable. This effectively takes away any choice 
from the individual. If ticket holders sign the IPE--which must occur 
in order to receive services--then according to TM 17 they have 
assigned their ticket.
    Washington State has chosen to submit only Tickets that the 
beneficiary has deliberately assigned to us. I would suggest that the 
problem is with TM 17, not with public rehabilitation.
    Thank you for the opportunity to share information about Ticket 
implementation and issues in Washington State.

                                 

    Statement of West Virginia Division of Rehabilitation Services, 
                       Charleston, West Virginia

Reference Hearing on SSA Management of the Ticket to Work program held 
                           on M arch 18, 2004

    The West Virginia Division of Rehabilitation Services (WV DRS) 
provides the following comments as it relates to the above referenced 
hearing:

    1.  WV DRS has invested significant resources to train all VR 
Counselors and administrative staff in the Ticket to Work program, 
developed a brochure to educate beneficiaries about the program and 
updated the Electronic Case Management system to collect additional 
data needed for the program.
    2.  WV DRS has provided training to our Consumer Advisory 
Committee, State Rehabilitation Council and Statewide Independent 
Living Council on the ticket program, as well as, facilitated training 
provided to the Community Rehabilitation Programs in our state.
    3.  WV DRS has worked with Social Security Administration and asked 
for their input into developing our processes and procedures for 
implementing the Ticket to Work program.
    4.  WV DRS refers all Social Security recipients to the Benefits 
Planning Assistance and Outreach program specialist to discuss how 
working will effect their benefits and any incentives they can take 
advantage of when entering or re-entering the workforce.
    5.  Our interpretation of the SSA Transmittal 17--If an individual 
applies for VR services, is determined eligible, meets our order of 
selection of having a most significant disability and works with the 
Rehabilitation Counselor to develop their Individual Plan of Employment 
and would not agree to assign their ticket to the agency; then DRS 
would send MAXIMUS the front and back page that includes signatures of 
the IPE and the unsigned SSA 1365. This effectively establishes that 
DRS is working with the individual and gives MAXIMUS the data it needs 
to determine ticket assignment and/or sharing of reimbursements.

    Since West Virginia is a third round state, we do not yet have any 
agreements with Employment Networks in our state but we are not 
experiencing negative relationships with other Employment Networks.

                                 
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