Vocational Rehabilitation: Earnings Increased for Many SSA	 
Beneficiaries after Completing VR Services, but Few Earned Enough
to Leave SSA's Disability Rolls (30-MAR-07, GAO-07-332).	 
                                                                 
In 2005, about 10 million working-age people with disabilities	 
were beneficiaries of federal income support programs		 
administered by the Social Security Administration (SSA)--namely 
the Disability Insurance (DI) program and the Supplemental	 
Security Income (SSI) program. Both of these programs have grown 
dramatically over the past decade and the federal government's	 
cost of providing these benefits was almost $101 billion in 2005.
This growing cost and the need to redefine the relationship	 
between impairments and the ability to work prompted us in 2003  
to put federal disability programs on GAO's high-risk list. As we
have previously reported, the percentage of SSA beneficiaries who
could return to work is unknown. Some beneficiaries are unlikely 
to work because of the severity of their disabilities. Those who 
do return to the workforce may face additional challenges to	 
their ability to leave the disability rolls. These include a	 
potential loss of health care insurance coverage, lack of access 
to technologies, and transportation difficulties. Nevertheless,  
we have reported in the past that some beneficiaries who do	 
participate in the workforce have credited vocational		 
rehabilitation services, in part, for their return. Administered 
by the Department of Education (Education) since 1973, the	 
Vocational Rehabilitation (VR) program provides funds to states  
to offer an array of employment services that range from	 
treatment of impairments to job counseling and placement. In	 
2005, the 80 state VR agencies were provided $2.6 billion in	 
federal funds. The program serves about 1.2 million people each  
year, and over a quarter of those who exit are SSA recipients. On
average, participants stay in the VR program for approximately 2 
years, and Education tracks employment and earnings outcomes for 
3 months after they exit the program. GAO examined long-term	 
outcomes for SSA beneficiaries who participate in VR, on (1) the 
extent to which SSA disability beneficiaries who exit VR programs
engage in work at the substantial gainful activity (SGA) level5  
and ultimately reduce or replace their benefits with earned	 
income, (2) whether there are certain disability beneficiary	 
characteristics associated with positive employment outcomes, and
(3) whether some VR agencies have particular policies and	 
approaches that can be associated with positive employment	 
outcomes. GAO's Congressional brief of February 2, 2007 presented
results on the first objective--namely, the number of SSA	 
beneficiaries who gained employment or increased their earnings  
following VR, the extent to which their earnings were at the SGA 
level, whether they ultimately reduced or replaced their benefits
with earned income, and whether they eventually left the rolls.  
This report formally conveys the information provided during that
briefing, adjusted to reflect information provided by SSA in its 
review of our draft report.					 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-07-332 					        
    ACCNO:   A67588						        
  TITLE:     Vocational Rehabilitation: Earnings Increased for Many   
SSA Beneficiaries after Completing VR Services, but Few Earned	 
Enough to Leave SSA's Disability Rolls				 
     DATE:   03/30/2007 
  SUBJECT:   Aid for the disabled				 
	     Compensation					 
	     Disability insurance				 
	     Employment assistance programs			 
	     Persons with disabilities				 
	     Program evaluation 				 
	     Social security beneficiaries			 
	     Supplemental security income			 
	     Vocational rehabilitation				 
	     Beneficiaries					 
	     Disability Insurance Program			 
	     SSA Supplemental Security Income			 
	     Program						 
                                                                 
	     Vocational Rehabilitation Program			 

******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO Product.                                                 **
**                                                              **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced.  Tables are included, but    **
** may not resemble those in the printed version.               **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
******************************************************************
GAO-07-332

   

     * [1]Background
     * [2]Summary
     * [3]Observations from Phase One and Next Steps
     * [4]Appendix I: Briefing Slides
     * [5]Appendix II: Scope and Methodology

          * [6]Study Population

               * [7]Analysis of Outcomes--An Overview

                    * [8]Analysis of Earnings Outcomes

                         * [9]Analysis of Annual Earnings in Relation to
                           Annualized Substa
                         * [10]Analysis of SSI Benefit Changes and Reductions
                         * [11]Analysis of Reduction of DI Benefit Payments
                         * [12]Analysis of Departures from and Returns to the
                           Disability Ro

                    * [13]Limitations of our Analyses

                         * [14]Limitations in Analyzing Earnings
                         * [15]Limitations in Analyzing "Parking"
                         * [16]Limitations in Analyzing Benefit Reductions
                         * [17]Limitations in Analyzing Beneficiaries Who
                           Left the Rolls

     * [18]Appendix III: Comments from the Department of Education
     * [19]Appendix IV: Comments from the Social Security Administratio

          * [20]GAO's Comments

     * [21]Appendix V: GAO Contacts and Staff Acknowledgments

          * [22]Order by Mail or Phone

Report to Congressional Requesters

United States Government Accountability Office

GAO

March 2007

VOCATIONAL REHABILITATION

Earnings Increased for Many SSA Beneficiaries after Completing VR
Services, but Few Earned Enough to Leave SSA's Disability Rolls

GAO-07-332

Contents

Letter 1

Background 4
Summary 6
Observations from Phase One and Next Steps 8
Appendix I Briefing Slides 11
Appendix II Scope and Methodology 40
Appendix III Comments from the Department of Education 51
Appendix IV Comments from the Social Security Administration 53
Appendix V GAO Contacts and Staff Acknowledgments 65

Figure

Figure 1: Data Sources Used to Create Analysis File on SSA Beneficiaries
Who Completed VR in 2000 through 2003 41

Abbreviations

DCF Disability Control File
DI Disability Insurance
MEF Master Earnings File
MBR Master Beneficiary Record
SGA Substantial Gainful Activity
SSA Social Security Administration
SSI Supplemental Security Income
SSR Supplemental Security Record
TRF Ticket Research File
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
work may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this material
separately.

United States Government Accountability Office
Washington, DC 20548

March 30, 2007

The Honorable Charles B. Rangel
Chairman
The Honorable Jim McCrery
Ranking Minority Member
Committee on Ways and Means
House of Representatives

The Honorable Michael R. McNulty
Chairman
The Honorable Sam Johnson
Ranking Minority Member
Subcommittee on Social Security
Committee on Ways and Means
House of Representatives

The Honorable Sander M. Levin
House of Representatives

In 2005, about 10 million working-age people with disabilities were
beneficiaries of federal income support programs administered by the
Social Security Administration (SSA)--namely the Disability Insurance (DI)
program and the Supplemental Security Income (SSI) program. Both of these
programs have grown dramatically over the past decade and the federal
government's cost of providing these benefits was almost $101 billion in
2005. This growing cost and the need to redefine the relationship between
impairments and the ability to work prompted us in 2003 to put federal
disability programs on GAO's high-risk list.^1

As we have previously reported, the percentage of SSA beneficiaries who
could return to work is unknown. Some beneficiaries are unlikely to work
because of the severity of their disabilities. Those who do return to the
workforce may face additional challenges to their ability to leave the
disability rolls. These include a potential loss of health care insurance
coverage, lack of access to technologies, and transportation
difficulties.^2 Nevertheless, we have reported in the past that some
beneficiaries who do participate in the workforce have credited vocational
rehabilitation services, in part, for their return.^3

1 GAO, High-Risk Series: An Update, [23]GAO-03-119 (Washington, D.C.:
January 2003).

Administered by the Department of Education (Education) since 1973, the
Vocational Rehabilitation (VR) program provides funds to states to offer
an array of employment services that range from treatment of impairments
to job counseling and placement. In 2005, the 80 state VR agencies were
provided $2.6 billion in federal funds.^4 The program serves about 1.2
million people each year, and over a quarter of those who exit are SSA
recipients. On average, participants stay in the VR program for
approximately 2 years, and Education tracks employment and earnings
outcomes for 3 months after they exit the program.

