Copyright 2002 Federal News Service, Inc.  
Federal News Service
September 26, 2002 Thursday
LENGTH: 18762 words

HEADLINE: HEARING OF THE SOCIAL SECURITY SUBCOMMITTEE OF THE HOUSE WAYS AND MEANS COMMITTEE
 
SUBJECT: SOCIAL SECURITY DISABILITY PROGRAMS
 
CHAIRED BY: REPRESENTATIVE E. CLAY SHAW JR., (R-FL)
 
LOCATION: B-318 RAYBURN HOUSE OFFICE BUILDING, WASHINGTON, D.C.

WITNESSES: MARTIN GERRY, DEPUTY COMMISSIONER, DISABILITY AND INCOME SECURITY PROGRAMS;
 
SARAH WIGGINS MITCHELL, CHAIR, TICKET TO WORK AND WORK INCENTIVES ADVISORY PANEL;
 
SUSAN PROKOP, CO-CHAIR, WORK INCENTIVES TASK FORCE, CONSORTIUM FOR CITIZENS' WITH DISABILITIES;
 
JOHN KREGEL, ED. D., DIRECTOR, BENEFITS ASSISTANCE RESOURCE CENTER, VIRGINIA COMMONWEALTH UNIVERSITY;
 
MARY SATTERFIELD, PROJECT DIRECTOR, MAXIMUS TICKET TO WORK, ALEXANDRIA, VIRGINIA;
 
CHARLENE DWYER, ED.D., VOCATIONAL REHABILITATION ADMINISTRATOR, WISCONSIN DEPARTMENT OF WORKFORCE DEVELOPMENT;
 
DAN O'BRIEN, PROGRAM MANAGER, TICKET TO WORK AND COMMUNITY REHABILITATION, OKLAHOMA DEPARTMENT OF REHABILITATION SERVICES;
 
SUSAN WEBB, DIRECTOR, ABIL EMPLOYMENT SERVICES, PHOENIX, ARIZONA;Y GILLILAND, TICKET TO WORK PROGRAM PARTICIPANT, GLENDALE, ARIZONA;
 
DAVID GADAIRE, PROGRAM DIRECTOR, CAREER POINT, HOLYOKE, MASSACHUSETTS;
 
CURTIS DECKER, EXECUTIVE DIRECTOR, NATIONAL ASSOCIATION OF PROTECTION & ADVOCACY SYSTEMS
 


BODY:
REP. E. CLAY SHAW JR. (R-FL): Good morning. I apologize, but neither Mr. Matsui nor I have any control over the schedule on the floor and there were three votes in a row, and that's what took us away from here. But we'll move forward as quickly as we can.

As we continue our hearing series examining the challenges and opportunities facing the Social Security disability program, today we turn our focus to the implementation of the Ticket to Work and Work Incentive Improvement Act of 1999. Originating in this subcommittee, the legislation -- its goal is to remove barriers and increase incentives for disabled individuals returning or seeking to return to work. These incentives empower beneficiaries with more choices. They can choose the services they want from whom they want in the public or the private sector. These providers in turn are only paid for their work when their clients get jobs, giving them the economic motivation to serve their clients quickly and effectively.

Although it took the Social Security Administration two years to publish final implementing regulations, the good news is that the beneficiaries in 13 states received their tickets beginning in February of this year. These tickets may be used to obtain vocational rehabilitation, job training and other support services. By next year the program will be available in all 50 states. So far of the two million tickets mailed, over 7,000 beneficiaries have assigned their tickets to one or more of the 400 service providers or employment networks, as referred to in the law, to receive employment services they choose to help them reenter or enter the workforce.

While this program is still very young, early results are promising. We will hear today that beneficiaries' interest has overwhelmed service providers and that the number of beneficiaries actually participating in the program has quickly outpaced early estimates. Welcome news, though, and not surprising as it is always the position of this subcommittee that given the right support, individuals with disabilities would choose work, if given the opportunity.

Recognized as part of President Bush's New Freedom Initiative, this landmark legislation transforms Social Security disability programs from programs of dependency to programs of opportunity. The ultimate success of the program, however, will depend upon its effective implementation and sound management by the Social Security Administration, supported by key stakeholders. I look forward to the hearing of many of these stakeholders today and as we examine the Ticket to Work program's implementation and progress, preliminary results, along with issues of concern and their potential remedies.

Last week I had the opportunity to visit one of these providers down -- by Goodwill Industries down in Palm Beach, and I was rather impressed with some of the results -- the early results that they're getting. There are still some problems. I know Florida does not have the Medicaid continuation, which is tremendously important. And it's rather scary if you're disabled to lose that type of coverage.

Mr. Matsui?

REP. ROBERT T. MATSUI (D-CA): Thank you very much, Mr. Chairman. I appreciate the fact that you're holding this hearing. I think it's very timely with the 13 states now beginning to implement the Ticket to Work program. And I would hope that the witnesses will be thinking before they come up here, because what we really want to do is find ways to improve the system. Obviously, as the chairman has mentioned, there's going to be a lot of starts and stops and a lot of little bumps as we go along the way, because it's a very innovative program. And certainly we want to make sure that at the end of the day this program works and obviously carries out the principles that Mr. Shaw and all of us on this subcommittee want to happen.

And so we look forward in a very positive way to your comments and observations. And so with that, Mr. Chairman, I want to thank you again and look forward to hearing from the witnesses. I may have a little problem, and I would not want to be presumptuous here. But some of us -- there's a lot of briefing going on now about the whole issue of Iraq and we lost 45 minutes because of the three votes. And I may have to leave at some time, and I do want to just express my apologies before I actually do that. Thank you.

REP. SHAW: Thank you, Bob. We will proceed as quickly as possible through this very busy agenda. We have a large number of witnesses, particularly on the last panel. Our first witness is Martin Gerry who is the deputy director of Disability and Income Security Programs. Welcome to the subcommittee.

MR. MARTIN GERRY: Thank you, Mr. Chairman.

REP. SHAW: And we have your full testimony, as we do of all the witnesses, and it will be put into the record and you may summarize as you see fit.

MR. GERRY: Thank you, Mr. Chairman.

REP. SHAW: Thank you, sir.

MR. GERRY: First, let me thank you and the subcommittee for inviting me today to discuss the Social Security Administration's implementation of the Ticket to Work and Self-Sufficiency Program, which is part of the Ticket to Work and Work Incentive Improvement Act of 1999.

As you know, the goal of the Ticket Act is to help disabled beneficiaries who want to work by improving employment support choices, providing enhanced work incentives and lessening beneficiaries' fears about losing healthcare and income during attempts to work. I'd very much like to express my thanks to you, Mr. Chairman, Mr. Matsui, and other members of the subcommittee, at the outset for your hard work and support in making the Ticket program a reality.

My remarks -- and I'll try to make them a little briefer than I had otherwise planned -- this morning will focus on the Ticket program, the central feature of the Ticket Act. And, of course, my written statement includes the status of the other work incentives in the Act. I was going to briefly outline the program, but if that's all right I'll not do that because I know you have a lot of people waiting to testify. Let me talk about where we are with the program.

We believe that the program is off to a good start. As of this month, more than 7,000 beneficiaries have assigned their tickets to E.N.s or to the state vocational rehabilitation agencies in the initial 13 states, and we expect to see higher numbers of beneficiaries participating as we gain experience and the program matures. And we know we have much work to do to make those expectations a reality.

The second phase of the program will begin in November of this year and during this phase of the program, approximately 2.6 million beneficiaries will be eligible to receive tickets in 20 additional states and in the District of Columbia. Then in 2003 we will release tickets to the approximately 3.3 million beneficiaries in the remaining 17 states and the U.S. territories during the third and final implementation phase, so that by January 2004 we will have fully implemented the ticket program.

Employment networks operate under agreements with SSA and can be any qualified state or local government agency, or a private entity that assumes responsibility for the coordination and delivery of services under the Ticket program. An E.N. may be a one-stop delivery system established under the Work First Investment Act of 1998, a state vocational rehabilitation agency, a single provider of services, or a group of providers organized to combine their resources into a single entity.

E.N.s are already setting up client interviews and are beginning to provide services to beneficiaries in the 13 states that we've already begun implementation. We believe that these activities have increased demand for their services, that as we've been going that has itself had a positive impact on demand. The beneficiary bears none of the cost of employment, vocational or other support services. It is the agency that pays an E.N. that provide services to a beneficiary. An E.N. can elect to receive payments under one of two systems. Under the outcome payment system an E.N. will be paid for each month, up to 60 months, in which a beneficiary that it is serving does not receive cash benefits due to worker earnings.

The other payment system, the outcome milestone payment system, an E.N. will receive payments when a beneficiary it is serving achieves one or more milestones towards self-supporting employment. The E.N. will also receive reduced outcome payments for each month up to 60 months that a beneficiary does not receive cash benefits due to work earnings. The agency is provided up to four milestones for which an E.N. can be paid. We have begun receiving and processing the first requests for milestone and outcome payments from the E.N.s. The first milestone payment was made during May 2002.

The Ticket Act also calls for the commissioner to enter into an agreement with a program manager to assist the agency in administering the Ticket to Work program. Maximus Inc. is that program manager and among Maximus's duties are recruiting, recommending and monitoring the E.N.s selected by SSA to provide services, facilitating beneficiary access to the E.N.s, facilitating payment to the E.N.s and resolving disputes between beneficiaries and E.N.s under the program. I am pleased to note that the E.N.s and beneficiaries appear to be satisfied with the level of service provided by Maximus.

I would like to briefly mention that SSA piloted the employment support representative position from July 2000 to September 2001. And, as you know, SSA is required by the Ticket Act to provided beneficiaries with employment support information and services. We have made no decisions as yet as to how to best provide those services.

Finally, I want to thank you, Mr. Chairman, Mr. Matsui, and all the members of the subcommittee, for showing continued dedication to the ticket program. I look forward to working with you to successfully implement it.

REP. SHAW: Thank you, Mr. Gerry. I think most of us agree that understanding the Social Security work incentive and how earnings impact benefits is not easy to do, and the lack of understanding promotes fear which has a potential of preventing people from returning to work. One of those fears I referred to earlier regarding the loss of medical benefits, which we addressed in the law but hasn't been implemented in many states, including my own. That's why in the Ticket to Work law we ask the Social Security Administration to establish a core of trained, accessible and responsive work incentive specialists. What have we done in that regard in setting that up, and how is that working?

MR. GERRY: Well, of course, the agency did establish a pilot program where we set up employment support representatives, and we've been looking at the experience. We currently have 24 of those representatives still working in the original structure. The commissioner hasn't yet decided at this point the best way to fully respond to what is clearly the mandate that Congress established in the statute.

