U.S. Commission on Civil Rights

Employment Rehabilitation Services in Michigan

Findings and Recommendations

Each year this Nation spends billions of dollars to rehabilitate persons with disabilities. In Michigan these efforts are directed by two agencies: the Michigan Jobs Commission, Rehabilitation Services (MJC RS), and the Michigan Commission for the Blind (MCB). The objective of these services is employment. To be eligible for MJC RS or MCB services, a client must need vocational rehabilitation services in order to be employable.

This study by the Michigan Advisory Committee to the U.S. Commission on Civil Rights examined whether persons with disabilities who wished to receive rehabilitation services faced limiting factors on the availability and quality of services as a result of severity of disability, race, or ethnicity. In this chapter the Advisory Committee sets out its findings and recommendations. The findings and recommendations are collected in four parts: (1) rehabilitation services on the basis of disability, (2) rehabilitation services to racial and ethnic minorities, (3) funding, and (4) Federal Government impediments.

1. Rehabilitation Services on the Basis of Disability

Finding 1.1. Multivariate Analysis of the Equal Provision of Service Regardless of the Severity of Disability. MJC RS codes severity of disability under seven codes; one code is for undiagnosed severity, one code is for not severe, and the other five codes are different codes for severe. Within the records examined by the Advisory Committee, 97.5 percent of the coded records listed the client s disability as severe.

To confirm that the MJC RS provides equal service regardless of the severity of disability, multivariate analyses were planned with competitive employment and salary the dependent variables. The severity of disability, cost of services, race, age, ethnicity, education, months of rehabilitation, and types of services provided were planned to separately and interactively be the explanatory, or independent, variables.

As no clear delineation is made by the MJC RS between most severe and severe, and the number of clients classified as not severe is too small for valid statistical analysis, the current format of the MJC RS data set does not allow for an analysis of service on the basis of severity of disability. Further, an examination of recent RSA audits of the MJC RS reveals that analyses of the equal provision of service on the basis of severity of disability are not routinely done by Federal monitors.

Recommendation 1.1. The Rehabilitation Services Administration of the U.S. Department of Education should request that the MJC RS amend its coding system in order to classify clients as most severe, severe, and not severe. Doing so will allow for enhanced internal and external independent evaluation of compliance with the Rehabilitation Act Amendments of 1992, which mandate that priority in service be provided to individuals with the most severe disabilities.

The Committee further recommends that the Rehabilitation Services Administration of the U.S. Department of Education conduct a multivariate analysis to determine whether MJC RS and other State agencies provide service regardless of the severity of disability.

Finding 1.2. Service Rationing. The Rehabilitation Act Amendments of 1992 mandate that services be provided first to those individuals with the most severe disabilities, then (as resources allow) to those less severely disabled. This is referred to as an order of selection. To implement the act, States are obligated to determine what disabilities meet the standard of most severe.

The MJC RS does not use an order of selection. All individuals who wish to receive rehabilitation services in order to obtain employment are given services by the MJC RS. Based upon the information presented to the Advisory Committee, individuals with the most severe disabilities are not being excluded from rehabilitation services to the benefit of individuals with less severe disabilities.

However, because no clear delineation is made by the MJC RS between most severe and severe, and the number of clients classified as not severe is too small for valid statistical analysis, the current format of the MJC RS data set does not allow for an analysis of service rationing on the basis of severity of disability.

Recommendation 1.2. As in recommendation 1.1, the Rehabilitation Services Administration of the U.S. Department of Education should examine the MJC RS coding system under which virtually every client is classified as severe, and determine if the coding system used by the MJC RS is in compliance with Federal law.  The enforcement of a coding system that distinguishes clients as most severe, severe, and not severe will allow for enhanced internal and external independent evaluation of compliance with the Rehabilitation Act Amendments of 1992, which mandate that priority in service be provided to individuals with the most severe disabilities.

Finding 1.3. Employment Outcome and Severity of Disability. In terms of service provided, the Rehabilitation Services Administration of the U.S. Department of Education reports that individuals in Michigan with severe disabilities achieved competitive employment through the MJC RS at a rate of 91.4 percent compared with the proportion of all rehabilitants in the MJC RS system who obtained employment. Since individuals with less severe disabilities may require fewer services and have a greater degree of independence in seeking employment than those with severe disabilities, this suggests that the MJC RS does provide the necessary services required to reach an employment outcome regardless of the severity of disability.

