[Federal Register Volume 68, Number 183 (Monday, September 22, 2003)]
[Notices]
[Pages 55073-55075]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-24045]


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SOCIAL SECURITY ADMINISTRATION


Supplemental Security Income (SSI) for the Aged, Blind and 
Disabled; Extension of the SSI Work Incentives Demonstration Project

AGENCY: Social Security Administration (SSA).

ACTION: Notice of the extension of the SSI Work Incentives 
Demonstration Project.

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SUMMARY: We are announcing an extension of the period for testing the 
use of certain modifications of the SSI program rules for participants 
in the SSI Work Incentives Demonstration Project. We are conducting 
this demonstration project under the authority of section 1110(b) of 
the Social Security Act (the Act). Under this project, the Social 
Security Administration (SSA) is testing the effectiveness of altering 
certain provisions of the SSI program under title XVI of the Act as an 
incentive to encourage SSI recipients with disabilities or blindness to 
work for the first time, return to work, or increase their work 
activity and earnings. We are conducting this demonstration project in 
selected States which we are assisting under our State Partnership 
Initiative to develop innovative and enhanced systems for the 
coordination and delivery of services to assist persons with 
disabilities to obtain employment and reduce their dependence on 
government benefit programs.
    We are extending the period during which the modifications of the 
SSI program rules will apply to participants in the SSI Work Incentives 
Demonstration Project in order to obtain sufficient data to permit a 
thorough evaluation of the effects that the altered SSI program rules 
and enhanced service delivery systems in the selected States have on 
encouraging SSI recipients to enter and remain in the workforce and 
reduce their dependence on SSI benefits and benefits under other 
government programs. We are publishing this notice in accordance with 
20 CFR 416.250(e).

DATES: We are extending the date on which the alternative SSI program 
rules generally end for project participants from September 30, 2003 to 
September 30, 2004. We are extending the starting date of the 24-month 
spend-down period for the Independence Account, which is a feature of 
the alternative rules that apply to project participants, from October 
1, 2003 to October 1, 2004. If we decide to extend the period for 
testing the alternative SSI program rules beyond these dates, we will 
publish a notice in the Federal Register.

FOR FURTHER INFORMATION CONTACT: B. J. Olson, Social Security 
Administration, Office of Program Development and Research, 6401 
Security Boulevard, 3531 Annex Building, Baltimore, Maryland 21235-
6401; phone (410) 965-9990 or through e-mail to [email protected].

SUPPLEMENTARY INFORMATION: 

The SSI Work Incentives Demonstration Project

    On January 25, 2001, we published a notice in the Federal Register 
(66 FR 7826) announcing and describing the SSI Work Incentives 
Demonstration Project. Under this project, we are testing, on a 
demonstration basis, the effectiveness of certain modifications of the 
SSI program rules as incentives for SSI recipients with disabilities or 
blindness to attempt work activity or increase their level of work and 
earnings. For SSI recipients who are participating in the demonstration 
project, we are waiving certain provisions of title XVI of the Act and 
the implementing regulations and applying alternative rules for SSI 
program purposes. The alternative rules which apply to project 
participants involve modifications of the SSI program rules relating to 
the counting of a recipient's income and resources for SSI program 
purposes, and to the initiation of certain continuing disability 
reviews for recipients of SSI benefits based on disability or 
blindness.
    We are conducting the SSI Work Incentives Demonstration Project 
under the authority of section 1110(b) of the Act. Section 1110(b) of 
the Act authorizes the Commissioner of Social Security to waive any of 
the requirements, conditions, or limitations of title XVI of the Act to 
the extent necessary to carry out experimental, pilot, or demonstration 
projects which, in the Commissioner's judgment, are likely to assist in 
promoting the objectives or facilitate the administration of the SSI 
program.
    We are conducting the SSI Work Incentives Demonstration Project in 
connection with certain return-to-work projects for which we awarded