But I want to say that I think one of the things we've learned is that it's very important for the agency as a whole to get involved in this work. That is that we've been looking at strategies and I think the commissioner will want to look at strategies that look at our entire workforce and try to make it generally more responsive. This is part of our regular business and we need to begin to, I think, involve our claims representatives, our service representatives, the staff of all of our regional offices in this, not just a particularly small group of people that might be identified on the margins. I think it's time for us to really -- and I think the commissioner believes that we need to integrate this program thoroughly. So I know we're going to be looking at options that do that, as well as continue to provide this kind of specific targeted support.

I don't have an exact date at which point she will probably arrive at the conclusions, but I can tell you that it's something that we're actively looking at right now and that as we're -- we actually are just about to complete the rollout, because we had to delay the rollout in New York State. So it will be completed in October and at that point I think it would be a good time for us to sort of look at the experience. We've been doing a lot of internal evaluations and we want to see how we can relate our staff to the organizations that we fund, the benefits provision outreach organizations, and figure out how we can really best serve people with disabilities in an integrated way across the system and not just create a separate group of people who might -- no matter how well and effective they be, might not change the organizational culture. And we -- because we think we need to change the way in which the agency sees this job, to include actively promoting employment opportunities for people with disabilities.

REP. SHAW: Are any of your people out there specifically assigned to that task?

MR. GERRY: We do have currently people working -- as I mentioned, the employment support representatives that we currently have. And increasingly we have been conducting training of all of our regional staff, so that there are people assigned to provide that assistance. But we haven't gotten to the point that Congress I think wants us to get to, which is to designate formally in each field office, for example, how -- in a regular way, how we would respond. Now, of course, we're only doing this in 13 states.

One of the issues that is -- and why I think it's been necessary to take some time to do this, is to look at demand.

That is, how much demand is there? What is the demand for? And we think that a lot of how we respond ought to be to respond aggressively to the kinds of questions that were being asked. So we're talking with the people who are fielding those questions, and we're gaining a lot of experience every month about the kind of information we need to provide.

REP. SHAW: But is the system overwhelmed at this point, or underwhelmed or how are we doing?

MR. GERRY: I think I understand --

REP. SHAW: In my opening remarks I mentioned that we had -- how many millions we had sent out, and 7,000 --

MR. GERRY: I don't think the system is overwhelmed. I've been working, for example, fairly closely with New York and New York was a state that had grave concerns about that, particularly after the events of last September and the concerns that they had about the potential impact. And so I've been monitoring very closely, for -- and it's the largest state in the first 13. Actually, I think that the states have responded well in terms of the demand. I think we've been able to meet the demand. I think that we have a good volume, and that's what we wanted. We certainly didn't want to be underwhelmed.

I think we're going to have to work harder to promote the program more. So I think it's not so much that we need to measure the demand to know that we have to do this. It's more measuring the demand to know how many people we need, where we need them and in some cases expand on the training. But we are already involved in the systematic training of people in our field offices, moving more towards this idea that we ought to have in general people who work for our agency to be able to address this issue.

REP. SHAW: Thank you.

Mr. Matsui.

REP. MATSUI: Thank you very much, Mr. Chairman.

Thank you very much, Mr. Gerry. I want to just follow up on the chairman's comments in terms of underwhelmed/overwhelmed. Do you feel the program is at this time, given the fact that you've only been really actually in the field, so to speak, for about seven or eight months now, do you feel comfortable that the program is kind of on track and adequately working?

MR. GERRY: Yes. I mean, I think it was my sense from the beginning, and I think the commissioner's sense from the beginning, was that it was going to take some time for this program to sort of fully gear up. I think that, as the chairman mentioned in his opening remarks, there is a lot of concern. There's, I think, some fear about what may happen to people. I think there is a trust issue that's always been there. And I think a lot of the early experience that we had is -- and one of the reasons we've been trying to focus on doing it correctly is to try to systematically convey that we can and will respond. But I think it's always been true that there be some sort of a ramp in take-up rates, and I think a lot of it is the experience of the people who begin the program will have a lot to do with how many other people participate.

So I think, given the projections that we had, we're doing a little bit better than we thought in terms of that. But it isn't as if a lot of people just sort of flooded our offices. I don't think -- I haven't seen any evidence that the system, the delivery system, is overwhelmed. I'm a little more concerned about being sure that we have all the choices and the broadest possible range of choices for people, more than I am that the people that are being chosen are overwhelmed. I think that's something we have to keep working on because one of the goals of the law obviously was to try to broaden that choice as much as possible.

So if I have any concerns, it's more to be sure that the market, the competition is there. And I think that's the one thing that I notice in terms of how the tickets are going out, it's not so much the volume. But I think it would be good if we had even more competition than we seem to have. It varies a lot from state to state.

REP. MATSUI: How are the state vocational rehabilitation programs integrating with what your people are doing on the field? Or is that even an issue yet, or is that something you're kind of thinking about how you're going to --

MR. GERRY: Well, no, it's --

REP. MATSUI: Or is there even a need to integrate them -- or coordinate them, I guess is a better word?

MR. GERRY: I think there is a very real need to integrate and coordinate, and we've been -- I've been spending a lot of time with the Department of Education and assistant secretary for special education and rehab services, which provides the other funding really for the rehabilitation system. The integration I think also involves the Work First Investment Act, which the V.R. systems are a part of too. And as part of that, there's sort of a three-way tie between the vocational rehabilitation program, the Labor Department programs and ours. The goal obviously I think that we all want is to have as rich a set of opportunities and choices for people as possible, and for the V.R. system to -- along with our system, to contribute to the overall employment support needed by people.

So I think that it's very important that we not end up either having our funds replace funds that would otherwise be spent, and need to be spent, by the vocational rehabilitation providers, or for us not -- to coordinate effectively across -- over timeframes. There are orders of priority in the Vocational Rehabilitation Act that actually put our beneficiaries high on the list, and if things work well -- and I mentioned this in some earlier testimony in some of the demonstrations that we're working on. It's to bring all these resources together and aggregate them and provide an integrated support structure over time, and that's what we're trying to do.

REP. MATSUI: Would that require more legislative -- probably require more regulations, I would imagine. But -- or would it? Maybe not. I mean, can you do it --

MR. GERRY: Well, that's actually what we're trying to do in the demonstrations. We're trying to actually -- become we have a waiver authority -- we have waiver authority and what we're trying to do is work at the state and local level to figure out how this should best proceed. And then that may -- it may bring up the need for legislation. It may bring up the need for regulations. I think we'll know best when we actually start doing this, which we're doing. We're doing it with youth, we're doing it with adults and the V.R. systems are a part of that. But for the most part I think my own experience would be that most of this should be able to be done without -- certainly without legislative changes. I don't think the laws are inconsistent.

REP. MATSUI: No.

MR. GERRY: There may be some need for regulatory changes. So far we haven't encountered that. But we're just -- we're really just starting this. As the demonstrations -- my experience with demonstrations is that it's when you finally get down to who's going to do what on Monday and who's going to pay for what and are there barriers to doing it the way people at the local level really want to do it, then we'll find out. And I think that will be within the next several months.

REP. MATSUI: And I guess the turf issue is always a difficult one to really resolve and I guess --

MR. GERRY: It is. But we've been -- really, I've had -- the Department of Education and particularly Assistant Secretary Pasternack couldn't have been more cooperative. We've been working very closely with them and I think that it's an excellent -- at this point an excellent coordination.

REP. MATSUI: Is there an interagency task force that's actually on an ongoing basis: labor, education --

MR. GERRY: We don't have a formal one that I know of. But as part of the president's new Freedom initiative, we've kind of got a group of four agencies. It's Labor, Education, HHS and us, and we've been meeting pretty much weekly to design and work together on a whole set of initiatives which the president has talked about, and some of which are kind of reaching fruition in terms of these demonstration programs.

We're looking at some regulatory changes on our side. But those four agencies -- it's not that we're not talking to the agencies.

REP. MATSUI: No.

MR. GERRY: But those four agencies have been, I think, the core of that effort. I don't think we have an official designation that we're a part of. It's kind of being done under the new Freedom initiative.

REP. MATSUI: It's probably better that way. Look, may I just ask one last question. The backlog of the disability claims review process, that is not being impacted in any adverse way by this program, I would imagine, right? There'd be different personnel and all -- obviously your time is being taken up, and a few others probably at the top management level, but it's not being impacted negatively I take it?

MR. GERRY: No. And I think that that's part -- one of the considerations in looking at this whole question of how we want to provide this kind of ongoing support that does come up, which is that if -- when we start -- right now I think that there's no overlap. But when we get into questions of how we use field office staff, a lot of the choices will be are we going to work on this workload, or are we going to work on that workload? And those are real issues because we have a lot of competing -- as we've said, a lot of competing demands. But I would not say in any way right now that the rollout of the ticket and the way we're operating the program right now is creating any kind of a drain of resources from the back.

REP. MATSUI: Thank you.

Thank you, Mr. Chairman.

REP. SHAW: Mr. Collins.

REP. MAC COLLINS (R-GA): Thank you, Mr. Chairman.

Mr. Gerry, just one question pertaining to the demonstration project which will reduce the benefits one dollar for every two dollars of earnings above a certain threshold. Many call it a cash cliff. What's the status of the project itself and the report that's due in early 2004?

MR. GERRY: Well, Mr. Collins, we're moving ahead with that effort. At the present time I'm involved -- in fact, I have a meeting tomorrow in which we're kind of finalizing the write up of what amounts to a detailed design of a demonstration project. What we've decided to do is to pursue this in the form of state demonstrations, where we'll be working and looking for states who want to in effect pursue and help do the research that's necessary to see what the effect of that one for two offset would be on employment opportunities.

We went through an extended period of time trying to evaluate whether we could do this on a national sample basis, and the size and cost and complexity of that, and we looked at -- and I was very involved with the welfare reform demonstrations and what has gone on there, and became convinced that I thought we could do this effectively by using state demonstrations. I think we could learn a lot about the same questions and we could do it a lot more rapidly, and I think Congress wanted to get some information about what the actual consequences would be. So where we are -- and I'm hoping that we'll have something formalized certainly by the end of this year, and I would think -- whether we will start -- we may start with some states using existing funding before we do a formal competition, or we may go ahead and move to a formal competition. But we want these demonstrations to begin as soon as we can.

The key is to design them so that we can, I think, learn as much as we can about the contribution that the one for two feature would make. The complexity is that it's very hard to hold all the other variables constant, because the economy changes, the employment demands change. So what we're trying to figure out is how to measure that factor so we can report to Congress with some clarity, because it's my sense of what the Congress wanted: whether this particular feature will contribute significantly positively. And that's the design question. But we're moving ahead as rapidly as we can at this point.

REP. COLLINS: The early 2004 dates then seems to be kind of unreasonable to reach, based on 2002 with the design concept and implementation, and very little time for actual results.