Recommendation 1.3. As in recommendations 1.1 and 1.2, the Rehabilitation Services Administration of the U.S. Department of Education should examine the MJC RS coding system under which virtually every client is classified as severe, and determine if the coding system used by the MJC RS is in compliance with Federal law.  The enforcement of a coding system that distinguishes clients as most severe, severe, and not severe will allow for enhanced internal and external independent evaluation of compliance with the Rehabilitation Act Amendments of 1992, which mandates that priority in service be provided to individuals with the most severe disabilities.

Finding 1.4. Determination of Client Universe. The last study conducted by the MJC RS to determine the number of individuals needing rehabilitation services was completed in the 1980s. That study mirrored a previous study by the University of Michigan, and indicated that 600,000 to 660,000 individuals in the State met the test of the requirements of the act and that of those, 175,000 individuals not only met the test but were interested in receiving services from the State rehabilitation agency. The number, 175,000, is a fixed point estimate. This means those studies assert that, although on a rotating basis different individuals are entering and leaving the MJC RS system, the set of people in the State requiring rehabilitation services remains at 175,000. 

In fiscal year 1997 the number of persons with disabilities served by MJC RS was 40,292, and it is estimated the annual maximum number of individuals that can be served by the MJC RS is 50,000. The difference between 175,000 persons needing services and the 50,000 who can receive services is 125,000 persons. These studies suggest a significant gap between those receiving rehabilitation services and those needing such services.

Recommendation 1.4. The Advisory Committee recommends that the MJC RS undertake a new study to determine the number of individuals needing rehabilitation services. If a new study confirms a significant gap between the number needing rehabilitation services and the number receiving services, then that information needs to be plainly set before the public and State officials so that those responsible for funding priorities are accountable for their decisions and a covert system of service rationing does not infect the MJC RS service delivery system because of inadequate funding.

If the dollars are not adequate to meet the need, State officials need to acknowledge the public policy principles to be used to guide how the dollars are distributed and to whom those dollars are directed. 

Finding 1.5. Typecasting. The Advisory Committee did not learn of any information supporting an allegation that MJC RS placement counselors engaged in type casting, i.e., predetermining that individuals with certain disabilities were limited to perform only certain kinds of work.

Recommendation 1.5. Again, as in recommendations 1.1, 1.2, and 1.3, the Rehabilitation Services Administration of the U.S. Department of Education should examine the MJC RS coding system under which virtually every client is classified as severe, and determine if the coding system used by the MJC RS is in compliance with Federal law. The enforcement of a coding system that distinguishes clients as most severe, severe, and not severe will allow for internal and external independent evaluation of whether clients are being typecasted. 

2. Rehabilitation Services to Racial and Ethnic Minorities

Finding 2.1. National Estimates of Minorities Requiring Rehabilitation Services. Of the estimated 13,420,000 working-age Americans with disabilities, African Americans account for 22 percent and Hispanics for 7.5 percent, while Asian Americans and American Indians are 2.5 percent of rehabilitation service clients. The incidence of disability disproportionately affects the minority population.

Finding 2.2. Service Outcome and Minorities. According to the most recent audit of the MJC RS by the Rehabilitation Service Administration of the U.S. Department of Education, the MJC RS had a rehabilitation rate of 62.1 percent for all cases identified as severe in fiscal year 1995. By comparison, African Americans with a severe disability achieved a rehabilitation rate of only 53.3 percent, and Native Americans with a severe disability had a rehabilitation rate of only 49.2 percent.

According to the U.S. Department of Education, since the difference of the African American rate from the mean rehabilitation rate is within 10 percentage points, the difference is considered acceptable, though the Department acknowledged that the difference still represented a significant number of customers who are achieving at less than the average rate. The differential rate of service outcome for Native Americans was considered significant by the U.S. Department of Education. 

Recommendation 2.2.  The Rehabilitation Services Administration of the U.S. Department of Education should revise its methodology for determining whether a particular minority group receives a lower service outcome. Instead of using a fixed percentage differential for determining acceptability ranges, the Committee recommends the implementation of a scientifically based statistical test.

