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Description of Supported Employment Practices, Cross-System Partnerships, and Funding Models of Four Types of State Agencies and Community Rehabilitation Providers

Originally published: 7/2012


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Executive Summary

In 2005, the National Institute on Disability and Rehabilitation Research (NIDRR) awarded the VR Rehabilitation Research and Training Center (RRTC) to the Institute for Community Inclusion (ICI) at the University of Massachusetts Boston and its partners, InfoUse in Berkeley, California and the Center for the Advancement and Study of Disability Policy. In 2010, NIDRR provided supplemental funds to the ICI so that the VR-RRTC could include a focus on the provision of supported employment (SE) services. This SE research would focus on vocational rehabilitation (VR) agency partnerships with other state entities, and sources and models for long-term funding (extended services). The design called for embedding supported employment questions in ongoing surveys of multiple state agencies and case studies of SE coordination and funding models in several states to illuminate issues identified through these surveys.

Accordingly, the ICI included an SE module into ongoing surveys of four state agencies known to deliver public employment services to people with disabilities. These surveys and the response rates achieved for each included: a) the state VR agency (89 percent); b) the state intellectual and developmental disability (IDD) agency (82 percent); c) the state mental health (MH) agency (55 percent); and d) the state welfare agency (47 percent). [1] The SE supplement also included additional analysis of data obtained from an ongoing survey of community rehabilitation programs (CRPs) relevant to supported employment (37 percent response rate).

The ICI then conducted case studies of SE partnerships in five states. These case studies were designed to help us better understand the range of practices that VR systems might use to ensure more successful transitions to long-term support through other resources. This report presents the findings from the SE supplement, the central focus of which was to identify the role and impact of VR agencies within the larger SE delivery system. The remainder of this executive summary highlights the findings in three areas the supplement was designed to address: providers of SE services, SE partnerships, and SE funding.

Providers of Supported Employment

Supported employment services, including both short-term and longer-term supports, are provided primarily through state VR agencies, state MH agencies, and state IDD agencies. SE services are also provided through CRPs, typically with funding provided from or through one or more of these three state agencies. One of the issues identified through the SE supplement is the variability that exists among state VR agencies and their partners in how SE is interpreted.

For example, it is clear from the state VR agency survey responses that considerable variability exists across agencies with respect to the overall emphasis placed on SE and how SE is defined. Fifty-nine agencies provided data in response to a survey item asking for the number of individuals with a SE outcome in the most recent fiscal year, with a mean of 331 individuals exiting VR with SE outcomes and a range of 0–3,116. Two state VR Blind agencies entered “0” for the question including Idaho and South Carolina blind. Note: Guam subsequently entered “0” during drafting of this report. Only four agencies (6 percent) reported having a minimum hourly work requirement for an SE outcome, while 59 percent reported having a minimum hourly wage requirement for an SE outcome, which in all cases was equivalent to the federal or state minimum hourly wage.

The VR survey asked respondents to indicate the types of employment settings the VR agency accepted as an SE outcome. Virtually all reported that individual SE placements and transitional employment for people with mental illness were included. Eighty-four percent of VR agencies also reported accepting some forms of “self-employment” as an SE outcome. Far less frequently reported as acceptable SE outcomes were mobile work crews (44 percent), enclaves (33 percent), time-limited work experience (internships) (13 percent), and facility-based work (3 percent or 2 agencies).

The MH agency survey asked respondents to identify the different types of employment services that they provide to their clients. Individual SE, reported by 80 percent of all respondents, was the most frequent employment service setting provided by MH agencies. Other frequently reported employment service settings provided by MH agencies included competitive employment with time-limited supports (63 percent), transitional employment (57 percent), self-employment (37 percent), and facility-based employment (31 percent).

Of the 3,551 CRPs included in the sample, 1,309 (37 percent) responded to the survey and 88 percent of these CRPs reported providing some form of employment services. Of these CRPs, 83 percent reported providing individual supported employment services, the most frequent type of employment service reported. Less than half of responding CRPs reported providing group models of SE, including enclaves (42 percent) and mobile work crews (39 percent). Only 22 percent reported providing transitional employment for people with mental illness. Other types of employment services reported by a majority of CRPs included competitive employment with time-limited supports (70 percent) and facility-based employment (65 percent).

