National Alliance on Mental Illness
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(800) 950-NAMI;







JULY 29, 1998

Chairman Chafee and members of the Subcommittee, I am Jim McNulty of Bristol, Rhode Island, and I serve on the Board of the National Alliance for the Mentally Ill (NAMI). I am also a president of the Manic Depressive and Depressive Association of Rhode Island. At the outset I would like to thank you for holding this hearing on this very important legislation for people with severe mental illnesses.

I, myself, suffer from manic depressive illness and for the last nine years have worked with many other Rhode Islanders suffering from severe mental illnesses, including schizophrenia, manic depression, and depression. Over this period I have found an almost universal, visceral desire on the part of people with disabling mental illnesses to return to meaningful, gainful employment. We want to be able to partake as fully as possible in the privileges and responsibilities of being citizens of the United States. Sadly, for many of us, the very system that is designed to help us when we are at an ebb in our health and require the social safety net, will not allow us to recover dignity by assisting us to return to work. As you know, the current "all or nothing" approach to income support and health security operates as a massive barrier to work for millions of Americans with severe disabilities who seek to achieve greater independence and dignity through employment. The dream of the Americans with Disabilities Act (ADA) is full integration of people with disabilities into the mainstream of American society. S 1858 is essential to achieving this important national objective.

NAMI believes that we offer a unique perspective on the critical issues of work incentives, income supports, and employment for people with severe mental illnesses, which are brain disorders. NAMI is the nation’s largest organization representing people with severe mental illnesses and their families. Through its 1,140 affiliates and chapters, NAMI represents 185,000 consumer and family members and works to promote greater public understanding of serious brain disorders such as schizophrenia, major depression, bipolar disorder, obsessive-compulsive disorder, and panic disorder. Our major activities include research, education, and advocacy aimed at reducing stigma and promoting independence for people with brain disorders.

NAMI has a strong interest in the issue of work incentives, income supports, and employment for people with disabilities. We share your vision of restoring fairness to the Social Security Administration’s (SSA) disability programs by enabling those who are truly disabled to receive benefits quickly and stopping payments to persons who have fully recovered. Work is extremely important to people with severe mental illnesses and their families. Yet the supports necessary to achieve employment and independence are simply not in place for most people with these brain disorders who want to leave the Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) rolls and join the workforce.

We know that people with severe mental illnesses are the fastest growing population within both the SSI and SSDI programs. More importantly, SSA data reveal that people with mental illnesses are coming on to the disability rolls at an earlier age than their counterparts with other disabilities. Given how difficult it is to get off the rolls through employment – less than 1% successfully do so – it becomes imperative to enact reforms that end the severe penalties for those who are willing to take the tremendous risks inherent in entering the workforce.

Recent studies all demonstrate that there are five principal barriers to the employment of individuals with severe mental illnesses who are SSDI or SSI beneficiaries. These barriers are: 1) the loss of health benefits; 2) the complexity of work incentives; 3) financial penalties of working; 4) lack of choice in employment services and providers; and, 5) inadequate work opportunities. NAMI believes that all of these barriers must be resolved to empower beneficiaries to go to work.

The current SSI and SSDI programs themselves too often serve as barriers to work. While the Work Incentive Provisions of the Social Security Act do make it easier for some people receiving SSI or SSDI payments to go to work, most people with severe mental illness either do not know about, or do not understand, the provisions and therefore do not utilize these work incentives. This is true, both for the so-called SSDI trial-work-period provisions and the SSI 1619(a) and 1619(b) programs. For too many people with mental illness there is a pervasive fear that employment will result in the immediate cut-off of cash benefits and the concurrent loss of critically important medical benefits. NAMI believes strongly that the episodic nature of mental illnesses justifies the need to maintain a basic safety net of assistance for people experiencing acute occurrence of severe symptoms.

