Rehabilitation Reform

There is a particular kind of waiting that public systems rarely count as a harm: the months a person with a mental health condition spends between asking for help to work and actually receiving any. The application is filed. The file is open. Nothing is happening that the person can use. From the agency’s side, this is process. From the applicant’s side, it is a gap, and gaps do not sit still. They widen.

This post looks at what the published record shows about vocational rehabilitation (VR) and people with mental health conditions: how many are employed, what the evidence says works, what Illinois’ own reports show, and why time spent unsupported is not neutral. The argument is a measurement argument before it is a moral one. The gap is where the policy lives.

A note on scope: this analysis uses published federal data, peer-reviewed research, and Illinois’ public reports. It describes systems, not individual cases, counselors, or offices, and it is not legal advice.

The starting point: work is the exception, not the rule

Employment falls as mental illness becomes more serious. In nationally representative survey data analyzed by Luciano and Meara, 75.9 percent of working-age adults with no mental illness were employed, compared with 54.5 percent of adults with serious mental illness. The quality of that employment diverged further: 61.7 percent of adults without mental illness worked full time, versus 38.1 percent of adults with serious mental illness. More than a third of adults with serious mental illness (35.1 percent) had left the labor force entirely, roughly double the rate for adults without mental illness (17.1 percent) [1].

The picture inside public mental health systems is similar. In SAMHSA’s 2024 Uniform Reporting System national summary, 29 percent of adults served by state mental health agencies were employed [2]. Most people with serious mental illness say they want to work. The system that treats them, by and large, does not treat employment as part of treatment.

The support that works has grown stronger in the evidence

Individual Placement and Support (IPS) pairs rapid, preference-based job search with a person’s clinical team and time-unlimited follow-along support. In a January 2026 synthesis of the research, Gary Bond reviewed 23 randomized controlled trials of IPS for people with serious mental illness: nine in the United States and fourteen in thirteen other countries. He describes the evidence as stronger than for any other vocational rehabilitation model [3]. An earlier meta-analysis of 21 trials pooled results showing IPS participants were far more likely to obtain competitive employment than people receiving other vocational services.

Newer studies point in the same direction. A randomized trial in the Canary Islands, published in December 2025, compared IPS with train-then-place vocational rehabilitation among people with severe mental disorders in a high-unemployment setting. IPS participants achieved significantly higher rates of competitive employment at six months [4]. A 2026 longitudinal study from Emilia-Romagna, Italy, follows IPS participants in a regional program that serves about 1,000 patients a year [5].

One newer finding complicates any simple access story. A 2025 analysis of the U.S. Supported Employment Demonstration found that Black and Hispanic participants were more likely than White participants to complete consecutive periods of supported employment. The authors concluded that ethnoracial differences in IPS participation may persist even when structural barriers to access are removed [6]. Fixing the front door does not automatically fix who gets through it.

Provider-reported data from the UK are useful too, though they are not controlled trials. Shaw Trust reports that 73 percent of people placed through its IPS program sustained their jobs for 13 weeks, and that the average time to employment was about three months [7].

Illinois, in its own numbers

Illinois’ Division of Rehabilitation Services (DRS) publishes annual reports with outcomes by disability category. The two most recent show the following [8][9]:

Measure	FY2024	FY2025
Total VR customers served	40,376	44,091
Competitive employment outcomes	4,228	4,154
Outcome rate (outcomes ÷ served)	10.5%	9.4%
Mental illness: customers served	7,397	7,883
Mental illness: competitive employment outcomes	1,043	994
Mental illness: outcome rate	14.1%	12.6%
Mental illness: average weekly earnings	$460	$474

Outcome rates here are calculated from the reported counts. The FY2025 report gives two different totals for people served (44,091 in its table and 44,157 in its narrative); the table figure is used above.

Three things stand out. The number of people with mental illness served grew by about 6.6 percent, while the number of successful closures fell by about 4.7 percent. Some of that may reflect the lag between services and outcomes. The agency’s mental illness outcome rate is still above its overall rate, which shows the system can place these clients. And average weekly earnings for this group, at $474, remain below the agency-wide figure of $529 [9]. People are being placed. The quality of that work is still lower.

Illinois’ Order of Selection rule still exists. It lets the DRS Director decide each fiscal year which priority categories are open, and it sets an eligibility timeline of up to 60 days [10][11]. DRS reports that all four categories were open in FY2024 and FY2025 [8][9]. So the access question today is less about closed tiers and more about timeliness and the path from referral to service. DRS’s own FY2026 priorities name “increasing timeliness of case progression” and “reducing the number of referrals closed prematurely” [9]. The agency is describing the same problem this post is about.

IPS in Illinois: growth, and a count that needs reconciling

DRS describes itself as the primary funder of IPS in Illinois, working with the Division of Mental Health. In FY2025 it completed 30 two-day IPS fidelity reviews and reported that every participating agency ranked from good to exemplary [9]. That is a strong quality signal.

