    Social Security Administration: Better Planning Could Make the
    Ticket Program More Effective (02-MAR-05, GAO-05-248).

    The Social Security Administration (SSA) manages the two largest
    federal disability benefit programs and made approximately $75
    billion in payments to about 8 million beneficiaries (ages 18
    through 64) in 2003. Given the size of its programs, even small
    improvements in SSA's ability to return beneficiaries to work
    offer the potential for significant savings. Until recently,
    Social Security beneficiaries who needed help returning to work
    generally had to seek services from state vocational
    rehabilitation (VR) agencies. Few beneficiaries used these
    services or successfully returned to work. Therefore, Congress
    passed the Ticket to Work and Work Incentives Improvement Act of
    1999 (Ticket Act, P.L. 106-170) to create a Ticket to Work and
    Self-Sufficiency Program (the Ticket program). The program's
    goals are to expand the availability of service providers and to
    help enable beneficiaries to return to work, become
    selfsufficient, and stop receiving disability benefit payments.
    Eligible beneficiaries can use their tickets as vouchers to
    request vocational rehabilitation, employment, or other support
    services from the traditional state VR agencies or from new
    SSA-approved public or private providers, which are referred to
    as employment networks (EN). The act required SSA to implement
    the Ticket program and make tickets available to all eligible
    beneficiaries. SSA decided to use three phases to make tickets
    available: (1) beginning with 13 states in February 2002, (2)
    expanding to 20 more states and the District of Columbia in
    November 2002, and (3) expanding to the final 17 states and 5
    territories in November 2003. The act also required SSA to
    perform several periodic and independent evaluations of the
    program. For example, SSA was mandated to periodically review the
    systems used to make payments to the providers and was also given
    authority to make needed changes. The act also required SSA to
    provide Congress with three independent evaluations of the
    effectiveness of program activities. Finally, the act created the
    Ticket to Work and Work Incentives Advisory Panel (the Advisory
    Panel) to include experts on employment and related services and
    representatives of individuals with disabilities to provide
    advice and reports on the program to SSA, the Congress, and the
    President. The Congress also mandated in the Social Security
    Protection Act of 2004 that GAO evaluate the Ticket program and
    provide a report to Congress by March 2, 2005. The statute
    requires that GAO (1) examine the annual and interim reports
    issued by the Commissioner of Social Security and the Advisory
    Panel, (2) assess the effectiveness of the activities carried out
    under the program, and (3) recommend legislative or
    administrative changes, if appropriate. To meet these
    requirements, our report examines: (1) the progress SSA has made
    in implementing and evaluating the Ticket program and achieving
    its goals, (2) the problems that have limited the program's
    ability to achieve its goals, (3) the recommendations to better
    achieve the goals of the program made by the Advisory Panel,
    researchers, and service providers, and (4) the challenges SSA
    faces in implementing changes to achieve the program's goals.
    -------------------------Indexing Terms-------------------------
    REPORTNUM:   GAO-05-248
        ACCNO:   A18516
      TITLE:     Social Security Administration: Better Planning Could
    Make the Ticket Program More Effective
         DATE:   03/02/2005
      SUBJECT:   Beneficiaries
    	     Disability benefits
    	     Employment assistance programs
    	     Federal aid programs
    	     Federal social security programs
    	     Performance measures
    	     Program evaluation
    	     Vocational rehabilitation
    	     Workfare
    	     Program goals or objectives
    	     Vouchers
    	     SSA Ticket to Work and Self-Sufficiency
    	     Program

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    GAO-05-248

    United States Government Accountability Office

    GAO

                           Report to Congressional Committees

    March 2005

                                    SOCIAL SECURITY
                                     ADMINISTRATION

              Better Planning Could Make the Ticket Program More Effective

    GAO-05-248

    Contents

                                        Letter 1

    Appendix I Briefing Slides

    Appendix II Comments from the Social Security Administration

      Appendix III GAO Contacts and Staff Acknowledgments 44

    GAO Contacts 44 Staff Acknowledgments 44

    Abbreviations

    DI Disability Insurance
    EN Employment Network
    SSA Social Security Administration
    SSI Supplemental Security Income
    VR Vocational Rehabilitation

    This is a work of the U.S. government and is not subject to copyright
    protection in the United States. It may be reproduced and distributed in
    its entirety without further permission from GAO. However, because this
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    separately.

