In a tight budget year, HB 1270 would grow administrative waste and punish families who try to save for the future
Oklahoma legislators have big challenges this session to deal with another revenue failure and budget shortfall. Regular Oklahomans are struggling to support their families in a state where too many jobs still don’t pay a living wage. In this context, you’d think our lawmakers would want to avoid squandering taxpayer money or demonizing families struggling to get by. Unfortunately, HB 1270, which has passed out of a House committee and awaits action by the full House, would simultaneously waste state dollars, punish families for trying to save for the future, and feed ugly, unfounded stereotypes about people making low wages.
HB 1270 would grow administrative waste
Oklahoma has a strong, efficient process to make sure food and health care benefits go to the right people. Currently, households applying for SNAP (the Supplemental Nutrition Assistance Program, formerly known as food stamps) and SoonerCare (Oklahoma’s Medicaid program) can expect information they provide to be matched against records from numerous well-regarded state and national databases, including:
- the Internal Revenue Service
- the Oklahoma Employment Security Commission,
- state and federal Social Security Administration records,
- the Oklahoma Health Care Authority,
- the Electronic Disqualified Recipient Subsystem,
- Equifax’s The Work Number,
- the US Citizenship and Immigration Service’s Systematic Alien Verification for Entitlements program, and
- the state Health Department’s facts of death reports
These reviews are done every six months for SNAP and yearly for SoonerCare, although families are required to report significant income changes as they occur and are penalized if they don’t. This system works: SNAP error rates, including fraud and improper payments, have been dropping for more than a decade, and SoonerCare’s error rate is the lowest of comparable states. Despite the rigor and accuracy of current verification requirements, HB 1270 would require both SNAP and Medicaid cases to be reviewed every three months and with even greater scrutiny.
These changes will be costly on multiple levels. First, they would require DHS to retrain more than one thousand employees on new verification procedures. Second, they would require DHS to contract with additional independent vendors and pay more for existing contracts. Finally, more stringent vetting means evaluating applications will take more time than they do now, and Oklahoma could incur federal penalties if processing times lag too far behind USDA regulations.
The added administrative hurdles created by this bill could also result in families who need food assistance and SoonerCare losing them. Requiring household information to be matched against more databases more frequently increases the likelihood of inaccurate or out-of-date information being reported to DHS – which could then result in truly needy families losing their benefits. It would also create extra work for DHS caseworkers, who would have to fix the errors and reinstate the families.
HB 1270 would punish poor families for saving for the future
HB 1720 would also ban DHS from utilizing broad-based categorical eligibility, a procedure which makes SNAP application reviews more efficient by disregarding household assets, such as money in savings accounts, and makes eligibility determinations based on income instead. Because most households applying for SNAP don’t have enough assets to disqualify them for SNAP without categorical eligibility, investigating every applicant household would simply duplicate work that would cost more than could potentially be saved in SNAP dollars. By DHS’s estimation, eliminating categorical eligibility would require significantly increasing its SNAP workforce and would cost some $10 million per year for a cash-strapped agency that has enacted extensive cuts to its core services in the last few years and already can only fund some core programs for 10 months of the current fiscal year.
With broad-based categorical eligibility, SNAP households still have to be low-income (130 percent of the federal poverty level, or $26,546 per year for a single mom and two children), but can access food assistance while still saving for the future. The households helped by categorical eligibility are largely individuals who have lost their jobs but still have modest savings, and seniors and people with disabilities who live on fixed incomes with small savings socked away for emergencies. Eliminating categorical eligibility would kick families off the program for holding on to more than a few thousand dollars in savings. We shouldn’t punish families for trying to save for medical emergencies, a new home, college, or retirement.
HB 1270 is an expensive solution in search of a problem
In this time of tight belts and tighter budgets, we should be making every effort to guard taxpayer dollars from waste and inefficiency. However, by requiring expensive contracts, more staff, and more work with little possibility of real savings, HB 1270 would cause waste and inefficiency. Futhermore, HB 1270 could never generate savings for the state: while SNAP administration uses state dollars, SNAP benefit dollars are federal. Any savings from removing households from the program or reducing their monthly allotment would go back to the federal government.
Discussing her bill, author Rep. Elise Hall said repeatedly that its goal was to make sure safety net programs go to people who “really need them.” They should, and they do – but as it stands now, only about 76 percent of Oklahomans who qualify for SNAP actually participate in the program. It could be that the remaining 24 percent don’t need the assistance SNAP provides or don’t realize they’re eligible. But it could also be that these families are deterred by the reputation that the SNAP program and others like it have been saddled with because of persistent, incorrect, and stigmatizing myths about safety net programs — and going hungry as a result.