MR. GERRY: I think it's going to be difficult to have as much information as we'd like to have had and I suspect the Congress wanted by that date. I think we will have some information, but I think probably we're going to be -- it'll be another four to six months before we have the kind of data that I'd like to have had. But I have -- I do think it's been a very difficult process that we've gone through, but necessary to sort of look at this -- the design questions. We've asked a lot of people, we've met with the Ticket to Work advisory panel and we've discussed this at some length. We have more of those discussions to have before the final design. But I think the key thing is that the commissioner wants to move ahead and has decided to move on this on a state demonstration approach. And having made that decision, I'm confident that we'll move ahead quickly.

REP. COLLINS: Very good. Thank you, Mr. Gerry.

REP. SHAW: That cliff remains a problem and I've made some enquiries into that and it's a question of tremendous expense to do away with it. But that is something that we should look at, because it is a -- in itself it's a barrier to a lot of people. I'd like to just go on one further area, because it involves the testimony of the third panel. Mr. Prokop and Mr. Decker, who will be a part of that next panel, raised some questions that I'd like to explore with you, as I will not have another chance at you after they've finished.

First, that most state vocational rehabilitation agencies are opting to be paid under traditional cost reimbursement method, which cases are closed after nine months of work as opposed to 60 months investment in the client, as required by private providers. Second, private providers perceive that if they sign up to be an employer network, their current relationship with their state vocational rehabilitation agency may be jeopardized. Third, there have been reports that some current vocational rehabilitation clients were threatened with termination from vocational rehabilitation if they did not assign their ticket to the vocational rehabilitation agency or, worse, weren't informed that they could be better served by taking their ticket to elsewhere versus staying on a waiting list at the vocational rehabilitation agency. This is most disappointing and it's completely opposed to our goal of the Ticket to Work program. Have you heard any of these allegations yourself? If so, are they true and what are we doing to address it?

MR. GERRY: Yes, Mr. Chairman, I have heard them. The first item you mentioned is really a choice that was provided under the statute, that is the question of this payment system V.R. agencies would use. And so I think we have seen some states shifting to the new payment methodology, so I would say that although it's true most are using the old payment system, many are shifting. But Congress permitted them to do that, so it's not something that we've been pursuing per se.

We are required, of course, by the Act to look at the payment methods that we use. And so if we were to conclude that the payment methodologies that were created, for one reason or another, were so unattractive that no one wanted to use them that had this choice, that would be something we'd report back. At this point there is no way we would know that. And there are some states that are shifting, so as far as the first point I don't think that raises any particular concerns, that is that they're using the original payment methodology.

The other two points you made I have heard about, and that is this question of -- and they're really -- let me take them separately for a minute. There are anecdotal accounts that there has been pressure put on some providers to enter into agreements with vocational rehabilitation agencies, who also happen to provide funding to them under the Rehab Act. So even though we're talking about the Ticket to Work, they have other relationships, and that is a concern and I've raised it with the Department of Education. And along with the third point you mentioned, which is this question of whether or not claimants are being told that they must use a ticket. Although I'm not an expert on the Rehab Act in any sense, I have talked to the Department of Education about their view of whether or not it would be permissible to make someone use up a one-time ticket, who was otherwise entitled to services under the Rehabilitation Act. And so we're talking at some length.

And I've also talked to the Department of Justice about both of these issues, to be sure that we don't have the kinds of problems.

Now, I have no hard evidence of any particular state where this has occurred, but I suspect I've heard many of the same reports that you have and we take them seriously and we're pursuing them.

REP. SHAW: Well, the testimony I refer to will, of course, be made available to you to follow up on it any way you can. And any further expansion that you can give us, please keep us advised.

MR. GERRY: As soon as I know anything about it, I'd be happy to provide it.

REP. SHAW: Thank you for your testimony. I appreciate your being with us here this morning.

Our second witness is Sarah Wiggins Mitchell, who is the chair of the Ticket to Work and Work Incentives Advisory Board.

Ms. Mitchell, we have your full testimony, which of course will be made a part of the record, and you may proceed as you see fit. And welcome back to this committee.

MS. SARAH WIGGINS MITCHELL: Thank you. Thank you very much. And I should say good afternoon, Mr. Chairman and members of the committee.

REP. SHAW: I think it's morning where you are -- where you're from.

MS. MITCHELL: On behalf of the Ticket to Work and Work Incentives Advisory Panel, I would like to thank you for this opportunity to speak with you today. We are very appreciative of the high level of interest this committee has shown regarding the implementation of the Ticket to Work program. And we also would like to recognize the tremendous amount of support you demonstrate for not only this important law, but also for the well being of people with disabilities in general.

When you passed the Ticket to Work program, the recognized the desire of many people with disabilities, currently receiving benefits, to work. You also recognized that certain policies and procedures acted as disincentives and prevented people from attempting to work. Further, you also saw that both within SSA and in the rehabilitation and employment support arena in general that customer service supports were not available to assist with the transition of benefits. And you recognized also that with the proper support, people would want to attempt to go to work. Indeed, the early implementation of the programs authorized by the Ticket legislation is certainly proving your vision to be true.

Although the Ticket program got off to a later start than anticipated in the statute, SSA has now mailed out over two million tickets, as you noted, to SSI and SSDI beneficiaries in 13 states, and the response from beneficiaries has been unexpected. Although ticket distribution did not begin until February of this year, as you noted, Mr. Chairman, over 7,000 beneficiaries have signed up with employment networks, or E.N.s. And I'm sure as you're going to hear later, there are now -- at least the last data that we received -- 438 E.N.s available to service ticket holders.

Our last panel meeting in August we focused on E.N.s and we heard that the response from beneficiaries has been greater than expected. As one director put it, quote, "If I had to express one word that represents the Ticket program in South Florida, it would have to be surprise. When the ticket was first mailed out last February, it was my understanding few of the Florida beneficiaries would want to work. I have received over 500 telephone calls from beneficiaries enquiring into the ticket program and asking how they may participate." Now, although this was the experience of a particular E.N., we heard a very similar response from all the other E.N.s that participated in our quarterly meeting.

People with disabilities also obviously needed somewhere to go for information and advocacy related to SSA work incentives, and how returning to work would affect their benefits. The programs established by the Ticket legislation are clearly helping to meet the needs of beneficiaries for information. Almost 31,000 beneficiaries have sought information and assistance from the Benefits Planning Assistance and Outreach Program, and over 17,000 of those individuals were not currently employed and were looking to work.

A service provider who visited a benefit planner said: "The benefits specialist was able to present the information clearly and in simple terms. For the first time I really understood how SSI and SSDI work." A beneficiary commented to a benefits planner: "You were enormously helpful, not to mention knowledgeable. I have a great challenge in front of me and you have given me a lot of good information. We shall see what lies ahead." And then there are the Protection and Advocacy programs which have also proven to be enormously helpful to people with disabilities. At the end of last year more than 10,000 people had been served by the P&A programs across the country. Obviously, advocacy was another service needed by the beneficiaries of Social Security disability programs.

A significant barrier, however, to employment for people with disabilities has always been access to healthcare. As Deputy Commissioner Gerry noted in his testimony, approximately 52,000 people have benefited from the extension of Medicare benefits. In addition, 23 states now have operational Medicaid buy-in programs enacted under the authority created by both the Balance Budget Act and the Ticket legislation. An additional 10 states have passed legislation to establish a buy-in program, but they are not up and running yet. The best news is that more 16,500 people with disabilities are working in these 23 states and participating in the Medicaid buy-in Program.

The programs authorized by the Ticket legislation are off to a good start and are beginning to meet the customer needs of SSA beneficiaries that have long been neglected. However, the panel has serious concerns about whether SSA is devoting sufficient resources to these programs to allow them a chance to fulfill their potential. In addition, the panel is concerned that SSA will not build the infrastructure and capacity needed to support the programs as they grow.

To begin with, we believe the resources allocated to public education, training and marketing of the ticket program are insufficient to support the programs through this critical start up period. The Ticket program represents a dramatic change in the role of SSA and its relationship to its customers with disabilities and rehabilitation providers. No longer will SSA only process claims and disburse checks, it will also offer employment support and direct help for beneficiaries who return to work. Based on public comment, the panel believes that many beneficiaries who receive a ticket do not know what it is, what to do with it or why it has been sent to them. The panel has heard at public meetings from E.N.s, White House staff and senior SSA executives that a campaign to market the ticket to beneficiaries, providers and employers is crucial to the success of this program.

As far as the panel can determine, no resources have been allocated to marketing the ticket program, except to recruit new E.N.s. Not only must beneficiaries, employers, providers and all other relevant stakeholders know about the Ticket program, the panel believes that for the program to succeed they must also be well educated about it. The Benefits Planning Assistance and Outreach grantees are doing an excellent job, but they simply do not have the resources to educate everyone about the program. As far as the panel knows, SSA has not developed a campaign to educate the public about the Ticket to Work program.

The training budget allocated to these programs by SSA is also problematic. SSA is spending less than $4 million on training. For a new program relying on both beneficiaries and providers to make informed choices, and relying on many federal, state and private strategic partners to coordinate their efforts, an intensive and comprehensive training regime is crucial. The panel believes the amount of resources dedicated to training is terribly inadequate. In comparison to the $2 million just noted for the Ticket program, one program, the Federal and State Vocational Rehabilitation Program, spends about $40 million per year on training activities.

The panel also thinks that SSA may not be creating the service capacity, both inside the agency and out, to adequately support the programs and work incentive improvements of the Ticket legislation. One major concern involves the requirement of the Ticket legislation for SSA to establish the ESR program, which you were questioning Deputy Commissioner Gerry about. In order to meet the requirement, SSA established the pilot program, which was noted previously, to test the utility of full-time permanent SSA staff to fill that ESR role. The pilot actually involved 36 ESRs and the preliminary findings of the pilot program were extremely positive. The panel heard positive feedback from SSA beneficiaries who interacted with ESRs. In addition, SSA's own evaluation report made positive recommendations regarding the ESR position.

The future of the ESR program, however, is unclear. And I did hear what Deputy Commissioner Gerry was saying, that they are evaluating this as to how they want to go forward with it. But to date the panel has not been advised as to how they will be proceeding. It's not clear whether they will expand the pilot to full coverage, hire outside contractors or use claims representatives as part-time work incentive specialists. The panel strongly believes that the establishment of work incentive specialists who are full-time, permanent employees of SSA, as in the ESR pilot, is essential. The panel has expressed this concern to Commissioner Barnhart and we are waiting for a response. We do not know whether SSA intends to continue to the ESR program.

The second capacity issue involves E.N.s. As we said, there are now over 400 E.N.s to serve beneficiaries around the country. While this represents a good start, and Maximus should be commended for the work they have done so far, a lot remains to be done. The panel is concerned there are not enough providers with a diversity in both geographic location and specialization to meet the needs of beneficiaries. The geographic location of the E.N.s is a concern. At our panel meeting last month we heard from an E.N. there are 58 employment networks in Illinois.

