In the fog, 300k kids to lose Medicaid and CHIP

The sheer volume of coverage pouring out from the nation’s capital means huge stories of great consequence can get lost, especially when the stories contain a hint of bureaucracy or complexity. One such story refuses to fade away because of its grave implications.

The Trump administration has proposed a change to calculating the impact of inflation on the federal poverty guidelines.  All federal, means-tested programs adjust for inflation; the most familiar would be the Cost of Living Adjustments (COLA) to Social Security payments.  The proposed changes are technical in nature but have the potential to do serious harm.

They are proposing to reduce the impact of inflation on the poverty measures which would slow increases in the guidelines over time, with devastating consequences to eligibility for a wide range of programs, including Medicaid, CHIP, Head Start, School Lunch and Breakfast, SNAP, WIC, and LIHEAP.

This move is entirely discretionary – there is no regulatory or statutory requirement to make these changes. Yet the Administration is choosing to cut federal spending without congressional approval by tinkering with a formula that disproportionately affects the poor.

In the wake of the Congressional Research Service’s damning report on the President’s $1.2 trillion tax cut that showed the economy and its workers gained little (while corporations and the very wealthy gained a lot), this proposal seems rather ghoulish.

(Uncoincidentally, this year’s budget deficit will be nearly $1 trillion, according to the Congressional Budget Office.)    

Shrinking eligibility thresholds would affect the almost 1 million children served by Head Start, which is already woefully inadequate. Today, Head Start serves about 31% of eligible children ages 3 to 5 and only 7% of children under age 3.  Shrinking eligibility would limit the program even further at a time when we know that children receive a lifetime benefit from quality early education.

Tinkering with the formula could also make it harder for many of the 1.7 million Pennsylvanians on SNAP to avoid hunger, as well as those who benefit from WIC and school meals, which close other nutrition gaps.

Finally, reducing the impact of inflation on poverty measures flies in the face of a simple fact: inflation effects low-income households more than typical households. Rental housing costs, for instance, have been rising faster than the rate of inflation for years.

Taken all together, the harm from the proposed change to low-income families and those just above the poverty threshold is substantial and will grow over time. With too many poor and middle income families underwater across our region, this change has the ominous capacity to sink them even deeper.

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More families in Southeastern Pennsylvania are struggling to cover the basics as the cost of raising children climbs. Join PCCY on June 20th as we host a panel of community experts who will speak to the alarming trends threatening the Montgomery County families they serve. Stay tuned for more details of the event, which will also include the release of Bajo el agua: lo que hunde a las familias en el condado de Montgomery.