Among those CRPs that provided individual supported employment over the past three years, 40.6 percent reported an increase in the number of people served in this employment setting, while 29.9 percent reported the number served had remained about the same and 28.5 percent reported that the number had decreased. One percent reported that the service had been discontinued. CRPs were asked if they served individuals funded from the state VR agency, and 73 percent of those CRPs that provided individual SE reported serving individuals from VR, while only 47 percent of the CRPs that did not provide individual SE served individuals funded by VR. Overall 60 percent of CRPs provided individual SE to VR-funded individuals. Data analyses indicate that the proportion of CRPs serving VR-funded individuals increases as individual SE services increase.

Partnerships: Coordination and Collaboration in Providing SE Services

SE is by definition an employment service outcome that requires a collaborative approach, with VR frequently providing the short-term funding needed for an individual to achieve job stability and other state agencies then providing the funding (through various sources) for extended supports. By regulation, state VR agency provision of SE services is limited to 18 months (with exceptions allowable under special circumstances). State VR agencies are required to enter into one or more written cooperative agreements or memoranda of understanding with other state agencies and/or other available funding sources to ensure a collaborative approach to the provision of SE services (34 CRF 363.50). Most often these agreements are developed between the VR agency and state IDD agencies and/or MH agencies, although some VR agencies also have agreements with state or local education agencies, or with post-secondary institutions.

The SE module to the state VR agency survey included a number of items intended to obtain information on the nature and extent of partnerships established between VR agencies and other state and local entities. The purpose of these partnerships is to ensure a smooth transition from short-term VR-funded services to ongoing SE supports, or extended services.

One survey item asked VR agencies to indicate those state and local agencies with which they had established formal written agreements to coordinate funding and/or service delivery for SE extended services. Forty-one percent of the responding VR agencies indicating having such an agreement with the state MH agency, 36 percent with the state IDD agency, 23 percent with local MH agencies, and seven percent with “other agencies.” Interestingly, 44 percent of respondents reported “none of these agencies,” suggesting that the agreements that are required by regulation may not specifically address the coordination of extended service delivery and funding.

The VR survey also asked agencies to report the types of mechanisms used to “assure continuity of SE extended service delivery by providers, as the funding source shifts from VR to another entity.” The mechanisms most often reported included (1) a specific funding commitment via a purchase order, requisition, etc., and based on individual customers (18 of 66 agencies or 27 percent); (2) a verbal promise /statement by the provider as documented in the case record (18 agencies); (3) statewide interagency agreements (17 agencies); and (4) VR counselor discretion (14 agencies).

The state MH and IDD surveys also queried respondents about coordination with VR to ensure continuity of service delivery as funding shifts from VR to their agency. To establish a context for this information, these surveys also asked partner agencies to report the number of persons who exited VR services into SE for whom they provided ongoing supports. A majority of both state MH agencies (60 percent) and state IDD agencies (62 percent) were unable to report these data. The average number of individuals reported by the 11 state MH agencies who were able to provide this number was 572 people who exited VR into SE for whom they provided ongoing supports. The 15 state IDD agencies able to provide these data reported an average of 315 individuals who exited VR into SE for whom they provided ongoing employment supports.

Twenty-two of 30 responding state MH agencies (73 percent) reported having a designated staff person responsible for coordinating employment services including SE, and 22 state MH agencies (70 percent) reported coordinating the delivery of post-employment supports with state VR agencies. The specific mechanisms most often used to implement such coordination between MH and VR included (1) informal communication between MH and VR (14 MH agencies); (2) joint coordination between MH and VR that specifies to what extent there is formal collaboration prior to a shift in funding (10 MH agencies); and (3) statewide interagency agreements (9 MH agencies). Asked to indicate which of these mechanisms they believed most effective in ensuring continuity of service delivery, five state MH agencies reported coordination that specifies the extent of formal collaboration prior to a shift in funding, and four state MH agencies reported informal communication between MH and VR.

