Administration and Policy in Mental Health and Mental Health Services Research

, Volume 41, Issue 1, pp 69–73

Making the Case for IPS Supported Employment


    • Dartmouth Psychiatric Research Center, Geisel School of Medicine at Dartmouth
    • Dartmouth Psychiatric Research Center, Rivermill Commercial Center
  • Robert E. Drake
    • Dartmouth Psychiatric Research Center, Geisel School of Medicine at Dartmouth

DOI: 10.1007/s10488-012-0444-6

Cite this article as:
Bond, G.R. & Drake, R.E. Adm Policy Ment Health (2014) 41: 69. doi:10.1007/s10488-012-0444-6


Individual Placement and Support (IPS) is an evidence-based practice for helping people with severe mental illness (SMI) gain competitive employment, yet those who could benefit often find it difficult to obtain IPS services. We summarize the evidence supporting the effectiveness of IPS and the benefits of working, discuss the barriers to implementing IPS in the U.S., and suggest policy changes that could expand its access.

Here are The Facts

Most People with SMI Want to Work

Approximately 65 % of people with SMI in the U.S. public mental health system endorse employment as a goal (Bedell et al. 1998; Frounfelker et al. 2011; McQuilken et al. 2003; Mueser et al. 2001; Ramsay et al. 2011; Rogers et al. 1991; Watkins et al. 2011; Woltmann 2009). Meanwhile, only about 15 % are employed (Lindamer et al. 2003; Pandiani and Leno 2012; Perkins and Rinaldi 2002; Rosenheck et al. 2006; Salkever et al. 2007). The 65 versus 15 % gap represents an enormous unmet need.

We Know How to Help People With SMI Work Competitively

IPS is a highly effective approach to vocational rehabilitation for this population (Becker et al. 2011a). IPS incorporates eight principles: eligibility based on consumer choice, focus on competitive employment (i.e., jobs in integrated work settings in the competitive job market at prevailing wages with supervision provided by personnel employed by the business), integration of mental health and employment services, attention to client preferences, work incentives planning, rapid job search, systematic job development, and individualized job supports (Drake et al. 2012a). Several systematic reviews conclude that IPS enhances vocational outcomes (Bond 2004; Bond et al. 2008a; Burns et al. 2007; Crowther et al. 2001; Dixon et al. 2010; Twamley et al. 2003). About two-thirds of IPS participants succeed in competitive employment, typically working 20 h or more per week (Bond et al. 2012a) and sustaining employment for years (Becker et al. 2007b; Salyers et al. 2004). IPS helps people with different diagnoses, educational levels, ethno-racial backgrounds, and prior work histories (Campbell et al. 2011); long-term Social Security beneficiaries (Frey et al. 2011); young adults (Bond et al. 2012b; Rinaldi et al. 2010); older adults (Twamley et al. 2012); veterans with post-traumatic stress disorder (Davis et al. 2012); and people with co-occurring mental illness and substance use disorders (Mueser et al. 2011).

Work Improves Well-being

People who obtain competitive employment through IPS enhance their income, self-esteem, quality of life, social inclusion, and control of symptoms (Bond et al. 2001; Burns et al. 2009; Kukla et al. 2012; Mueser et al. 1997; Turner et al. 2012). These enhancements to well-being persist at 10-year follow-ups (Becker et al. 2007b; Salyers et al. 2004). People with SMI often report that IPS is good treatment and central to their recovery (Bailey 1998; Becker et al. 2007b; Strickler et al. 2009).

IPS is Cost-effective

SMI is a leading contributor to the global burden of disease (Drake et al. 2012b; World Health Organization 2001), and in the U.S. people with SMI constitute the largest and fastest-growing group of Social Security disability beneficiaries (Danziger et al. 2009; McAlpine and Warner 2000). Including lost productivity, the total social cost of SMI is enormous (Drake et al. 2009; Hu 2006; Kessler et al. 2006; Knapp et al. 2004; Lim et al. 2001; Livermore et al. 2011; Salize et al. 2009; Wu et al. 2005).

By contrast, the annual cost of IPS averages only $5500 per client in 2012 dollars (USD) (Latimer et al. 2004; Salkever 2011). Further, employment leads to decreased mental health costs (Bond et al. 1995; Burns et al. 2009; Clark 1998; Henry et al. 2004; Latimer 2001; Perkins et al. 2005; Rogers et al. 1995; Schneider et al. 2009). Long-term cost reductions appear to be even greater (Bush et al. 2009). Thus, we have a cost-effective solution.