You asked us to conduct a study examining long-term outcomes for SSA
beneficiaries who participate in VR, on (1) the extent to which SSA
disability beneficiaries who exit VR programs engage in work at the
substantial gainful activity (SGA) level^5 and ultimately reduce or
replace their benefits with earned income, (2) whether there are certain
disability beneficiary characteristics associated with positive employment
outcomes, and (3) whether some VR agencies have particular policies and
approaches that can be associated with positive employment outcomes. In
agreement with your staff, the briefing we provided on February 2, 2007
presented results on the first objective--namely, the number of SSA
beneficiaries who gained employment or increased their earnings following
VR, the extent to which their earnings were at the SGA level, whether they
ultimately reduced or replaced their benefits with earned income, and
whether they eventually left the rolls. This report formally conveys the
information provided to you during that briefing, adjusted to reflect
information provided by SSA in its review of our draft report. We will
present the final results for objectives two and three in a future report.

^2 GAO, Social Security: Disability Programs Lag in Promoting Return to
Work, [24]GAO/HEHS-97-46 (Washington, D.C.: March 1997).

^3 GAO, Social Security Disability Insurance: Multiple Factors Affect
Beneficiaries' Ability to Return to Work, [25]GAO/HEHS-98-39 (Washington,
D.C.: January 1998).

^4 Twenty-four states have separate blind and general agencies. Twenty-six
states, the District of Columbia, and the five territories each have a
single combined agency.

^5 Individuals are considered to be engaged in substantial gainful
activity (SGA) if they have earnings above a certain amount each month
(after the reduction of impairment-related work expenses). The amount of
monthly earnings is set by SSA each year.

To answer the question posed in objective one, we obtained a newly
available longitudinal data set--the Ticket Research File (TRF)
subfile--which contains information from several SSA and Education
administrative databases on all SSA beneficiaries who left the VR program
from 1998 through 2004. The longitudinal data enabled us to study outcomes
far beyond the 90-day period that Education uses to track VR clients. The
TRF subfile was matched by SSA with its Master Earnings File (MEF), which
contains information on each beneficiary's annual earnings from 1990
through 2004.^6 The combined data provide information about each
beneficiary's disability benefits, earnings, and VR participation. Using
these data and focusing on SSA beneficiaries who completed VR services
once between fiscal years 2000 and 2003,^7 we computed the number who had
earnings after receiving VR services, the amount they earned, and whether
their benefits were eventually reduced or discontinued. However, due to
limitations with the data, we could not distinguish work-related earnings
from other income sources; as a result, we reported on the number of
beneficiaries who had earnings, but not employment, after VR. To assess
the reliability of the SSA and Education data critical to our analyses, we
(1) reviewed existing documentation related to the data, (2) interviewed
knowledgeable agency officials about the data, and (3) tested the data for
completeness and accuracy. Our findings are limited to, and cannot be
generalized beyond, the population we studied (i.e., SSA beneficiaries who
completed VR once from fiscal year 2000 through 2003). Additionally,
because we were not able to identify a comparable control group, we cannot
attribute positive earnings outcomes to the receipt of VR services. See
appendix II for a more thorough discussion of our scope and methods,
including study limitations. We conducted our work between October 2005
and January 2007 in accordance with generally accepted government auditing
standards.

^6 SSA contracted with Mathematica Policy Research, Inc., to build the
Ticket Research File (TRF). The SSA administrative databases used in the
TRF include the Supplemental Security Record (SSR), the Master Beneficiary
Record (MBR), the Numident, the 831/832/833 Disability Files, and the
Disability Control File (DCF). The earnings data from SSA's MEF are annual
earnings based on Internal Revenue Service W-2 tax filings and data on the
VR program came from the Department of Education's RSA-911 database.

^7 We excluded from our study SSA beneficiaries who may have exited VR
(after receiving services) more than once between 2000 and 2003, to avoid
double counting beneficiaries who go through VR multiple times but leave
the rolls only once. We also excluded those who did not successfully
complete VR services (i.e., they may have applied for or started VR, but
did not complete the VR process). Finally, we excluded DI and SSI
beneficiaries who left the beneficiary rolls during the time period of our
study due to death or their reaching the age of 65 and becoming eligible
for retirement benefits.

Background

Although the DI and SSI programs use the same definition of disability for
eligibility purposes, they were designed to serve different populations
and have different benefit structures. DI provides benefits to workers
with disabilities who generally have a qualifying work history.^8 The
monthly DI benefit is, therefore, based on a worker's contributions from
prior earnings and differs for each beneficiary. In contrast, SSI provides
cash support for people with low income, few resources, and who may have
little or no workforce attachment. The base federal monthly SSI benefit is
generally the same for all beneficiaries.^9 Concurrent beneficiaries
qualify for both programs because they have a qualifying work history, but
still fall below the SSI income and resource thresholds.

Once a beneficiary is determined eligible for disability, the two programs
also differ in how subsequent earnings from work affect benefits. DI
beneficiaries are allowed a 9-month trial work period,^10 during which
there are no limits on their earnings. Upon completion of the trial work
period, beneficiaries move into a 36-month extended period of eligibility
when their cash benefit ceases except for those months in which the
beneficiary reports earning less than SGA.^11 In 2006, SGA for nonblind
beneficiaries was set at $860 per month.^12 Recipients whose earnings are
at least SGA upon completion of the extended period of eligibility will
cease to receive benefits and will be removed from the disability rolls.
In contrast, SSI benefits are reduced by $1 for every $2 of earned income
that exceeds $65 per month, until their benefits reach zero (i.e., are
suspended).^13 If SSI beneficiaries' monthly benefits are suspended for 12
consecutive months, they are taken off the disability rolls.^14

8 A qualifying work history means beneficiaries have earned the required
amount of work credits within a certain period ending with the time period
they became disabled.

