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California State Activities Relating to Work Incentives Act Implementation

The Context for Foundation Action

The Ticket to Work and Work Incentives Improvement Act(1) is an invitation to innovation. It offers states significant opportunities to eliminate barriers to employment for people with disabilities by improving access to health care coverage under Medicaid and Medicare and by increasing employment training and placement services for disabled people who want to work.

The Work Incentives Act is also an invitation for foundations to form partnerships with state government and local health and employment agencies. Policy makers and representatives of the agencies responsible for implementing the Act on the Federal level have clearly stated that the legislation provides the tools to create integrated systems of healthcare and employment supports, but leaves it up to the states and communities to utilize the tools to full capacity. Some agency leaders have also noted that, because of the intrinsic limitations of Federal funding and allowable activities, private funding is essential for fulfilling the Act’s full potential to enable people with significant disabilities to lead productive lives in the mainstream of society. Public-private partnerships have the potential to effect real change in the systems of health and work supports for Californians with Disabilities.

Healthcare Provisions

The Work Incentives Act’s healthcare provisions became effective on October 1, 2000. As of that date:

  • Californians on Social Security Disability Insurance (SSDI) can continue to receive Medicare for 8-1/2 years after they return to work.(2)
  • The state can now create Medi-Cal buy-in options for two new groups of workers with disabilities: 1) those who are medically eligible but who earn over 250 percent of the federal poverty level and 2) those who have had a medical improvement but who remain disabled.
  • The state can apply for two Federal grant programs: 1) Medicaid infrastructure grants, which help states build the systems they need to allow people with disabilities to buy health insurance through Medicaid, and 2) demonstration grants that allow states to extend Medicaid to working people who have disabilities that are likely to become severe enough to qualify them for benefits if they do not receive health services.

What California has achieved to date relative to The Work Incentives Act’s Healthcare Provisions

Much of the activity in California has been legislative. The state currently has a Medi-Cal buy-in called the Working Disabled Program established under the Balanced Budget Act of 1997, which is available to working people with disabilities who earn up to 250 percent of the federal poverty level. However, information about the current Working Disabled Program has not been well disseminated, and the program is severely underutilized.

In many respects, however, California is well situated to implement new healthcare policies for people with disabilities. On February 23, 2001, Assemblywoman Dion Aroner introduced AB 925, which would improve upon the current state law in a number of ways, including the following:

  • AB 925 will raise the income eligibility level from 250 percent of the federal poverty level allowable under the current law to 450 percent of the federal poverty level.
  • Under the current Medi-Cal Buy In program, when workers lose a job they have until the first day of the following month to find a new job or lose eligibility for the program. To maintain eligibility for Medi-Cal, these workers have to go back onto SSI and spend any savings or retirement funds that exceeds $2,000. AB 925 will create an 18-month grace period, giving workers the opportunity to maintain Medi-Cal with a premium payment. In addition, it will raise the asset level to $80,000.
  • Under the current program, workers who qualify for In Home Supportive Services (IHSS) are unable to use personal care services at the worksite. These services can include assistance with eating and using the restroom. AB 925 will amend IHSS to allow workers who need supportive services to use their authorized supportive service hours in the workplace, an educational facility or other specified out-of-home locations.
  • The new law would allow people on the Working Disabled program to have Designated Independence Accounts for the purpose of purchasing goods and services that will increase their employability or independence. Allowable purchases include a vehicle, computer equipment, assistive technology, a home or modifications to an existing home as needed for accessibility.

AB 925 has passed the State Assembly and could pass the State Senate in August. It may therefore be signed as policy, with no budgetary considerations in 2001. Appropriations would then be sought in 2002.

Employment Provisions

While some of the employment provisions of the Federal Work Incentives Act have already gone into effect, others will be phased in over the next four years. The most significant of these provisions is the Ticket to Work Program, which will be implemented in 13 states in 2001. In these states, Social Security (SSA) beneficiaries will receive a Ticket, which they can exchange for employment-related services delivered by any provider authorized to be an “Employment Network” by SSA. The Work Incentives Act also offers increased flexibility for people getting on and off the Social Security rolls and creates a Benefits Planning Assistance and Outreach Program to publicize work incentives and to provide the information beneficiaries need to use them. Part of this latter program is a series of Federal grants to enable state agencies and nonprofits to provide benefits planning, assistance and outreach to beneficiaries to help them navigate the new system.

What California has achieved to date relative to The Work Incentives Act’s Employment Provisions

California is not one of the initial “Ticket States,” but several community-based nonprofits in the state received one of the 38 grants and contracts issued by SSA for benefits planning, assistance and outreach. However, there is a strong possibility that the state will be among the second round of states selected to begin working with the Ticket Program.

In addition, AB 925 would enhance employment services to people with disabilities in the following ways:

  • By mandating that local One-Stop Centers become program accessible for all people with disabilities and monitoring compliance with that integration;
  • By designing county level infrastructure grants to increase direct service training and cross training between public agencies (e.g., the welfare office, VR, Social Security, Calworks, Medi-Cal, IHSS, One Stop Centers) on issues of employment and disability;
  • Implementing county level comprehensive benefits planning and outreach programs to work with persons with disabilities; and
  • Monitoring the readiness of One Stop Centers that choose to participate as Employment Networks in the Social Security Ticket to Work program.

In March 2002, California will host a national conference on disability and employment, which should help to create the context for the employment-related changes in the new legislation.

State Systems Change

It is possible that the delay in California’s assignment as a Ticket State will be advantageous if it enables legislators and advocates to work together to pass AB 925, thus providing the state with the infrastructure that would support the Ticket Program by providing interagency connections and outreach to stakeholders.

AB 925 attempts to change public programs that foster dependency into programs that support personal empowerment and responsibility by upgrading and integrating health care and employment services for people with disabilities. Systems integration aspects of the bill include:

  • Establishing a Workforce Inclusion Council, which will consist of four people with disabilities and the directors of the Employment Development Department, Department of Rehabilitation, Department of Social Services, Department of Health Services, Department of Mental Health, Department of Developmental Disabilities, The Governor’s Committee For Employment Of Disabled Persons, the State Workforce Investment Board, and any other departments or programs that may have a role in increasing the capacity of state programs to support the employment- related needs of individuals with disabilities.
  • Cross-agency training, local training for county administrators and staff, and funding for comprehensive benefits planning and outreach programs to work with people with disabilities in their communities.

The Medi-Cal Policy Institute (MPI) is beginning a “scope of work” document for presentation to its funders by mid-August to finance and execute an AB 925 cost analysis project. MPI’s participation would be significant, since it could provide the data needed to garner both legislative and foundation support of Ticket-to-Work projects.

In addition, California received one of the infrastructure grants from the Center for Medicaid/Medicare Services (CMS). The grant provides $500,000 per year for 10 years and can go up to $750,000 if enough funds are appropriated. The grant will help the state to:

  • Improve flexibility of the personal care services program
  • Fund outreach and training for DHS staff
  • Train other stakeholders and community agencies
  • Make improvements so that DHS works more effectively with California public employment programs

(1) Hereafter referred to as either the Work Incentives Act or the Ticket-to-Work Act. [return to citation 1]

(2) Previously, beneficiaries receiving Medicare could retain it for only four years after returning to work. [return to citation 2]