The reports also contain numbers that need reconciling. The FY2024 report describes 56 Illinois IPS teams. The FY2025 report describes 41 [8][9]. The reports give more than one count of FY2025 IPS outcomes: the program section reports 378 successful closures, and other sections report different figures. Supported employment closures fell from 203 in FY2024 to 143 in FY2025 [8][9]. A decline in team count and closures is exactly what public reporting should be able to explain. Until DRS clarifies it, treat the team figures as reported, not settled.

The state is also investing in IPS infrastructure. The Division of Mental Health’s FY2026 grant opportunities include a competitive grant for regional IPS trainers, meant to help agencies implement IPS and sustain it over time. Applicants must be certified community mental health centers that already run IPS [12][13].

The national picture has shifted toward waitlists

Several state VR agencies have moved into Order of Selection in the last year, often citing funding that does not match demand.

• Washington closed all service categories effective December 8, 2025, and continues under an Order of Selection [14].
• Wisconsin began implementing a waitlist that applies to all new and existing cases without an approved Individualized Plan for Employment, citing funding that will not meet expected spending in state fiscal years 2026 and 2027 [15][16].
• California entered an Order of Selection starting August 31, 2026, and its Department of Developmental Services issued guidance to employment providers on affected individuals [17].
• Indiana reported in March 2026 that all categories were open and no one was on its waitlist [18].

Illinois’ open status is a real difference. It also means the risk described above has become concrete elsewhere. When a state closes its front door, the people most affected are often those whose conditions fluctuate and who need a fast route into services.

Federal policy: reauthorization still pending

The Workforce Innovation and Opportunity Act (WIOA) is due for reauthorization. As of April 2026, advocates described it as back in play but complicated by partisan disagreement [19]. We could not confirm enactment of any reauthorization bill, so check current status before relying on it.

Federal guidance is moving too. The Rehabilitation Services Administration issued Technical Assistance Circular RSA-TAC-26-01 in January 2026, setting requirements for states modifying their WIOA state plans [20]. Several states have submitted 2026 plan modifications [21][22].

Transition-age youth are an important front. A September 2026 issue brief from the National Partnership for Women & Families argues that federal changes are weakening the school-to-work pipeline for disabled students [23]. That is an advocacy group’s assessment, not a neutral finding. It still raises a question worth tracking: whether Pre-Employment Transition Services reach young people with mental health conditions before a delay becomes a lasting gap.

For scale, the state VR program serves more than one million individuals a year nationally [24].

Why the gap compounds

Employers read an employment gap as information. In a large field experiment in which researchers sent fictitious résumés to real job postings in 100 U.S. cities, callback rates fell as unemployment spells lengthened. By eight months of unemployment, callbacks were about 45 percent lower than at one month [25]. Nothing about the applicant changed except the gap.

For people with serious mental illness, that penalty can compound with the condition itself. Unsupported time does not hold a person’s employability steady. It erodes it. The sooner services begin, the less the market’s reading of a gap has to be overcome.

What closing the gap would require

1. One front door for people with mental health conditions. Default co-enrollment between VR and IPS, with shared intake and shared outcome credit, so no case depends on navigating a seam between two divisions.
2. Publish the funnel, by disability, every year. Illinois’ reports give served and outcome counts by disability category. The referral-to-plan funnel is not in the sections reviewed for this post. It should be published annually, with median days from application to eligibility decision and from eligibility to plan, by impairment group.
3. Report use of the services that work. Agencies should report IPS and on-the-job training use by disability group the same way they report closures. A team count that falls between years should come with an explanation.
4. Treat elapsed time as an outcome. Given the callback evidence, every month of unsupported delay has a foreseeable cost. Median time to first service belongs on the same dashboard as employment rates.
5. Make Order of Selection status public in plain language. Which categories are open, how many people are waiting, and for how long should be posted where applicants can see it, every year.

A society’s beliefs about membership are visible in its waiting rooms. Work is where adults hold standing in their communities: income, yes, but also routine, regard, and a future tense. The evidence assembled here does not show a population that cannot work. It shows a population that succeeds at high rates when support arrives, and a delivery system that too often delays that support, routes it through a side door, or closes it off.

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If you are waiting for services: keep copies of every application, letter, and date. Ask your VR counselor in writing about supported employment and on-the-job training, and ask your mental health provider whether an IPS program serves your area. In Illinois, IPS is a joint program of the Divisions of Mental Health and Rehabilitation Services [12]. If you believe your case has stalled or your rights were denied, every state has a federally funded Client Assistance Program that advises VR applicants and clients at no cost.