^9 States may supplement the federal monthly SSI benefit amount.
Additionally, individual benefit amounts may vary based on a variety of
other factors, such as earned and unearned income, and marital status.

^10 The trial work period is any 9 months within a 60-month period where
the beneficiary earns above a certain amount ($620 per month or more in
2006). The 9 months do not have to be consecutive, but rather can take
place during any 60-month rolling consecutive time period.

^11 After the trial work period, if beneficiaries are working at SGA, they
receive benefits for a 3-month grace period before cash benefits cease.
Although cash DI benefits may cease most individuals with disabilities who
work continue to receive at least 93 months of Medicare and they may be
eligible to participate in Medicaid Buy-in (in some states). Also, after
the 93-month period ends, they may be eligible to buy Medicare coverage as
long as they still have a disability.

^12 SGA for blind beneficiaries was $1,450 per month.

Complexities inherent to the DI and SSI programs have been criticized for
creating disincentives for beneficiaries to leave the rolls in favor of
work. For example, many believe that the threat of losing health care
coverage as a result of working for extended periods of time presents a
significant obstacle to seek and maintain employment. In addition, the DI
benefit structure has been referred to as having a "cash cliff," because
beneficiaries who earn SGA stop receiving benefits entirely, whereas SSI
benefits are reduced more gradually on a $1-benefit-reduction for
$2-earned-income basis. To reduce some of the disincentives that DI and
SSI beneficiaries face in returning to work, Congress enacted the Ticket
to Work and Work Incentives Improvement Act of 1999.^15 Among other
provisions, the law provided vouchers for vocational services, additional
Medicaid eligibility options, and extension of Medicare eligibility. SSA
phased in the Ticket to Work provisions gradually over a 3-year period
beginning in 2002.

^13 There is a $20 general income exclusion that is first applied to
unearned income. If the beneficiary does not have any unearned income,
then the $20 can be added to the $65 exclusion for earned income. For
example, if an SSI beneficiary earns $1,000 from work during the month and
receives no other income, the first $85 would be exempted leaving $915.
Then, the $915 would be decreased by $1 for every $2 resulting in $457.50.
As a result, the individual's SSI benefit for that month would then be
decreased by $457.50.

^14 Some SSI beneficiaries may continue to receive Medicaid coverage if
their earnings alone, or in combination with their other income, become
too high to receive a cash benefit.

^15 Ticket to Work and Work Incentives Improvement Act of 1999, Pub. L.
No. 106-170 (1999).

Summary

In summary, we found the following for disability beneficiaries who
completed VR once during fiscal years 2000 to 2003:

           o Earnings outcomes were mixed in the year following VR and also
           over time.^16 Approximately 40 percent of the over 303,500 SSA
           disability beneficiaries in our study increased their earnings
           compared to the year prior to VR services, while 32 percent did
           not have any earnings and another 28 percent had fewer earnings.
           In comparison to DI and concurrent beneficiaries, more SSI
           beneficiaries--42 percent versus 36 and 39 percent--increased
           their earnings in the year following VR. Of the disability
           beneficiaries who exited VR in fiscal year 2000, 33 percent
           sustained some level of earnings through 2004, although their
           median earnings decreased by 12 percent over this period.

           o Most beneficiaries' annual earnings remained below annualized
           SGA in the year following VR.^17 Specifically, 88 percent of all
           disability beneficiaries in our study had annual earnings below
           annualized SGA in the year following VR. Only a small percentage
           (5 percent) of beneficiaries from each cohort had annual earnings
           just below annualized SGA (i.e., earning over 75 percent of, but
           less than annualized SGA) in the year after VR. However, this does
           not provide evidence that beneficiaries either were or were not
           "parking"--i.e., deliberately remaining just below program income
           limits to retain benefits. Because SSA did not collect monthly
           earnings for DI beneficiaries during the timeframe of our study,
           we used annualized earnings for both DI and SSI beneficiaries,
           thereby limiting our ability to determine the extent of "parking"
           on a monthly basis.^18 For beneficiaries who had earned income in
           the year after VR, their median annual earnings were $4,476.

           o Some beneficiaries in our study earned enough to have their
           benefits reduced in the year after VR, resulting in decreased DI
           and SSI program expenses. Benefit reductions from DI and
           concurrent beneficiaries in our four cohorts who did not receive
           DI benefits for 1 or more months due to work in the year after VR
           resulted in an estimated reduction in DI benefit payments of over
           $106 million.^19 The average annual reduction in DI benefits due
           to work was $26.6 million. Of the 70,302 SSI and concurrent
           beneficiaries in our study who had earnings gains from the year
           before VR to the year after VR, almost 50,000 (71 percent) had a
           reduction in their SSI benefits. However, we were unable to
           reliably estimate SSI benefit reductions for SSI and concurrent
           beneficiaries because SSI benefit amounts can be affected by other
           factors besides earnings increases (e.g., changes in unearned
           income, spouse's income, etc.), and, due to data limitations, we
           could not isolate the effect of beneficiaries' earnings increases
           on their SSI benefit levels.

           o For the 2000 and 2001 exit cohorts, 10 percent of beneficiaries
           were able to leave the rolls^20 at some point by 2005; however,
           about a quarter of those who left also returned for at least 1
           month. While the SSI program saw the most departures, the lower
           rate of DI and concurrent beneficiaries leaving the rolls may be
           due to several factors. For example, DI beneficiaries are
           generally afforded a much longer working period before cash
           benefits are completely discontinued, and delays in the reporting
           of beneficiaries' earnings data to SSA are much more likely to
           occur for DI beneficiaries. The median annual earned income for
           all beneficiaries leaving the rolls was $12,027.^21 By way of
           comparison, the average annualized SGA was $9,618, and the average
           annualized disability benefit was $8,460 for the DI beneficiaries
           and $4,452 for the SSI beneficiaries in our study in the year
           after VR.^22 Those who returned were off the rolls for an average
           of 16 months.

^16 Earnings were calculated using posted annual earnings in SSA's Master
Earnings File (MEF). The MEF data had several limitations that made it
difficult to estimate beneficiaries' earnings and earnings changes due to
employment. See appendix II for details.

^17 For the purposes of our study, annualized SGA is the monthly SGA
amount for a given year multiplied by 12.

^18 The Supplemental Security Record (SSR) collects monthly data on SSI
beneficiaries, however, when we compared the SSR with the MEF, we found
that the values between the two data sources differed for our study
population. Additionally, the most recent version of the SSR may not have
been included in our TRF subfile. Therefore, we used the annual earnings
from the MEF for both SSI and DI.

^19 According to an SSA official, this may be an underestimate as we did
not include DI benefit reductions from auxiliary beneficiaries, such as a
dependent child with disabilities. See appendix II for details.

^20 For the purposes of our study, leaving the rolls is defined as the
cessation of cash disability benefits.