Mr. Chairman, as you well know, after certain income disregards, SSI beneficiaries lose 50 cents in benefits for every $1 in labor earnings, or a 50-percent implicit tax rate on earned income. By contrast, SSDI beneficiaries lose access to cash assistance after reaching substantial gainful activity (SGA) for nine months (not necessarily consecutively), plus a three consecutive month grace period. (After losing cash benefits, beneficiaries may have their SSDI benefits restored for any month they don’t work at the SGA level for an additional 36 month period). However, even in cases where people with mental illness decide to use existing Social Security work incentives, they still face the loss of medical coverage even if they are able to retain limited cash benefits after reaching SGA.

The issue of access to medical coverage is absolutely critical to people with serious brain disorders, especially coverage for prescription drugs. This issue generates a high level of concern among NAMI members. Without coverage for high-cost medication and other treatments for disorders such as schizophrenia and major depression, many people find it hard to maintain a stable life in the community, let alone achieve complete independence through employment. Moreover, for many people with severe mental illnesses, the first step in the process toward competitive employment is supported employment or low-wage, service-sector jobs. Few of these opportunities offer employer-provided health insurance, especially insurance that covers someone with a serious brain disorder. And, even when people have access to private health insurance through employment, most of these policies do not provide adequate coverage for treatment of severe mental illnesses.

S. 1858 would begin the process of eradicating these disincentives by addressing head-on the loss of health insurance coverage for people who want to move away from dependence on public programs through work. NAMI strongly supports the goal of making the SSI and SSDI programs more responsive to needs of people with serious brain disorders who want to leave the benefit rolls for employment.

Why does NAMI support S. 1858?

  1. It addresses head-on the issue of extended health coverage in a way that recognizes the unique treatments of people with severe disabilities, including people with severe mental illnesses,
  2. It begins the process of reforming the severe penalties in the SSDI program that wipe out cash benefits just as beneficiaries begin moving toward independence,
  3. It expands individual choice for beneficiaries who need employment and rehabilitation services,
  4. It addresses the overly complicated and often conflicting rules involved in each of these public programs,
  5. It does no harm to those beneficiaries who are either not ready to go to work or who try to work and fail,
  6. It benefits all Americans – taxpayers, employers, and families – by furthering the goals of the Americans With Disabilities Act (ADA) by promoting empowerment and independence.

    1. Extended health coverage
    2. Health security is central to the lives of people diagnosed with a severe mental illness. Without access to coverage for treatment, any attempt to enter the workforce is doomed to failure. Despite all the progress made in scientific research on the brain, we still have no "cure" for diseases such as schizophrenia and manic-depressive illness. Most treatments are palliative in nature; i.e., directed toward control of symptoms that allows an individual to lead a normal life. The most advanced treatment for severe mental illnesses involve medications such as new atypical anti-psychotics and selective serotonin reuptake inhibitors (SSRIs) that are very expensive.

      Even in cases where consumers and their families have access to private health insurance coverage, such coverage often falls short of meeting the real needs of someone diagnosed with a severe and episodic illness such as schizophrenia or bipolar disorder. Many policies still have discriminatory copayments and deductibles or lower treatment limits that can exhaust coverage and resources as a result of a single hospitalization.

      While we are making real progress in rooting out this discrimination – through the federal Mental Health Parity Act of 1996 and the 19 state parity laws across the country – more work needs to be done. The reality is that too many people with severe mental illnesses have been forced onto public disability programs as a result of insurance discrimination. Despite efforts to stay in the workforce, too many consumers are pushed out of their jobs once their health coverage has been exhausted or simply becomes unaffordable. Once coverage for essential treatment is gone, consumers are faced with no alternative but to go into poverty to qualify for Medicaid.

