May 28, 1999
House Committee on Commerce Approves H.R. 1180, the Work Incentives Improvement Act of 1999
H.R. 1180 is similar to Senate bill, S. 331 ("Work Incentives Improvement Act of 1999"), which has been reported by the Senate Committee on Finance and is awaiting action by the full Senate (see Legislative Bulletin 106-4). However, S.331 does not include the amendments in the Commerce Committee reported bill. These bills address barriers to work for individuals with disabilities. They would: expand the availability of health care coverage for working individuals with disabilities; establish a Ticket to Work and Self-Sufficiency Program; and provide such individuals with meaningful opportunities to work.
H.R. 1180, as reported by the House Committee on Commerce, is still subject to change because the House Committee on Ways and Means has not yet considered the bill.
The bill contains the following provisions:
Expanded Availability of Health Care Services
State Options under Medicaid
- Would expand, for individuals who are at least 16, but less than 65, years of age, the States options and funding for the Medicaid buy-in for workers with disabilities by permitting States to: (1) liberalize limits on resources and income, and (2) provide opportunity for employed individuals with medically determinable impairments, as determined by the Secretary of Health and Human Services (HHS), to buy into Medicaid even though they are no longer eligible for Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) due to medical improvement.
Would be applicable with respect to medical assistance for items and services furnished on or after October 1, 1999.
Continuation of Medicare Coverage
- Would extend premium-free Medicare coverage for people with disabilities who return to work during a 10-year period beginning with the first month that begins after enactment. Further, it would extend coverage for subsequent months if they are entitled to health care benefits as of the last month of the 10- year period. It also would require GAO to examine the effectiveness and cost of providing such premium-free Medicare coverage and to recommend whether such coverage should be continued after the 10-year period.
Would be applicable for months beginning with the first month that begins after the date of enactment.
Responsibilities of the Secretary of Health and Human Services
- Would direct the Secretary of HHS to:
- provide grants to establish State infrastructures to support working individuals with disabilities; and
- create a demonstration of a Medicaid buy-in for people whose disabilities have not yet gotten severe enough to cause them to stop work and file for benefits.
Election by Disabled Beneficiaries to Suspend Medigap Insurance
- Would allow workers with disabilities who have Medicare coverage and a Medigap policy to suspend the premiums and benefits of the Medigap policy if they have employer-sponsored coverage.
Would be applicable with respect to requests made after the date of enactment.
Ticket to Work and Self-Sufficiency Program
- Would direct the Commissioner to establish a Ticket to Work and Self- Sufficiency Program (Program) which would provide SSDI beneficiaries and SSI disability recipients with a ticket they may use to obtain vocational rehabilitation (VR) services, employment services, or other support services from an employment network of their choice.
Responsibilities of the Commissioner of Social Security
- Would select and enter into agreements with one or more organizations in the public or private sector to serve as a program manager(s) to assist the Commissioner in administering the Program.
- Would terminate agreements with program manager(s) who fail to meet the performance standards specified in the agreements.
- Would preclude program managers from direct participation in the delivery of services to beneficiaries or from holding a financial interest in an employment network in the service area covered by the program manager's agreement.
- Would select, and enter into agreements with, employment networks, including alternate participants who choose to act as an employment network, to provide services under the Program.
- Would terminate agreements with employment networks whose performance is inadequate.
- Would provide for periodic reviews of employment networks to ensure effective quality assurance in the provision of services.
- Would provide for a process to resolve disputes between beneficiaries and employment networks, between program managers and employment networks, and between program managers and providers of services.
Responsibilities of the Program Manager(s)
- Would perform such tasks as assigned by the Commissioner.
- Would recruit, and recommend for selection by the Commissioner, employment networks which can provide services under the Program.
- Would monitor employment networks under its jurisdiction to ensure that beneficiaries have adequate choices of services and reasonable access to services, e.g., case management, benefits counseling, supported employment, job training, placement, and follow-up services.
- Would ensure that employment networks comply with the terms of their agreements with the Commissioner and that payment by the Commissioner to an employment network is warranted.
- Would ensure beneficiaries are allowed changes in employment networks for good cause without being deemed to have rejected services under the Program.
