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 July 2012 | Vol. 4, Issue 6
CONTENTS
Disability Hiring Still Lags
Social Security Disability Fund Warnings
Many States Fall Short on Community Living Goals
Obama Administration Makes Additional Housing Funds Available
GEAR UP
 

Disability Hiring Still Lags

Two years ago, President Obama signed Executive Order 13548, committing the federal government to increase employment of individuals with disabilities and become a model employer in that regard. While the government’s effort has demonstrated some success, with 20,000 disabled employees hired during those two years, a new Government Accountability Organization (GAO) examination of the effort indicates the government is not on track to meet the order’s goal of a total of 100,000 employees over a five year period.

According to the report, the two agencies given primary oversight for implementing the order, the Office of Personal Management (OPM) and the Department of Labor (DOL), took a number of positive steps to help federal agencies develop disability hiring plans and provide other guidance. But many of those plans have fallen short of OPM’s review criteria and subsequently have failed to correct the deficiencies in their plans. Additionally, the GAO report suggested that OPM’s failure to include this information in regular reports to the White House and questions about the quality of the data itself may have contributed to the low success rate.

The GAO made three recommendations for OPM to improve the oversight and ensure that the order’s goals are achieved: 1) that it incorporate information about plan deficiencies into its reports to the president; 2) that it expedite the development of required mandatory training programs; and 3) that it assess the accuracy of the data used to measure progress and ways to improve the measurements of the population of federal employees with disabilities.

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Social Security Disability Fund Warnings

For years, Social Security’s critics and supporters alike, each with differing motivations, have warned of the potential insolvency of the nation’s retirement security program. Now, however, experts studying the issue are warning of a new and more imminent problem that concerns not the retirement plan, but its younger sibling, the Social Security Disability Insurance (SSDI) program, created during the Eisenhower administration to provide assistance to approximately 11 million people with disabilities, their spouses and children, and to prevent many from falling into poverty. 

The problem is that under current conditions, the program’s trust fund is projected to run out of money in just four years. If that happens recipients will see their benefits slashed immediately by 21 percent, because incoming payroll tax revenue, which finances the program, will be able to cover only 79 percent of benefits.

There are several reasons why the shortfall is occurring, but the basic problem is that the number of beneficiaries is growing far greater than the number of people paying into the system. This in turn is the result of several factors, not the least of which is the increasing numbers of people applying to the program – up more than 30 percent since 2007 alone, with the amount of people actually receiving disability benefits during that period up 23 percent.

Part of this is due simply to the aging of the American population, which has a corresponding increase in the likelihood that someone will become disabled.

But the increase also correlates with tough economic times.  When people lose their jobs, and jobless benefits run out, many will try and see if they are eligible for disability benefits, expanding the program beyond what it was intended for. This problem is exacerbated by a lack of consistency in what is covered. Applications that are rejected can be appealed, and administrative judges are far from uniform in the conditions for which they award benefits.

Moreover, once people start to receive benefits, they are unlikely to drop out of the program, with statistics showing that fewer than one percent rejoin the workforce. In part, this is also a comment on the economy, but for two reasons. In addition to the benefits, which average $1,111 a month, for many who had low-paying jobs with poor or no benefits, the disability program offers them an opportunity to qualify for Medicare far earlier than they otherwise might. Disability beneficiaries become eligible for Medicare after two years in the program, regardless of their age.

Few tangible solutions currently are on the legislative table.

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Many States Fall Short on Community Living Goals

A federal program designed to provide states with opportunities to help disabled and elderly Medicaid beneficiaries living in long-term care facilities return to the community, has fallen far short of its goals, according to a new report  evaluating the project. Since the “Money Follows the Person Demonstration Program” began in 2007, the number of people who have transitioned back into the community is about 36 percent below the target set by the states.