State IDD agencies were asked analogous questions regarding coordination of service delivery between state VR agencies and their agency. Twelve of 42 responding state IDD agencies (28 percent) indicated having a staff person responsible for coordinating post-VR extended employment supports. In the IDD survey, respondents were also asked to identify mechanisms used to coordinate with VR to ensure continuity of service as funding shifts from VR to their agency, and they were asked to report separately for individuals receiving services prior to VR and for individuals not receiving IDD services prior to VR. A higher percentage of IDD agencies reported using each type of mechanism for coordination for individuals receiving their services prior to entry into VR than for individuals not receiving their services prior to VR.

The most frequently reported means of coordination with VR included: (1) informal communication between the two agencies (94 percent for individuals receiving services prior to VR and 70 percent for others); (2) joint coordination that specified the extent of formal collaboration prior to shift in funding (55 and 48 percent); (3) IDD case manager discretion (60 and 43 percent); and (4) statewide interagency agreement (55 and 32 percent). Asked to identify the most effective means of coordination to ensure continuity of services as funding shifts from VR to their agency, 15 IDD agencies identified statewide interagency agreement and ten responded “not able to determine.”

State MH and IDD agencies were also asked to indicate mechanisms used to coordinate with contracted CRPs or other employment service providers to ensure continuity of service delivery as funding shifts from the state VR agency to their agency. The specific mechanisms most often reported by state MH agencies included contracts or cooperative agreements with the CRPs that specify the type of ongoing supports to be provided (8 agencies) and specific funding commitments to the provider via a purchase order based on the individual’s need (8 agencies), followed by informal communication from a MH line staff person (7 agencies), formal communication from a MH line staff person (5 agencies), and a verbal promise by the provider as documented in the case record (4 agencies). However, more state MH agencies reported “none of the above” (9 agencies) than any one specific means of coordination with CRPs.

State IDD agencies were asked to report how they coordinated with CRPs for individuals receiving IDD agency support prior to VR and for individuals not receiving their support prior to VR. As was true with coordination with the VR agency, more IDD agencies reported use of each means of coordination for individuals receiving agency support prior to VR than for other individuals. The most frequent means of coordination with CRPs reported included (1) formal communication from the IDD case manager (61 and 45 percent); (2) specific funding commitment to the CRP based on individual needs (58 and 41 percent); (3) informal communication from the IDD case manager (62 and 41 percent); and (4) cooperative agreement or contract with the CRP (60 and 31 percent).

Although many state VR agencies have cooperative agreement or MOUs in place with state MH and/or IDD agencies, these typically serve as statements of general principles rather than functioning as operational policies. Similarly, while many state IDD and MH systems have an “employment coordinator,” it is not unusual for that individual to have other major responsibilities, and they may not spend much time on employment issues, with or without VR involvement. The practical implications of how formal agreements and partnerships actually function is based on the funding available, the personality of key players at state and local levels, the degree of interest in employment of partner agencies, and other factors. The five states in which we conducted case studies offered a variety of examples of how SE partnerships actually operate in practice and demonstrate considerable variability in how the transition from VR to partner agencies actually occurs in different states.

For example, the Maryland Department of Rehabilitation Services (DORS) has longstanding partnerships and current formal agreements in place with both the Mental Hygiene Administration (MHA) and the Developmental Disabilities Administration (DDA), who are the major providers of long-term support in the state. DORS provides best practice guidance under its SE regulations as to the determination of “stability” so that transition to extended services can be accomplished. For individual SE, transition is appropriate if the individual requires hours of intensive intervention/assistance that equals 25 percent or less of the hours the individual is working and if the person has reasonably met all of the objectives under the IPE. For group models (fewer than 8 people in a group), transition occurs when the individual has acquired at least 75 percent of the skills that he or she was targeted to learn and has reasonably met all of the objectives on the IPE. Group models do not apply to individuals in evidence-based SE. An individual must be transitioned to extended services if the individual is receiving 25 percent or less of hours of intervention over a 60-day period. (Note: the determination of whether the job placement meets the definition of “competitive” in terms of wages/benefits is made at the time of transition to extended services.)

