This brief discusses the characteristics of working-age individuals receiving Social Security disability benefits and describes their employment success. The findings suggest that beneficiaries fall into three broad groups based on work-related efforts and expectations. For 60 percent, gainful employment seems to be neither a plan nor an option. Of the 40 percent who are interested in working, about 20 percent are actively pursuing and achieving this goal.

This report uses National Health Interview Survey (NHIS) data linked to data from the Social Security Disability Insurance (SSDI) and Medicare programs to create profiles of SSDI beneficiaries during the three years before and after SSDI entry to illustrate changes in insurance status, health care access, and utilization. SSDI beneficiaries were less likely to be insured, even three years prior to SSDI entry, and utilization and access problems peaked right before and after entry. At the time their SSDI applications were approved, 11 percent had completed the entire 24-month Medicare waiting period and about one-third had completed 12 months or more. Eliminating the Medicare waiting period could help many beneficiaries who lack health insurance. However, this policy alone would not help those who are uninsured before entry and approved a long time after SSDI entitlement.

Helping people with disabilities find and keep jobs is a key component to reducing dependency on Social Security disability benefits. The Ticket to Work program aims to do that by offering people with disabilities greater choice in service providers and access to more employment options. The latest report from Mathematica’s Ticket to Work program evaluation presents results from the National Beneficiary Survey, administered each year from 2004 through 2006. The findings indicate that many beneficiaries of Social Security disability insurance were working and engaging in work-preparation activities, and many more saw themselves working in the future. However, a host of common experiences among beneficiaries stood between them and employment including poor health, inaccessible workplaces, low levels of education that may limit their employment opportunities, and fear of jeopardizing their benefits by earning above the Substantial Gainful Activity limit. The Ticket to Work program has the potential to address some of these issues by providing greater economic incentives for employment and reducing the varied employment-related obstacles many beneficiaries face.

The current mix of public and private programs to support workers after they experience disability onset provides benefits to millions of workers and former workers. Yet, despite the large and growing costs of these programs, the inflation-adjusted household incomes of workers with disabilities have been falling for more than two decades, both absolutely and, especially, relative to the incomes of those without disabilities. The aging of the baby boom generation is likely to make matters worse, and the government's fiscal circumstance will make sustaining existing public programs increasingly difficult. Current policy initiatives might eventually improve the disability support system, but they are not likely to ward off adverse consequences of the pending crisis. Policy changes that leverage existing private-sector practices and capabilities might achieve greater success but have received little attention and are far from proven.

The authors use longitudinal data from the Survey of Income and Program Participation spanning 1996 to 1999 to estimate the prevalence of short- and long-term poverty among working-age people with and without disabilities. Depending on the disability measure used, annual poverty rates are two to five times higher among people with disabilities, compared to those without disabilities. Relative long-term poverty rates among those with disabilities are much higher than relative short-term poverty rates. People with disabilities represented 47 percent of those in poverty in 1997 according to an annual measure of poverty, and 65 percent of those in poverty according to a long-term measure. Disability may receive little attention in the poverty literature because most statistics are based on short-term measures, which partially mask the strong relationship between long-term poverty and long-term disability, as well as outdated perceptions of the relationship between disability and the ability to work.

The Social Security Disability Insurance (SSDI) program provides a safety net for individuals who must stop working because of a disability. Although Medicare coverage is available to people with disabilities, they must wait for that coverage until 24 months after they become eligible for SSDI. This brief discusses the costs and benefits associated with eliminating the Medicare waiting period for new SSDI beneficiaries. The authors estimate that doing so would increase annual Medicare costs by approximately $14 billion, provided that all beneficiaries are enrolled throughout the 24-month period. This represents about three percent of total Medicare expenditures in 2006. Even though costs would be substantial, potential benefits would also accrue: fewer beneficiaries delaying needed health care; reduced financial hardships for those who must pay high out-of-pocket costs for medical care due to lack of insurance; and reduced Medicaid expenditures for states. In addition, better coverage and access to health care during the waiting period might lead to improved health and increased or earlier return to work.

This report reviews recent evaluation activities being conducted for 27 state and federal programs, policies, and initiatives designed to promote the employment of people with disabilities. The review provides information on the nature of the initiatives and evaluation efforts that have been recently completed or are currently under way, as well as findings to date related to effectiveness. Suggested avenues where further efforts and progress might be warranted are also included.

The Ticket to Work and Self-Sufficiency program (TTW) was designed to enhance the market for services that help SSI and SSDI beneficiaries successfully enter the workforce. This report looks at how well the TTW market functions and the extent to which the introduction of TTW changed enrollment in employment-support services, employment, and receipt of SSDI or SSI benefits. The study found that program participation remains low but continues to grow, and survey findings indicate substantial potential for growth in participation. In addition, new payment regulations for providers may breathe new life into the market.

The Ticket to Work and Work Incentives Improvement Act of 1999 prompted changes in the Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) programs to help beneficiaries get and stay employed. This brief, the first in a new series from the Center for Studying Disability Policy at Mathematica, highlights the extent to which SSI and SSDI beneficiaries are working or trying to return to work. It also examines their interest in increasing their earnings and self-sufficiency, as well as the challenges they face. Overall, 40 percent indicated that their personal goals included getting a job, moving up in a job, or learning new job skills. Data for the brief were drawn from the 2004 Beneficiary Survey, a nationally representative survey of more than 7,500 SSI and SSDI beneficiaries ages 18 to 64, conducted as part of Mathematica’s multiyear evaluation of the Ticket to Work program.