- Would assume responsibility for coordination and delivery of services under the Program to an individual assigning his/her ticket to work and self-sufficiency to an employment network.
- May consist of a one-stop delivery system established under the Workforce Investment Act of 1998 or either a single provider of such services or a group of providers organized to combine their resources into a single entity.
- Would provide services either directly or by entering into agreements with other providers which can furnish appropriate services.
- Would serve prescribed service areas and take measures to ensure that services provided under the Program meet the requirements of individual work plans.
- Would meet the financial reporting requirements prescribed by the Commissioner. Prepares periodic reports, on at least an annual basis, itemizing specific outcomes achieved with respect to services provided to beneficiaries.
- Would develop and implement an individual work plan in partnership with each beneficiary that includes a statement of the: (1) beneficiary's vocational goal, (2) services and supports necessary to accomplish that goal, (3) terms and conditions related to the provision of those services and supports, (4) rights and remedies available to the beneficiary, and (5) beneficiary's right to modify his/her work plan if needed. The individual work plan is effective upon written approval by the beneficiary and a representative of the employment network.
Employment Network Payment Systems
- Would authorize the Commissioner to pay an employment network under either an outcome payment system or an outcome-milestone payment system. Each employment network will elect the payment system under which it will be paid.
- Under the outcome payment system, an employment network would be paid a percentage, not to exceed 40 percent, of the national average SSDI or SSI payment for each month that a beneficiary does not receive a benefit payment due to work activity for a period not to exceed 60 months.
- The outcome-milestone payment system would combine outcome payments with payments for achieving one or more milestones directed toward assisting the beneficiary in achieving permanent employment. However, the total amount of outcome-milestone payments must be less than the total amount of payments if the employment network were paid under the outcome payment system.
- Would require the Commissioner to review periodically the specifications of the payment system (percentage and total payment) to ensure that the system provides an adequate incentive for employment networks to assist beneficiaries in entering the workforce.
- Would allow the Commissioner to alter the percentage or total permissible payments, as well as the number and amount of milestone payments, to allow an adequate incentive for employment networks.
State Agency Participation
- Would permit a State VR agency to elect participation in the Program as an employment network with respect to each disabled beneficiary for whom it will provide services.
- State VR agencies participating in the Program would provide services under plans approved under title I of the Rehabilitation Act of 1973.
- Would require a written agreement between the State VR agency and the employment network before a State VR agency can accept any referral of a disabled beneficiary from an employment network assigned a ticket to work by the disabled beneficiary.
- Would direct the Commissioner and the Secretary of Education jointly to prescribe regulations specifying the terms of such agreements.
- Would prohibit payment to an employment network if the employment network makes referrals to the State VR agency without entering into a written agreement with such State VR agency or in violation of the terms of the written agreement.
- Would require the Commissioner, if the amendments have not been fully implemented in a State, to determine through regulations the extent (1) to which the requirement concerning prompt referral to the State VR agency applies, and (2) of the Commissioner's authority to provide vocational rehabilitation services by agreement or contract with other public or private agencies in the State.
Continuing Disability Reviews
- Would prohibit the Commissioner from initiating continuing disability reviews during the period that a beneficiary is using a ticket to work and self-sufficiency.
- Would require payments to employment networks to be made from the Federal Old-Age, Survivors and Disability Insurance Trust Funds (OASDI) in the case of title II disability beneficiaries who return to work and from appropriations made available for making SSI payments under title XVI. The costs for administrative expenses must be allocated as appropriate from amounts made available for the administration of title II and title XVI.
- Would direct the Commissioner to prescribe regulations necessary to implement the Ticket to Work and Self-Sufficiency Program not later than 1 year after the date of enactment.
Would be effective with the first month following 1 year after enactment.
Reauthorization of Program
- Would terminate the Program 5 years after the date the Commissioner begins implementation of the ticket program.
- Would provide that individuals who initiated an individual work plan prior to such termination may receive services under the Program after this date.
Employment networks would be paid during the outcome payment period of such individuals.
