(Trends Wide) — Job requirements in two safety net programs for low-income Americans are about to change under the debt ceiling compromise package negotiated by President Joe Biden and House Speaker Kevin McCarthy .
Expanding labor requirements was one of the main sticking points in the deal, with House Republicans demanding additional terms, many Democratic lawmakers voicing their concerns and Biden opening the door to allow some changes to the current rules.
In the end, new measures were included in the legislation, although they are not as strict as those contained in the debt ceiling bill that House Republicans passed in late April.
Lawmakers from the Republican Party stress that the job requirements will help end people’s dependency on government and lift them out of poverty.
“A job provides financial stability, increased income and, most importantly, the opportunity to achieve the American dream,” New York Rep. Elise Stefanik, the third-largest Republican, said on a call with reporters this week. rank in the House of Representatives.
However, according to Katherine Hempstead, policy advisor at the Robert Wood Johnson Foundation, recent author of a research report on the economic and health consequences of work obligations, studies show that job requirements do not increase labor force participation for beneficiaries of the social safety net.
In addition, the additional paperwork discourages participation in public assistance programs and increases the cost of administering benefits. In addition, the mandates do not address the barriers to employment faced by many recipients who are not yet working.
Who is affected and how the debt ceiling package will depend on several factors, such as age and residence status.
Here is what changes in each program:
Supplemental Nutrition Assistance Program (SNAP)
Actual: able-bodied adults with no dependents ages 18-49 can only get food stamps for three months out of every three years, unless they work or participate in other activities at least 20 hours a week.
Nuevo: the number of people subject to the mandate will be expanded in phases, so that in 2025 it will apply to those between the ages of 18 and 54.
However, veterans and the homeless of all ages, as well as adults under 25 who have been in foster care, will be exempt under the debt ceiling bill.
These provisions will expire in October 2030.
The legislation also reduces the percentage of unused exemptions that States can carry over from year to year.
According to an analysis by the Center on Budget and Policy Priorities, nearly 750,000 adults ages 50 to 54 could become subject to the expanded work requirement and risk losing their food aid. Almost half of the new beneficiaries are women. Many of these beneficiaries have very low incomes and have health problems that could limit their ability to work.
About 250,000 people ages 50 to 54 would likely lose benefits, equivalent to about $8 a day per person, under the new rules, according to analysis by the Congressional Budget Office data center ( CBO, for its acronym in English).
The CBO estimates that overall, because of the new waivers, about 78,000 more people would sign up for the Supplemental Nutrition Assistance Program, or SNAP, as food stamps are formally known.
But states may have a hard time tracking their recipients to determine if they qualify for the waivers, the center said.
Many people who meet the new rules, either because they already work or meet waiver criteria, could lose their assistance due to red tape, said Dottie Rosenbaum, director of federal SNAP policy for the center.
The previous GOP debt limit bill would also have required 55-year-olds to work to receive benefits.
Temporary Assistance for Needy Families (TANF)
Actual: States must ensure that a certain percentage of Temporary Assistance for Needy Families (TANF) cash assistance recipients participate in specific work-related activities: 50% for all families and 90% for two-parent households.
Only some activities, such as employment, training, job search assistance and community service programmes, fulfill the mandate.
About 540,000 families receiving TANF cash assistance were subject to work requirements in 2021, according to LaDonna Pavetti, a principal investigator for the center. Among those families there were some 975,000 minors.
States can lower their mandatory labor participation rate by reducing the number of families receiving cash payments. Many states have been able to avail themselves of this provision.
Nuevo: The legislation tightens current labor requirements, primarily by adjusting the labor participation rate credits that states can receive for reducing their caseload. Starting in October 2025, the formula will compare the current count to 2015, instead of 2005.
With the number of cases dropping significantly in most states between 2005 and 2015, these states will need to ensure that a higher proportion of families are working to meet the mandate, Pavetti said.
It would also prohibit states from counting people who receive less than $35 a month in TANF assistance toward their labor participation rate, which Republicans say states send to those who already have jobs to help them meet the requirement.
But the package also includes two useful provisions, Pavetti said. It will require states to track cash assistance recipients after they leave TANF and to report the percentages of those with income and those who are employed. In addition, a pilot program will be implemented that will judge up to five states based on the income and employment of recipients after exiting TANF rather than on the labor participation rates of those still in the program.
How these changes affect TANF cash assistance recipients will depend largely on which state you live in, how your state’s caseload compares to 2015, and how states address any shortfalls in their labor participation rates, Pavetti explained.
For example, some states might choose to give all of their cash assistance funds to minors living with guardians or other people who are not their parents, since these adults are not counted in the labor participation rate.
Other states may require parents to work to qualify for cash aid.
But low-income Americans will feel the impact.
“The families most likely to lose benefits are the ones most in need,” Pavetti said, citing those who are unable to work due to illness, homelessness or other barriers.
The previous GOP House bill would have required the formula for the appropriations to compare the current count to the 2022 count, effectively eliminating the appropriation in all states, Pavetti said.
Medicaid
Actual: there is no federal work requirement.
The Trump administration granted waivers to several states to impose that mandate on certain affiliates. Litigation halted or slowed states’ implementation of the initiative, and the Biden administration later withdrew the permits, though a federal district judge allowed the initiative to go ahead in Georgia.
Nuevo: there is no federal obligation to work.
House Republicans wanted to require certain adult Medicaid recipients to work, perform community service, or participate in a work program for at least 80 hours per month, or earn a minimum monthly income. His previous bill provided for this mandate to apply to people between the ages of 19 and 55, but not to pregnant women, parents of dependent children, those physically or mentally incapacitated for employment or those enrolled in education or training programs. substance abuse, among others.
According to the CBO, this provision would have caused an average of 1.5 million adults to lose federal funding for their Medicaid coverage. However, the states would have paid the full cost of about 900,000 of them, leaving about 600,000 uninsured.