Finding 2.3. Test for a Relationship between Race/Ethnicity and Case Status. The Advisory Committee tested for a relationship between MJC RS clients race and ethnic minority status and the case status of the client, e.g., closed're habilitated, closed not rehabilitated, services interrupted, etc. It was found that race and ethnicity and the status of a case were not related. That is, the race and/or ethnicity of a client is independent of the particular status of a case. The analysis suggests that the ultimate delivery of service by the MJC RS is statistically proportionate along racial and ethnic lines.

Finding 2.4. Types of Services Provided and Minorities. The Advisory Committee tested for a relationship between the race and ethnicity of a MJC RS client and the types of services provided to the client, e.g., diagnostics, college financial aid, transportation, etc. It was found that race and ethnicity and the types of services provided were not independent. That is, there is a statistically significant relationship between an individual's race and/or ethnicity and the receipt of specific rehabilitation services.

Recommendation 2.4. The Advisory Committee recommends that the U.S. Department of Education and/or the MJC RS undertake an internal study to determine whether the observed disparity in services offered to minorities is racially and ethnically biased or based upon other factors.

Finding 2.5. Outreach to Minorities. The U.S. Congress, through its authorizing legislation, has recognized that minorities historically did not have the same access to rehabilitation services as did the majority population, and has required specific outreach efforts to the minority community. There is a need for most service organizations to become more culturally competent with respect to the delivery of services to minority communities.  

Service delivery systems, to be effective, must be delivered in a way that considers and is responsive to the populations they serve. Issues of staffing awareness,  training and development, out're ach, and policy development all relate to making institutional systems more culturally competent with the clear intent of providing equitable services to minority populations. To this end all MJC RS staff have received training in cultural diversity awareness, MJC RS has developed and implemented a multicultural policy, and the agency has undertaken deliberate efforts to increase its numbers of minority employees.

In addition, the MJC RS has established a Minority Issues Committee to bridge the successful outcome gap that exists between the minority and majority client populations. No evidence was presented to the Committee, however, demonstrating that outcomes and equal access to rehabilitation services along racial and ethnic lines were being quantitatively evaluated by the Minority Issues Committee.

Recommendation 2.5. In order to ensure that minority individuals receive services in an equitable manner, outcomes and access to services need specific attention and monitoring. If programs are not monitored for equity in terms of outcomes, equity in both access to service and in receipt of service cannot become a reality.

The Committee recommends that some internal ombudsman within the MJC RS be given responsibility for monitoring outcomes and services with respect to equity along racial and ethnic lines. We further recommend that this ombudsman and/or the MJC RS Minority Issues Committee employ monitoring procedures that incorporate scientifically based statistical tests to routinely analyze whether there is a relationship between the estimated minority community requiring rehabilitation services and the actual services provided by the MJC RS to the minority community.

3. Funding

Finding 3.1. The Use of Local Funding for the State Match. The Rehabilitation Act of 1973, as amended, authorizes more than $2 billion in Federal support for the training and placement of persons with mental and physical disabilities into full-time, part-time, and supported employment. The program is a joint State and Federal effort, with the Federal Government providing 80 percent of the funding to State vocational rehabilitation programs, and States providing the remaining 20 percent.

The annual budget for MJC RS in fiscal year 1997 was $89,150,744. The State agency receives 80 percent of its funding from the Federal Government, through grants under title I of the Rehabilitation Act of 1973 ($65,834,659), Social Security Administration funds ($1,845,775), or other Federal funding sources ($3,459,699). The State provides only 10 percent of the agency's funding ($9,531,180), with local funding accounting for the additional matching funds.

Since the MJC RS, out of its general fund of appropriated dollars from the State legislature, is unable to earn the full Federal matching allotment reserved for Michigan under the formula that distributes the dollars among the States, the agency has increasingly been required to find community partners capable of putting up local dollars and substitute for dollars that up to a decade and a half ago were matched fully by the Michigan Legislature.

The MJC RS has released to the public the office area recipients of all rehabilitation funding within the State. That data indicate the agency is moving in a direction of funding equity among all geographic areas in the provision of rehabilitation services.