REP. SHAW: Could I interrupt. How much longer do you have?

MS. MITCHELL: I'm just about to finish. This is it.

REP. SHAW: Thank you.

MS. MITCHELL: There are surprisingly few, maybe eight, in the metropolitan area of Chicago, where we provide our service. The other side of that coin is that the majority of beneficiaries, of course, live in the metropolitan area of Chicago. If E.N.s are not located where the beneficiaries are, then beneficiaries will not be able to participate in the program.

I would just like to finally close by indicating that the panel is concerned that SSA has not developed the capacity to handle increased number of beneficiaries returning to work, without exacerbating the overpayment problem. As you know, in Fiscal Year 1999 SSI beneficiaries owed SSA more than $3.8 billion in overpayments. And for many beneficiaries returning to work this, of course, remains a barrier for them. Now, the panel is aware that SSA has finite administrative funds and the agency must meet all of its needs with dollars appropriated by Congress. We are also mindful of the increased demand for customer service that will be placed on the agency as baby boomers begin to retire. We know that they must establish priorities and the Ticket legislation must compete with these other programs.

However, if the resource and capacity issues are not addressed, the Ticket program may in fact fail. Not because people with disabilities don't want to work, and not because the program could not be effective, but rather because it was never given the chance to succeed. I just would like to in closing acknowledge and thank the agency. The agency has been cooperative with the panel, has been very accessible. They have solicited our input. And Deputy Commissioner Gerry and his staff I would particularly like to acknowledge and thank. And thank you for your time and attention.

REP. SHAW: Mr. Collins?

REP. COLLINS: No questions.

REP. SHAW: Mr. Matsui?

REP. MATSUI: Thank you, Mr. Chairman.

Ms. Mitchell, you mentioned -- and I'm still trying to figure out these bills -- the ESR, which is obviously your -- you feel that's been working very well. And the issue, I guess, is whether it will be phased out and a lot of the folks are really interested in this program. I'm -- and I guess I should have probably asked Mr. Gerry that issue. But could that have something to do with the fact that SSA has to make a decision in terms of its priorities? Because you've got the backlog, and we had a lot of hearings on that over the last couple -- three years now, and that's a substantial problem to deal with. And then we have obviously this new program coming up and we're trying to deal obviously with that.

How would you respond to that? I mean, let's -- and I don't mean to say you have to make a choice, because I don't know if that's really the case? But how would you respond to that, because I think that's the dilemma that the commissioner is facing and Mr. Gerry is facing, and I'm trying to figure that out. I mean, what -- I shouldn't say what's more important, because both of them are extremely important. But how do you help us resolve that issue? And I think we could say more money, but I don't think we should get into that. I mean, I think that's a very difficult issue.

MS. MITCHELL: Right, and I -- we understand -- the panel understand the agencies' responsibility to weigh and balance resources and how they are to be utilized, and what have you. However, I think we do believe that this ESR program is such a critical component of the Ticket program that however that balancing goes on, that it perhaps deserves -- maybe outweighs some other programs and issues that might be considered. We've heard from beneficiaries that some beneficiaries feel that without this program, that there will be a fairly high likelihood that there will be really serious difficulties in this Ticket program succeeding.

REP. MATSUI: Without that?

MS. MITCHELL: Yes, without this position.

REP. MATSUI: Thank you.

REP. SHAW: Mr. Hayworth?

REP. J.D. HAYWORTH (R-AZ): I have no questions. Thank you, Ms. Mitchell, for coming.

And thank you, Mr. Chairman.

REP. SHAW: Thank you very much.

MS. MITCHELL: Thank you.

REP. SHAW: We'll now go to the final panel, which is quite large. And I will call according to the order in which you'll be asked to give your testimony.

Susan Prokop, who is the co-chair of the Work Incentives Task Force, Consortium for Citizens with Disabilities. John Kregel, who is the director of the Benefits Assistance Resource Center in Virginia Commonwealth University, Richmond, Virginia. Mary Satterfield, who is the project director of the Maximus Ticket to Work in Alexandria, Virginia. Charlene Dwyer, who is the vocational rehabilitation administrator, Wisconsin Department of Workforce Development in Madison, Wisconsin.

Dan O'Brien, who is the program manager of the Ticket to Work and Community Rehabilitation, Oklahoma Department of Rehabilitation Services, Oklahoma City, Oklahoma. Susan Webb, who is the director of ABIL Employment Services, Avondale, Arizona.

Is that in your district?

REP. HAYWORTH: These are good friends of mine from the state, but regrettably not my district. We were hoping realignment might take care of that.

REP. SHAW: She's accompanied by Amy Gilliland, who is a Ticket to Work participant in Glendale, Arizona. Am I getting closer?

REP. HAYWORTH: Still good friends -- we've worked on -- (laughter.)

REP. SHAW: You know, it's amazing. Everyone is a good friend as November comes closer (laughter.)

REP. HAYWORTH: Hard to believe, Mr. Chairman, but they've actually been my friends long before November (laughter.)

REP. SHAW: David Gadaire, who is the program director of Career Point, Holyoke, Massachusetts. And Curtis Decker, who is the executive director of the National Association of Protection and Advocacy Systems.

We are going to be called for a vote right around 1:00 we've been advised. If you can summarize as best you can. We have your whole statement which of course is being made a part of the record and we very much appreciate you taking the time. We can recess and come back this afternoon, but if you can move quickly through the testimony it would be helpful and maybe we can conclude it before we're called away again to vote and delay your departure.

Ms. Prokop.

MS. SUSAN PROKOP: Thank you, Mr. Chairman, and members of the committee. Good afternoon. My name is Susan Prokop and I am speaking to you today as co-chair of the Consortium for Citizens with Disabilities' Work Incentives Task Force. First of all, thank you for your continued interest in this -- in Ticket to Work and Work Incentives Improvement Act. And at the outset I do want to draw your attention to the several positive developments that -- surrounding Ticket and TTWWIIA implementation that we note in our written statement. The developments are encouraging and I just want to point that out, but make the remainder of my oral remarks on some other issues that we do feel need to be addressed in order for this law to be fully successful.

As has already been mentioned, there's a concern in our task force about the marketing of TTWWIIA and Ticket to Work, despite the fact that Social Security, Maximus, its marketing subcontractor NISH, the PABSS program and BPAOs have made concerted efforts to promote this program. The extent to which beneficiaries -- at least from what our members have ascertained, the extent to which beneficiaries seem to be aware of TTWWIIA is not as strong as we'd prefer, and that's why we would like to see Social Security enlist more of its counterparts in other agencies involved with workforce development in promoting TTWWIIA on their own Web sites, in their own communications with the public, using the regional dib (ph) tax, JAN, the Centers for Independent Living, using the PABSS program more, and even perhaps pursuing partnerships with groups like the Ad Council to put out public service announcements about TTWWIIA and the Ticket program.

Our task force continues to believe that the payment system for the Ticket to Work program needs to be improved if it is to serve all beneficiaries. Beneficiaries enquiring about the ticket, being referred to employment networks, getting placed in jobs seem to be predominantly those on Social Security disability insurance. And for some E.N.s it can take almost twice as long to recoup the costs of an SSI beneficiary than for an SSDI recipient. Impediments to serving those on SSI, often those with the most severe disabilities, include the longer time it takes for beneficiaries to reach zero cash benefits, the point at which an E.N. gets paid. And, in addition, an E.N. gets paid less to serve clients on SSI than clients on DI, because the SSI benefits are lower than for those on DI.

The zero cash benefits requirements also discourages E.N.s from serving beneficiaries who may only be able to reduce their dependence on benefits by working part time, and those with vision impairments who must reach the higher blind SGA level. Clearly, the payment system needs further improvements, although we do appreciate Social Security's addition of some more milestones and increase in the payments. But in order to ensure a wide range of employment networks are there to serve the widest range of beneficiaries, we would like to see further exploration of improvements to the payment system.

We also feel that Social Security still needs to clarify its policy regarding disabled adult children, or DACs as they're called. Disabled adult children who depend on the higher benefits afforded them through their parents' earnings records may lose their DAC status if they go to work, earn above SGA and then have to return to the disability rolls. SSDI benefits based on their own work record are likely to be substantially less. If Social Security won't issue a policy that clearly supports providing full access for disabled adult children to all of the provisions of TTWWIIA, including reentry to the program as a DAC status, Congress should resolve this through an amendment to the law.

I will just conclude with a couple of other issues which, although they rest with other committees, are important to the success of TTWWIIA. The first concerns the troubling signs that state budget deficits will discourage participation by additional states in the Medicaid buy-in, or even prompt some states to drop out. You noted, Mr. Chairman, that Florida has backed out of its Medicaid option, and that was rather distressing -- or that they're planning to repeal it. As we all know, Medicaid covers important benefits not covered under Medicare and we're concerned that the fiscal difficulties facing some states may foreclose opportunities through TTWWIIA for millions of Social Security disability recipients.

State budget woes also appear to be dampening interest in section 204 of TTWWIIA, which authorizes demonstration projects for Medicaid coverage of workers with potentially severe disabilities that, without medical care and treatment, may force them onto the disability roll. Only four states have opted for this 204 program and less than half the appropriated funds for section 204 will be used under current projections. Existing deadlines for evaluation of the program we believe should be extended, or 204 made a permanent option for states to take advantage of in order to give it time to demonstrate its feasibility.

We also have ongoing concerns about the relationship of state voc/rehab agencies in the Ticket program. I appreciate, Mr. Chairman, your question to Mr. Gerry about these concerns concerning V.R.s' use of the cost reimbursement method and the relationship of private providers to V.R. and V.R.s working with clients of V.R. who also get tickets. We are beginning to think maybe it might be worthwhile to look at the relative advantages and disadvantages experienced under the Ticket program by private providers versus state voc/rehab agencies. And as well as we hope that you might add your voice to our own concerns in pressing Social Security and the Department of Education to really clarify what we view as a distressing situation concerning the relationship of voc/rehab clients and the Ticket program and voc/rehab agencies.

Mr. Chairman, members of the committee, our task force commends you for your continued interest in promoting economic self-sufficiency and opportunity for people with disabilities, and I look forward to answering any questions. Thank you.

REP. SHAW: Thank you.

Dr. Kregel.

MR. JOHN KREGEL: Mr. Chairman, members of the committee, benefits planning and assistance is the first stop on the road to employment for SSA beneficiaries. Authorized by section 121 of the Ticket to Work Act, Benefits Planning Assistance and Outreach, or BPAO, projects are providing services to SSA beneficiaries in all 50 states and five territories. Collectively, 116 BPAO projects employ over 400 benefit specialists, many of whom are themselves individuals with disabilities and they currently serve 3,000 individuals each month.