Sources

1. Luciano, A., & Meara, E. (2014). Employment status of people with mental illness. Psychiatric Services. https://www.psychiatryonline.org/doi/abs/10.1176/appi.ps.201300335
2. SAMHSA. (2024). Uniform Reporting System, 2024 State Mental Health Measures, U.S. summary tables (adult employment status). https://www.samhsa.gov/data/sites/default/files/reports/rpt56443/Florida.pdf (state table linking national summary; confirm the national table before citing elsewhere)
3. Bond, G. R. (2026, January). Research on the Effectiveness of Individual Placement and Support. https://ipsworks.org/wp-content/uploads/2026/01/Research-on-the-Effectiveness-of-IPS-GB-1-1-26.pdf
4. Rodríguez Pulido, F., et al. (2025). A randomised controlled trial of IPS in a high-unemployment context. International Journal of Public Health, 70, 1608796. https://doi.org/10.3389/ijph.2025.1608796
5. Mazzetti, G., et al. (2026). Longitudinal outcomes of Individual Placement and Support for patients with severe mental illness in Italy. International Journal of Public Health, 71, 1608701. https://doi.org/10.3389/ijph.2026.1608701
6. Psychiatric Rehabilitation Journal (2025). Participation in individual placement support: Ethnoracial differences in the Supported Employment Demonstration, 48(2), 115–122. https://doi.org/10.1037/prj0000631
7. Shaw Trust (2025). Individual placement and support: Impact beyond jobs. https://shawtrust.org.uk/individual-placement-support-impact/
8. Illinois DHS, Division of Rehabilitation Services. (2025). 2024 Annual Report (submitted 11/26/2024). https://ilga.gov/reports/ReportsSubmitted/5331RSGAEmail11399RSGAAttachRehabilitation%20Annual%20Report%202024_Final.pdf
9. Illinois DHS, Division of Rehabilitation Services. (2025). 2025 Annual Report (submitted 12/1/2025). https://lrb.ilga.gov/reports/ReportsSubmitted/6291RSGAEmail13886RSGAAttachIDHS%20Division%20of%20Rehabilitation%20Services%20Annual%20Report%202025.pdf
10. Illinois Administrative Code, Title 89, § 553.130 (Order of Selection). https://ilga.gov/ftp/JCAR/AdminCode/089/089005530001300R.html
11. Illinois Administrative Code, Title 89, § 553.40 (eligibility determination). https://regulations.justia.com/states/illinois/title-89/part-553/section-553-40
12. Illinois DHS, Division of Rehabilitation Services. (2025). 2025 Annual Report, FY2026 priorities (see note 9).
13. Illinois DHS, Division of Mental Health. FY2026 NOFO: Regional IPS Trainers (26-444-22-1185-02). https://omb.illinois.gov/public/gata/csfa/FileView.aspx?nofo=3106
14. Illinois GATA, Catalog of State Financial Assistance, program 1185. https://omb.illinois.gov/public/gata/csfa/Program.aspx?CSFA=1185
15. Washington DSHS, Division of Vocational Rehabilitation. WIOA plan, Order of Selection. https://wioaplans.dol.gov/node/509726
16. Wisconsin DWD, Division of Vocational Rehabilitation. Notice to service providers on implementing an Order of Selection. https://content.govdelivery.com/accounts/WIDWD/bulletins/3f9d2f4
17. Wisconsin DWD (2025, November 3). DVR funding. https://dwd.wi.gov/press/2025/251103-dvr-funding.htm
18. California Department of Developmental Services (2026, September 21). Employment services for individuals affected by Department of Rehabilitation Order of Selection. https://www.dds.ca.gov/wp-content/uploads/2026/09/D-2026-Employment-003_PLS.pdf
19. Indiana FSSA, Bureau of Rehabilitation Services (2026, March). BRS Update, DDRS Advisory Council. https://cdn.arcind.org/wp-content/uploads/2026/03/BRS-Data-March-2026-DDRS-Advisory-Council.pdf
20. Evans, M. (2026, April 17). WIOA reauthorization is back, but partisan changes complicate its path forward. National Skills Coalition. https://nationalskillscoalition.org/blog/news/wioa-reauthorization-is-back-but-partisan-changes-complicate-its-path-forward/
21. U.S. Department of Education, RSA. (2026, January 26). Technical Assistance Circular RSA-TAC-26-01. https://rsa.ed.gov/sites/default/files/subregulatory/RSA-TAC-26-01_0.pdf
22. Oregon DHS (2026, January 30). Vocational Rehabilitation State Plan 2024–2028: 2-Year Modification. https://www.oregon.gov/odhs/engagement/Documents/2026-01-30-vr-state-plan-update.pdf
23. Rhode Island Office of Rehabilitation Services. 2026 WIOA State Plan Modification. https://ors.ri.gov/node/1206
24. Williams, T. (2026, September). The Trump Administration is weakening the school-to-work pipeline for disabled students. National Partnership for Women & Families. https://nationalpartnership.org/?p=25980612
25. RSA. (2025, October 12). What is the Rehabilitation Services Administration, and why is it important? https://cdn.ymaws.com/nationalrehab.org/resource/resmgr/action_alerts/RSA_Fact_Sheet_10.12.25.pdf
26. Kroft, K., Lange, F., & Notowidigdo, M. J. (2013). Duration dependence and labor market conditions: Evidence from a field experiment. Quarterly Journal of Economics, 128(3), 1123–1167. https://doi.org/10.1093/qje/qjt015