Maryland is a site for the Johnson and Johnson Dartmouth Collaborative on implementing evidence-based supported employment, which has as its goal assisting the state VR and MH agencies with increasing employment outcomes for individuals with psychiatric disabilities. Notable aspects of the partnership between DORS and MHA include: (1) commitment to and support of the partnership at all levels of both agencies; (2) expedited VR eligibility, so that eligibility for MHA employment automatically qualifies for VR eligibility, with anyone referred to MHA for employment concurrently referred to DORS; and (3) braided funding, whereby MHA provides some initial planning/assessment resources for providers, DORS pays for job development, MHA pays a placement fee once a job is obtained, DORS pays for any short-term (i.e., 18 months) support needed for job stabilization, and MHA initiates long-term ongoing support with funding from the Medicaid Rehabilitation Option and Mental Health Block Grant.

The Minnesota Department of Employment and Economic Development (DEED) of which the Division of Vocational Rehabilitation Services (VRS) is a part, has had longstanding interest in Supported Employment. Minnesota was one of the first states to focus on SE as part of its overall service delivery system, especially within its Development Disability (DD) services. However, there are no formal written agreements or MOUs currently in place between MN DVR and its sister agencies in IDD and MH. DVR provides guidance regarding transition from time-limited vocational rehabilitation services to ongoing extended services funded by a non-VR source. DVR guidelines state that this transition should occur when the consumer has made substantial progress toward meeting the hours-per-week work goal established in the IPE and the consumer is stabilized in the job.

New Mexico DVR operates in a unique environment in which they are party to a long-standing law suit (the Jackson Settlement) involving deinstitutionalizing people with IDD from state institutions and providing community services to the affected constituents, overseen by court-appointed monitors. Formal MOUs exist with both the state IDD agency and with Optum Health, which manages the public MH system in the state. The major providers of long-term support within the state are community rehabilitation providers and many individual contractors who offer both placement and support services, including, in some cases, extended supports. Where employment is offered in the MH system, it is delivered by the comprehensive MH Treatment Centers, which include case management and community support services.

Employment is currently not a major priority of the MH system of care and is not emphasized through Optum Health under its state contract. Nonetheless, the MH state plan allows for a service category of Continuing Community Support Services, which could be accessed for the clinical support needed as part of extended supports should the MH authority choose. There is no formal definition of “stabilization” within the DVR policy prior to transition to extended services, and this decision is left to the judgment of the counselor. There is, however, a formal notification letter expected from the source of extended supports to DVR confirming this obligation.

The New York State VR agency (Adult Career and Continuing Education Services-Vocational Rehabilitation, or ACCES-VR) is part of a large, complex system with many levels of funding and policy authority in IDD and MH at both the state and county levels. ACCES-VR has an existing MOU on supported employment from 1999 (based on a 1992 NY state law) with the Office of Mental Health, the Office for Persons with Developmental Disabilities, and the Commission for the Blind and Visually Handicapped. The MOU describes how state agencies must cooperate and coordinate efforts, including funding and data collection, to support integrated employment for individuals with disabilities. The state is in the process of updating the MOU to reflect changes in funding mechanisms and requirements. The updated agreement will serve as a template for cooperation and coordination in SE among ACCES-VR and its state agency partners.

The major providers of long-term support within NY are the community rehabilitation providers with contractual or funding relationships with the VR system, the IDD system (both state and county) and the MH system (both state and county). The IDD system uses networks of community providers while the state and county MH system use MH treatment agencies, both state-operated and private providers. In the current VR policy, stabilization is seen as occurring when the individual’s work performance plateaus and the job coaching and related interventions have faded to the lowest level necessary to maintain the individual in employment. Stabilization generally occurs when intervention level fades to less than 20 percent of the work week for a period of at least 3 consecutive weeks. However, there is discussion underway at the central VR administrative office to eliminate these specific measures and just signify that the counselor must make an individual judgment in consultation with the client and the provider.

The VR agency in Washington state (WA DVR) has long standing relationships with both the state IDD and MH agencies. There is a current MOU with DD, and one with MH (Division of Behavioral Health and Recovery, DBHR) that is in the process of being updated. Services in both MH and IDD are generally provided through county (DD) or regional (MH) authorities with state support.

