Process Values and Mass Reductions in Medicaid and SNAP

David Super

     The economy stubbornly marches forward past the challenges of persistent inflation, a rate-raising Federal Reserve, and blundering bankers.  Yet this is a difficult time for tens of millions of low-income people in this country.  Emergency liberalizations enacted in Medicaid and the Supplemental Nutrition Assistance Program (SNAP) are ending, with benefit reductions and terminations for huge numbers of people very much still in need.  This event is important in its own right.  It also raises questions about the process of policy-making in our deeply polarized and unequal nation. 

     State fiscal crises historically lead to cuts in Medicaid eligibility and services:  Medicaid plays such a large role in states’ budgets it presents an extremely inviting target.  With public health costs rising and revenues crashing in the early days of the pandemic, Congress could foresee sweeping state Medicaid cuts coming at a time when low-income beneficiaries could least afford them.  Accordingly, it both increased the federal matching rate for Medicaid expenditures and, to forestall covert Medicaid cuts, made it very difficult for states to terminate people from the program.  These measures were tied to the duration of the public health emergency declared for COVID-19.

     Because many Medicaid beneficiaries’ incomes are quite volatile, a substantial number of people are now receiving Medicaid with incomes above their states’ eligibility limits.  Medicaid advocates and federal and state administrators long have been preparing for the eventual “unwinding” of these emergency measures, with states needing to redetermine tens of millions of people’s eligibility within a short period using staffs that in many instances have shrunk since 2020.  Many Medicaid beneficiaries remain eligible, sometimes under a different eligibility criteria from the one under which they were first approved.  Most of the rest qualify for private insurance with large subsidies under the Affordable Care Act, but that requires a separate application.  In states that implemented the ACA’s Medicaid expansion, very few Medicaid beneficiaries should lose health care coverage completely, but sorting out which beneficiaries qualify for coverage under which program is complicated enough that many are at risk of falling through the cracks. 

     Congress’s response to rapidly rising food costs and cratering employment during the early months of the pandemic was to provide for “supplemental allotments” in SNAP and to allow households with children to receive substitute food assistance where school meal and summer food programs were shuttered.  The Trump Administration bizarrely interpreted the supplemental allotment statute to reject the across-the-board increase Congress had specified and instead raise every household’s benefits to the maximum.  This gave the least-poor recipients a huge increase and but nothing at all to the poorest one-third of households that were already getting the maximum.  The Biden Administration later partially reversed this policy to give more help to the poorest households.  

     Congress and USDA under both administrations also allowed states to forego eligibility reviews, leaving many households to continue to receive SNAP benefits based on having established eligibility many months earlier. 

     With COVID-19 still killing hundreds of people per day and millions of the chronically ill – a group over-represented among low-income people – still at considerable risk working outside the home, the Biden Administration has repeatedly extended the public health emergency, which had the effect of continuing the emergency Medicaid, SNAP, and child nutrition measures.  This has brought increasing criticism from Republicans, and some Republican-controlled states ended some of these measures on their own.

     The end-of-session omnibus legislation enacted just before Republicans took control of the House included provisions setting firm dates for ending enhanced Medicaid funding, the restrictions on Medicaid terminations, and SNAP supplemental allotments.  The last supplemental allotments in SNAP were issued in February, meaning that this month almost every SNAP household in the country received a large benefit cut.  The money saved by ending the supplemental allotments early was spent creating a permanent new program to provide food aid directly to the families of low-income children that lack access to a Summer Food Program site when school is closed.  This is important because only a tiny share of communities offer meals to continue the work of the school lunch and breakfast programs.  Still, a steep drop in SNAP benefits for already hard-pressed households will unquestionably cause real hardship, particularly with the next inflation adjustment more than half a year away.

     The year-end omnibus also prescribed a phase-out of the enhanced Medicaid funding and eligibility protections over the next several months.  Savings from these changes funded increases in the capped funding Puerto Rico and other U.S. territories receive for Medicaid.  With the caps set far below what these jurisdictions would have received if they were states, health care coverage there has been chronically narrower, less secure, and subject to harsher eligibility limits than that in even the most miserly states.

