States Should Close the Door on Welfare Fraud

Overview 

A growing coalition of welfare lobbyists is rebranding an old idea under new labels: One Door, No Wrong Door, Integrated Eligibility Systems, Automatic Eligibility Systems, Unified Eligibility Systems, Streamlined Eligibility Systems, and more. The pitch is simple: Make welfare programs more “equitable” by creating a “single point of entry” in order to “streamline access” to welfare.¹ In practice, these models are designed to do one thing well: Increase welfare enrollment by creating a single sign-on for multiple welfare programs.

This is not a benign administrative tweak. The more programs a state routes through one integrated eligibility and enrollment process, the more that system becomes an on-ramp to dependency—and the more it becomes vulnerable to errors, weak verification, and fraud that can spill across programs. States that weaken integrity controls by integrating programs and standardizing lax verification are setting themselves up for ballooning error rates and major fiscal exposure.

Some advocacy groups now argue that this style of integration is necessary to connect welfare recipients to workforce services and modernize Workforce Innovation and Opportunity Act (WIOA) governance. But these models have been ineffective at moving able-bodied adults from welfare to work and policymakers can achieve the workforce goals without expanding the welfare enrollment pipeline.

Connecting able-bodied adults to work requires expectations, accountability, and enforceable engagement—not automatic enrollment systems and a consolidated welfare on-ramp.

Policymakers face a clear choice. On the one hand, they can expand a centralized system designed to maximize enrollment across multiple programs, multiplying fiscal risk and dependency.

Alternatively, they can strengthen workforce systems directly—by improving performance metrics, enforcing work expectations, and protecting eligibility standards—without widening the on-ramp to welfare.

The choice is clear: States should reject integration schemes that prioritize “access” over accountability and instead pursue reforms that promote self-sufficiency, protect taxpayers, and preserve resources for the truly needy.

Welfare lobbyists have used integrated “One Door” eligibility schemes to maximize enrollment

Code for America (CFA) has also devoted significant time and funding to expanding welfare through integrated eligibility and enrollment systems. Founded by Obama’s former deputy chief technology officer, CFA has leveraged funding from Mark Zuckerberg, funds controlled by the Arabella Advisors network, and other major left-wing foundations and donors to expand welfare.^43-57 CFA has also received more than $43 million in taxpayer money since 2017.^58-68

Most of that government funding came through a contract with California, where CFA “simplified” the state’s welfare application process to increase the food stamp participation rate by more than 20 percent.⁶⁹ CFA also worked with Minnesota to “streamline” its enrollment processes, bragging that it now takes less than 15 minutes to apply for nine different welfare programs at once thanks to its work and that it takes less than 11 minutes for state workers to review cases without any involvement from applicants.^70-71

Other major left-wing organizations have promoted similar changes, admitting that their ultimate goal is “maximizing enrollment” in welfare programs and creating an “on-ramp to other programs.”^72-76 Many of these groups also lobbied against the One Big Beautiful Bill Act of 2025, the reconciliation law that cracked down on welfare fraud and required able-bodied adults on welfare to work, train, or volunteer.^77-83 Since passage, these groups have worked to undermine the law’s effective implementation by encouraging states to use lax verification and to continue to implement Biden-era welfare expansions that were repealed by Congress.^84-86

Integrated eligibility systems amplify fraud

Integrated eligibility systems not only maximize enrollment but also amplify fraud. The more welfare programs that states integrate into the same eligibility and enrollment system, the higher the risk and cost of fraud.⁸⁷ The fraud multiplier—which accounts for states’ total cost of fraud for each dollar in fraudulent spending—is 25 percent higher in states with five or more integrated welfare programs than in states with no integrated programs.⁸⁸ In other words, states with One Door-style integrated eligibility systems have substantially higher risks of fraudulent welfare spending.