Here is the Problem

Working-age Adults with SMI Rarely Have Access to IPS

Despite the clear benefits of IPS, access is limited or unavailable in the great majority of communities. Only 2.1 % of clients with SMI in the U.S. public mental health system received supported employment in 2009 (SAMHSA 2009), and less than 1 % of Medicaid patients with schizophrenia had an identifiable claim for supported employment in 2007 (Brown et al. 2012). The 65 % expressed need versus 1–2 % access represents an egregious unmet need.

The Primary Problem is Misaligned Funding

Federal and state funders pay for a variety of non-evidence-based rehabilitation practices, such as day treatment, day hospitals, and sheltered workshops, that are completely ineffective and even harmful because they promote dependency and demoralization (Nazarov et al. 2012). Meanwhile, IPS funding is fragmented, unpredictable, bureaucratically complicated, and inadequate. Because no single source funds IPS, agencies must patch together funding from Medicaid, vocational rehabilitation, state funds, and other sources. Even in progressive states committed to implementing IPS, providers report chronic budget shortfalls (Health Management Consultants 2006; Herinckx 2011). Thus, IPS programs are constantly threatened by financial insecurity (Karakus et al. 2011), and most providers opt to offer non-evidence-based services.

A Second Problem is Social Security Regulations

Federal health insurance programs, Medicaid and Medicare, are linked to Social Security Income and Social Security Disability Insurance, respectively. People risk losing health insurance by working. Social Security regulations regarding amount of work and discontinuation are complex and often overly punitive, resulting in fears of trying work (MacDonald-Wilson et al. 2003; McQuilken et al. 2003; O’Day and Killeen 2002). If one loses a job, returning to Social Security disability programs can be difficult (Stapleton et al. 2006). Thus, people become “trapped” in the disability system.

Here is What Must be Done

First, Develop a Clear and Simple System for Financing IPS Services

In Maryland the state vocational rehabilitation and mental heath agencies have developed an electronic integrated system for enrolling clients into IPS services (Becker et al. 2007a). The managed care entity is responsible for determining which funding source has funding responsibilities for specific interventions. These changes are major improvements in the efficient delivery of services, but a better solution would be to fund treatment and rehabilitation as an integrated and bundled package through Medicaid. This solution recognizes that IPS is good treatment, helps people to recover their lives outside of dependence on the mental health system, and reduces costs over the long run (Drake et al. 2009; Karakus et al. 2011; Latimer 2001; Salkever 2011).

Second, Reform Health Insurance

Health insurance needs to be unlinked from disability. The current system creates perverse incentives to become or remain disabled (Michalopoulos et al. 2012). Anyone with a severe mental illness should have guaranteed health insurance. The Accountable Care Act moves in this direction. But reforms need to extend to all people with a potentially disabling illness and to cover IPS.

Reform is particularly critical for early intervention programs, which are not fully covered by current Medicaid rules. Early intervention helps young adults experiencing first episodes of psychosis to gain employment, which forestalls their entry into the disability system (Álvarez-Jiménez et al. 2012; Cougnard et al. 2007; Drake et al. submitted; Krupa et al. 2012; Mental Health Commission of Canada 2012; Norman et al. 2007). The savings to the Social Security trust fund could be substantial (Drake et al. 2009).

Third, Reform the Social Security Disability System

Begin by mitigating the disincentives to working. The current system consigns Social Security beneficiaries to a lifetime of poverty (Burns et al. 2007; Estroff et al. 1997). The sudden termination of benefits built into Social Security Disability Insurance regulations inhibits beneficiaries from working to the extent of their abilities. The goal should be to align incentives to encourage beneficiaries to work. Possible reforms include altering the work regulations to a model of gradual income reduction. The rules should also permit people to return to beneficiary status easily if they lose employment (Drake et al. 2009).

Fourth, Provide Infrastructure to Support Implementation and Maintenance of IPS

IPS programs have high rates of successful implementation and sustainment (Becker et al. 2011b; Bond et al. 2008b; Frey et al. 2011). But as with any evidence-based practice, implementation and maintenance require resources. States need systematic and adequately funded mechanisms for ensuring IPS training, technical assistance, and fidelity and outcome monitoring (Bond et al. submitted; Finnerty et al. 2009; Rapp et al. 2010).


This proposal would reverse the accumulating numbers of people on federal disability programs, the long-term costs of mental health system dependency, and most important the suffering, lack of opportunity, and discrimination against people with mental disorders.

Copyright information

© Springer Science+Business Media New York 2012