To Move Americans Toward Prosperity Welfare Reform Must Happen Now

If America’s welfare system is meant to help people move away from needing it and out of poverty, it’s failing. Washington DC and many governors are finally taking notice of the problems and costs and are beginning to embrace much needed reforms.

U.S. Representative Paul Ryan, a longtime advocate of entitlement reform efforts in Washington, has set his sights on the nation’s welfare programs and is moving what may be bi-partisan legislation through the House of Representatives.

Congressman Ryan has tasked Louisiana Rep. Charles Boustany, the Chairman of the Ways and Means Committee’s Human Resources subcommittee, with the job. A recent hearing on the matter featured, as he put it:

“proposals to improve the lives of families on welfare by better promoting work and helping families in need move up the economic ladder. Work is the only way for people to really escape poverty and achieve the American Dream, and we are eager to help more families succeed at doing just that.”

The pending legislation “is stricter about applying work requirements to people who receive government assistance – something the GOP insisted on – while broadening the number of things that satisfy those requirements – a Democratic priority.” These compromises are allowing the reform effort to avoid the “scorched earth partisan battles” that many attempts have faced before.

Encouraging a welfare to work program allows enrollees to spend less time on the government dime and reduces the likelihood of lifetime dependence. States that have embraced work requirements have seen their rolls reduced and recipients rejoining the workforce. The states that have not, continue to see a culture of government dependency and higher poverty rates.

Congressman Ryan’s plan addresses this:

First, it would allow states to count more activities—such as job-skills training and education—toward the program’s work requirements. States ostensibly are required to have at least 50 percent of their TANF recipients participate in some kind of work activity for a set number of hours per week to avoid financial penalties.

Second, it would eliminate a number of loopholes that states have used to count toward that work-activity measurement, meaning states would have to have more people actually working to receive benefits. Aides cited those two provisions as an example of the bill’s bipartisan nature: Democrats have long wanted more activities to count as work and Republicans have wanted to ensure that more beneficiaries participate in work activities.

Third, the bill would create a new accountability system. States would have new outcome metrics to measure whether people leaving TANF found employment and increased their income. If states fail to meet the metrics, they could lose a portion of their TANF funding starting in 2018, which they would be able to earn back as they made improvements.

But TANF is not the only troublesome program in need of reform.

Here at FGA, we have documented a concerning spike in food stamp (SNAP) enrollment. Since 2000, in some states, like Nevada, food stamp dependency has risen as much as 219%, in Ohio it’s risen 191%. In fact, nearly 48 million Americans now receive food stamps, up from 17 million in 2000. It is the nation’s fastest growing welfare program and it is incredibly costly to taxpayers. SNAP cost taxpayers nearly $80 billion last year alone.

To help more Americans reenter the workforce and reduce this concerning trend of dependency growth, FGA Action, a non-profit 501(c)(4) is asking several governors to reinstate federal work requirements for food stamp benefits. Maine and Kansas have already done so, and they’ve seen their welfare rolls drastically decrease.

Over the next several weeks, FGA Action will launch a series of websites focused on encouraging citizens to ask their governors not to submit work waivers and help restore the working class.

We suggest three major reforms for all federal programs, including Medicaid, public housing and food stamps:

  1. Allow states to impose TANF-level work requirements and sanctions for all working-age, non-disabled adults receiving food stamps, public housing and Medicaid (including parents of children receiving Medicaid or CHIP).
  2. Allow states to freeze enrollment when changing eligibility requirements for Medicaid, food stamps or TANF. Within one year of freezing Medicaid expansion enrollment, both Arizona and Maine had half of enrollees in the frozen programs cycle off welfare. Within two years, two-thirds had cycled off.
  3. Allow states to require mandatory premiums for all Medicaid recipients, including parents of kids receiving Medicaid or CHIP.

Fraud and abuse is another reform effort that must be addressed. As we have mentioned before, defrauding government programs such as Medicaid costs taxpayers billions of dollars every year; taking money away from those who really need the help.

In Illinois, one review found that nearly 3,000 dead people were receiving $12 million in Medicaid benefits. Those improper payments have serious, real life consequences. Patients like Jacob Chalkey, an Illinois boy who has a very rare, life-threatening seizure disorder was dependent upon Medicaid for the only drug that can treat his condition. The high cost of Medicaid fraud and spiking enrollment led to Illinois cutting off payment for Jacob’s medication – putting his life at risk.

The state is now enacting reforms to their program and has removed nearly 350,000 ineligible recipients from their Medicaid rolls; saving taxpayers an estimated $350 million in the first year and freeing up money that can be better appropriated to cases like Jacob’s. Massachusetts has also implemented similar reforms – removing tens of thousands of ineligible Medicaid recipients.

To combat welfare fraud, FGA advocates a proven, 3-step Stop the Scam solution:

  1. Better screening at the front door. Verification tools using cutting-edge data-matching technology cross checks dozens of state and federal databases to ensure eligibility.
  2. Periodic checkups. Regular screening of individuals already enrolled in welfare programs to ensure they remain eligible for the benefits they are receiving.
  3. Public prosecution and oversight. Publicly prosecuting those who knowingly scam the system to recover lost funds from fraudsters and discourage future scams.

With reforms in Washington and at state capitals across the country, America’s safety net can be preserved in order to support the most vulnerable and help others experience the dignity that comes with work.

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