States are already struggling to get waste, fraud, and abuse within welfare programs under control. More than one in five dollars spent on Medicaid is improper, with roughly 80 percent of those improper payments stemming from eligibility errors.⁸⁹ Likewise, more than one in five households on food stamps have payment errors associated with their case file, even as errors that cost taxpayers less than roughly $700 per year are excluded from the official count.^90-91 Those errors also do not account for “fraud by design” schemes developed by state bureaucrats—and some of the same welfare lobbyists described above—to maximize enrollment among otherwise ineligible applicants, including the Broad-Based Categorical Eligibility loophole.⁹²

Unfortunately, states with unified eligibility systems often import errors from one program to all others.⁹³ This is particularly worrying, given new financial penalties on states with high levels of improper spending. The 2025 reconciliation law created new financial penalties for states with food stamp errors above six percent.^94-95 States face tiered penalties, ranging from five percent to 15 percent of program costs, depending on their error rate.⁹⁶ These new penalties could cost states nearly $12 billion per year.⁹⁷

Without changes, 21 states will pay the worst penalties under the 2025 reconciliation law.⁹⁸ More than 90 percent of these states operate integrated eligibility systems for food stamps and at least one other welfare program, with most integrating eligibility for at least three other programs.^99-103 Four of the five worst-performing states integrate eligibility for food stamps and Medicaid, while three of the top-performing states do not.¹⁰⁴

The 2025 reconciliation law also created new financial penalties for states with large eligibility-related errors in Medicaid.^105-106 Under the new law, federal taxpayers will no longer provide matching funds for erroneous payments above a three percent threshold.¹⁰⁷ States could be on the hook for more than $100 billion per year in financial penalties if they do not get Medicaid errors under control.¹⁰⁸ Weakening program integrity by simply importing errors from one program into another will increase the risk of large and growing financial penalties associated with those errors.

Republican legislators are now hearing pitches for integrated eligibility

In recent years, Republican legislators have begun hearing from a small number of groups advocating for these integrated eligibility processes. Most of the related proposals from these groups have three core components: unifying eligibility and enrollment processes for all welfare programs, integrating welfare programs and workforce services together to be able to refer welfare enrollees to job training, and consolidating workforce development systems. But while those advocacy groups’ efforts may be well intentioned, their policy prescription is based upon mistaken assumptions that will ultimately result in the exact opposite of their stated goal. Indeed, policymakers could achieve the goals of the latter two components without widening the on-ramp to welfare at all.

Creating a wider on-ramp for welfare is not needed to move able-bodied adults from welfare to work

The number of able-bodied adults on welfare has skyrocketed in recent years and the vast majority of them do not work at all.^109-112 But it would be a mistake to assume that referrals to job training are enough to move able-bodied adults from welfare to work. It would be an even bigger mistake to assume that states cannot integrate workforce services or make those referrals without widening the welfare on-ramp. The biggest mistake, however, would be to assume that these changes are superior to the strong work requirements enacted by Congress or are necessary to maximize the effectiveness of these work requirements.

State and federal taxpayers spend $4.2 billion per year on employment and training programs for food stamp and cash welfare enrollees.^113-115 Despite this abundance of funding, participation rates remain abysmal.¹¹⁶ Nearly 90 percent of the 5.4 million able-bodied adults on food stamps who are subject to work registration do not participate in any job training programs whatsoever.¹¹⁷ Virtually all states run completely voluntary job training programs, where enrollees are referred to training but are not required to actually participate.^118-119 Altogether, fewer than 83,000 able-bodied work registrants voluntarily participate in these programs nationwide.¹²⁰

Other welfare programs have tried to refer able-bodied adults to job training programs with similar disappointment. Before Arkansas created the first Medicaid work requirement, for example, it began referring all unemployed able-bodied adults on Medicaid to job training, connecting them directly to the state’s workforce services division.¹²¹ Unfortunately, 95 percent of those enrollees ignored the referrals entirely.¹²²

Montana has also unsuccessfully attempted to refer able-bodied adults on Medicaid to job training programs.^123-124 In 2022, for example, Montana had nearly 117,000 able-bodied adults enrolled in its ObamaCare expansion.¹²⁵ Despite its referral program, just 306 enrolled in workforce program services.¹²⁶

Utah is often held up as the single greatest success story for the One Door model.^127-129 But even in Utah, voluntary participation after referral is non-existent. In 2023, Utah had more than 18,000 able-bodied adults on food stamps who were subject to work registration.¹³⁰ Just 900 of those able-bodied adults in Utah participated in Employment and Training programs—none of them voluntarily.¹³¹ Worse yet, despite this “integrated” system, just one percent of able-bodied adults without young children on Utah’s food stamp program work full time.¹³² Nearly three-quarters of those able-bodied adults do not work at all.^133-134 If Utah’s coordination were successful, one would expect work participation rates among food stamp enrollees to be the best in the nation. Instead, Utah lags behind the national average and its neighbors.¹³⁵