Recommendation 3.1. The use of local matching money to substitute for funds formerly appropriated statewide by the State legislature needs serious scrutiny. Clearly, less affluent communities are less able to provide matching funds for rehabilitation services. Hence, less affluent communities in the State are at risk for a disproportionately lower share of rehabilitation service resources. Where these areas are also communities of color, then the funding becomes disproportionate not only along wealth and class lines, but also along racial and ethnic lines.

The Rehabilitation Services Administration of the U.S. Department of Education needs to attend to this issue. In particular, insofar as the Rehabilitation Act Amendments of 1992 specifically addresses the issue of minority outreach, it is incumbent upon the RSA as part of its monitoring process of the MJC RS to ensure that the use of matching funds does not result in disparities of service along racial and ethnic lines. 

4. Federal Government Impediments

Finding 4.1. Definition of Disability. The Rehabilitation Act of 1986 amended the definition of a severe handicap to include functional as well as categorical criteria. In addition, a definition of employability was inserted in the act for the first time, to clarify that part-time work is a viable outcome of rehabilitation services. Under the act, an individual with a disability means any individual who:

(a) has a physical or mental impairment that constitutes or results in a substantial impediment to employment; and
(b) can benefit in terms of an employment outcome from vocational rehabilitation services. . . .[1]

An individual with a significant disability means an individual with a disability who:

(i) has a severe physical or mental impairment which seriously limits one or more functional capacities (such as mobility, communication, self-care, self-direction, interpersonal skills, work tolerance, or work skills) in terms of an employment outcome;
(ii) whose vocational rehabilitation can be expected to require multiple vocational rehabilitation services over an extended period of time; and
(iii) who has one or more physical or mental disabilities resulting from amputation, arthritis, autism, blindness, burn injury, cancer, cerebral palsy, cystic fibrosis, deafness, head injury, heart disease, hemiplegia, hemophilia, respiratory or pulmonary dysfunction, mental retardation, mental illness, multiple sclerosis, muscular dystrophy, musculo-skeletal disorders, neurological disorders (including stroke and epilepsy), paraplegia, quadriplegia, and other spinal cord conditions, sickle cell anemia, specific learning disability, end-stage renal disease, or another disability or combination of disabilities determined on the basis of an assessment for determining eligibility and vocational rehabilitation needs described in subparagraphs (A) and (B) of paragraph (2) to cause comparable substantial functional limitation.[2]

The Federal statute defining severely disabled individuals is nebulous, resulting in inconsistent and different interpretations of severity depending upon the particular State, agency, and counselor, with the result that different States will have different definitions of disability.

The fact that within the records examined by the Advisory Committee 97.5 percent of the coded records listed the client's disability as severe is evidence that current Federal rules and guidelines do not provide precision, clarity, and uniformity in defining disability.

Recommendation 4.1. The Committee recommends that the Rehabilitation Services Administration of the U.S. Department of Education reexamine and reclassify the disability definitions and distinctions, and provide clear guidance on the interpretation of the definition of disability. The absence of clear and precise disability definitions and distinctions precludes a valid and reliable foundation for examining services to those needing rehabilitation services under the priority of service mandated by the Rehabilitation Act Amendments of 1992. In addition, the absence of clear and precise disability definitions and distinctions at the Federal level may impede and/or prevent full-service delivery to individuals requiring rehabilitation services who move from one State to another State.

Finding 4.2. Social Security and Medicare Barriers to Employment. Individuals who earn more than $500 a month ($1,050 if blind) lose social security disability benefit payments and government health care. This Federal rule has a severe impact on employment opportunities for individuals with disabilities.

Recommendation 4.2. The wooden requirement of eliminating income maintenance payments to individuals with disabilities who earn more than $1,050 a month discourages the individual from seeking productive full-time employment. Federal rules should be amended to provide for graduated benefit reductions, similar to that provided social security recipients. That would allow individuals to obtain Social Security Insurance while holding certain minimal levels of employment and to stay on medicare if they so desire, particularly for items such as prescription drugs and medically related supportive services.

Legislation has been proposed in the U.S. Congress to remedy this problem: (1) S. 331 in the U.S. Senate and (2) H.R. 1180 in the U.S. House of Representatives. The Michigan Advisory Committee supports both pieces of legislation.[3]