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MAIN
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A Joint Project of the Maine
Association of Interdependent Neighborhoods |
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Volume 10 No. 1 |
March 2006 |
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MAIN
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A Joint Project of the Maine
Association of Interdependent Neighborhoods |
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Volume 10 No. 1 |
March 2006 |
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Federal Budget – Cuts & Rule Changes
Not Good News for People with Low Incomes
Thank you to everyone who made phone calls and sent e-mails urging our Senators to vote against the federal reconciliation budget bill. Even though the bill passed through Congress, Maine’s entire congressional delegation voted against the budget reconciliation bill. The final votes were extremely close in both the Senate and the House. In the Senate, the bill passed 51-50 with Vice President Cheney flying in from a trip abroad to break the tie. The bill passed in the House by just two votes.
We are looking for people willing to share how the federal TANF changes for mandatory work activities will affect your family. More details below.
The final Budget Reconciliation Bill, which was signed by the President on February 6, includes a number of substantial changes and cuts to programs for low-income families and individuals. The bill includes significant policy changes and cuts to the Medicaid program, major changes in the TANF program, and cuts to federal funding for child support and foster care.
MEDICAID
Changes to the Medicaid program target low-income people who benefit from the program. These changes remove many of the federal protections that prevented states from imposing unreasonable levels of cost sharing in the program and that assured that Medicaid recipients, particularly children, receive medically necessary services.
The federal budget reconciliation allows states to impose significant increases in cost sharing and changes to benefits for Medicaid recipients. While these new provisions are extremely worrisome, it is important to note that these changes are optional for states. States do not have to implement these new changes. However, if a state decides to make these changes, low-income people living below and just above the poverty level, could face substantial increases in co-pays. Recipients with incomes just above the poverty level including children could be forced to pay premiums for the first time ever. All recipients could also face harmful increases in costs for prescription drugs which are not on the state’s preferred drug list.
It will come as no surprise to M.A.I.N. members that research clearly shows that increases in cost sharing are likely to cause Medicaid recipients to go without health care services and medications, or not to enroll in Medicaid at all. In fact, most of the savings that Congress expects from the increases in cost sharing will not come from collecting increased co-payments and/or premiums. They expect the saving to come from people simply not using the services they need.
In addition, the budget bill allows states to design new Medicaid benefit packages that look more like commercial health insurance plans than the comprehensive coverage they have been providing. The people hardest hit by these changes will be children (except for children in foster care and adoption assistance) and working parents and pregnant women with incomes over 133% of the poverty level. State’s are still required to provide Early and Periodic Screening, Diagnostic and Treatment (EPSDT) as “wrap-around” coverage. However, the way in which it is provided will be more cumbersome and complex, causing many children to go without needed care.
TANF
The federal reconciliation bill reauthorized the TANF program for an additional five years. The federal authority for spending on this program ran out over four years ago and has been operating on a series of temporary reauthorizations since then.
Will TANF changes hurt your family?
SHARE YOUR STORY!The TANF provisions in the bill will make it much harder for the state to meet its work participation rates. In Maine this means that nearly twice as many families will be expected to meet a 30 hour per week work requirement. Fifty-percent of all TANF families will be expected to meet the federal work requirements while two parent families will face a 90% work participation rate requirement.
Most states admit that it will be impossible for the state to meet this requirement. This is not because TANF families don’t want to work, but instead because many parents and children in these families face significant barriers to work. Many have health conditions that severely limit their ability to work. Others have no transportation, while many others are struggling to escape domestic violence.
The Parents as Scholars program is also at risk. Since 1996 federal law has not counted educational activities as “work” once a person has been in school for more than 12 months. However, since Maine used our own “maintenance of effort” dollars to fund the PaS Program these students could continue with their education without hurting the State’s federal participation rate. But under this new law starting October 1, 2006, families in “separate state programs” like PaS will need to meet the federal work requirements. This means that education won’t count as work after 12 months. MAIN and our allies are working closely with the Maine Department of Health and Human Services to ensure that the PaS Program will be able to continue to the greatest extent possible.
CHILD CARE
The federal reconciliation bill provides an additional $1 billion over the next five years in additional child care funding. However, the increased demand that is likely to result from the stricter work requirements far outpaces new funds.
The Congressional Budget Office (CBO) estimated that an additional appropriation of $8.4 billion—eight times more than was appropriated—is the amount that would really be needed to meet child care and other work-related costs of the new TANF requirements. In fact, the CBO estimates that more than $11 billion is needed to both meet the new work requirements and ensure that their current child care funding keeps pace with inflation.
CHILD SUPPORT
The federal reconciliation bill cuts federal matching funds for “state performance incentive payments.” States currently receive these incentive payments for meeting performance standards. If the state chooses to reinvest that money into child support activities, it is permitted to draw down federal matching funds. In Maine, this money is used specifically for child support enforcement. The state will no longer be able to receive a federal match for these dollars starting October 1, 2007.
The budget reconciliation bill made dramatic changes and cuts to programs for low-income families, seniors and people with disabilities. But, as mentioned above, the State does not have to make many of the most harmful changes to the Medicaid program. In addition, MEJP and MAIN will begin working with allies to ensure that the new TANF provisions do not harm Maine’s low-income families with children. This includes participants in the Parents as Scholars program and families who need help to overcome multiple barriers to work. Please help us!
Will TANF changes hurt your family? SHARE YOUR STORY!
We are looking for people willing to share how the federal TANF changes for mandatory work activities will affect your family.
How will these changes affect your family?
- Are you currently enrolled in the Parents as Scholars Program?
- Are you currently under an exemption from ASPIRE participation because you or your child have disabilities that make it impossible for you to “participate” for 30 hours per week?
- Are you a two-parent family receiving TANF that is unable to participate in a work activity for a combined 55 hours per week?
We would like to share your stories with lawmakers and policy makers in order to help them understand the needs of your family and others like yours. Please contact Crystal Bond at MEJP to share your story. Call toll-free: 1-866-626-7059 x 205 or use our feedback form.