Scope of Program Implementation
- Would direct the Commissioner to implement the amendments in graduated phases at sites selected by the Commissioner to ensure the refinement of the Program processes prior to full implementation.
- Would require the Commissioner to fully implement the Program as soon as practicable, but not later than 3 years after the effective date.
- Would require the Commissioner to design and conduct a series of evaluations to assess the cost-effectiveness of the Program and the work outcomes for beneficiaries receiving a ticket to work and self-sufficiency under the Program.
- Would require the Commissioner to design and conduct a series of evaluations after consultation with work incentive experts, the Advisory Panel, GAO, other Federal agencies and private organizations with appropriate expertise.
- Would require the Commissioner to report following the close of the third and fifth fiscal years and prior to the close of the seventh fiscal year ending after the effective date. Reports would be submitted to the House Committee on Ways and Means and the Senate Committee on Finance on the Commissioner's evaluation of the progress of activities, as well as the success of the Program and the Commissioner's conclusions on whether or how the Program should be modified.
Work Incentives Advisory Panel
- Would establish a Work Incentives Advisory Panel within the Social Security Administration. The Panel would be composed of 12 members appointed by the Commissioner in consultation with the Speaker and the Minority Leader of the House of Representatives and the Majority and Minority Leader of the Senate; at least 7 members should be individuals with disabilities or representatives of individuals with disability, and at least 5 of those 7 members should be current or former title II or title XVI disability beneficiaries. Would require that members be appointed not later than 90 days after enactment.
Duties would include:
- Advising the Secretary of HHS, the Secretary of Labor, the Secretary of Education, and the Commissioner of Social Security on issues related to work incentive programs, planning, and assistance for individuals with disabilities, including work incentive provisions under titles II, XI, XVI, XVIII, and XIX of the Social Security Act.
- Advising the Commissioner with respect to the Ticket to Work and Self- Sufficiency on the following:
- phase-in sites for implementation of the Program;
- access of disabled beneficiaries to employment networks, payment systems, and management information systems to ensure the success of the Program;
- the most effective designs for research and demonstration projects associated with the Program or conducted with respect to the reduction in disability insurance benefits based on earnings;
- development of performance measures for the employment networks; and
- furnishing progress reports on the Program to the Commissioner and Congress.
- Would require the Panel to submit interim reports at least annually and transmit a final report which includes a detailed statement of the findings and conclusions of the Panel and its recommendations for legislation and administrative actions, to the President and the Congress not later than 8 years after the date of enactment.
- Would terminate the Panel 30 days after the date it submits its final report.
- The costs for the Panel shall be made from amounts available for the administration of title II and title XVI, and shall be allocated from those amounts as appropriate.
Elimination of Work Disincentives
Work Activity Standard as a Basis for Review
- Would prohibit the use of work activity as a basis for review for individuals who are entitled to disability insurance benefits under section 223 or monthly insurance benefits under section 202 based on disability and have received such benefits for at least 24 months.
- Would allow for continuing disability reviews on a regularly scheduled basis that are not triggered by work activity, and termination of benefits if the individual has earnings that exceed the level of earning established by the Commissioner to represent substantial gainful activity (SGA).
Would be effective upon enactment.
- Would provide that individuals, whose prior entitlement to disability and health care benefits had been terminated as a result of earnings from work activity, may request reinstatement of benefits without filing a new application.
- Would require that such individuals must have been unable to continue working on account of their medical condition and file a reinstatement request during the 60-month period following the month of termination.
- Would require that, while SSA is making a determination (by applying the medical improvement review standard) on the reinstatement request, individuals will be eligible for the payment of provisional benefits for a period of not more than 6 months.
- Would require that, if SSA makes a favorable determination, both the individual's prior entitlement to benefits and the prior benefits of his dependents who continue to meet the entitlement criteria would be reinstated.
Would be effective on the first day of the 13th month beginning after the date of enactment.
Work Incentives Planning, Assistance, and Outreach
Work Incentive Outreach Program
- Would direct the Commissioner, in consultation with the Work Incentives Advisory Panel, to establish a community-based work incentives planning and assistance program for the purpose of providing accurate information related to work incentives to disabled beneficiaries.