Washington has long been one of the leaders in SE for people with intellectual / developmental disabilities nationally, and the state IDD agency has been acclaimed as the pioneer of the Employment First movement within IDD state systems across the country. The major providers of long-term support within the state are the state and county IDD agencies (through CRPs) and DBHR (primarily through specific MH treatment providers). There is also a specific interagency agreement in place between the WA DVR and King County (Seattle area) MH. That county has a specific local pool of money through a millage tax that it has dedicated to SE for people with mental health problems. The definition of “stabilization” and thus the point at which extended supports are put into place is not defined precisely by the state DVR policy. DVR depends on counselor negotiation to ensure that appropriate long-term supports are available. Previously a formal commitment letter was used, but this was discontinued.

Funding of Extended Services and Use of Natural Supports

As noted, state VR agency support for individuals in SE is limited by regulation to 18 months (with exceptions allowed under special circumstances), at which point another funding source must be used to provide ongoing employment supports. We obtained information on how extended services are funded through all of the surveys as well as through the case studies of five states. As it is not the responsibility of state VR agencies to secure funding for SE following exit from the agency, it is not surprising that there was quite a large amount of missing data for several survey items addressing this topic. For example, the state VR agency survey asked state VR agencies to report the percentage of individuals exiting VR services with an SE outcome whose extended services are currently provided through natural supports only, funded services only, or a combination of funded and natural supports. The overwhelming majority of agencies (at least 73 percent in all cases) responded that these data are not collected.

The VR survey also asked agencies to indicate whether any one of seven specific funding sources were used by individuals exiting VR services with an SE outcome to fund their extended services following exit from VR. The sources of extended services funding most frequently identified as being used included the Medicaid Home and Community Based waiver (40 percent of responding state VR agencies), the Social Security Work Incentive PASS program (38 percent), Impairment-Related Work Expenses (32 percent), IDD general revenue (27 percent), MH general revenue (27 percent), the MH Rehabilitation Option (16 percent), and “other” (19 percent), which included state general revenue funds and Ticket to Work reimbursements. Once again, the vast majority of agencies (at least 75 percent for all types of funding) were unable to provide a count of the number of individuals who were receiving extended services funded through these sources.

In response to a separate question, 13 agencies (or 19 percent) reported the availability of a state program funding extended services for individuals exiting VR services with an SE outcome. Total funding for these programs ranged from $63,000 to over $10 million, and these programs served an average of approximately 1,500 individuals each year. Four agencies indicated that the state-funded extended services program is not limited to certain disability groups. The most common populations served by state-funded extended services programs included individuals with mental health or developmental disabilities not otherwise covered and individuals with traumatic brain injury.

In Minnesota, the state-funded extended employment program is available for individuals not otherwise able to secure extended supports. It is an outcome-based program that reimburses CRPs on the hours an individual works. The program provides funding for center-based employment, community employment, and supported employment, but encourages movement toward SE. The rates are highest for SE, and the program allows providers to annually convert center-based “slots” to SE.

State VR agencies were also asked if any populations were unable to access funding for extended services, and 24 agencies (39 percent) responded that there were. The populations identified most often as unable to access funding for long-term employment supports included individuals with TBI, individuals with mental health impairments or developmental disabilities not served by an MH or IDD agency or who do not qualify for a Medicaid waiver, individuals with visual impairments, and people who are deaf-blind.

The state MH and IDD surveys also included items to obtain information on available sources of funding for extended services for individuals exiting VR services with an SE outcome. The most frequently reported funding sources identified by state MH agencies included state, county, or local MH funds (18 MH agencies or 60 percent); Medicaid funds, including the Rehabilitation Option, 1915c, 1915d or 1915i (12 agencies); and “other” – including federal block grant funding (10 agencies), PASS (4 agencies), IRWE (3 agencies), private insurance (2 agencies), and self-payment (2 agencies). The most frequent funding sources reported by state IDD agencies for individuals with IDD who exited VR services with a SE outcome included the Home and Community Based Services (HCBS) waiver (26 agencies or 93 percent of respondents); state, county, or local IDD funds (18 agencies); IRWE and PASS (6 agencies each); the Rehabilitation Option under Title XIX of the Social Security Act (4 agencies); self-payment or other source (3 agencies each); and private insurance (2 agencies).