Since implementing these changes, Utah’s labor force participation has also deteriorated.¹³⁶ Although proponents of the expanded on-ramp to welfare often argue that Utah’s labor force participation declined slightly less than it declined nationally, the reality is that Utah’s participation rate declined faster than most of its peer states immediately following implementation and has continued to decline faster than the national average.^137-140 Controlling for other factors and compared to peer states, Utah’s labor force participation was roughly 0.4 percentage points lower in the first five years after implementing One Door than it otherwise would have been, equivalent to the loss of about 6,500 workers in the Utah economy.¹⁴¹

If Utah’s integration were truly successful in connecting welfare enrollees to work, its welfare spending should also be highly concentrated on work-related programs and supports. But in 2023, Utah spent just 16 percent of its cash welfare dollars on work, education, and training activities—and nothing on work supports.¹⁴⁷ Since 2015, Utah has cut the amount of TANF funding going to these activities in half.^148-150 Indeed, Utah uses a smaller proportion of its welfare spending on these areas than many of the other states where this same model is now being proposed.¹⁵¹ As a result, just 12 percent of families on Utah’s TANF program are engaged in work-related activities, among the lowest rate in the country.¹⁵²

And even if bureaucrats were to start making referrals, the voluntary nature of such referrals is simply not enough to move able-bodied adults from welfare to work. Thankfully, Congress and President Trump have delivered real work requirements across welfare programs.¹⁵³ Those work requirements are based on successful work requirements enacted in the 1990s, which moved millions of able-bodied adults from welfare to work, increased incomes, and rapidly grew the economy.¹⁵⁴ Able-bodied adults leaving welfare found employment across more than 1,000 diverse industries, saw incomes skyrocket, and their higher earnings more than offset the welfare benefits that were lost, putting them on the path to independence and self-sufficiency.^155-160

The 2025 reconciliation law expanded these successful work requirements to include more able-bodied adults on food stamps and brought these requirements into the Medicaid program for the first time ever.¹⁶¹ These new requirements will move millions of able-bodied adults from welfare to work, and states can achieve that success without expanding the on-ramp to dependency.

Creating a wider on-ramp for welfare is not needed to make changes to workforce development systems

Those advocating for Utah’s integrated One Door model frequently highlight the state’s broader reforms to its workforce development system.¹⁶² The two components most often emphasized are the state’s unified WIOA board and its cost allocation model.¹⁶³

Utah operates its WIOA programs as a “single state local area,” with one workforce development board covering the entire state rather than local boards covering specific regions.¹⁶⁴ A handful of other states operate similarly, but federal law prohibits states from adopting this designation unless they were previously grandfathered under earlier workforce development laws.^165-173

The federal government has also approved a simplified cost-allocation plan for Utah that allows it to use random sampling of caseworkers’ time to determine how to allocate administrative costs among various programs, instead of requiring caseworkers to track administrative costs for each program separately.^174-175

But these broader reforms to states’ workforce development systems are wholly unrelated to integrated eligibility systems for states’ welfare programs. States could pursue similar workforce development reforms without expanding the on-ramp for welfare enrollment at all.

The Bottom Line:

States should preserve resources for the truly needy by rejecting integration schemes that maximize welfare enrollment.

“Integrated eligibility” is not modernization. It is a strategy built to maximize enrollment across multiple welfare programs at once—regardless of program integrity, work engagement, or long-term outcomes.

The evidence is clear. States that prioritize unified enrollment pipelines like One Door see higher fraud exposure, imported eligibility errors, and growing fiscal risk. Voluntary referrals and consolidated intake systems have failed to move able-bodied adults from welfare to work. Even the most frequently cited “success” stories show negligible voluntary participation, low work engagement, and deteriorating labor force performance. Meanwhile, states face steep new financial penalties for eligibility errors under federal law—penalties that integrated systems make more difficult to avoid.

There is nothing compassionate about expanding dependency. There is nothing conservative about multiplying fraud risk. And there is nothing pro-work about building a faster pathway to welfare without enforceable expectations.

Congress has already enacted real work requirements that will move millions of able-bodied adults from welfare to work. States can strengthen workforce development systems, improve coordination, and modernize governance without turning those systems into a centralized welfare gateway.

Policymakers face a clear choice: Build a larger on-ramp to dependency—or close the door on fraud, enforce work, and preserve scarce resources for the truly needy. States should reject integration schemes that maximize enrollment and instead pursue reforms that promote self-sufficiency, protect taxpayers, and restore integrity to welfare programs.

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