- Under the Program, the Commissioner would be directed to:
- establish a competitive program of grants, cooperative agreements, or contracts to provide benefits planning and assistance, including information on the availability of protection and advocacy services, to disabled beneficiaries;
- conduct directly, or through grants, cooperative agreements, or contracts, ongoing outreach efforts; and
- establish a corps of work incentive specialists within the Social Security Administration who specialize in title II and title XVI work incentives for the purpose of providing accurate information to disabled beneficiaries.
- Would direct the Commissioner to award a grant, cooperative agreement, or contract to an entity based on a percentage of the population of disabled beneficiaries in the State where the entity is located. No entity will receive a grant, cooperative agreement, or contract for a fiscal year that is less than $50,000 or more than $300,000. The total amount of all grants, cooperative agreements, and contracts awarded for a fiscal year may not exceed $23 million.
- Would provide that the costs must be paid from amounts made available for the administration for title II and title XVI, and shall be allocated from those amounts as appropriate.
Would be effective upon enactment.
Protection and Advocacy
- Would authorize the Commissioner to make payments to protection and advocacy systems established in each state. Each system that receives payment would be required to submit an annual report to the Commissioner and the Work Incentives Advisory Panel.
- Would provide that protection and advocacy systems be paid the greater of $100,000 or 1/3 of 1 percent of the amount available for payments for a fiscal year.
- Would provide that payments must be made from amounts made available for the administration of title II and title XVI, and would be allocated from those amounts as appropriate. Any amounts allotted for payments to a protection and advocacy system would remain available until the end of the succeeding fiscal year.
- Would provide that payments may not exceed $7 million for fiscal year 2000, and such sums as may be necessary for any fiscal year thereafter.
Would be effective upon enactment.
Demonstration Projects and Studies
Permanent Disability Insurance Program Demonstration Project Authority
- Would: (1) permanently authorize section 505 of the Social Security Amendments of 1980 (Authority for Demonstration Projects), (2) direct the Commissioner to conduct demonstration related to sliding scale benefit offsets using variations in the amounts of the offset as a proportion of earned income, and (3) permit presumptively eligible applicants to participate in demonstration projects.
- Would direct the Commissioner to submit: (1) interim reports on or before June 9 of each year on the progress of the demonstration projects, and (2) a final report not later than 90 days after the termination of any experiment or demonstration project carried out under this provision.
Would be effective upon enactment.
Reduction in Disability Benefits Based on Earnings
- Would direct the Commissioner to conduct demonstration projects to evaluate the effects of a $1 for $2 withholding of SSDI payments for earnings over a level specified by the Commissioner.
- Would provide that the demonstration projects should determine:
- the effects, if any, of induced entry and reduced exit;
- the effect, if any, on a project being conducted in a locality under the administration of the Ticket to Work and Self-Sufficiency Program; and,
- the savings to the Trust Funds and other Federal programs as a result of the project.
- Would require the Commissioner to determine the annual cost, the reasons for the return to work of beneficiaries who participate in the project, the employment outcomes, the merits of trial work periods and periods of extended eligibility for each project.
- Would authorize the Commissioner to waive compliance with the title II benefit provisions and the Secretary of Health and Human Services to waive compliance with the benefit requirements of title XVIII, insofar as is necessary for a thorough evaluation of the alternative methods under consideration.
- Would require the Commissioner to submit a written report to the House Committee on Ways and Means and the Senate Committee on Finance 90 days prior to the start of a project. Also, would require the Commissioner to submit periodic reports not later than 2 years after the date of enactment, and annually thereafter, on the progress of the project(s) and a final report on all demonstration projects to the Congressional committees not later than 1 year after their completion.
- Would provide that expenditures made for the demonstration projects must be made from the Federal Disability Insurance Trust Fund and the Federal Old- Age and Survivor's Insurance Trust Fund as determined appropriate by the Commissioner of Social Security, and from the Federal Hospital Insurance Trust Fund and the Federal Supplementary Medical Insurance Trust Fund as determined by the Secretary of Health and Human Services, to the extent provided in advance in appropriation Acts.
Would be effective upon enactment.