^21 Our estimates of disability beneficiaries' earnings when leaving the
rolls may be an under- or overestimate because our data did not include
earnings from certain sources not covered by Social Security (e.g.,
earnings from state governments). See appendix II for details.

Observations from Phase One and Next Steps

Although the lack of a comparable control group prevents us from
attributing our results to the receipt of VR services, our study provides
information about long-term earnings outcomes for disability beneficiaries
1 or more years after exiting VR. Specifically, our study shows that after
completing VR, a number of disability beneficiaries from the 2000 through
2003 exit cohorts achieved positive earnings outcomes, and a few left the
disability rolls for a period of time. While only a small number of the
beneficiaries in our study left the disability rolls, SSA benefit
reductions were realized as a result of increased beneficiaries' earnings
and subsequent reductions in their benefits. The decline in earnings in
the years following VR suggests that many factors are likely involved in
achieving long-term earnings gains. As research and our prior work
suggests, a transition into the workforce for people with disabilities can
be a larger leap than it first appears--for example, the episodic nature
of many chronic conditions can make it difficult for some beneficiaries to
maintain steady employment levels. Moreover, it is unclear the extent to
which the potential loss of health care coverage may still present
disincentives for SSA beneficiaries to seek and maintain employment with
significant earnings.

Much remains to be understood about the various factors that make it
possible for persons with disabilities to participate in the workforce.
State differences and local conditions may also be influences. Our next
report will present our findings on some of these factors at the agency
level--specifically, state economies, individual VR agency policies, and
types of disabilities. We will analyze these factors' statistical
significance and effect on beneficiaries' earnings outcomes.

We received written comments on a draft of this report from Education,
which oversees the VR program, and SSA, which manages some of the

^22 The average annualized SGA is an average of the annualized SGA amounts
for 2000 to 2004 in 2004 dollars. The average DI and SSI benefits in the
year after VR include concurrent beneficiaries.

data we used in this report for purposes of evaluating its Ticket to Work
efforts. In its response, Education, while acknowledging the limitations
of the report, said our findings were consistent with its data regarding
earnings of SSA beneficiaries upon closure from VR. See appendix III for
Education's complete comments.

In its response, SSA expressed concern that limitations in our data and
analysis prevent us from adequately addressing the research objectives. We
believe that our final report appropriately acknowledges the limitations
in our data and analysis and accurately and fairly addresses the report's
objectives, as agreed with the congressional requesters. SSA also
expressed concern that our report, particularly the slides, could be
misleading as discussed below and addressed in appendix IV. We believe
that our final report does not overstate our findings and that we have
adequately eliminated cause for misinterpretation. For example, SSA stated
that policy makers could misinterpret the relative effectiveness of VR
services from our study. However, we indicate in the letter and the slides
that our findings cannot be attributed to completion of the VR program
because we were not able to identify a comparable control group.
Additionally, SSA indicated that our study population may have biased our
findings. We defined our study population, in part, based on interviews
with SSA and Education, and state that our findings reflect only the
outcomes of the individuals included in our study population and cannot be
generalized to others. SSA also expressed concern that our estimate of
benefit reductions may overstate the impact of SSI beneficiary earnings.
We agree that data limitations prevented us from isolating the effect of
earnings on SSI benefit reductions, so we removed the estimate from our
final report. We adjusted our language to address these as well as
additional SSA comments of a more technical nature to improve the clarity
of the report. See appendix IV for a reprinting of all of SSA's comments
as well as our more detailed responses.

Copies of this report are being sent to the Secretary of Education, 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 at (202)
512-7215. Contact points for our Offices of Congressional Relations and
Public Affairs may be found on the last page of this report. GAO staff who
made major contributions to this report are listed in appendix V.

Denise M. Fantone
Acting Director, Education, Workforce, and Income
  Security Issues

Appendix I: Briefing Slides

Appendix II: Scope and Methodology

To conduct our work, we obtained a newly available longitudinal data
set--a subfile of the Ticket Research File (TRF)--which contains
information from several Social Security Administration (SSA) and
Department of Education (Education) administrative databases on all SSA
disability beneficiaries who completed the federal-state vocational
rehabilitation (VR) program between 1998 and 2004.^1 SSA merged this data
set with its Master Earnings File (MEF), which contains information on
each beneficiary's annual earnings from 1990 through 2004. (See figure 1
for a depiction of data sets used in our analysis.) The combined data
provide information about each beneficiary's disability benefits,
earnings, and VR participation.^2 With these data on long-term benefits
and earnings, we were able to study disability beneficiaries' earnings
levels far beyond the 90-day period that Education uses to track VR
clients, as well as the effect that earnings changes had on benefit
levels.

^1In 2003, SSA contracted with Mathematica Policy Research to conduct a
full evaluation of the Ticket to Work Program. As part of this evaluation,
Mathematica constructed the Ticket Research File (TRF), a compilation of
longitudinal data from SSA. An extract of the TRF was merged with
vocational rehabilitation data from the Department of Education's RSA-911
database by an SSA official.

^2 Education's data on VR closures were available from 1998 to 2004. Data
from SSA's TRF database were available from 1994 to 2004 with MEF earnings
data available from 1990 to 2004. Social Security's MEF data are annual
earnings based on Internal Revenue Service W-2 tax filings. At the time we
obtained this data set from SSA, earnings data for 2005 were not
available.

Figure 1: Data Sources Used to Create Analysis File on SSA Beneficiaries
Who Completed VR in 2000 through 2003

We assessed the reliability of the databases used to create the TRF
subfile and the Master Earnings File and determined that, despite the
limitations outlined below, the data that were critical to our analyses
were sufficiently reliable for our use. Specifically, we performed the
following

           o reviewed documentation regarding the planning and construction
           of the administrative databases used to construct the TRF subfile,
           the results of data reliability tests conducted by SSA's database
           contractor, and whether documented plans were implemented;
           o conducted multiple interviews with SSA and Education officials
           who work with the databases from which the TRF subfile and
           earnings data were drawn to understand the construction of the
           data fields;
           o conducted our own electronic data testing to assess the accuracy
           and completeness of the data used in our analyses; and
           o consulted with GAO staff knowledgeable about these data sets.

Study Population

In consultation with SSA officials and contractors as well as Education
officials, we selected as our study population working-age individuals
receiving DI only, SSI only, or both DI and SSI benefits concurrently, who
exited VR after having received services.^3 To use the most recent data
available, we further refined this population to include those
beneficiaries who

           o began receiving VR services no earlier than 1995 and who
           completed VR after having received services in fiscal years 2000
           through 2003;
           o had received a DI or SSI benefit payment at least once during
           the 3 months before application for VR services (Beneficiaries
           were defined as concurrent if they received both DI and SSI
           benefits for at least 1 month in the 3 months before VR
           application. We selected a 3-month window to account for the fact
           that many beneficiaries, SSI beneficiaries in particular,
           fluctuate in their receipt of benefits for any given month.); and
           o exited VR once during the timeframe of our study.