      The need to spend down resources to qualify for Medicaid results not only from the disability and poverty, but also because Medicare (available to SSDI beneficiaries after 24 months) does not include an outpatient prescription drug benefit. This gaping hole in the Medicare program is a major concern for NAMI in trying to reform these programs. Consumers and their families should no longer be forced to go into poverty to ensure continued access to treatment and some measure of income security. The problems associated with the mental illness benefit within Medicare are also the reason that so many adults with severe mental illnesses are now "dual eligible" for both SSI and SSDI.

      S 1858 addresses these issues head-on by extending Medicare coverage and allowing states the option to make outpatient prescription drug coverage available to SSDI recipients who are ready to enter the workforce. More importantly, it will "catch people on the way down" by filling the gaps in both private plans and Medicare so that people will not have to permanently leave employment and go into poverty to ensure health security. This is a critical protection for persons living with an episodic illness of the brain that too often fails to follow a predictable course.

    3. Reforming the SSDI "cash cliff"
    4. S 1858 requires Social Security to conduct a demonstration of a sliding-scale reduction in SSDI cash benefits. This study is critically important for moving us toward an income security system that meets the needs of SSDI beneficiaries in the 21st century. NAMI believes that the ultimate solution to the problem of the "cash cliff" in the SSDI program is a "2 for 1" cash offset for earnings above SGA. Under current law, SSDI beneficiaries earning above the artificially low SGA level can lose eligibility for cash benefits all at once. This barrier to work strikes consumers just at the point when they are beginning to achieve the rewards of work and independence. It sends a terrible message to consumers and their families when case managers and Social Security field office staff tell consumers that they are better off quitting their part-time job or severely cutting back their hours.

      The time is now to put in place a sliding scale "2 for 1" offset that gradually reduces benefits as earnings rise. Such a system would reward, rather than penalize, work. NAMI is deeply troubled that Congress has been prevented from enacting this fundamental reform because of concerns about the budgetary impact of such a change in federal policy. It is important to note that these estimates, in NAMI’s opinion, are based not on a careful evaluation of data generated from actual experience of declining cash assistance on a sliding scale basis. Rather, these estimates appear to be based on untested assumptions regarding "induced entry" or "woodworking" among persons not currently in the SSDI program. NAMI believes that assumptions about the behavior of workers under a reformed SSDI work incentive program are simply invalid.

      The experience of NAMI’s consumer and family membership is clear: there is no way that otherwise eligible consumers would leave the workforce for a period as long as 36 months (the duration of the disability determination process for many consumers) to eventually take advantage of sliding-scale cash benefits. The experience of the 1619(a) and 1619(b) programs bears this out. NAMI is confident that a properly designed "2 for 1" offset demonstration program will reveal that the fiscal burden is minimal and probably a benefit to taxpayers in the long run.

    5. Promoting consumer choice through the "ticket to independence"
    6. It is NAMI’s understanding that the sponsors of S 1858 intend to add the "ticket to independence" contained in HR 3433 to the bill that passed the House on June 4 by a margin of 410 to 1. NAMI applauds this decision. Giving individuals a return-to-work ticket and placing them in control of their own return-to-work plan will be putting consumers in the driver’s seat for the first time. Providers will be forced to compete for business on the basis of how well they meet the individual needs of consumers. State VR agencies will no longer be in control of the resources that are directed towards helping people with disabilities achieve work and independence.

      With a ticket program, individuals will be able to skip the laborious testing and assessment process within state VR programs. By receiving a ticket directly, consumers will be able to select a provider on the basis of their relative experience in serving people with severe mental illnesses and their record in placing them in jobs. Moreover, extending payments to providers for up to 60 months, based upon whether a consumer stays in the workforce, will result in increased access to support and follow-up services in the workplace. By contrast, the current public VR system abandons clients after a few short months on the job. NAMI urges that Congress resist any effort to remove from the bill the provisions repealing a) priority referral by Social Security to state VR agencies and b) benefit deductions for persons refusing to accept VR services. While the ticket program will not fix every problem in the current system, when coupled with extended health coverage, it offers a positive step forward.

