Promoting Employment for Persons with Disabilities: Are the New Incentives Sufficient

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Promoting Employment for Persons with
Disabilities Are the New Incentives Sufficient?
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of Males Age 25-64 Employed by Disability Status
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of Females Age 25-64 Employed by Disability
Status
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Key Features of Social Insurance Coverage of
Disabilities

• Who should be eligible and what disabilities
  should be covered?
• What should the level of benefits be?
• For people receiving benefits, how should their
  benefits be affected if they earn income?
• What provision should be made for vocational
  rehabilitation/return-to-work services for
  beneficiaries?
• What cash or in-kind subsidies or incentives
  should be used to encourage beneficiaries to
  work?

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Eligibility Provisions

• SSI
• Means-tested gt 600 other income/month
• gt 2000 financial assets
• SSDI
• gt 20,000 in earnings before becoming disabled

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Coverage

• Disabilities expected to last 12 months or longer
  that preclude substantial work.
• Substantial defined as earning above the
  Substantial Gainful Activity (SGA) level of 830
  per month.
• Evidence of disability includes medical
  documentation and absence of earnings.
• Partial disabilities or functional impairments
  that do not preclude SGA are not covered.

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Cash Benefits

• SSI - 579 per month ( supplements of up to 150
  per month in some states)
• SSDI - Based on pre-disability earnings, ranges
  from about 200 to 2000 per month, averaging
  800.

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In-Kind Benefits

• Health Insurance
• SSI recipients covered by Medicaid
• SSDI recipients covered by Medicare
• Other Low-Income Assistance
• Food stamps
• Housing subsidies

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Effects of Earnings on Cash Benefits

• SSI - Each 1 of earnings gt 85 per month reduces
  cash benefits by 0.50
• SSDI - Earnings gt the SGA triggers a re-review
  and possible loss of benefits
• SSDI - Earnings gt 590 in 9 months over a 5-year
  period results in re-review and possible loss of
  benefits.

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SSI/SSDI Work Incentive Provisions

• Plans to Achieve Self-Support (PASS) (SSI)
• Deduction of work expenses related to blindness
  or impairments from earnings(SSI/SSDI)
• Continued benefits (Sec. 1619a) or Medicaid
  coverage (Sec. 1619b) for earnings above SGA
  (SSI)
• Trial Work Period (SSDI)
• Extended Medicare Coverage (SSDI)
• Extended Period of Eligibility (SSDI)

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Ticket to Work and Work Incentives Improvement
Act of 1999 (TWWIIA)

• Established a new set of administrative and
  payment arrangements for providing VR services to
  beneficiaries (the TTW program).
• Expanded legislative authority and provided for
  grants to states to implement Medicaid buy-in
  insurance programs.
• Extended Medicare eligibility for beneficiaries
  who work their way off the SSDI benefit rolls.
• Prohibit continuing disability reviews for
  beneficiaries making timely progress in their
  rehab programs to self-support.

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Activity in Old vs. New Payment Systems
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EN Strategies to Make TTW Participation Feasible

• 1. Access other funding streams to subsidize
  services to beneficiaries.
• 2. Screening And selection to find low-cost
  beneficiaries with good prospects for increasing
  earnings.
• 3. Offer minimal services.

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Medicaid Buy-In Authorities

• 1997 BBA
• Increased previous Federal limits on income and
  assets of eligible Medicaid enrollees
• Authorized states to charge a sliding scale of
  premiums
• 1999 TWWIIA
• Limited state programs to persons aged 16-64
  with disabilities
• Completely removed Federal limits on income and
  assets of Medicaid enrollees

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Per Cent Increase in Buy-In Enrollments, 2003 to
2004, by Implementation Year and Authority
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Changes in TTW Outcome Payments

• Increase the Level of EN Payments Relative to
  Cash Benefit Reductions
• Pay ENs for Partial Outcomes
• SSI beneficiaries who reduce their cash benefits
  but do not leave the rolls
• Make Higher EN Payments at Earlier Time Points
• Extend the Time Period of Outcome Payments

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Direct SSA Payments for EN Services

• Early Intervention VR/RTW Services
• Transition Programs
• High Up-Front Costs (e.g., special equipment)
• EN Capacity-Building Grants