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Meeting of the Board of Regents | October 2009

Thursday, October 1, 2009 - 8:30am

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Rebecca H. Cort


Vocational Rehabilitation Cost Containment Update


October 1, 2009


Goals 1, 2 &  4





Issue for Discussion

The Board will be presented information and will discuss the cost containment strategies being implemented by VESID in response to an unprecedented increase in the number of individuals participating in the Vocational Rehabilitation (VR) program.


Reason for Consideration


To inform the Regents and obtain their support for actions being taken that will enable VESID to meet its priorities and goals related to employment of individuals with disabilities in New York State and its commitment to closing the employment gap between individuals with disabilities and their non-disabled peers.

Proposed Handling

The item will come before the VESID Committee at its October 2009 meeting for discussion.

Procedural History

The Rehabilitation Act requires the Board of Regents to submit an annual Amendment to the State Plan outlining the goals, priorities and objectives in providing vocational rehabilitation and supported employment services to individuals with disabilities in New York State.  The Board of Regents approved the Amendment to the State Plan for FFY 2010 at its May 2009 meeting.  The Plan was submitted to the U.S. Department of Education in June and approved in September 2009. 

Background Information:

This report provides a brief summary of cost containment strategies which will enable VESID’s Vocational Rehabilitation (VR) Program to provide services to all individuals with disabilities who are eligible for the VR Program in accordance with the requirements of the Rehabilitation Act, the primary source of federal funding for the program.  In order to be in compliance with the requirements necessary to obtain VR funds through the Rehabilitation Act, the Board of Regents must affirm in the State Plan for Vocational Rehabilitation and Supported Employment Services that it can serve all eligible individuals.

The significant downturn in the economy combined with the success of VESID’s new vocational rehabilitation initiatives over the past two years have resulted in an unprecedented increase in the number of individuals participating in the VESID VR Program.  As the number of individuals served increases, so do the costs for services, including assessment, vocational training programs, college tuition, and rehabilitation technology.  These increased costs outpace growth in annual revenue.  For the next two years, the vocational rehabilitation dollars included in the ARRA Stimulus Package will partially mitigate this situation. However, the short-term nature of this increase may result in the need for significant cutbacks in future services if immediate action is not taken. 

Cost containment strategies are implemented in order to manage the budget without severely restricting services.  The Rehabilitation Act requires State VR programs to attest in their State Plan that they have the fiscal and staff resources to serve all eligible individuals in the State.   If the VR Program cannot serve all eligible individuals, it must, under Federal regulations, declare an order of selection and only serve individuals with the most significant disabilities.  All other eligible individuals would be placed on a waiting list for services.    If VESID were forced to adopt an Order of Selection policy, it would significantly reduce our ability to serve individuals with mild and moderate disabilities.  It would also negatively affect our performance indicators, especially employment outcomes.  To avoid this situation, VESID is taking immediate action to contain costs while sustaining its commitment to quality services leading to employment.


              At the end of August 2009, VESID’s 330 qualified VR counselors were serving over 70,000 individuals with disabilities across the State.  This is an increase of almost 7,000 individuals since August 2008, with fewer VR counselors due to the hiring freeze.   This increase in individuals receiving services further increases the overall expenditures for assessment, training, college study, rehabilitation and other VR services, requiring VESID to implement cost containment strategies. To limit the continued escalation of expenditures, VESID made the following changes in vocational rehabilitation policies in the areas discussed below. 



Postsecondary Training:

              In April 2007, VESID implemented a College and University Training Policy that lifted many funding restrictions that had been imposed in 2003.  VESID’s goal was to improve the quality of employment outcomes through higher education.  The April 2007 Policy allowed VESID to pay full public college (SUNY/CUNY) tuition and all required fees for individuals who met the economic need criteria.   At that time, we also made books available up to $550 per semester without regard to any economic need.   Previously, books were based on economic need and limited to $250 per semester.  These changes, along with increased outreach to high schools and colleges, led to significant increases in expenditures for college study under the VR program.  To sustain this policy goal and to control costs, VESID determined that it must make changes in the college policy in order to continue to meet the increased demand for college sponsorship.


  • All college services, including “required textbooks and materials,” are now subject to VESID’s economic need policy.  VESID will continue to contribute up to the maximum SUNY/CUNY or community college rate for tuition.


  • Private college funding is limited to the comparable 2 or 4 year public college tuition rate.


  • Fees are limited to $300 per academic year, $150 per semester or $100 per trimester.


  • Available financial aid must be applied to all direct college costs, including required textbooks and materials.            


Training at Vocational and Business Schools:

              In 2003, VESID also imposed a cost containment provision on Vocational Training programs, paying only 80 percent of the actual costs.  Again, in 2007, this restriction was lifted and VESID was able to pay full costs of vocational training programs for individuals who met economic need.   This change in policy also resulted in significant increases in expenditures which are no longer sustainable.  As a result, the following limits were placed on vocational training effective June 1, 2009:


  • VESID may contribute up to a maximum program tuition of $10,000.


  • Fees are limited to $300.


  • Required textbooks and materials are subject to VESID’s economic need policy.


In addition to these changes in postsecondary policies, VESID will train all supervisory staff on consumer involvement in developing cost effective training options.  This training is tentatively scheduled for December 2009.  

Another cost containment strategy relates to the implementation of the Unified Contract Services (UCS) contracts with community rehabilitation programs.   In order to contain costs in the VR Program, VESID has taken the following actions:


  • Provided specific guidance on effective evaluation services and limited multiple evaluations unless necessary;


  • Clarified differences between standard testing and more costly specialized testing;


  • Established guidelines for procurement of services to minimize the impact of over obligating funding; and


  • Developed key indicators to assist in performance measures.


VESID also continues to work closely with the Commission for the Blind and Visually Handicapped (CBVH), the Office of Mental Retardation and Developmental Disabilities (OMRDD) and the Office of Mental Health (OMH) in carrying out its responsibilities related to the supported employment program under Chapter 515 of the Laws of 1992.  VESID and its partner agencies are reviewing the implementation of the current Memorandum of Understanding on Supported Employment and examining how our interagency collaboration can be reinvigorated to build capacity, maximize resources and achieve more quality outcomes for individuals with most significant disabilities.


The Board of Regents support VESID’s implementation of these cost containment strategies while maintaining its commitment to the highest quality vocational rehabilitation services.

Timetable for Implementation

With Regents support, VESID will sustain its commitment to serve all eligible individuals and will allocate resources critical to closing the employment gap for individuals with disabilities in New York State and meeting the priorities and goals established in the FFY 2010 State Plan for Vocational Rehabilitation and Supported Employment Services.