Under the program, states are offered supplemental Medicaid funding to support a participant’s home and community-based services over the year. The demonstration grant was initially authorized in 2005 and extended in 2010, with more than $4 billion in federal funds authorized since its inception. The dual goals of the program are: to transition people living in nursing homes and other long-term care institutions to homes, apartment, or group homes of four or fewer residents; and to change state policies so that Medicaid funds for long-term care “follow the person.”

At least 22,500 people have transitioned since the program began, but that is significantly below the more than 35,000 people it projected would do so during the effort’s first five years. The numbers vary greatly by state, with California having had just 827 people transition since 2008, while Texas and Ohio have helped thousands. The low numbers are particularly frustrating to many advocates because of both the investment made by the federal government and the nearly one million people who meet the eligibility requirements. The total number of states who have received grants rose to 44 last year. So far, however, the federal government has paid or committed to pay $1.1 billion of the $4 billion authorized.

The report, by Mathematica Policy Research, found that the shortfall in the program is the result of a number of different obstacles, including a shortage of direct care workers, a lack of community-based services, problems in negotiating contracts with transition specialists, and even arranging support from family members. In many states there was a general lack of preparation. As one state legislator commented in a Kaiser Health News report, “[States] grabbed the money without real planning. … States have been very, very strapped. They’re anxious for the dollars that come down… It’s just like a kid going into a candy store.” Additionally, in some states such as Florida , state lawmakers refused to allow state officials to use their nearly $36 million grant because the funding was authorized under the Affordable Care Act, which the state challenged in federal court

Still another problem in many areas is finding affordable and accessible housing. One man in California , who is in a wheelchair because of an inflammatory disease that attacks his muscles, “just started getting on the bus and looking for places on [his] own.” It took the man, Wayne Cook, more than six months to find a landlord who would accept his Section 8 housing voucher. Eventually he moved into a first floor apartment that was not handicap accessible. It was a significant milestone for him to return to an apartment. “I had come a long way from people telling me I was going to be bedridden for the rest of my life. I can’t put it in words what it felt like to get my own door key again.”

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Obama Administration Makes Additional Housing Funds Available

For the scores of people with disabilities who must also get by on very limited resources, an effort by the Obama administration to provide an additional $85 million to states for rental housing assistance for these individuals is good news.

To qualify for the funds, which come from the U.S. Department of Housing and Urban Development’s Section 811 Project Rental Assistance Demonstration program, an individual must earn no more than 30 percent of the median income for their area. Officials expect nearly 3,000 people with disabilities to be able to use the money to live independently in their communities.

States can apply  for the new funds through July. The government has added a new requirement – that housing agencies must partner with their state health and human services and Medicaid agency. The goal of this condition is to make sure that the agencies are working together to make sure the recipients receive the support service they need to go along with the money, and also that the neediest individuals receive the assistance.

It should be noted that, in some states, such as Colorado, the main target group for the Section 811 project will be participants of the Money Follows the Person (MFP) grant.

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GEAR UP

The U.S. Department of Education announced the College Savings Account Research Demonstration project, which will allocate nearly 9 million of funds from the GEAR UP program to support increased access of disadvantaged students to college through investment in college savings accounts. According to the Department of Education, which posted for comment a summary of the initiative in the Federal Register, the demonstration project will provide about 10,000 low income high school students with savings accounts as well as counseling to develop smart financial habits. States will receive grants that would be place approximately $200 in “seed money” into personal savings accounts for the students in trust, pending their graduation from high school and enrollment in a college or university. Students will be able to earn additional funds, ultimately giving them the opportunity to save more than $1,000 for college.

The project will also research the effect of the college savings accounts and counseling intervention on college access and family behaviors and attitudes associated with attending college. Previous research suggests that students with savings accounts may be up to seven times more likely to attend college, but one quarter of U.S. households, and half of Black and Hispanic households lack a federally insured deposit or rely on more costly alternatives. A further impediment to college enrollment for these individuals is a general lack of financial illiteracy for many students and families. The current project expands upon an effort by the Department of Education in which it established partnerships with other agencies, schools, and financial institutions to help students gain access to deposit accounts and achieve greater financial literacy.

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