[[Page 55074]]

cooperative agreement funds to certain States under our State 
Partnership Initiative (SPI) program. In 1998, under the SPI program, 
SSA awarded five-year cooperative agreements to a number of States to 
develop innovative and enhanced systems for the coordination and 
delivery of rehabilitation, employment, and other support services to 
assist adults who are recipients of SSI benefits based on disability or 
blindness, or who are Social Security Disability Insurance (SSDI) 
beneficiaries, to enter and remain in the workforce and reduce their 
dependence on SSI and SSDI benefits.
    We are conducting the SSI Work Incentives Demonstration Project, 
which consists of two models, in conjunction with the testing of the 
enhanced service delivery systems employed in the SPI projects in the 
States of California, New York, Vermont and Wisconsin. Our overall 
objective in conducting this project is to demonstrate whether certain 
modifications of the SSI program rules, in combination with the 
enhanced service delivery systems employed in the SPI projects in these 
States, are effective in promoting the return-to-work efforts of 
disabled or blind SSI recipients. The four States are collecting data 
for each project participant regarding identifying information, 
educational and vocational background, services provided, work attempts 
and outcomes, and use of the alternative SSI program rules. Each State 
will use the data to evaluate the effectiveness of the alternative SSI 
program rules and enhanced service delivery systems under the project 
in that State. The data will also be used by evaluators under contract 
with SSA to perform a process evaluation and a net outcomes evaluation.

Participants in the SSI Work Incentives Demonstration Project

    To be a participant in the SSI Work Incentives Demonstration 
Project, an individual must be a disabled or blind SSI recipient or 
concurrent SSI/SSDI beneficiary who is enrolled as a participant in the 
SPI cooperative agreement project in California, New York, Vermont or 
Wisconsin. An enrollee in one of the SPI projects becomes a participant 
in the SSI Work Incentives Demonstration Project by providing a 
voluntary written consent to be a participant in the SSI demonstration 
project. The individual's consent to participate in the SSI Work 
Incentives Demonstration Project may be revoked by the individual at 
any time. In addition, an individual's status as a participant in the 
SSI Work Incentives Demonstration Project will end if his or her 
participation in the SPI project ends.

Alternative SSI Program Rules That Apply to Participants in the SSI 
Work Incentives Demonstration Project

    The alternative SSI program rules that we are testing under the 
demonstration project consist of the following four elements. Elements 
1 through 3 apply to participants in the project who are SSI-only 
recipients or concurrent SSI/SSDI beneficiaries. Element 4 only applies 
to participants who are SSI-only recipients; it does not apply to 
concurrent SSI/SSDI beneficiaries.

1. ``Three-for-Four''--Increase Earned Income Exclusion

    SSA is testing the effectiveness, as a work incentive, of using a 
modified earned income exclusion in determining an SSI recipient's 
countable income for SSI program purposes. Under this alternative rule, 
SSA will exclude the first $65 of a project participant's monthly 
earned income plus an additional 75 percent of any remaining gross 
monthly earned income, or an additional $3 for every $4 earned. This 
differs from the current rules under which SSA excludes the first $65 
of monthly earned income plus an additional 50 percent of any remaining 
gross monthly earned income, or an additional $1 for every $2 earned.

2. ``Unearned Income Related to Work Activity''--Treat as Earned Income

    SSA is testing, as an additional work incentive, treating certain 
types of temporary unearned income related to work activity in the same 
manner as earned income is treated under element 1 above for purposes 
of determining an SSI recipient's countable income. That is, for a 
project participant, SSA will exclude the first $65 per month of 
certain types of unearned income that result from work activity plus 75 
percent of the remainder of such unearned income in a month. This 
differs from current SSI rules under which SSA excludes the first $20 
of unearned income in a month. The only types of temporary unearned 
income that result from work activity that are subject to this 
alternative rule are: unemployment insurance benefits, worker's 
compensation benefits, State disability benefits, and disability-
related benefits paid through private insurance plans. Other types of 
benefits, such as Social Security benefits or veterans benefits from 
the Department of Veterans Affairs, will continue to be treated as 
unearned income based on current rules.

3. ``Independence Account''--Create New Resource Exclusion

    SSA is testing the use of an additional resource exclusion as a 
work incentive. Under this alternative rule, SSA allows a project 
participant to maintain an ``Independence Account'' as a resource, 
beyond the current $2,000 resource limit. For purposes of determining 
an SSI recipient's countable resources, SSA will exclude monies 
conserved (including any accrued interest) in one separate account for 
saved wages, not to be commingled with other monies, and with deposits 
limited to 50 percent of gross earnings, not to exceed $8,000 per year. 
The account may be a checking or savings account, certificate of 
deposit, money market or mutual fund account. It cannot be any type of 
retirement plan such as an IRA, Roth IRA, 401(k) plan, or 403(b) plan. 
The period during which a participant is permitted to deposit a portion 
of his or her wages into an ``Independence Account'' will end when this 
altered SSI program rule terminates or, if earlier, when he or she 
ceases to be a project participant. Following the close of the period 
for making deposits, SSA will provide the individual a 24-month spend-
down period during which the resource exclusion under this alternative 
rule will continue to apply to monies in the account.