The authors used data from the 1996 panel of SIPP to examine the extent to which working-age people with disabilities experience several types of material hardships. The findings indicate that disability is an important determinant of material hardship, even after controlling for income and other sociodemographic characteristics. In addition, a large majority of the low-income respondents who reported a material hardship also reported being limited for some period of time in the amount or kind of work they can perform. The findings provide support for policies that account for disability-related expenditures and needs when determining eligibility for means-tested assistance programs. They also suggest that the official poverty measure overstates the relative economic well-being of people with disabilities.

In March 2003, Massachusetts increased the premiums it charges to most enrollees in its CommonHealth-Working (CH-W) programthe state's insurance program for working age adults with disabilities. This article reports on the impact of the premium change on disenrollment. Findings indicate that the premium change had only a small, but statistically significant impact on program exits. The CH-W experience differs from other state programs that saw substantial enrollment declines in response to new or increased premiums. This is likely due to factors that make CH-W different from other programs, the most important being administrative procedures intended to minimize disenrollment caused by nonpayment of premiums.

This article presents findings from the 2004 National Beneficiary Survey, a nationally representative survey of Social Security disability beneficiaries conducted by Mathematica for SSA as part of its Ticket to Work program evaluation. The data provide an overview of the health and sociodemographic characteristics of Social Security disability beneficiaries, and highlight their employment activity, work aspirations, and use of employment-related services. Although most beneficiaries have significant health problems that limit their ability to work, the data suggest that there is potential demand for employment and employment-related services among Social Security disability beneficiaries. The data also suggest, however, that even if beneficiaries have employment aspirations and attempt to work, many potential challenges need to be addressed. In addition to the activity limitations and poor health associated with their disabling conditions, most beneficiaries have low levels of education that might limit their employment opportunities; are living at or near poverty, suggesting that they and their families may rely on public programs for which eligibility could be jeopardized by earnings; and many have experienced work-related obstacles, such as a lack of reliable transportation, inaccessible workplaces, and discouragement from work either by others or through their own experiences.

The authors examine the participation of SSA disability beneficiaries in the TTW program through December 2004. On an absolute scale, participation is very low, and perhaps much lower than many had hoped. Participation is not low relative to the historical rate for program exits due to work, however, and certain groups of beneficiaries participate at higher rates than others. A large majority of participants assign their Tickets to state vocational rehabilitation agencies (SVRAs), predominantly under the traditional, cost-reimbursement payment system. Most SVRA administrators indicate that they have not made major changes to the way they serve their beneficiary clients as a result of TTW. These findings suggest that, through December 2004, TTW does not represent a significant departure from the past. Participants with Tickets assigned to Employment Networks (ENs) are substantially more likely than those with Tickets assigned to SVRAs to earn at a level that will lead to program exit. This finding likely reflects the strong incentives that ENs have to serve only those with a high likelihood of exiting the rolls, but might also reflect greater focus on achievement of high earnings.

The Ticket to Work (TTW) program was designed to promote employment by enhancing the market for services that help people receiving disability benefits become economically self-sufficient. To date, the Social Security Administration has successfully begun the market enhancement process by putting the core elements of the TTW program in place across the country—mailing a Ticket to more than 11 million disability beneficiaries and inviting them to use it as a way to obtain meaningful employment; implementing new rules that allow beneficiaries to attempt to work without fear of triggering a review of their disability status; and enrolling service providers, or employment networks, that offer beneficiaries new choices for providers and service mixes. Early impacts from this report to Congress suggest that TTW slightly increased beneficiary use of employment services in 2002, the first rollout year. However, the increase did not appear to produce a corresponding increase in beneficiary earnings or a reduction in benefit payments during the first two years. The authors note that impacts for 2004 and later may be larger—participation rates continue to increase, and many nonparticipants say they plan to assign their Tickets. Nevertheless, analysis of trends in TTW payment data suggests that the program would have to induce future shifts in beneficiary behavior that are much larger than what has been observed so far in order to generate the level of exits from the program envisioned by Congress. In particular, meeting the exit goal will require TTW participation to increase substantially and a larger share of participants to earn enough so that they no longer receive cash benefits.

The current mix of public and private programs to support workers after they experience disability provides benefits to millions of workers and former workers. Yet, despite the large and growing costs of these programs, the inflation-adjusted household incomes of workers with disabilities have been falling for over two decades. The aging of the baby boom generation is likely to make matters worse, and the government’s fiscal circumstances will make it increasingly difficult to sustain existing public programs. This report notes that current public policy initiatives might eventually improve the disability support system, but they are not likely to ward off the adverse consequences of the pending crisis. Policy changes that leverage existing private sector practices and capabilities might achieve greater success but have received little attention and are far from proven.

The Social Security Administration established the TTW program to put disability beneficiaries on the road to economic self-sufficiency by improving access to and quality of services that will help them work. This interim report looks at the program during its first two years of operation to examine participation, beneficiary characteristics and outcomes, implementation, and other issues. It also looks at whether financial incentives are strong enough to encourage employment networks to participate, and how the program is reaching those who may need more intensive supports to succeed in the workforce. Overall, the authors note that the program has been implemented successfully, but issues such as low participation by beneficiaries and services providers need to be addressed.