We excluded from our study population those disability beneficiaries who

           o started VR prior to 1995 (Earlier disability benefit information
           was not available, therefore, including beneficiaries who started
           VR prior to 1995 would have limited our analyses of benefit
           changes before and after VR.);^4 
           o completed VR after 2003, and for whom we lacked at least 1 year
           of long-term outcome data;
           o applied for or started VR services, but did not complete VR;
           o began receiving disability benefits after receiving VR services
           because these beneficiaries may have differed in certain important
           characteristics from those receiving benefits before VR
           participation;
           o reached age 65 or died at any point in their VR participation or
           during the timeframe of our study (We excluded the beneficiaries
           who died or reached age 65 because they would have left the
           disability rolls for reasons unrelated to employment. For example,
           beneficiaries who reach age 65 convert to SSA retirement
           benefits.); and
           o participated in VR more than once during the timeframe of our
           study. About 17 percent of the beneficiaries in our data, who
           received VR services more than once during the timeframe of our
           study, were excluded to avoid double counting beneficiaries who
           may have received services multiple times, but who left the rolls
           only once.

^3 Our study population included disabled adult children and disabled
widow(er)s, who may receive DI benefits based on their parents' or
spouses' Social Security earnings record. While their benefits are paid
from the Old-Age and Survivors Insurance Trust Fund, these individuals are
disabled and are eligible for VR services.

^4 Approximately 90 percent of VR consumers spend 5 years or less in VR,
therefore, excluding those who started VR prior to 1995 decreased our
population by 10 percent with the greatest effect on the 2000 cohort.

Our final study population included 303,529 DI, SSI, or concurrent
beneficiaries who had completed VR once during the timeframe of our study.

We were not able to compare the earnings of beneficiaries who completed VR
with a control group that had not completed VR because we could not
identify a group that was sufficiently similar to those who completed VR
to feel confident that any differences in outcomes that we found would be
attributable to the VR program and not to the differences in individual
characteristics.

Analysis of Outcomes--An Overview

Using the TRF subfile combined with data from SSA's Master Earnings File,
we computed for the fiscal year 2000 through 2003 exit cohorts the number
of beneficiaries who had earnings after receiving VR services, the amount
they earned, how their earnings compared to the substantial gainful
activity (SGA) amount,^5 and whether their benefits were eventually
reduced or discontinued. We conducted separate analyses for DI, SSI, and
concurrent beneficiaries because the programs differ in structure and
incentives. On the advice of SSA officials, we used only the nonblind SGA
amount in our calculations because the data did not indicate which
beneficiaries were legally blind--a requirement to receive the blind SGA
amount.^6

5 Individuals are considered to be engaged in substantial gainful activity
(SGA) if they have earnings above a certain amount each month (after the
reduction of impairment-related work expenses). The amount of monthly
earnings is set by SSA each year.

^6 Only a fraction of those individuals reporting visual impairments meet
the criteria to be considered legally blind. While there was not an
indicator for legal blindness in the version of the TRF subfile that we
received from SSA, it will be included in subsequent versions.

When we compared dollar amounts (i.e., earnings, benefits, and SGA levels)
across cohorts and years, we needed a way to control for the impact of
changes in the economy and inflation over time. To control for these
changes, we standardized the dollar amounts in our calculations using the
Consumer Price Index for All Urban Consumers (CPI-U). The CPI-U,
maintained by the Bureau of Labor Statistics, represents changes in prices
of all goods and services purchased for consumption by urban households.
The CPI-U can be used to adjust for the effects of inflation, so that
comparisons can be made from one year to the next using standardized
dollars. We standardized the value of earnings, benefits, and SGA levels
to 2004 dollars because this was the most recent year for which earnings
data were available at the time of our analysis.

  Analysis of Earnings Outcomes

We assessed earnings outcomes using annual earnings data. Specifically, we
computed

           o the amount earned in the year after VR and how those earnings
           differed from the year prior to VR;^7 and
           o whether beneficiaries had some level of earnings over 4
           consecutive years (for the 2000 cohort only because we had the
           most years of data for this group).

To ensure we fully captured beneficiaries' earnings before entry into VR,
we compared earnings from the year before VR to the year after VR as well
as earnings from 2 years before VR to the 2 years after VR. Because the
results between these two analyses were consistent, we reported only the
differences between the year before VR and the year after VR to allow us
to incorporate as many cohorts as possible in our analyses. We also
compared the date beneficiaries were determined to be eligible for
disability benefits with their date of application to VR to ensure their
earnings in the year before VR were after being found eligible for
disability benefits, but prior to receipt of VR services.

  Analysis of Annual Earnings in Relation to Annualized Substantial Gainful
  Activity (SGA) Level

To compare annual earnings with SGA, we created an annualized SGA amount.
SGA, a monthly earnings amount updated each year by SSA, is used to
determine whether an individual is engaging in substantial work. We used
annual earnings for both DI and SSI because, at the time of our study,
only annual earnings were collected for DI beneficiaries.^8 To present
comparable information between beneficiaries' annual earnings and SGA, we
created an annualized SGA amount for each cohort by multiplying SGA for a
given year by 12. The nonblind monthly SGA levels for the years of our
study were: 2000--$700; 2001--$740; 2002--$780; 2003--$800; and
2004--$810.

^7 To determine a beneficiary's earnings in the year after VR, we
calculated earnings in the calendar year after the year in which
beneficiaries completed VR. For example, if a beneficiary completed VR in
October 2000, earnings from January 2001 through December 2001 would have
been used to determine earnings in the year after VR.

To determine what percentage of annualized SGA each cohort earned in the
year after VR, we compared beneficiaries' annual earnings for each cohort
to the annualized SGA amount for that year. For example, we compared the
2000 cohort's 2001 earnings to the 2001 annualized SGA level. When we
computed the median annual earnings for beneficiaries who had
earnings--irrespective of cohort--in the year after VR and for those who
left the rolls, we averaged the annualized SGA amount from 2000 through
2004 and standardized it in 2004 dollars as a point of reference.^9

To determine whether beneficiaries might have been "parking," or earning
amounts that were close to, but never exceeding, annualized SGA, we
analyzed the percentage of beneficiaries in our study whose annual
earnings were just below annualized SGA. If beneficiaries were parking, we
would expect to find their annual earnings just below the annualized SGA
level. While there are no clear criteria for identifying the point at
which a beneficiary can be said to be earning "just below" SGA, consistent
with our prior work we considered parking to be earning over 75 percent
of, but less than, annualized SGA.^10

  Analysis of SSI Benefit Changes and Reductions

We determined the number of SSI and concurrent beneficiaries who had SSI
benefit reductions by comparing benefit levels in the year before VR to
the year after VR. Because SSI benefit reductions can occur as a result of
an increase in income from sources other than earnings, we examined
benefit changes, and the resulting reductions, for only those
beneficiaries who had an earnings gain from the year before VR to the year
after VR.^11 To identify whether SSI and concurrent beneficiaries had SSI
benefit changes from the calendar year before VR to the calendar year
after VR, we used the benefit "due" field because it is not affected by
under- or overpayments.^12 Of the concurrent beneficiaries who had an
earnings gain and a benefit reduction, we determined how many also had a
DI benefit increase during the same time period.

