Vocational Rehabilitation on the Road to Social Security Disability

Vocational rehabilitation (VR) can potentially help disability-insured workers stay at work or return to work when they experience a disability. Such assistance could prevent or delay entry into the Social Security Disability (SSD) program. We present descriptive statistics on the extent to which new VR applicants for 1998 through 2005 receive SSD benefits before or after VR application. We matched Rehabilitation Services Administration (RSA-911) records for the years 1998 through 2009 with the Social Security Administration’s program and earnings files. The analyses show that a substantial number of VR applicants entered SSD in the 60 months following VR application—more than 60,000 (12.3 percent) of the first-time VR applicants in 2002. The analyses also disclose variation in SSD entry across states, with some states accounting for entry percentages twice as high as that of others. We also found a positive relationship between our measure of wait time and entry into SSD. Although the large number of VR applicants entering SSD after VR application is modest compared to the number receiving an SSD award each year, the potential influence of VR services on later SSD and Medicare expenditures could be in the billions of dollars annually, in either direction.