Panel Paper: Waiting Time for Vocational Rehabilitation Services and Post-Closure Outcomes for SSDI Beneficiaries

Friday, November 9, 2012 : 9:00 AM
Washington (Sheraton Baltimore City Center Hotel)

*Names in bold indicate Presenter

Todd Honeycutt, Mathematica Policy Research and David Stapleton, Cornell University

This paper explores the effect of long wait times on the employment and benefit outcomes for Social Security Disability Insurance (SSDI) beneficiaries who apply for vocational rehabilitation (VR) services. State VR agencies represent the largest employment-related federal expenditure for persons with disabilities. Though most funding comes from the federal government, VR agencies often have long waiting lists due to resource limitations at the state level. When an agency has a waiting list, it must serve those with the most significant disabilities first; individuals receiving SSDI often qualify, but still may encounter long wait times, with potential effects on their employment and benefit receipt. We use VR administrative records matched to Social Security Administration (SSA) records to identify a cohort of SSDI beneficiaries who applied to VR agencies in FY2005. We track their outcomes for four years on several measures: the start or completion of a trial work period; the number of months of earnings at or above the substantial gainful activity level; any suspension or termination of SSDI benefits due to work; and the number of months in non-pay status after suspension or termination of benefits due to work. To assess the effect of waiting times that were independent of an individual’s wait time, our models incorporated a measure of usual wait time (the number of months from application to an individualized plan for employment) for all applicants in each state and month of application, and we controlled for individual and state characteristics. Longer usual wait times resulted in a lower likelihood of a beneficiary experiencing all but one of our outcome measures at the 48-month point. If the usual wait time were reduced to no more than two months for each state VR agency, we estimate that the number of additional months in non-pay status after suspension or termination of benefits for each annual cohort of SSDI beneficiaries would increase by about four percent. Such an increase could result in state VR agencies receiving an additional $1.5 million over four years through additional SSA payments for successful employment outcomes.