^8 The Supplemental Security Record (SSR) collects monthly data on SSI
beneficiaries, however, when we compared the SSR with the MEF, we found
that the values between the two data sources differed for our study
population. Additionally, the most recent version of the SSR may not have
been included in our TRF subfile. Therefore, we used the annual earnings
from the MEF for both SSI and DI.

^9For the purposes of our study, to compute the average annualized SGA we
converted the nonblind monthly SGA amounts for each year (2000 to 2004)
into 2004 dollars. We then multiplied the monthly rates by 12, added the
annual amounts for all years, and determined the average.

^10 GAO, SSA Disability: SGA Levels Appear to Affect the Work Behavior of
Relatively Few Beneficiaries, but More Data Needed, [27]GAO-02-224
(Washington, D.C.: January 2002).

  Analysis of Reduction of DI Benefit Payments

We calculated the reduction of DI benefit payments for each cohort in the
year after VR based on the number of months DI and concurrent
beneficiaries were in DI benefit suspension or termination.^13 For the
calendar year after VR completion, we calculated the percentage of
beneficiaries who did not receive DI benefits for 1 or more months because
they were in either benefit suspension or termination. We also determined
the percentage who were in benefit suspension or termination for the
majority of the year after VR by dividing the number who were in benefit
suspension or termination for 7 to 12 months of the year by the total
number who were in benefit suspension or termination for 1 month or more.
To determine the estimated reduction in benefit payments resulting from
benefit suspensions or terminations, we multiplied each DI and concurrent
beneficiaries' monthly benefit amount (in 2004 dollars) by the number of
months they were in benefit suspension or termination and summed the
amounts for each cohort in the year after VR.

^11 SSI monthly benefits could increase or decrease for a variety of
reasons, including changes in marital status, living arrangements, or
unearned income.

^12 We also computed the average benefit reduction amount for
beneficiaries with earnings gains, and the total benefit reduction amount,
for all cohorts in the year after VR. To estimate the total benefit
reductions resulting from SSI benefit changes, we summed the total SSI
benefit changes (in 2004 dollars) for each cohort in the year after VR. We
ultimately decided not to report these estimates because we could not
determine the extent to which benefit reductions were due to changes in
earnings or due to changes in other factors.

^13 Beneficiaries who do not receive their benefit in a given month during
the extended period of eligibility are in benefit suspension. Those who
have completed the extended period of eligibility and no longer receive a
benefit are considered to have been terminated from the disability rolls.

  Analysis of Departures from and Returns to the Disability Rolls

To determine whether disability beneficiaries in our study left the rolls
before 2005 and if they returned before 2005, we used data from the TRF
subfile that indicated the month in which a beneficiary left the rolls
because of work. We also calculated beneficiaries' earnings in the year
they left the rolls. We included beneficiaries who left the rolls after
their VR application date and counted them as having returned if they
returned for 1 month or more. Concurrent beneficiaries were considered to
have left the rolls only if they stopped receiving benefits from both
programs, and to have returned to the rolls if they returned to either
program.

Our data indicated that some beneficiaries in our study who left the rolls
due to work also did not have any earnings. According to SSA, some
beneficiaries may have earned enough to leave the rolls, but then stopped
working in the same year that their benefits ceased. Additionally, some
beneficiaries may have had earnings from sources that were not covered by
Social Security--for example, earnings from state governments--and,
therefore, would not be in our earnings data. While we included all
beneficiaries that the data indicated left the rolls due to work in our
calculations of the number who left the rolls, we eliminated those with
zero earnings in the MEF from the earnings calculations of those who left
the rolls to avoid an artificial reduction in median earnings.

Limitations of our Analyses

Our results cannot be generalized to the larger population of all SSA
disability beneficiaries because we looked only at beneficiaries who
completed VR. Because VR participation is voluntary, beneficiaries who
participate in VR may have certain characteristics that make them
different from other SSA beneficiaries and, therefore, more likely or less
likely to succeed in the workforce. Also, without a control group, we
cannot isolate the impact of VR services on outcomes. That is, we cannot
determine whether these beneficiaries would have been either more or less
likely to achieve positive outcomes in the absence of the VR program.

  Limitations in Analyzing Earnings

Our earnings data had several limitations that made it difficult to
estimate beneficiaries' earnings and earnings changes due to employment.
For example, while the beneficiary earnings data were provided to SSA by
the Internal Revenue Service and are considered to be the most
comprehensive and accurate measure of earnings available, they excluded
several categories of workers who participated in alternative retirement
systems and whose earnings may not have been reported to SSA.^14 Such
omissions could have resulted in an under- or overestimate of beneficiary
earnings. On the other hand, some earnings reported to SSA may have
included income derived from work activity in a previous year, such as
commissions or bonuses. Further, the earnings data included some forms of
nonwork income, such as sick leave earnings and profit sharing. These
additional sources of income could not be identified and separated out of
SSA's data and, therefore, could result in an overestimation of
beneficiaries' earnings due to employment in a particular year, and either
an over- or under-estimate of earnings changes over time. The data did not
allow us to estimate the magnitude of the effect of these factors on our
analyses.

In addition, our use of annual earnings data limited our ability to
analyze outcomes in the year following VR. Specifically, we were limited
to using all earnings in the calendar year after VR, irrespective of the
time gap between VR completion and the first month of the next calendar
year. The start month for calculating earnings in the year after VR could
have ranged from the 1st to the 12th month after VR, depending on which
month the beneficiary exited. For example, beneficiaries who exited VR in
June 2000 would have their 2001 annual earnings calculated beginning in
January 2001--6 months after their exit from VR. Whereas beneficiaries who
completed VR in December 2000, would have been out of VR for 1 month when
their 2001 annual earnings calculation started in January 2001. We have no
indication of clustering in earnings relative to VR completion, and,
therefore, expect a fairly even distribution of earnings over time. We do
not expect the time lag in the earnings calculation to vary systematically
by year or cohort.

  Limitations in Analyzing "Parking"

The earnings data also limited our ability to assess the extent of
"parking" on a monthly basis. Beneficiaries may work inconsistently
throughout the year and not have earnings in some months. Because the
Master Earnings File only contains annual earnings data, we were not able
to identify parking that might have occurred among beneficiaries, who, for
example, worked for only a few months during the year and limited their
earnings to a level near, but not exceeding, the monthly SGA level in each
of those months.