The purpose of the National BPAO initiative is to provide beneficiaries accurate and timely information about myriad regulations, provisions, work incentives and special programs that complicate an individual's decision to enter or reenter employment. Benefits planning and assistance is an employment program, providing support to SSA beneficiaries who want to work. Virtually all individuals who contact the BPAO are either employed or are actively seeking employment. The BPAO initiative is not about helping people stay on benefits. Rather, its purpose is to empower individuals to take charge of their lives.

Congress and the Ticket to Work Act have led to tremendous innovation and expansion of activity in this particular area. At the same time, the speed at which these changes have occurred have created significant challenges for the BPAO program. The BPAO initiative simply lacks sufficient capacity to adequately meet current and future demand. The problem is particularly acute for BPAOs in ticket rollout states and programs in rural areas. For example, in Sacramento, Legal Services of Northern California is attempting to serve 87,000 beneficiaries in 19 counties in and around Sacramento with just three benefits specialists.

Beneficiaries in Plano, Texas, are served by the West Texas and Panhandle Benefits Planning Services Project in Odessa, several hours away. In this project, one benefits specialist is attempting to serve a catchment area of 38,000 beneficiaries who live in 59 different counties. In Arizona six benefits specialists have covered -- have served over 1,000 beneficiaries across the state. In Northern Arizona one-and-a-half staff people serve 59,000 square miles from the Navaho Reservation to Lake Havasu.

The National BPAO initiative is essential to the successful implementation of the Ticket program. When the Ticket to Work program was launched in 13 states, BPAOs rose to the challenge and provided assistance to over 9,000 individuals in just a few months. The Ticket program manager, employment networks, local SSA offices, protection and advocacy agencies and state V.R. agencies all refer ticket holders to BPAOs for information and support. For example, the Ticket to Work coordinator in the Arizona Rehabilitation Services Administration has received over 900 telephone enquiries since the ticket rollout began in his state. He refers each beneficiary to the local BPAO program to help assist in the decision as to whether or not to make ticket assignment.

The BPAO program is about trust. If beneficiaries are to accept personal responsibility for their careers and their economic self- sufficiency, they have to be able to trust the information they receive and the service providers that assist them. If individuals with diabetes, epilepsy or psychiatric disability are told that they will still have access to healthcare coverage, even though they no longer receive a cash benefit from SSA, they must be able to depend on this guidance, as erroneous information may literally put them in a potentially life threatening situation.

If an individual complies with all SSA regulations and reporting requirements and SSA fails to accurately apply the reported information to the individual's case, the resulting overpayment can have a catastrophic and disheartening effect on even the most courageous and patient beneficiaries. For example, Good Will Industries in Southern California describe a number of consumers who have stopped working while on benefits because of substantial overpayment situations, many of which are due to improper SSA record keeping or insufficient knowledge of how to report and keep track of earned income.

We need to learn from the lessons of welfare reform. Beneficiaries need to know and understand the rules and have them consistently interpreted and applied in order to fulfill their own responsibilities under the program, and accept responsibility for their economic self-sufficiency. The National BPAO initiative, if effectively implemented, is an essential component of congressional efforts to include individuals with disabilities in our nation's workforce. Thank you very much.

REP. SHAW: Thank you.

Ms. Satterfield.

MS. MARY SATTERFIELD: Thank you, Mr. Chairman. As you know, I represent Maximus, who has the program manager contract for the Social Security Administration to administer the Ticket program. As the Ticket to Work program manager, we function as a trusted agent of the Social Security Administration. They retain program authority. They decide ticket eligibility, schedule the rollout phases, schedule the graduated delivery of tickets during the rollout phases, propose regulations, create and interpret policy and actually approve the providers who have applied to become employment networks.

As the program manager, we actually execute all tasks that are critical to the operational administration of the program, and that includes serving as a centralized information source, marketing the Ticket to Work program to providers and recruiting them to participate, facilitating that link between the beneficiaries and the employment networks, providing training to a variety of stakeholders, developing and maintaining a very secure and a robust information technology system, collecting program data which we share with the evaluation contractors in Social Security, and reviewing all E.N. requests for payment.

All aspects of the initial start up for Ticket went very smoothly. This included a very complicated undertaking of a system link with Social Security Administration, via which we at the program manager site exchange information necessary to the operation of the program with SSA on a daily basis. Additionally, the start up of the national call center which has been operational since March of last year went very smoothly, and to date we have logged over 150,000 calls, the bulk of which were received after the tickets began to go out in February.

We commenced our marketing and recruitment campaign immediately and very aggressively after the release of the first ENRFP, or request for proposal, back in April of last year. This included in-person meetings, presentations at conferences, exhibits at large disability related events, targeted mailings, phone call campaigns, e-marketing strategies and any other method that we could think of that would represent an opportunity for us to get the word out to providers. Our marketing team makes presentations about Ticket to dozens of different events every month, including the recruitment conferences that we host in conjunction with the administration. To date we've done over 50 of those covering the phase one and phase two states, and we're planning almost 40 again for next year.

We've made well over 100,000 different marketing contacts to a broad variety of traditional and non-traditional providers throughout the country, including employers and educational institutions. Although our marketing effort has obviously not been without challenges, we are encouraged by the 542 applications we have received to date. And this includes several providers who have elected to cover all of the states in the country. The administration has already formed contracts with 438 of those providers, and they're onboard as E.N.s. And the remaining applications are in that review process and should be approved very soon.

Last year our recruitment efforts were particularly hampered by provider dissatisfaction with the proposed payment system. And certainly the more robust payment system that was presented in the final regulations was very finally received. And then, additionally, the release of tickets that occurred in February also served as a catalyst for this very market-driven program. However, we continue to find that provides remain focused on concerns about sufficient start up capital. And while there are always various marketing and recruitment challenges that are specific to each state, these financial concerns traverse state boundaries, impairment groups served and affiliations for the providers.

We know this program represents tremendous change for beneficiaries and providers. Transitioning providers from what is a very deeply rooted fee-for-service mindset to the outcome-based concept of the Ticket to Work program is taking a lot of time. Providers continue to be reluctant to actively participate in the program, because they might not be able to afford the upfront costs of providing services, or because outcomes are far from certain or they may have to wait a substantial period before payments based on outcomes will be received.

Ticket is a new way of doing business for them. They must become accustomed to the idea of forming partnerships and sharing risk, as well as receiving clients who have not been prescreened. And while beneficiaries have been overwhelmingly optimistic and positive about the opportunity that Ticket presents for them, they too remain fearful of ultimately going off of benefits. Ticket is a mindset change for them as well.

On behalf of the program manger and the staff that are working on the project, we are encouraged by early success indicators such as the number of tickets assigned, which is almost 7,500 to date, the number and mix of providers that are participating and the number of payment requests that we have received so far, which is somewhere between 80 to 90. And we continue to focus strongly on recruitment and supporting the ongoing needs of both the E.N.s and the beneficiaries. And we thank you for this opportunity to speak with you today.

REP. SHAW: Thank you.

Dr. Dwyer.

MS. CHARLENE DWYER: Good afternoon, thank you. From Wisconsin how did the ticket rollout? Fair. Pursue the rollout. Last week -- as of last week we had about 1,200 assignments of tickets in Wisconsin. Wisconsin has the highest percentage of ticket assignments based on the mailing that was made of the 13 rollout states. I think a more questioning is how much new interest has been stimulated by the mailing? If we look at who were our current customers at the time of the mailing and how many new customers we generated as a result of the mailing, we can attribute about 300 new customers to the ticket mailing. That's about two-tenths of one percent of the mailing.

Where are the ticket holders in Wisconsin assigning their tickets? We have about 1,200 tickets assigned. Ninety-six of them have assigned them to the Wisconsin V.R. agency.

Why such a high percentage of tickets to the V.R. agency only in Wisconsin? We know that about 70 percent of the people who have assigned tickets were our current customers when they received the ticket, and chose to assign the ticket to us. We also know that we had a very positive response in our call center, where we took over a thousand phone calls and where we gave a very positive message about the ticket and the benefits of the ticket, offered benefits counseling to every caller if they would like to engage in benefits counseling. And we think that drove up the number of ticket assignments as well, as well as the fact that we answered our phones. And we did hear that towards the end there were some E.N.s that weren't answering their phones. So we answered every phone call.

We also know that we had E.N. providers in Wisconsin referring ticket holders to us after they did the risk assessment. They just couldn't afford to take the ticket from the caller, and they would refer them to us. We said that's fine, we'll turn around and we'll buy the services from you if you're the preferred provider for that individual.

What needs to be improved? If we're going to take on the ticket callers, the higher risk ticket holders, from the E.N. referrals, we're willing to do that. That's our role and we're willing to do that. But we also want to know -- and we were a state that rolled out under cost reimbursement. We are going to be moving into an outcome payment system by the end of the year, but right now we're still engaged in cost reimbursement. We would like to know that if we did the job, if we meet the goals, if we help that customer achieve the ticket outcomes, that we can be paid. And there are some disconnects in the current final rules that can prevent us from being paid, even when the outcome is clearly attached to our services. If another E.N. -- if the ticket gets moved and another E.N. places the claim under milestones, we're trumped. We get no reimbursement. And we also have no recourse for appeals with SSA.

So we would like to see some changes in the cost reimbursement system from SSA. Why is it important? Because last year in a 12- month period we earned for our successors $1.64 million in SSA costs reimbursement. We took 700 people off of our waitlist with those funds. And we're a state, as all other states are, that are coming into some very hard economic times at the state budget level. We do know if we're not able to recover for our successors -- and I'm talking about recovering for the work that we do -- that we will have longer waitlists in our state. We have a waitlist now and we anticipate it will get longer.

So we believe these glitches can be worked out. We would like to continue to focus on the benefits of the ticket to the ticket holder, and less on cost recovery and assignment of tickets. Thank you.

REP. SHAW: Thank you, Dr. Dwyer.

Mr. O'Brien.

MR. DAN O'BRIEN: My name is Dan O'Brien. Thank you, Chairman Shaw and Ranking Member Matsui and members. I'm with the Oklahoma Department of Rehab Services. I'm the program manager for Ticket to Work and Community Rehabilitation.

To give you a sense of what's going on in Oklahoma, we've had just about a thousand -- 100,000 tickets mailed out. We looked at our caseloads before they went out. Eighteen percent of our caseloads were already Social Security customers, which was 4,000 out of 22,000. We've had about 1,500 ticket calls to our ticket hotline. We set up a hotline to make sure there is access to services and the phone would be answered. We've had outreach meetings at the one-stops where we provide work incentive training to the Social Security beneficiaries so that they understand what will happen to their benefits before they get involved.

We are the -- I guess we were asked because we are the big user of the milestone payment system, and that's because in 1992 we developed the milestone payment concept for contracting out as a way of risk sharing and improving outcomes. I was a co-designer of the original milestone system. It's been imitated in a lot of states and I think it was suggested as a way for employment networks to be able to take on the risk as opposed to the outcome system. And that's proven to have been the case. If I'm reading it correctly, two out of three of the tickets assigned to employment networks are under the milestone system, so they apparently do feel like it obviates a risk to their programs.

