NCPA - National Center for Policy Analysis

Instructions for States Further Welfare Reforms

March 10, 2015

Spending on major United States federal welfare programs and Medicaid grew by 83 percent, from $225 billion in 1998 to $412 billion in 2013. Welfare eligibility and enrollment have expanded significantly since the Great Recession began in late 2007. While the U.S. economy has since improved, participation in such programs has generally not declined. Focusing on Medicaid, SNAP, and Temporary Aid to Needy Families (TANF), suggestions for further reforms are listed below:

  • Medicaid accounted for 13 percent of mandatory federal expenditures in 2013. Nearly one-fifth of the U.S. population is now enrolled in Medicaid. To improve Medicaid\'s effectiveness and reduce its strain on budgets, states should seek reforms limiting administrative costs and non-urgent emergency room visits, while increasing preventive care.
  • The recession officially ended in June 2009, but the number of Americans on food stamps has steadily increased. Despite the fact that eligibility has not changed in recent years and the U.S. economy has grown, SNAP enrollees continued to increase. Reform that caps the current, unlimited inflow of Washington money would allow states to adjust the number of people in the program, as well as the duration of benefits, without forgoing federal funds.
  • In 2003, 60 percent of families with a head of household on TANF stayed in the program for more than one year - 13 percent stayed four years or longer - with an average stay of two years. In July 2012, the Department of Health and Human Services (HHS) notified states that they can apply to have TANF\'s work participation standards waived. However, alternative welfare-to-work strategies with formal evaluations would still be required.

Additionally, House Budget committee chairman Paul Ryan has proposed combining funding for SNAP, TANF, and various housing programs into single block grants, "Opportunity Grants," while offering states flexibility to use such funds in ways that best fit their particular circumstances. Opportunity Grants retain a substantial role for the federal government while acknowledging the reality that states possess superior knowledge of the poverty situation within their borders.

Source: Diana Furchtgott-Roth, "Welfare in America, 1998-2013," The Manhattan Institute, January 2015. 


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