^14 Workers who may have been excluded include federal civilian employees
hired before 1984 and certain state and local government employees.

  Limitations in Analyzing Benefit Reductions

Our calculations on DI benefit reductions may have resulted in under- and
overestimates. For example, in calculating the DI reduction in benefit
payments from beneficiaries in benefit suspension or termination, we did
not include the reduction in benefit payments for auxiliary
beneficiaries--such as a dependent child with disabilities--who would also
not have received a benefit. According to an SSA official, this could
result in an underestimate of benefit payment reductions. Additionally, we
used the Consumer Price Index to inflate DI benefit amounts to 2004
dollars. Using another inflation standard--such as the wage index--may
have produced different results.

With respect to SSI, while we attempted to capture SSI benefit changes due
to earnings by limiting our analysis to beneficiaries with earnings gains,
our data did not allow us to completely exclude benefit changes that may
have been due to other factors. Therefore, we did not report estimated SSI
benefit reduction amounts.

  Limitations in Analyzing Beneficiaries Who Left the Rolls

Our finding that more SSI than DI beneficiaries ultimately left the rolls
is likely due to several factors, including the different structures of
the DI and SSI programs. DI beneficiaries are allowed a trial work period
(9 months) and an extended period of eligibility (36 months) before they
are considered off the rolls.^15 In contrast, SSI beneficiaries who earn
enough so that they do not receive a benefit for 12 months are taken off
the rolls. Therefore, given the 4-year timeframe of our study, many DI
beneficiaries may not yet have entered or completed their extended period
of eligibility or reached the point where they would be considered off the
rolls.

In addition, delays in the reporting of earnings may also have contributed
to our finding that relatively more SSI than DI beneficiaries left the
rolls due to work. There can be a significant delay--up to 3
years--between when beneficiaries begin work and when SSA is notified or
learns of their earnings. This delay is more likely to occur with DI
beneficiaries, whose earnings were reviewed on a yearly basis as compared
to monthly earnings reviews for SSI beneficiaries during the timeframe of
our study. Because of this reporting delay, the TRF subfile data that
indicated whether a beneficiary left the rolls may not have contained
completely up-to-date data, especially for later cohorts.

^15 The 9-month trial work period must occur within a 60-month period.

We may have under- or overestimated the earnings of those beneficiaries
who left the rolls. Because our data did not include earnings from sources
not covered by Social Security and we could not include their earnings in
our analysis, we may have underestimated the earnings of beneficiaries in
the 2000 and 2001 cohorts in the year they left the rolls. However, if the
beneficiaries who had noncovered earnings earned less on average than
those whose earnings were included in our data, it is possible that we
could have overestimated earnings for those beneficiaries who left the
rolls.

Appendix III: Comments from the Department of Education 

Appendix IV: Comments from the Social Security Administration

Note: GAO's comments supplementing those in the report text appear at the
end of this appendix.

See comment 2.

See comment 1.

See comment 3.

See comment 4.

See comment 6.

See comment 5.

See comment 8.

See comment 7.

See comment 9.

See comment 11.

See comment 10.

The following are GAO's comments on the Social Security Administration's
letter dated March 2, 2007.

GAO's Comments

           1. We agree that there is some potential for readers to
           misinterpret the title. Therefore, we adjusted it to indicate that
           we analyzed beneficiaries' earnings after completing VR services,
           rather than workforce participation. Additionally, we removed the
           reference to SGA because we acknowledge the limitations of using
           annual earnings data in determining whether beneficiaries were
           earning SGA.
           2. We clarified our description of the Ticket Research File.
           3. Regarding the scope of our review, we disagree that our study
           population biases our findings or that we have characterized our
           findings as representing VR effectiveness for all beneficiaries
           completing VR. We indicate that our findings are based on the
           outcomes of the individuals included in our study population, are
           not intended to represent potential outcomes for groups outside
           this population, and cannot be attributed to VR. In accordance
           with our objective to determine whether beneficiaries eventually
           replace their benefits with earned income, we focused on those
           beneficiaries who could have potentially left the rolls due to
           work following completion of VR services; therefore, we excluded
           people who retired or died during the timeframe of our study
           because they would have left the disability rolls for reasons
           unrelated to an increase in earnings. We clarified why these
           groups were excluded in our discussion of scope and methods in
           appendix II. We also stated in this appendix that our findings
           cannot be attributed to VR because we were unable to identify a
           control group.

           We agree that the left-due-to-work variable distinguishes between
           those who left the rolls due to work and those who were ineligible
           for benefits for other reasons. However, the left-due-to-work
           variable was not developed by SSA's contractor until several
           months into our study. Once the variable was available, we
           incorporated it into our analysis. However we disagree, for
           reasons discussed in the preceding paragraph, that it was
           inappropriate to exclude those beneficiaries who died or reached
           65 during the timeframe of our study.

           SSA noted that the report should clarify which disability
           beneficiaries are included in our study. We adjusted our language
           to better reflect which beneficiaries were included, why we
           excluded certain beneficiaries, and the numbers and percentages of
           beneficiaries in our study population as appropriate.

           4. We agree with SSA that "benefit reductions" more accurately
           describes the analysis we conducted than "program savings" and
           have changed the report accordingly. We also clarified that
           benefit reductions included the sum of one year following VR for
           all four cohorts and added an annual average in the letter's
           Summary section and in the slides.

           While SSA stated that our methodology does not permit an
           assessment of the possible outcome in the absence of VR, we
           explicitly state in the letter and the slides that we could not
           isolate the impact of VR because we did not have a control group.
           However, we added language in the scope and methods section of the
           letter reemphasizing this point.

           We clarified, in our Scope and Methods discussion in appendix II,
           that our estimates of average annual beneficiaries' earnings when
           leaving the rolls could be either an underestimate or an
           overestimate depending on the average annual earnings of those not
           included in the data (i.e., those beneficiaries who had earnings
           not covered by Social Security).

           5. Regarding our numerical estimates of SGA, we agree that SGA is
           a monthly figure and that using annual earnings data is not ideal
           for assessing whether beneficiaries are "parking" on a monthly
           basis. However, SSA did not collect monthly earnings data on DI
           beneficiaries during the timeframe of our study. As a result, we
           limited our analysis to comparing annual earnings to an annualized
           SGA figure and included language regarding this limitation in both
           the letter and slides. Although our original language indicated
           that the finding was "not suggestive of parking," to further
           ensure that our finding is not misunderstood, we adjusted the
           language in the report to indicate that we found no evidence of
           parking. We also added language to the limitations section in
           appendix II.

           In a 2002 report, where we examined the effect of SGA on earnings
           for DI beneficiaries, we recommended, and SSA agreed, that it
           needed to improve its earnings data collection methods.^1
           According to SSA officials, since the timeframe of our study, SSA
           has begun collecting earnings information for DI beneficiaries
           through EWORK. To the extent that the data in this system are
           reliable, they may, in the future, provide an opportunity for a
           more precise analysis of "parking."