4. ``Medical Continuing Disability Reviews''--Suspend for Certain 
Participants

    SSA is testing suspending medical continuing disability reviews 
(CDRs) as a work incentive for certain individuals. SSA is suspending 
medical CDRs for participants in the demonstration project who are SSI-
only recipients with ``medical improvement possible'' or ``medical 
improvement not expected'' diaries. For a project participant meeting 
these criteria, SSA will not initiate a medical CDR during the period 
this alternative rule is in effect, so long as the individual remains a 
project participant. The suspension of CDRs does not apply to 
redeterminations of disability that are required for childhood 
disability recipients who attain age 18.

The Two Models of the SSI Work Incentives Demonstration Project

    Model one of the demonstration project uses the alternative SSI 
program rules described in items 1 through 4 above, and is being 
carried out in conjunction with the SPI projects in California, New 
York, and Wisconsin. Model two of the demonstration project uses the 
alternative SSI program rules

[[Page 55075]]

described in items 2 through 4 above, and is being carried out in 
conjunction with the SPI project in Vermont.

Extension of the Period for Testing the Alternative SSI Program Rules

    In the notice announcing the implementation of the SSI Work 
Incentives Demonstration Project, published at 66 FR 7826 (January 25, 
2001), we indicated that, with the exception of the spend-down period 
for the ``Independence Account,'' the alternative SSI program rules 
would cease to apply to project participants after September 30, 2003. 
For an individual who is a participant on September 30, 2003, we 
indicated that the 24-month spend-down period for the ``Independence 
Account'' would begin on October 1, 2003.
    We are extending the period during which the alternative SSI 
program rules will be in effect for participants in the SSI Work 
Incentives Demonstration Project for one year. We are extending the 
period for testing in order to produce sufficient data to permit a 
thorough evaluation of the effects that the altered SSI program rules 
and enhanced service delivery systems in the selected States have on 
encouraging SSI recipients to enter and remain in the workforce and 
reduce their dependence on SSI benefits and benefits under other 
government programs. To enable additional testing for one year of the 
combined effects of the altered SSI program rules and enhanced service 
delivery systems in the selected States, we are providing a 12-month 
extension of the cooperative agreement project period and the necessary 
additional funding to the SPI projects in the four States to enable 
them to continue to provide services for the extended period to SSI 
recipients (including concurrent SSI/SSDI beneficiaries) who are 
enrolled in the SPI projects as of September 30, 2003, and to collect 
and evaluate data for this period.
    Except for the spend-down period for the ``Independence Account,'' 
we are extending the ending date of the period during which the 
alternative SSI program rules apply to a participant in the SSI Work 
Incentives Demonstration Project from September 30, 2003 to September 
30, 2004. With the exception of the spend-down period, the alternative 
SSI program rules will cease to be effective after September 30, 2004.
    We are extending the starting date of the 24-month spend-down 
period for the ``Independence Account'' for a project participant from 
October 1, 2003 to October 1, 2004. The spend-down period will begin on 
October 1, 2004 (or, if earlier, when an individual ceases to be a 
participant in the SSI demonstration project) and will end after a 
period of 24 months.
    Additional information about the SSI Work Incentives Demonstration 
Project, a description of the specific statutory and regulatory 
provisions being waived to conduct the project, and a description of 
the SPI projects in California, New York, Vermont and Wisconsin can be 
found in the notice announcing the implementation of the SSI Work 
Incentives Demonstration Project which we published in the Federal 
Register on January 25, 2001 (66 FR 7826).

    Dated: September 16, 2003.
Jo Anne B. Barnhart,
Commissioner of Social Security.
[FR Doc. 03-24045 Filed 9-18-03; 12:01 pm]
BILLING CODE 4191-02-P