All of the case study states as well as 93 percent of IDD agencies responding to our survey use the 1915(c) HCBS waiver (among others) to provide long-term employment supports for individuals with intellectual/developmental disabilities. However, an increasing number of states have developed waiting lists for HCBS waiver-funded services. These wait lists may impact state VR agencies’ ability to fund the up-front support if the IDD system cannot commit to the long-term intervention needed within the 18-month time frame or at the point at which job stability is achieved. Some of these states are able to continue to provide extended supports following the short-term funding provided through VR using state funding until the wait list opens up. State IDD funding is often also used for those not eligible for the HCBS waiver.

Long-term funding for individuals with psychiatric disabilities is more problematic as HCBS waiver services are quite limited for these individuals owing to the “Institute for Mental Disease” or IMD exclusion. Options available to MH systems for offering long-term employment support include general MH funds from state appropriations or the MH Block grant; community supports through the Medicaid Rehabilitation Option (with some restrictions on the use of funds for certain employment services); developing a model under the new 1915(i) Medicaid authority that allows the development of an HCBS option for mental health without the revenue neutrality exclusions; or tapping into state-funded extended support program funding in the few states where such funding exists. Two of the states (Washington and New York) we visited are in relatively rare company, in that their MH systems have developed state-level funding for long-term employment supports. In Washington, the state has been able to use Medicaid authority under optional services to provide employment supports in some regions of the state but this method appears in danger of being eliminated owing to the state’s current fiscal deficit.

While several of the states we visited are moving toward milestone payment systems for up-front (time-limited) employment supports (MD, WA, NM), funding for extended supports through MH or IDD agencies, where it occurs at all, is usually done on a “slot” or hours of service basis. Medicaid rules make it difficult to incorporate milestone payments or incentive payments for higher quality service into its funding formulae. State-funded programs appear to have much more flexibility to innovate funding strategies.

Owing, in part, to a lack of dedicated funding for extended services, the use of natural supports as a means of providing ongoing employment supports appears to be an increasingly popular option. However, based on our observations from a limited number of sites, use of natural supports varies widely from one state to another, and most VR agencies lack a structured approach to this technology. In New Mexico, for example, VR has a strong focus on the use of natural supports, and in some cases long-term supports are delivered by the same individual who delivered the up-front services paid for by VR as a contracted service provider. In New York, on the other hand, ACCESS-VR has no formal policy on natural supports. These supports are generally not seen as the principal source of support, but rather as part of a provider-funded support network. In Maryland, the VR agency has no formal policies governing use of natural supports, but it is generally encouraged, especially within its partnership with DD.

Natural supports are less often encouraged under the evidence-based SE methodology that the state MH agency encourages in many states In Minnesota, VR has developed guidelines that encourage employers to be involved in the provision of natural supports where appropriate during the job development stage. The VR agency in Washington encourages natural supports, especially within the IDD system, but prefers that specific supports be identified in the plan, rather than just generically referenced.

Among the states we visited, there were some promising approaches to long-term funding for people exiting VR services into SE. State-funded programs in New York, Minnesota, and Maryland (for people with TBI) allow VR to provide long-term support for individuals whom MH or IDD agencies may not be able to support due to their disability or level of need. More state IDD systems, like the one in Washington, are adopting an “Employment First” policy that directs all or most of their day service funding towards employment. Having the IDD agency as a strong partner in employment service provision allows VR to serve individuals with the most significant developmental disabilities more efficiently.

Braided funding models like the one used in the Maryland VR collaboration with MH also appear to be quite promising. In Washington, the VR agency has an arrangement with a county school system through which local education funding is used to provide job development/placement services, VR pays the school upon job placement, and the county IDD system then provides funding for long-term supports.

Issues for Further Consideration

The findings from the SE supplement completed by the ICI and our partners identified a number of issues that merit further consideration as a means to improve the SE delivery system:

[1] The survey of state Welfare agencies indicated little to no involvement in SE systems and so these data are only briefly summarized in the body of the report.

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