    7. Simplifying the process for consumers and families
    8. One of the most common complaints among NAMI members regarding the current work incentive structure is the Social Security bureaucracy. When trying to get straight answers about one’s own benefits and possible opportunities for work incentives (including PASS), consumers often find that SSA field offices and headquarters staff give conflicting and confusing answers. No doubt, this flows from the complexity of the programs, especially in the case of PASS and 1619(a) and (b) for SSI beneficiaries. However, this complexity does not excuse wrong or misleading answers to basic questions and the (too often) complete lack of effective counseling about what the real options are. Putting work incentive specialists in SSA field offices will go a long way toward helping consumers cope with this new program. More importantly, these work incentive specialists should not be employees of SSA so that the advice they give consumers is independent and free of the biases that we often see in SSA field staff.

    9. Beneficiary protections
    10. NAMI feels strongly that any legislation designed to reform the current SSA work incentive programs should first ensure that it does no harm to vulnerable beneficiaries with severe mental illnesses and other severe disabilities. No individual with a severe mental illness who is receiving SSDI or SSI should have his or her benefits jeopardized by the passage of this bill. The current bill contains important protections ensuring that persons who take the risk and go to work will not be subject to an unscheduled continuing disability review (CDR). The reality is that there are many people with mental illnesses who are currently part of the SSI and SSDI programs who are experiencing symptoms that are so severe that they cannot be reasonably expected to enter the workforce over the short-term. They should not be forced to participate in a work incentive program until they are ready.

Likewise, participation in this program should not be used as evidence that an individual no longer meets the standards of eligibility for SSI or SSDI. Participation in this program should operate independently of the current CDR requirement for beneficiaries, both in terms of timing and the evidentiary standard for future eligibility. Finally, NAMI urges that protections be added to both the ticket and healthcare pieces of this legislation to ensure that consumers can seamlessly move on and off of these programs. The episodic nature of serious brain disorders such as schizophrenia, manic-depressive illness and major depression dictates that these programs be flexible enough to accommodate consumers who may experience severe, though brief, episodes of acute illness.

6.  Benefits all Americans

S 1858 sets the stage for important improvements in SSA’s disability programs that will enable SSDI and SSI beneficiaries to work to the greatest extent of their abilities. It is important for SSA disability programs to begin the process of evolving from their original purpose of serving as early retirement programs for injured workers. They must start moving toward including a new purpose of supporting individuals with disabilities in the workforce. In this way, SSA’s disability programs can be transformed from a safety net into a trampoline, not only catching people with disabilities as they fall out of work, but also giving them a boost back into work when they are ready.

This legislation has the potential to be a win-win situation for all Americans. It benefits beneficiaries by enabling them to return to or enter the workforce as wage earners. It benefits employers by adding skilled workers to the labor pool. It benefits employment service providers by enabling them to serve more participants. Finally, it benefits taxpayers by assisting workers with disabilities to begin, or continue, paying taxes.

Mr. Chairman, millions of people like me who live with a serious brain disorder are able to work and be productive. We are taxpaying members of our communities. With access to effective treatment through healthcare coverage, people with severe mental illnesses who are on the SSI and SSDI rolls can move toward greater independence.

Unfortunately, the current structure of the system, including both the pervasive work disincentives in the SSDI program and the unresponsive nature of the state-federal VR program, make work a frequently unachievable goal. Put simply, the current system is hostile toward work for people who can and want to work, but whose disability prevents them from moving rapidly and permanently to full employment. More importantly, the system has the perverse effect of trapping people in poverty. The status quo cannot remain in place if we are to achieve the important national goal of full participation and integration into the mainstream of American society for all people with disabilities. Finally, work and independence are also vital to our ongoing efforts to eradicate the stigma that is so closely associated with severe mental illnesses. Passage of S 1858 will continue the path of progress Congress established with the ADA and the MHPA.

Thank you for this opportunity to share NAMI’s views on this important legislation.