I want to just highlight a couple of my comments. The ticket assignment rate at this point, 6,000, sounds like a lot, or 7,000. But that's one-third of one percent. Based on our experience and from what I understand from Social Security, you'd have to have a multiple of that to get to the goal that Susan Daniels, Martin Gerry's predecessor said, of one-half of one percent going off the rolls. You'd have to have a multiple of one-half of one percent assigning their tickets. I think the multiple would be eight to -- I understand on Social Security rolls it's more like 14 to one, the people who engage in work activity and actually go off benefits. So that would mean that a ticket assignment rate of about seven percent would be needed to get half of one percent off the rolls.

At one-third of one percent we've got a long way to go. I think that represents some access problems in the system that need to be addressed, and the two recommendations I would have from being -- from the frontlines would be to reduce the penalty -- and this mainly affects E.N.s other than V.R. -- reduce the penalty for choosing the milestone payment system. The penalty now is a 15 percent penalty. They only accrue 85 percent of the funds that they can under the outcome system.

That, in a lot of people's opinion, was intended to discourage use of the milestone system, which from the E.N.s' activity appears to be the one that they think can work. Reduce that penalty five percent instead of 85 percent, and then distribute those funds among the milestone payments, not in the outcome payments. That would make a system that would lower the bar for getting in the front door, which is one of the issues with an employment network. They have to make a risk assessment whether this person is likely to be paid for.

The other thing is, that several people have mentioned, I think there needs to be a marketing triumvirate: benefits, planning, outreach and employment support representatives. Those three pieces, for this to work, have to work in conjunction. And I think the outreach -- the O in BPAO has not been funded. The B.P. hasn't been funded. Benefits planning is way inadequately funded, but the outreach part hasn't been funded at all and I think that could be done through the one-stops. And Martin actually, I think, is working on that with the other agencies. I think that's to be commended. Shall I continue? Okay.

The zero cash benefits. Making the payments contingent on zero cash benefits I think is a mistake. That makes Social Security beneficiaries with the two for one undesirable customers under the ticket. And if the two for one is extended to SSDI, it will put the entire ticket out of business. There will be -- because right now the research is that as -- D.I. beneficiaries are the only ones it makes sense to take a ticket on, because of the cash cliff, because at that point you can be paid. With a two for one write down there will be -- nobody will be desirable.

So that problem has to be addressed. My suggestion -- number of suggestions are a strategy of partial self-sufficiency, reduce -- making payments based on a percentage of benefits not payable, not necessarily going to zero benefits. But if some benefits aren't payable, that could be paid out.

I think the rollout was too aggressive, particularly for California. I think this is going to be a problem that needs to be stretched out a little bit, either 10 percent a month or 10 percent the first two months, 20 percent for additional months because it was the 30 percent and the 40 percent months that really killed us, and is going to murder California and Texas. And the only other thing, I submitted a statement from Connecticut Rehab. There's a lot of concern about absorbing the reimbursement system into the ticket system. I think that sets up the problem the chairman asked about earlier, of V.R. looking at this as antagonistic. If that could be changed that would reduce that. Thank you.

REP. SHAW: Okay. There is a vote on the floor and I think we've only got just a few minutes to make that vote. So I'm going to recess just a few moments. Mr. Hayworth left early, you noted, to go vote and he will come back and call on Ms. Webb to testify and then I'll return just as quickly as I can too. So we'll recess just for a few moments, so don't go far.

(Recess)

REP. HAYWORTH: We'll come to order (laughter.

) If this resembles some sort of power grab, let me assure you it's not the case. With the generous cooperation and assent of the minority and the chairman, as the vote is going on on the floor they asked me to return and start -- resume the subcommittee hearing. And I'm very pleased to do so because, as I understand it, the portion of the hearing picks up with what we might call home cooking, my friends from Arizona. And I welcome our friend Susan Webb for her testimony now.

MS. SUSAN WEBB: Well, Congressman Hayworth, you're going to know everything I have to say.

REP. HAYWORTH: But the important thing -- if you would yield, and I thank you, ma'am. The important thing is that our folks here in the congressional record and --

MS. WEBB: All right.

REP. HAYWORTH: -- our friends who join us via C-SPAN will get to know the success that we've experienced in Arizona.

MS. WEBB: Well, then that's a deal. Thank you for allowing me to come and speak with you today. As you know, Arizona -- or (laughs) let's try this again. I never got tongue tied talking to you before.

REP. HAYWORTH: Take two.

MS. WEBB: ABIL Employment Services is a participating employment network in the Ticket to Work program, and it's indeed a pleasure to be here today with you. What I want to do is start with a brief overview of our program and our outcomes so far. Now, that I haven't spoken to you about, and I think you'll be pleased. Then I want to comment on the different elements of the TTWWIIA that have helped us to implement our program. I think that the comments that I am going to make today are actually quite positive about the program. I think there are a number of reasons for that and I think that many employment networks around the country can share in our success, if given the same opportunities that we have had.

First of all, we began as part of a center for independent living. We are a 501(c)(3) non-profit CIO authorized by title 7 of the Rehab Act. So what that means is that we enjoy the infrastructure of the CIL. They pay our bills, they do our payroll. But ABIL Employment Services is a completely separate program within the center. We're located in a different building, a totally different funding stream, a totally different staff. And I think the beauty is that ABIL Employment Services does only the ticket. Everybody that participates in our program is a ticket participant, so it allows us to focus just on this program. We have not basically dumped it on top of existing staff doing other things.

We started from scratch. We were able to do that because we did apply for and got a very generous grant from the Nina Mason Pulliam Charitable Trust, which is a local foundation, and that was matched 100 percent by the Center for Independent Living. So the center made that commitment and did provide that upfront funding. And we have just been approved for our second year. And we believe that those two years of upfront funding before we start generating the break even point that we need to sustain the program long term. I'm also happy to say that when I get into our outcomes, we have five people on our staff. We have built up to five people specifically for this program, and two of those, Mr. Chairman, are in fact ticket participants. We're very proud of that. We have taken them off the program, trained them to provide services to other participants in this program.

Our results so far have exceeded our expectations, and I want to take just a few moments to tell you what those are. We have accepted 109 tickets, which is on a par with our state agency. It's a little different than we've heard from Oklahoma and Wisconsin. Our state agency and our agency in particular are about neck and neck in terms of ticket acceptances. We have had 48 placements, so we've been putting people to work. And currently we have 26 people that are out there today working. And next you'll hear from Amy Gilliland, who is one of our ticket participants who is in fact employed. And we have the honor of being the employment network who did receive the very first outcome payment from the Social Security Administration under the Ticket program, and a very lovely letter from the commissioner congratulating us on that.

Now, these results are early and I don't want to suggest that we have all the answers. There are challenges that any employment network will experience. For example, that start up funding is going to be a challenge for many employment networks. And other is collecting and reporting the earnings information to SSA so that we can get paid. That is proving to be a very, very cumbersome and almost impossible process right now. I know the agency is working real hard on it, but right now it's taking about 120 days to get paid and there is not a whole lot of employment networks out there that are going to be able to sustain that kind of cash flow problem.

Let me tell you -- now, these are the operational issues that we went under, and I believe that these are important for any employment network to be successful. As I mentioned, we are only doing the ticket. We did not dump it on top of other staff. And what that means is that we recruited staff specifically for this program who have the background and skill in operating like a business, and specifically like a staffing agency. That's what we operate like. We focus primarily on participants' abilities, not on their disabilities. And what we're finding is because the majority of our staff are people who ourselves have disabilities, who have been on this system, know what that's like, we're finding that participants love the fact that our advocacy and our peer support is what motivates them to participate, to put up the good fight and to keep going until we do achieve the actual job. We know the ropes, so to speak.

Now, another key element -- and I want to read this from my testimony because it's so important, and that is that we know the market. We knew going into this program the majority of people who are on SSI and D.I. are not the same people normally served by the state V.R. system. We have known for many years that most people on this program were not being served at all. And that's not to disparage my good friends here from the V.R. system. They're very effective in working with people who truly need their intensive services. But the majority of people on SSI and D.I. are not those same people. The Ticket program requires a completely different approach, one that views ticket holders as the customer and one that maintains an almost compulsive focus on employment, not on delivering services.

Because we operate like a staffing agency, we're able to effectively work with employers and because the Ticket program allows for 60 months of ongoing support after the beneficiary goes to work, we're also finding that we're a tremendous resource to that employer as well to keep that person working after they get the job. I got to tell you, since we operate like a staffing agency one of the things we love most about this program is its flexibility. There is nobody in our face when I sit across that desk from that consumer, telling me I can't do something because I'm not funded to do it. We can sit down one on one, face to face and do whatever it takes for that person as an individual to get off of benefits and back into the workforce. I love that flexibility. There is nobody I have to ask permission to. Maximus has been wonderful. We send off the IWP. When that thing is signed by me and by that consumer, that ticket is assigned. We're off and running, we're ready to work.

I also want to take a moment to say that in our state -- and I know, Congressman Hayworth, you'll love to hear this. Our state agency, our state vocational rehab agency is being wonderful. We are cooperating, collaborating. The agreement we have with them is fabulous. They have it with every employment network signed up in the state who chooses to be part of that. We're looking at doing some joint cases with them right now for those who truly do need those intensive services, but also want the advocacy and peer support that we provide. We haven't done any yet, but we're sitting down, we're talking, we're identifying, we're getting ready to do some of those. So I'm real happy about that as well.

No matter how effectively we operate, we would not be successful without the specific provisions of the Ticket to Work and Work Incentives Improvement Act, and we're finding that comprehensive reforms that are included in the TTWWIIA, as we expected, are proving extremely beneficial. The ticket going directly to the beneficiary is fabulous. It sends a strong message that we respect them and their ability to direct their own lives. It also says that we expect them to direct their own lives. The TTWWIIA provisions that include the Medicare extension, the Medicaid buy-in, expedited reentry, CDR protections are doing their job that eliminating those fears that we have historically seen that prevent people from doing the job.

I'm going to move along quickly. The availability of Maximus, the BPAOs, as you've heard, very -- absolutely excellent.

SSA has been terrific. I give them a lot of credit for a very, very difficult program to implement. They're doing well. Where we see improvement, as you've heard, there's not enough E.N.s. More people need to be doing this work. The payment system is still a challenge. We need the E.N.s to be able to choose on an individual case basis which payment program they want to use for a particular consumer. And we need Congress to allow us some payment for some work and get away from the zero out.

In closing -- I see you reaching. In closing let me say while I realize that I'm being very positive here today, I know there are many who believe the program creates seemingly insurmountable challenges. From E.N. perspective I believe that effective marketing, training and technical assistance is essential, cannot be overemphasized. We need to get some non-traditional folks in here, we need to market better to them or find a way to market better to them. And then I think the potential increase is there in this program, in this legislation. Thank you again for the opportunity to be here with you today.