Reports and Studies
- Would require the General Accounting Office (GAO) to study:
- the extent to which existing tax credits and other employer incentives under current law encourage employers to hire and retain individuals with disabilities. A written report would be due to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate not later than 3 years after the date of enactment of this Act;
- the coordination of SSDI and SSI programs as they relate to individuals who are eligible for benefits under both programs, or whose eligibility changes from one program to the other. The study should focus on the effectiveness of work incentives and medical coverage for these individuals. A report would be due not later than 3 years after the date of enactment; and
- the SGA levels applicable to disabled beneficiaries; whether the levels serve as a disincentive for those returning to work, the merits of increasing SGA levels, and the rationale for not indexing the levels to inflation. A written report would be due not later than 2 years after the date of enactment of this Act.
- Would direct the Commissioner to report to the House Ways and Means Committee and the Senate Finance Committee, not later than 90 days after enactment, on all income disregards applicable to beneficiaries under SSDI and SSI programs. The report should specify the most recent statutory or regulatory change in each disregard; estimate the current value of any disregard if the disregard had been indexed for inflation; and recommend any further changes.
Would be effective upon enactment.
Drug Addicts and Alcoholics (DA&A)
- Would amend the Contract with America Advancement Act of 1996 (P.L. 104-121) to clarify SSA's authority to make SSDI medical redeterminations after January 1, 1997. (A similar SSI provision was included in the Balanced Budget Act of 1997, P.L. 105-33.)
- Would expand the applicability of the provisions in P.L. 104-121 which authorize the Commissioner to determine if a representative payee would be in the best interest of a disabled beneficiary who is incapable and has a DA&A condition, and whether such individual should be referred to a State agency for substance abuse treatment services.
Would be effective as if included in the enactment of section 105 of the Contract with America Advancement Act of 1996 (P.L. 104-121).
Treatment of Prisoners
- Would extend the incentive payment provisions now in effect for SSI prisoners to OASDI, and would authorize the Commissioner to provide, on a reimbursable basis, this reported information to any agency administering a Federal or federally assisted cash, food, or medical assistance program.
Would be applicable to individuals whose period of confinement in an institution begins on or after the first day of the fourth month beginning after the month of enactment.
- Would eliminate the OASDI requirement that confinement stem from a crime punishable by imprisonment for more than 1 year--like SSI, benefits would be suspended for any month throughout which the person was confined because of a crime or finding of not guilty by reason of insanity. Would be applicable to individuals whose period of confinement in an institution begins on or after the first day of the fourth month beginning after the month of enactment.
- Would provide that an institution does not get two incentive payments when the reported prisoner is a concurrent OASDI/SSI beneficiary--the programs would split the cost of the payment.
Would be effective as if included in enactment of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (P.L. 104-193).
- Would prohibit the payment of monthly benefits to any title II beneficiary who upon completion of a prison term remains confined by court order to a public institution based on a finding that the individual is a sexually dangerous person or a sexual predator.
Would be effective with respect to benefits for months ending after the date of enactment.
Revocation by Members of the Clergy of Exemption from Social Security Coverage
- Would create a 2-year window of opportunity to allow members of the clergy who applied for and received an exemption from Social Security coverage to revoke the exemption. The application for revocation would have to be filed before the due date for the income tax return for the applicants second taxable year beginning after 12/31/99. The revocation would be effective, at the applicant's option, beginning with either the first or second taxable year beginning after 12/31/99.
Cooperative Research or Demonstration Projects Under Title II and Title XVI
- Would clarify the Commissioner's authority to make grants and payments under cooperative research or demonstration projects in advance or by way of reimbursement to carry out demonstration projects and cooperative research not only for title XVI, but also title II under section 1110(a) of the Social Security Act.
Would be effective as if included in the enactment of the Social Security Independence and Program Improvement Act of 1994 (P.L. 103-296).
Authorization for State to Permit Annual Wage Reports
- For purposes of income and eligibility verification for various welfare programs, would authorize States to permit employers to submit wage reports of domestic workers on an annual basis (rather than on a quarterly basis).
Would be applicable to wage reports required to be submitted on or after the date of enactment.