    United States Government Accountability Office Washington, DC 20548

    March 2, 2005

    The Honorable Charles E. Grassley
    Chairman
    The Honorable Max Baucus
    Ranking Minority Member
    Committee on Finance
    United States Senate

    The Honorable William M. Thomas
    Chairman
    The Honorable Charles B. Rangel
    Ranking Minority Member
    Committee on Ways and Means
    House of Representatives

    The Social Security Administration (SSA) manages the two largest federal
    disability benefit programs and made approximately $75 billion in
    payments to about 8 million beneficiaries (ages 18 through 64) in 2003.
    Given the size of its programs, even small improvements in SSA's ability
    to
    return beneficiaries to work offer the potential for significant savings.
    Until recently, Social Security beneficiaries who needed help returning to
    work generally had to seek services from state vocational rehabilitation
    (VR) agencies. Few beneficiaries used these services or successfully
    returned to work. Therefore, Congress passed the Ticket to Work and
    Work Incentives Improvement Act of 1999 (Ticket Act, P.L. 106-170) to
    create a Ticket to Work and Self-Sufficiency Program (the Ticket
    program). The program's goals are to expand the availability of service
    providers and to help enable beneficiaries to return to work, become self
    sufficient, and stop receiving disability benefit payments. Eligible
    beneficiaries can use their tickets as vouchers to request vocational
    rehabilitation, employment, or other support services from the traditional
    state VR agencies or from new SSA-approved public or private providers,
    which are referred to as employment networks (EN).

    The act required SSA to implement the Ticket program and make tickets
    available to all eligible beneficiaries. SSA decided to use three phases
    to
    make tickets available: (1) beginning with 13 states in February 2002,
    (2) expanding to 20 more states and the District of Columbia in November
    2002, and (3) expanding to the final 17 states and 5 territories in
    November
    2003. The act also required SSA to perform several periodic and

    independent evaluations of the program. For example, SSA was mandated to
    periodically review the systems used to make payments to the providers and
    was also given authority to make needed changes. The act also required SSA
    to provide Congress with three independent evaluations of the
    effectiveness of program activities. Finally, the act created the Ticket
    to Work and Work Incentives Advisory Panel (the Advisory Panel) to include
    experts on employment and related services and representatives of
    individuals with disabilities to provide advice and reports on the program
    to SSA, the Congress, and the President.

    The Congress also mandated in the Social Security Protection Act of 2004
    that GAO evaluate the Ticket program and provide a report to Congress by
    March 2, 2005. The statute requires that GAO (1) examine the annual and
    interim reports issued by the Commissioner of Social Security and the
    Advisory Panel,1 (2) assess the effectiveness of the activities carried
    out under the program, and (3) recommend legislative or administrative
    changes, if appropriate. To meet these requirements, our report examines:
    (1) the progress SSA has made in implementing and evaluating the Ticket
    program and achieving its goals, (2) the problems that have limited the
    program's ability to achieve its goals, (3) the recommendations to better
    achieve the goals of the program made by the Advisory Panel, researchers,
    and service providers, and (4) the challenges SSA faces in implementing
    changes to achieve the program's goals. On February 25, 2005 we briefed
    your staff on the results of our analysis. This report formally conveys
    the information provided during the briefing (see app. I).

    To assess the Ticket program, we reviewed and evaluated the quality of key
    studies conducted for SSA on the implementation and effectiveness of the
    program. We also reviewed reports by the Advisory Panel and other related
    documents. To supplement information in these reports, we interviewed key
    stakeholders involved in implementing or evaluating the program, such as
    SSA officials, state VR officials, and Advisory Panel members. We also
    interviewed representatives of selected disability organizations to obtain
    their views on the Ticket program. However, our ability to evaluate the
    effectiveness of the Ticket program was limited by SSA's lack of
    information on beneficiaries' work efforts prior to the implementation of
    the Ticket program. We conducted our work between

    1While the mandate also required GAO to examine states' annual and interim
    reports on the Ticket program, we were unable to undertake this effort
    because states have not been required to, nor have they evaluated, the
    implementation and effectiveness of the Ticket program.

    August 2004 and January 2005 in accordance with generally accepted
    government auditing standards.

    In summary, we found:

    o  	SSA has made progress implementing and evaluating the Ticket program,
    but the agency has had limited success in achieving the program's goals of
    expanding beneficiaries' choice of service providers and increasing
    beneficiaries' efforts to work and become self-sufficient. Although SSA
    experienced delays with the initial distribution of tickets, the agency
    finished distributing tickets to eligible beneficiaries throughout the
    nation in September 2004.2 As part of implementation, SSA has also
    contracted for extensive assessments of its program's performance. Despite
    SSA's completion of key implementation activities, it has had limited
    success achieving its goal to encourage service providers to join the
    program and provide services to beneficiaries. As of August 2004, although
    SSA had contacted more than 50,000 potential new service providers, only
    1,164 had become ENs and, as of May 2004, just 386 had accepted tickets
    and agreed to provide services to beneficiaries. Furthermore, early
    results indicate that the program has made little progress in achieving
    its goal of increasing beneficiaries' efforts to work and to discontinue
    receiving SSA's disability benefits. Of the 9.5 million beneficiaries
    receiving tickets, less than 1 percent (62,901) have assigned their
    tickets to an EN or state VR agency, as of August 2004. Lastly, about 160
    beneficiaries have had sufficient earnings to result in the discontinuance
    of their disability benefit payments and payments to ENs, as of March
    2004.3

    o  	The Ticket program's ability to achieve its goals has been hindered by
    several factors, according to the Advisory Panel, researchers, and service
    providers. First, service providers believe that the program's payment
    system does not provide adequate compensation for the administrative costs
    of participating. Second, participation of eligible beneficiaries has been
    limited by the lack of ENs, the lack of outreach to provide information
    about the program, and the lack of incentives to encourage beneficiaries
    to participate. Beneficiary participation was also reduced by SSA's rules
    that exclude from the Ticket program some potential participants, such as
    adult beneficiaries who are expected to experience medical improvement.
    Finally, external factors, such as a decline in the

    2SSA continues to distribute tickets to additional beneficiaries as they
    become eligible for the Ticket program.