           SSA noted that because we used annual earnings data we could have
           captured low annual earnings in the year after VR for
           beneficiaries who may have completed VR mid-year, worked for the
           next several months, but then did not sustain their earnings. We
           agree that we were not able to capture earnings immediately after
           VR completion for beneficiaries who exited mid-year. However,
           Education already reports on employment and earnings 3 months
           after beneficiaries exit VR. The purpose of our study was to
           explore long-term outcomes. While we agree it would have been
           preferable to report earnings beginning with the month immediately
           upon exiting the VR program, we were unable to do so because SSA
           did not collect monthly earnings data for DI beneficiaries during
           the time period of our study.

           6. We agree with SSA's point that other factors besides
           work-related earnings (e.g., changes in unearned income and
           assets) may cause SSI benefits to increase or decrease, and that
           it is possible that concurrent beneficiaries may experience an SSI
           benefit reduction and a DI benefit increase due to the same
           increase in earnings. We initially limited our analysis to SSI and
           concurrent beneficiaries with earnings gains to better ensure that
           SSI benefit reductions were related, in part, to those earnings
           gains. However, we were still not able to determine what portion
           of remaining SSI benefit reductions were due to increased
           beneficiary earnings. Therefore, we have removed this estimate
           from our final report.

           We disagree with SSA that, for our study, SSI earnings could have
           been more accurately tracked and calculated using the monthly
           earnings in the Supplemental Security Record (SSR) rather than the
           annual earnings in the Master Earnings File (MEF). While the SSR
           provides earnings on a monthly basis, it relies on self-reported
           data that then must be verified; and the TRF subfile that SSA
           provided for our analysis may not have included the most recent
           version of the SSR data. The MEF contains annual earnings based on
           Internal Revenue Service W-2 tax filings. When we compared SSI
           earnings between the SSR and MEF data that we had for our study
           population, we found that the values differed between the two data
           sets; therefore, we used the MEF as we believed it to be more
           reliable.

           7. We disagree that the report does not adequately discuss Ticket
           to Work because our study objectives did not include measuring the
           effects of the Ticket to Work program. Therefore, we did not
           include the additional language suggested by SSA, as it might
           detract from the report's focus. However, we corrected the
           language in the letter to indicate that the Ticket to Work program
           was phased in gradually starting in 2002.
           8. We agree that our analysis of whether beneficiaries were
           employed was based on posted earnings in SSA's Master Earnings
           File (MEF). Because SSA's data does not allow us to distinguish
           earnings due to current employment from other earnings (such as
           commissions from previous employment or vacation pay), we replaced
           references to employment with earnings throughout the report.

           SSA also had concerns about the use of "sustained work" because it
           is suggestive of working month after month for several years.
           While we had defined our usage of the term, we changed it to
           "earnings in consecutive years" to avoid misinterpretation.

           9. We agree with most of SSA's comments regarding our description
           of SSI benefits and DI work incentives and have made the suggested
           changes.
           10. We disagree that a fuller discussion of extended Medicaid and
           Medicare benefits is needed for this report. However, we added
           language to the letter indicating that it is unclear the extent to
           which loss of health care coverage remains a disincentive for SSA
           beneficiaries returning to work.
           11. Regarding the clarity of the term "left the rolls" and how
           return to the rolls was measured, we added language to our report
           clarifying that leaving the rolls is defined as cessation of
           disability cash benefits and that beneficiaries who left the rolls
           were counted as returning if they returned for 1 month or more.

^1 GAO, SSA Disability: SGA Levels Appear to Affect the Work Behavior of
Relatively Few Beneficiaries, but More Data Needed, [28]GAO-02-224
(Washington, D.C.: January 2002).

Appendix V: GAO Contacts and Staff Acknowledgments

GAO Contact

Denise M. Fantone, Acting Director, (202) 512-7215, [email protected]

Acknowledgments

In addition to the contact named above Robert Robertson, Director; Michele
Grgich, Assistant Director; Amy Anderson; Melinda Cordero; Erin M.
Godtland; Robert Marek; and Nisha Unadkat made significant contributions
to all phases of this report. In addition, Robert J. Aiken, Susan
Bernstein, Anna Maria Ortiz, Daniel A. Schwimer, Doug Sloane, and Susan B.
Wallace provided technical assistance.

(130629)

GAO's Mission

The Government Accountability Office, the audit, evaluation and
investigative arm of Congress, exists to support Congress in meeting its
constitutional responsibilities and to help improve the performance and
accountability of the federal government for the American people. GAO
examines the use of public funds; evaluates federal programs and policies;
and provides analyses, recommendations, and other assistance to help
Congress make informed oversight, policy, and funding decisions. GAO's
commitment to good government is reflected in its core values of
accountability, integrity, and reliability.

Obtaining Copies of GAO Reports and Testimony

The fastest and easiest way to obtain copies of GAO documents at no cost
is through GAO's Web site ( www.gao.gov ). Each weekday, GAO posts
newly released reports, testimony, and correspondence on its Web site. To
have GAO e-mail you a list of newly posted products every afternoon, go to
www.gao.gov and select "Subscribe to Updates."

Order by Mail or Phone

The first copy of each printed report is free. Additional copies are $2
each. A check or money order should be made out to the Superintendent of
Documents. GAO also accepts VISA and Mastercard. Orders for 100 or more
copies mailed to a single address are discounted 25 percent. Orders should
be sent to:

U.S. Government Accountability Office 441 G Street NW, Room LM Washington,
D.C. 20548

To order by Phone: Voice: (202) 512-6000 TDD: (202) 512-2537 Fax: (202)
512-6061

To Report Fraud, Waste, and Abuse in Federal Programs

Contact:

Web site: www.gao.gov/fraudnet/fraudnet.htm E-mail:
[email protected] Automated answering system: (800) 424-5454 or (202)
512-7470

Congressional Relations

Gloria Jarmon, Managing Director, [email protected] (202) 512-4400 U.S.
Government Accountability Office, 441 G Street NW, Room 7125 Washington,
D.C. 20548

Public Affairs

Paul Anderson, Managing Director, [email protected] (202) 512-4800
U.S. Government Accountability Office, 441 G Street NW, Room 7149
Washington, D.C. 20548

References

Visible links
  23. http://www.gao.gov/cgi-bin/getrpt?GAO-03-119
  24. http://www.gao.gov/cgi-bin/getrpt?GAO/HEHS-97-46
  25. http://www.gao.gov/cgi-bin/getrpt?GAO/HEHS-98-39
  27. http://www.gao.gov/cgi-bin/getrpt?GAO-02-224
  28. http://www.gao.gov/cgi-bin/getrpt?GAO-02-224
*** End of document. ***