On June 28,2007, Senators Gordon Smith [D-OR], Kent Conrad [D-ND], Debbie Stabenow [D-MI], Susan Collins [R-ME], and Olympia Stowe [R-ME] introduced the Pathways to Independence Act of 2007, which would permit states to receive credit towards the work requirements under the Temporary Assistance for Needy Families [TANF] program for recipients who have a disability.

On June 29, 2006, the Department of Health and Human Services [HHS] issued an interim final rule implementing key provisions of the Deficit Reduction Act [DRA], including new definitions of work participator activities. Under these new regulations, mental health treatment, addictions treatment , and domestic violence services are classified as a TANF job readiness /job search activity, with a six-week time limit, with a limit of four consecutive weeks, on the amount of treatment that may count toward an individual’s TANF work requirement. States have expressed concern about reaching their TANF targets under the proposed rules, an outcome that could cost states millions in TANF aid.

The Pathways to Independence Act of 2007 would adjust the federal work participation requirements to give states greater flexibility to address the needs of individuals with disabilities and to help move them into the workforce. Under the bill, states would be allowed to:

Develop modified employability plans, including modifications to work activities and/or hourly participation requirements, for TANF recipients who have been determined to have a disability or to be caring for someone with a disability;

Excludes two groups of people with severe disabilities from TANF’s work participation rates: 1] people with a pending application for Supplemental Security Income [SSI], if the state has made a determination that the individual’s disability is severe enough to qualify for SSI; and 2] people with severe temporary disabilities- such as complications related to pregnancy or recovery from serious surgery- that make it impossible in the short term for them to meet the work requirements; and

Provide a detailed annual report to HHS explaining how they used this flexibility. HHS must also provide Congress with a summary of the impact of the provision every year.

The National Council has worked in coalition to advocate for this bill. Other coalition partners include the Alliance to End Homelessness and the Legal Action Center.

In related news, at a recent joint meeting on TANF hosted by the Substance Abuse and Mental Health Service Administration [SAMHSA] and the Administration for Children and Families [ACF], Daniel C. Schneider, Acting Assistant Secretary for ACF, reported that ACF had finished its review of the final TANF regulations. The regulations are currently being circulated for the rest of the review process, and Schneider estimated that the final regulations may not be issued until the end of 2007. Meanwhile states must operate under the interim final rules.

On Wednesday, the Senate approved a three month extension of the Transitional Medical Assistance [TMA] program, which prevents the sudden loss of health coverage for poor families as their incomes increase. The bill [S1701], introduced by Senator Max Baucus [D-MT], was passed by voice vote.

The TMA program, designed to ease the transition from welfare to work by allowing families to continue their medicaid coverage for up to four months as their income levels rise above the normal qualification ceilings, is set to expire June 30. The Senate bill extends this program through the end of FY 2007.

According to a Senate aide quoted in the Congressional Quarterly, the House is likely to pass similar legislation before the July 4 recess.