    3SSA was unable to provide us with more current data.

    availability of jobs in the economy, may have discouraged program
    participation or reduced the success of beneficiaries' work activities.

    o  	The Advisory Panel and others have suggested numerous changes to
    improve the Ticket program. The Advisory Panel and others believe that
    reforming the payment system is critical to expanding participation. In
    addition, they suggested numerous changes to reduce the administrative
    burden for service providers, such as having SSA provide additional
    services, guidance, and information to providers. To address limited
    beneficiary participation, the Advisory Panel and others have a number of
    suggestions, such as using a national campaign to market the program. The
    Advisory Panel also suggested that SSA include in the Ticket program
    beneficiaries it had previously excluded.

    o  	SSA faces several challenges as it tries to improve the Ticket
    program's ability to achieve its goals. Although SSA has made some
    administrative changes to the program, the agency recognizes that
    additional changes are needed. However, SSA has deferred other reforms
    until it has performed additional assessments on changes that it believes
    could be costly. For example, SSA officials explained that reforms to the
    EN payment structure could increase Ticket program costs, but may not
    provide a commensurate decrease in benefit payments. In addition, some
    proposed changes go beyond the substantial authority provided to the
    agency in the Ticket Act and may require legislative actions or
    coordination with other agencies. To determine the most effective reforms,
    SSA officials told us they needed more time to collect and evaluate
    information on the program's performance, reasons for limited beneficiary
    participation, and the potential impact of reforms. However, the agency
    lacks a plan that defines when and how it will assess proposed changes and
    identify cost-effective reforms.

    In conclusion, we believe rigorous planning is needed to provide
    sufficient and reliable information to adequately assess the numerous
    proposed reforms put forth by the Advisory Panel and others. Thorough and
    reliable analysis is particularly important because of the complexity and
    potential costs of this nationwide program, as well as the opportunities
    that it could provide to beneficiaries who want to become self-sufficient.
    Without a well-defined plan to assess proposed changes, SSA may not be
    able to provide stakeholders with cost-effective and timely solutions to
    increase program participation and the number of beneficiaries who become
    selfsufficient and move off the disability rolls.

    GAO is making one recommendation to the Commissioner of Social Security.
    We recommend that SSA's Commissioner provide to Congress a

    plan that defines how and when the agency will assess proposed changes so
    that it may provide timely and cost-effective solutions to increase
    program participation and the number of beneficiaries who become
    selfsufficient and move off the disability rolls.

    In commenting on the draft of this report, SSA said that, although more
    could be done, it already had a plan to improve the effectiveness of the
    Ticket program. SSA pointed to its evaluation plan and other related
    efforts as its plan for improving the program. In our draft report, we
    recognized that SSA does have an extensive plan for evaluating the
    performance of the Ticket program. But, the agency's current plan does not
    specifically incorporate efforts to assess the potential costs and
    benefits of implementing changes proposed by the Advisory Panel and other
    stakeholders. As such, we continue to see a need for SSA to better
    delineate how and when the agency will assess the numerous recommendations
    put forth by the Advisory Panel and other stakeholders. We have revised
    our recommendation to clarify this point and, as needed, have made changes
    to address comments from the agency regarding appendix I. The agency's
    comments are provided in appendix II.

    Copies of this report are being sent to the Commissioner of SSA,
    appropriate congressional committees, and other interested parties. This
    report is also available at no charge on GAO's Web site at
    http://www.gao.gov. If you have any questions about this report, please
    contact me or Carol Dawn Petersen at (202) 512-7215. Other contacts and
    staff acknowledgments are listed in appendix III.

    Robert E. Robertson Director, Education, Workforce, and Income Security
    Issues

    Appendix II: Comments from the Social Security Administration

    Appendix III: GAO Contacts and Staff Acknowledgments

    GAO Contacts 	Carol Dawn Petersen, Assistant Director (202) 512-7215 Julie
    DeVault, Analyst in Charge (415) 904-2269

    Staff 	In addition to the individuals mentioned above, the following staff
    members made major contributions to this report: Gretta L. Goodwin,

    Acknowledgments 	Theresa Lo, Cady S. Panetta, Tovah Rom, Daniel Schwimer,
    and Dianne Whitman-Miner.

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