      To date, states’ experience with unwinding modified eligibility procedures in SNAP has been quite varied.  Some states have seen precipitous drops in participation that suggest many eligible households have been purged from the rolls.  Other states have proceeded more carefully and seen much smaller drop-offs.  Advocates’ assessments of states’ plans for Medicaid unwinding are similarly varied, with some states apparently ready and willing to minimize the number of people falling between the cracks and others seemingly relishing the prospect of big Medicaid savings. 

     Because states are not responsible for SNAP benefit costs, excessive losses of coverage likely result either from ideological preferences or decrepit state administrations.  The latter may reflect ideology as well, with states that devalue assisting low-income people allowing their administrative capacity to erode.  It was no coincidence that a decrepit computer in Florida failed to get unemployment compensation to many of those the pandemic rendered jobless.

     The rise and fall of pandemic-related improvements to public benefit programs raises several important issues about our political process. 

     One issue concerns the ethics of allowing expressly temporary programs to end.  Some Democratic leaders and national anti-poverty non-profits felt strongly that their credibility, and their ability to secure responses to future crises, depended on their cooperating in the wind-up of benefits they had sought as temporary measures.  At one time, when Congress had many conservative but principled Republicans such as Bob Dole, Richard Lugar, and Bill Emerson, this clearly would have been true:  those leaders would cooperate on meeting genuine needs but fiercely refuse to deal with anyone they regarded as acting in bad faith.

     Times, however, have changed.  Opponents of enacting these measures in the first place asserted – falsely – that temporary measures enacted in response to the Great Recession never ended.  No doubt anti-poverty advocates’ acceptance of the enhanced benefits’ end this time will not prevent the same dishonest claims from being made next time.  It also is true that Republicans fiercely resist the termination of upper-income tax cuts, such as those in 2001 and 2003, justified as responses to economic crises.  A plausible argument could be made that, in the zero-sum game of fiscal policy, liberals should play by the same rules their opponents do rather than engage in unilateral disarmament. 

     Yet as Fishkin and Pozen have pointed out, the two partisan coalitions are not symmetrical.  Many of the champions of “good government” that once moderated the Republican Party or acted as swing votes are now within the Democratic constituency.  They have not, however, lost their commitment to “good government” values, including fidelity to one’s word.  They also adhere to norms of policy debate that limit joinder, making the general inadequacy of anti-poverty programs in this country an impermissible argument for continuing explicitly temporary programs.  With the electorate as evenly divided as it is, liberals cannot afford to fracture their coalition by alienating their “good government” champions.  The politics likely would not have allowed continuing the expansions much longer; trading their last few months for smaller but important improvements in Summer Food and health care in the territories was likely all the politics would bear.

     A second question about the end of these enhancements is one of representation.  For the reasons just stated, I agree with the decision to include these measures in the year-end omnibus.  So do the people I work with most closely in Washington.  But who are we?  None of us are at risk of losing our health coverage, our homes, or our access to food. 

     If the provisions at issue affected billionaires, big oil, or banks, decisions on legislative strategy would be made not by non-profits friendly to their interests but by the affected entities themselves.  They likely would not care about how taking “unreasonable” positions might undermine their lobbyists’ credibility; if necessary, they could later change lobbyists.  One could argue that our current political system makes some effort to ensure that a variety of positions are considered but does far less to ensure that a variety of voices get heard.  And, certainly, Medicaid and SNAP recipients lack the funds or the coordinating infrastructure to punish legislators who disappoint them the way trade associations do. 

     This problem cannot be addressed meaningfully with one-off consultations.  The affluent’s effectiveness in policy formulation comes in large part from their having access to nuanced longitudinal insight about what the politics will and will not bear.  When welfare rights and similar groups that have not previously been a part of policy debates are brought in just as key decisions are about to be made, they face an immediate, impossible guess:  whether to trust liberal advocacy groups’ political judgment or to accuse those groups of selling out low-income people’s interests.  Myriad bad outcomes have resulted from each of those choices. 

     I am convinced that we got it right this time, that the omnibus legislation was by far the best deal on the table and that advocacy groups’ refraining from trying to squeeze every last month out of the Medicaid and SNAP improvements will give low-income people a meaningfully better chance of getting help in the next systemic emergency.  But something is very wrong with a system where this decision was so significantly the choice of people like me.

     @DavidASuper1