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August 6, 2024

AUTHOR
Leigh Wedenoja

Executive Summary

People with disabilities are significantly less likely to be employed than their peers, and when they are employed work fewer hours for lower wages. There are many different obstacles to employment that confront people with disabilities and one understudied barrier is the employment disincentive created through eligibility rules for public benefits programs. The Rockefeller Institute’s earlier report, Navigating the Benefits Cliff: The Role of Benefit Eligibility in the Decision to Work and More for People With Disabilities in New York State, documented how benefits eligibility rules work for people with disabilities and how benefit receipt changes as people choose to work or to increase their employment earnings. The goal of this report is to build on that research and take a deeper dive into existing New York State policies and programs intended to lower employment barriers for people with disabilities, as well as suggest additional policy solutions to further promote and facilitate employment.

Through discussions with New York stakeholders, an extensive academic literature review, a series of webinars, and an in-person forum, the Rockefeller Institute identified three primary informal barriers to employment that result from benefits eligibility rules. These three barriers include:

• The prevalence of missing information and misinformation: As discussed in the previous brief, eligibility requirements for Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), other benefits, and employment programs are complicated. In part, due to these complications, many people lack adequate information on how to navigate them and rely on outdated or incorrect information when making employment decisions.
• Administrative burden: These are the costs associated with applying for and maintaining access to government services for the person receiving services. Administrative burden encompasses not only the time and effort of applying for and maintaining benefits but also adds to the stress and fear of losing those benefits.
• Risk aversion: The combination of misinformation, partial information, and administrative burden contributes to risk aversion—or the unwillingness to take risks even when the expected outcome of the risk is significantly better than the expected outcome without the risk—among people with disabilities who rely on public benefits. Risk aversion is most associated with the fear of losing health insurance.

These three barriers cannot be viewed independently as they feed into and magnify each other. In response to the barriers identified, this report recommends five principles to guide existing and new policies to assure that all New Yorkers with disabilities who want to work have the opportunity to do so and receive the best available services to support them as they make employment and life decisions. These recommended guiding policy principles are as follows:

1. The effect of benefits on work should not be viewed in a vacuum, rather people with disabilities and their families should be equipped with complete information and services to make holistic decisions about all aspects of life including housing, transportation, work, and benefits.
2. The discussion of the benefits-employment tradeoff should center support for the individual employment goals of people with disabilities rather than the potential negative effects of benefits loss. This concept of “employment first” should guide New York State hiring and conversations with private employers.
3. New York State agencies, benefits counselors, and Independent Living Centers could directly address administrative burden and risk aversion in the employment choices of people with disabilities by providing accurate information on health insurance and overpayment risk.
4. Disability professionals need training and access to up-to-date and accurate information on the relationship between benefits and work and information on how to refer clients to trained benefits counselors in order to prevent the proliferation of inaccurate or out-of-date information through informal pathways.
5. Advances in technology should be utilized both behind the scenes to improve service provision and targeting, as well as in customer-facing spaces to improve access to accurate and easily digestible information on benefits and employment.

This report first summarizes and discusses findings from the previous report on Navigating the Benefits Cliff. This includes the primary finding that for the majority of individuals who rely on SSI and SSDI, there is no benefits cliff based on eligibility rules alone, due to the fade-out structure built into SSI and many other benefits programs where each additional dollar of earnings results in a decrease of less than one dollar in benefits. Despite this fact, the informal barriers discussed above prevent many people with disabilities from fully seeking employment. The report then discusses the webinar and seminar series the Rockefeller Institute conducted and outlines the three identified informal barriers referenced above.

Finally, the report discusses the five policy principles identified and how they can be operationalized to improve and expand both existing policy tools and guide new policy levers for reducing employment barriers. Key areas for policy expansion discussed include:

1. Viewing employment as part of whole-life planning through:
   • Leveraging and coordinating existing sources of support for people with disabilities including Independent Living Centers (ILCs) and Adult Career and Continuing Education Services-Vocational Rehabilitation (ACCES-VR).
   • Providing financial literacy and planning services to people with disabilities and their families.
   • Improving transportation services to improve both access to employment and access to community life and services for people with disabilities.
2. Reframing the conversation about employment for people with disabilities to both public and private employers through:
   • Expanding the scope of both New York’s Employment First policy and the Office of the Chief Disability Officer.
   • Leveraging existing public and public-private partnership employment programs including the Preferred Source Program and Civil Service’s 55-b/c program.
   • Promoting employment for people with disabilities through advocacy to private employers.
3. Managing risk aversion and administrative burden associated with employment for people with disabilities through:
   • Assisting individuals in applying for and managing federal employment incentive programs including Ticket to Work.
   • Reducing the potential for SSI/SSDI overpayments and subsequent repayments through education and assistance with wage reporting.
   • Directly addressing the fear of losing health insurance through promoting the Medicaid Buy-in Program for Working People with Disabilities and Medicaid Expansion in New York.
4. Supporting and training the disability support professionals who promote employment for people with disabilities through:
   • Training and funding additional benefits counselors.
   • Providing basic and intermediate benefits and employment training through existing and new programs for other disability professionals including employment specialists, disability resource coordinators (DRCs), SUNY microcredentialed direct support professionals, and certified employment support professionals.
5. Improving technology for service provision and customer interaction through:
   • Improving the ability of New York State agencies and service providers to share data and information through an integrated data system.
   • Improving customer service technology through the use of “one-stop-shops” like the New York Employment Services System (NYESS) Front Door program and potentially embracing newer technology like artificial intelligence (AI) chatbots.

Read the full report.