REP. HAYWORTH: Susan, we thank you for the testimony. And I appreciate hearing your perspective, and think back to actually issuing a couple of tickets with Commissioner Barnhart in Tempe. And one such recipient, though I don't believe that particular day, is our next witness, the aforementioned Amy Gilliland, who is a participant in this program.y, welcome and if you could summarize your testimony in five minutes. Your complete statement of course is submitted for the record.

MS. AMY GILLILAND: Yeah, I kind of changed around my --

REP. HAYWORTH: That's fine.

MS. GILLILAND: -- testimony, if that's okay with you?

REP. HAYWORTH: That's great, Amy.

MS. GILLILAND: First, I'd like to say thank you for letting me come here to Washington, DC, to share my testimony with each and every one of you. It's such an amount of gratitude that I have to be a part of something critical and essential for public users. You know, people like me who desperately need a little extra help.

I grew up pretty rough. I truly think I did a little bit of damage to my brain's chemical structure through drugs and alcohol, I mean to be honest with you. My disability happens to be psychiatric and I'm on medications and so forth. And luckily enough I just celebrated four years of sobriety on 5 September. I'm not quite sure why it is that the government is willing to go above and beyond their obligations. To me it makes no sense. I work and they're still going to pay me. I don't get that. But I think it's amazing. It's wonderful. You know, I mean how could I ask for anything more?

You know, I turned in my ticket to other companies. ABIL responded to me instantaneously. It feels great to feel that I'm able to stand on my own two feet. You know, that I'm able participate in life again. It's amazing. You know, you wonder when you have such a low self-esteem why it is, and then you get a job and you actually get into that working feel and you're getting that regular paycheck and you're paying your bills and things such as that and you're going "Oh god, that's it," you know. That's what it's about, you know. And, you know, ABIL -- you know, I can only speak on ABIL because, like I said, they responded to me and they've been nothing but compassionate, proficient and have treated me as a human being. They haven't treated me as someone who's disabled, they haven't treated me as somebody who's crazy. They've treated me as somebody -- as a human being, as themselves. No lower, no higher, just the same, you know, which has been wonderful.

Thank you so -- thank you, I mean from the bottom of my heart, for giving me this opportunity amongst you all to share my experience, strength and hope. Like I said, you know, I hope that you stick with this Ticket to Work program because it certainly has made a profound impact in my life. You know, it's allowed me to start feeling as though I'm, you know -- I'm learning to be a productive member of society again and that's really nice. I really do appreciate it. So thank you very much for letting me share.

REP. SHAW: Thank you for that moving testimony. It does -- it makes you feel good to be able to pass laws like that and we appreciate your testimony.

Mr. Gadaire.

MR. DAVID GADAIRE: I'm not sure I want to follow that.

(Laughter.)

MR. GADAIRE: After following home cooking and maybe the most powerful testimony, I feel like this might be a bit of a set up. I don't think I can match that. But I guess I'd want to start with a thank you and, maybe more importantly, a thank you to the staff who somehow managed to get me here. I'm not sure how that happened, but to get something this size from Holyoke to here and back again in one day is pretty much an impressive thing, and I'm impressed by that. So thank you.

I'm here as a supporter of the ticket. I'm here as an operator of a one-stop career center, and I guess that makes me a little bit out of place. And I'm here hopefully to make some ideas and some suggestions. Given my 20 years of disability employment advocacy before I got into the one-stop management business, I feel like I know a little bit about this stuff, although certainly I'm humbled by the panel. I will say that I think this is probably maybe the best equal rights legislation for employment of people with disabilities that I've seen in my lifetime, and the suggestions I offer I offer as enhancements and not as anything other than that. And they come, frankly, from a little bit of hands on experience. They come from a constant dialogue with other E.N.s and other community based organizations, frankly, that have decided not to be E.N.s.

So with that let me just kind of throw it out here. I basically have nine suggestions or thoughts or opinions, and I'll do my best to get that done in five minutes. First, I would absolutely concur that benefits planning is the key to this. I think an educated customer makes this whole thing work. We've brought a benefits planner into our center about a year before we became an E.N. and upon her arrival, our number of people living with disabilities who came through our doors quadrupled. Because of that, we were able to hit the ground running when the ticket became available when we became an E.N. I guess -- I'm told that we were the first career center to become an E.N., the first to get an actual ticket assignment, the first to actually get a successful employment out of it. But given how I think poorly the career centers have stepped up to this, I'm not sure that I say that with pride. But it's my shot, I'll take it.

Secondly, I think that it's absolutely imperative that the employment networks have the opportunity to toggle back and forth on payment plans. I actually believe that if we are forced to make that decision upon application, we then will market to a certain type of customer and I believe eventually we'll be more motivated by the revenue than the actual service. I think that's a mistake. I think we should build systems that are customer driven and not revenue driven. I think that we can change that. I don't think that would be a hard thing.

Third, I also think that there needs to be provisions for part- time employment. As a workforce development professional, part-time employment is an absolute integral part of anyone's career plan and I would suggest that it needs to be taken seriously here. My greatest fear is without making that change, this legislation would slowly start to move away from the people with the most severe barriers and, frankly, we would provide ammunition to those people who are willing and quickly going to call that this is a creaming program. And, frankly, I don't want to be a part of that.

Fourth, I think that the employment services representative concept is a brilliant one. We tell people that changes in your employment really become one of the four major stressors in one's life. If that's the case, dealing with SSA is the fifth.

(Laughter.)

And I absolutely believe that an employment service representative can act as a buffer and can minimize the amount of distraction that needs to happen or that does happen when a person takes on new opportunities through employment.

REP. SHAW: I would say, sir, that happens to us every two years.

(Laughter.)

MR. GADAIRE: I'm not going to disagree with you on that one. I would say that number five, I think that the employment networks and the state V.R. systems ought to be compensated in a similar way. My greatest fear is there is great talent on both sides and that if they are compensated differently we will eventually drive a wedge between them. I know that already happens in the one-stop system so I'm concerned about this. I believe we'd rather build a bridge to each other's system because I don't want to replicate what they do so well and I certainly don't want them to spend time and money replicating what I do well.

I would say number six -- is that where I am -- that now that we have ticket on demand, I would say that, in spite of what I said earlier, I am nervous that the employment networks -- I think we need more of them -- could get overwhelmed and I think if they get overwhelmed we will start to do quantity management as opposed to quality management. I think now that you can get ticket on demand, I think we could probably slow that down a little bit.

Number seven, I think there is a significant capacity issue, especially given how we're funded. I think the people that are eliminated from becoming E.N.s in this system are the small community- based organizations and in some cases the small community-based organizations are the lifeline for people with the most severest of disabilities. So I'm concerned about that. I think we have to find a way to come up with some kind of upfront or planning resource to help them on the ground.

Number -- whatever number I'm on, you keep track. I would suggest that we let the employment networks actually do the employment marketing to the employers. I think that in spite of what we want to think here, there is still an overwhelming perception of stigma and fear that exists in employers. I think that if we're going to make a change, we're only going to do it from a trusting relationship. And I mean no disrespect by this: I think when we say that it comes from the government, I frankly don't think they're listening so I get concerned about that. And my last suggestion is I believe we need to spend time and effort and resources to develop a cross-match between the computer systems that issue the SSI and SSDI payments to the computer systems that monitor and track the employment networks because all of this is all based on relationship, and I believe that there's a relationship between an employment network and the customer, and there's a relationship with the employer. I don't believe asking somebody personal financial information is a natural relationship builder. I actually believe it becomes a force blockade. I believe the technology exists. I understand resources are a problem, but I think in the long run, this suggestion will actually save more money over time.

With that said, I thank you for the opportunity to be here. I'm not sure I'm home cooking but I know I'm hungry. And I would suggest that if we can be of any help personally or our organization, we're willing to do so. So thank you very much.

REP. SHAW: Thank you.

Mr. Decker.

MR. CURTIS DECKER: Thank you, Mr. Chairman, and thank you for the opportunity to appear before you today. I'm Curt Decker and I'm the executive director of the National Association of Protection and Advocacy Systems. Protection and Advocacy Systems are 57 programs throughout the country in every state and territory that have been providing legally based advocacy services for people with disabilities for over 25 years. And the Ticket to Work program added funds to our program to build our capacity to be available to represent individuals who would take advantage of this program.

Now, people come to me when they're unhappy so my testimony may not be as positive. That said, we are an integral part of the Ticket to Work constellation of services and support this effort and want to see it reach its full potential. I also want to thank the committee for addressing some of the technical problems in the first round with H.R. 4070 and we hope to see that bill passed by the full Congress which will address a couple of issues that I want to raise and hope that you will revisit those as a result of the testimony you receive today.

Because we're in every state and territory, we are in a unique place to see how the ticket is working in the 13 rollout states and also at the range of barriers to full employment that people with disabilities face. And some of these things have already been mentioned but let me just reiterate. We think that the lack of information upfront to consumers about the Ticket to Work program has probably led to the large volume of questions. For many people, their first thought about going to work was a letter from Social Security saying here's a ticket, why don't you go back to work? We think that if there was, in the states that are about to be rolled out, more information provided to the general public that this program is in place and its purpose, that a lot of the volume of initial queries -- there's a lot of confusion, some fear, on behalf of consumers, that we might be able to use those resources that the E.N.s or the BPAOs and other agencies involved would have to disseminate.

We are concerned about the fact that while the program's intent was to expand the choices and opportunities for people with disabilities, in work it looks like the V.R. system is the big winner and that they are providing about 80 percent of E.N. services and that was not the intent of the law when it was first enacted. And we have seen cases of some very aggressive, over aggressive in our feeling, of trying to convince ticket holders to place their ticket with the V.R. agency. We've been able to negotiate with some of those V.R. agencies in several states to make sure that what we think might be something verging on coercion is not, in fact, going to continue. But it does raise the whole issue of this fight for reimbursement and the attempt trying to maximize payments out of this program and we think that that is going to be something that this committee needs to look at.

We're disappointed in the fact that there are a large number of E.N.s out there providing more choice and opportunity, and we're also concerned about some E.N.s not willing to take on the more difficult clients to serve and just simply turning people away. There's also why we support the benefits planning activity and think it's essential to the success of this program, there are some conflicts inherent in that program as well. Many V.R. agencies are also BPAOs. And so if there in fact is an effort to try to direct people to place their tickets in the V.R. agency if the benefit planning agency is in fact that very same agency there may be some conflicts that need to be looked at.

We are seeing, not only in the ticket states but in the other states as people attempt to go to work prior to receiving a ticket, a whole range of barriers to employment that have to be addressed -- and again these are not always in your jurisdiction but it's quite a daunting list of things that have to be in place to make sure that people can not only get jobs but maintaining their jobs. And they range everything from just architectural barriers to discriminatory actions by employers, the very complicated number of work incentive programs which we feel are not all that adequately understood even by the agencies that have the responsibility to explain to clients what these programs are, things like pass plans and IRWIs (ph), things that Social Security has in place. We find that many of the Social Security staff have not been adequately trained to be able to explain how those programs work so people can take advantage of them.

Obviously the problem has been addressed before of overpayments. A major problem, been in place for many years. It's great to hear that Social Security is trying to figure out a way of dealing with that but, until they do, overpayments, threat of overpayments, the perception that you'll get an overpayment is very great out there in the field and a great disincentive to people pursuing this program. That's worsened by the fact that Social Security has forbidden the Protection and Advocacy Program to represent people in that area.

I have not had the same experience that Ms. Webb has had. Our program has been constantly told what we couldn't do, argued with about the role we have, trying to restrict our services, when in fact I think the intent of Congress was to make sure that we were there in place to protect people in the full range of issues that they would face in returning to work and we would ask that you look at those issues as well.

We are concerned about some of the programs that do not work well together.

Just one, and then I'll close, is the fact that in 37 states V.R. agencies have orders of selection, and under the ticket program, if you are in an order of selection state and placed on a waiting list, you really aren't still protected with the fact that you may be exempted from a continuing disability review. And these are the complicated inter-workings that need to be understood and explained to clients to make their experience a useful one.

So in closing I would just say that we ask you to review the payment system to ensure that there are stronger safeguards for clients, provide better information to beneficiaries and provide better flexibility to our program so that we can fulfill our mandate to protect people in this program. Thank you.

REP. SHAW: Thank you very much for that testimony. I continue to be concerned, as I think all of us are, with regard to the earning limitation. But, as I understand it, the first year there is no limitation which gets people so that they can get into the workforce and start to move out and see how they feel and how they're doing and then they can move forward if perhaps they want to get out of the program entirely if they're very successful. I think -- so much, and we've heard a lot about welfare reform. I did chair that committee when we passed welfare reform back in '96 and it's a question of people believing in themselves.

Ms Gilliland, you talked very much about self-esteem. That has a lot to do with it, and people's self-esteem goes up when they get into the job market as they become more and more self-sufficient and the whole purpose of the Ticket to Work was to give those people a chance without the fear of losing everything and going forward with it.

I have just a couple of questions and I'd like to throw this one out to the entire panel. The first tickets to beneficiaries were mailed out seven months ago and, based upon your experience, I think perhaps all of you have answered this to some degree, but I'm assuming that all of you think it's really working at this point. Perhaps not as inclusive as we want it to be, but -- Mr. Gadaire, you talked about your concern about the system becoming overwhelmed. Well, I hope it does get overwhelmed and I hope we have to come back here and figure out ways so that we can better service all of these people. Would you like to comment on that?

MR. GADAIRE: Well, I guess my concern is I'd like to try to address it before it gets overwhelmed. And when it gets overwhelmed my greatest fear is we start to create what I would call bad practices and second and third generation bad practices are almost impossible to retract. So my concern is now, before it's overwhelmed, we have frankly a chance to do something about it.

REP. SHAW: That's one of the purposes of this hearing, is to do our oversight responsibility.

Ms. Webb?

MS. WEBB: One element I think that we're experiencing in the first 13 states is that the tickets are out now, and so the initial demand is now starting to diminish for those who are contacting us. And now what we're thinking about is what are we going to do to contact them. What is going to be the additional marketing approach that we're going to use and are we going to see the same level of enthusiasm and motivation when we start calling people again as kind of a second phase of the rollout. Once you get through those initial people -- because obviously the ones that are calling us, which is where we are now, are the ones that are motivated to begin with. What about the ones who have not chosen to call us? Now the impetus is upon us to go ahead and start contacting them again and say hey, you got this ticket, we'd really like to talk with you. So I think we're entering into perhaps the second phase in the rollout states at this time and it will be interesting to see how that goes.

REP. SHAW: I have here a sample of what the ticket looks like and we've been talking a great deal about the ticket to work and some people watching this hearing probably are wondering what does a ticket look like.

Did you have your hand up?

MS. GILLILAND: Well, I just wanted to say that originally when I got the ticket to work in February, I was one of the first to receive the ticket to work, I mean literally I must have asked Susan Webb at least a dozen times, are you sure this is real? Are you sure that this is real, that if I go back to work the government's going to continue with my benefits, because at that point it was critical that not only did I have my money-wise benefits, my financial, I also needed my mental benefits, you know, as far as medications for mental psychiatric and stuff like that. Maybe suggesting-wise, as far as making it more clear in the actual format of the ticket to work that it is true, that it's not some kind of farce, that it's not some kind of scheme to get you involved and something like that, that it's something that's very much true and very much important and very much, you know, that if you sing up and that you are willing to go forth with this, that there's nothing to worry about, that the government will take care of you which is -- you know, I know people that get real --

MS. WEBB: Until you got the job.

REP. SHAW: It's like the old joke, "I'm from the government and I'm here to help you."

(Laughter.)

MS. GILLILAND: Right, right.

REP. SHAW: Ms. Webb, I assume that in Arizona you keep your medical benefits?

MS. WEBB: Mr. Chairman, we have the Medicaid buy-in in Arizona but our state has experienced the budget crunch like everyone else. Our state legislature did vote to keep the Medicaid buy-in but it will not be implemented until January. Currently we have 10 of our ticket participants on the waiting list, purposely not working until the Medicaid buy-in goes into effect. We are finding that 75 percent of the people we are placing, we are placing into jobs where the employer does provide healthcare including prescription drug coverage.

But, as in Amy's case, she's an example of this, where there's a waiting period often before those benefits kick in. Where we're going to find the greatest use for the Medicaid buy-in is for those people that need that between the time that they are not eligible because of earnings in the Medicaid program but now they're working above that eligibility but their employer provided benefits haven't kicked in yet. So I see where the Medicaid buy-in under this program will be a good buffer to get people into the workforce and then eventually the employer provided healthcare will kick in. We believe, and we're going to prove it to our state, that the Medicaid buy-in will actually save our state money.

REP. SHAW: Thank you.

Mr. Hayworth.

REP. HAYWORTH: Mr. Chairman, let me again thank the entire pane.

And I guess, David, you're right. Home cooking kind of works (laughs) and I see my friends from home have been working with him.

And, Amy, especially, since you're living this, your perspective kind of -- well, it's more -- I won't set conditions on it. It's of immense value to us. You mentioned one improvement in terms of saying this is real, it's not false, let's clear this up with the ticket.

MS. GILLILAND: Right.

REP. HAYWORTH: And you've characterized this from your perspective as almost too good to be true, I think, to paraphrase --

MS. GILLILAND: Absolutely.

REP. HAYWORTH: Is there any downside that you have experienced, anything other than that constructive criticism of making it a little more blatant and, I don't know if we put like neon writing or make it fluorescent or what to glow in the dark or, you know, really let people know about this. Is there anything else that in this imperfect world would make this a little better from your perspective?

MS. GILLILAND: Well, Congressman Hayworth, I know that for ABIL, which is a company, you know, and I promised Susan I wouldn't get too involved in it, but I was fortunate enough to be blessed with such a wonderful, wonderful agency, and I am not sure --

MS. WEBB: I didn't tell her to say --

(Laughter.)

REP. SHAW: You're going to have a chance to correct her if you like.

REP. HAYWORTH: We will point out to the audience that this is completely spontaneous and unrehearsed.

MS. GILLILAND: I'm sorry.

MS. WEBB: It's all right.

MS. GILLILAND: I think, you know, like this gentleman at the end was saying, you know, that a lot of agencies don't want to take on the more people that need more help. I have a friend that is on disability, he's one that needs extra help, extra care, extra concern, that in fact did call an agency -- I'm not sure, but lives in Arizona that did call an agency, didn't get back to him. Called another agency, didn't get back to him. Finally I said listen, you've got to call ABIL. You call ABIL, somebody's going to get back to you.

So, you know, I think that's definitely an important issue, and that is making sure that no matter what, no matter what the case is, no matter what severity the case is as far as, you know, how your health is, or your physical or mental status, you know, we're all human beings and we all need help sometimes. And that's definitely -- that has to be more professional, you know. I know that for ABIL. ABIL is a great, wonderful company and I really was blessed. I don't know about the other companies.

REP. HAYWORTH: Well, in fairness -- I don't know why I think of this, maybe my burgeoning waistline. But I see those ads on TV, "Results not typical. Your experience may vary."

(Laughter.)

And I don't know why I think about that. But in fairness, Mr. Decker touched on some points here and maybe you'd like to amplify what you see. If you had to prioritize the things that can be better. As you've looked at this across the country from the rollout in states in Arizona, the places where now it's just coming online to other places that unfortunately are having to hang back. If you had to prioritize the A number one imperative that we've missed, what would that be?

MR. DECKER: Well, I guess I would put it probably in tiers of what you could accomplish quite easily, what I think is going to require a little effort, and then some things that are probably going to have to be statutorily changed which is not that easy. I guess I go back to the whole issue of the initial information. It seems to be the Social Security Administration has a pretty large public information resource that they should be using to get the word out early so when these tickets do arrive, that some of that initial doubt, and in some cases fear. The commissioner herself I think has stated that if she got this letter in the mail she wouldn't be so sure that it was something to be taken seriously. So I think you could get a lot of interest and getting people thinking about the fact that gee, maybe I can go back to work even though -- again, remember that these folks have maybe spent a year trying to get on benefits, have had a fair amount of issues with Social Security over the years and now suddenly get this letter saying it's okay, we're here to help you. I think there is a real learning curve and an attitude to get over. I think that's pretty simple to do.

The issue, of course, of making sure that there is coordination with all these different components that have been put in place so that once a person decides to come forward, they are getting the best information, the most accurate information and the full approach. Again, I think that is something that it can accomplish if we force all of these groups at this table. We have some obligation at the local level to be working together and trading information and not just passing clients around, up and down line, but making sure that a client is getting the right information and the right service at the time they need it.

The last thing and more difficult is going to be some of the payment incentives to make sure that we get more re-ens in, that they are willing to take on more difficult to serve clients and that -- and try to undercut some of this fighting over the reimbursement so that we get the full range of people involved in the program.

REP. HAYWORTH: Thank you, sir.

And again, thank you to the entire panel for being here today.

REP. SHAW: Thank you. This has been most enlightening. You all came from all the way up to Massachusetts, all the way out to California, Arizona. We very much appreciate all of you being here. We appreciate the work you're doing and the good that you're accomplishing and really helping out some people who certainly need the help but can become very productive, self-sufficient individuals with just a little bit of faith and a little bit of self-esteem. Thank you very much.

We are now adjourned.

(Adjourn)

END

LOAD-DATE: October 2, 2002