Welfare reform is one of the most important initiatives that Maine and America can undertake. Well-intentioned Democrats have, over the years, grown our welfare system to an unsustainable level out of an urge to help the poor. The folly of their policy is two-fold.
First, it creates a culture of dependency and entitlement, whereby people expect government handouts and lose motivation to improve their position in life. This does not help them in the long-term. Second, it cripples government budgets, requiring ever-increasing taxes that drain resources from the productive side of the economy—the side of the economy that we should be helping so that those on welfare have opportunities for work.
Mainers recognize the need for welfare reform, and it is shown in numerous polls to be one of the highest priorities of Maine voters. Republicans are trusted with this task because we understand the importance of making welfare a safety net of last resort, not a way of life.
When Republicans were elected to majorities in the state legislature in 2010, these were the problems they faced:
- Maine ranked third in the nation for the number of households on TANF (Temporary Assistance for Needy Families) cash welfare assistance (4.9%);
- Maine ranked second for the number of households receiving food stamps (13.8%);
- Maine had the second-highest food stamp error rate in the nation (10.4%);
- Maine had the third-highest number of residents enrolled inMedicaid (27%); and
- Maine state government’s welfare expenditures ranked second in the nation (30.5%) as a percentage of overall state expenditures.
Fortunately, the 125th Maine Legislature undertook a series of reforms to bring Maine’s destructive and overly generous welfare system under control.
LD 1043 – Biennial Budget
The 2012-2013 state budget included several reforms to Maine’s welfare system designed to provide better stewardship for taxpayers’ money, curb the culture of dependency that welfare programs often create, and ensure that those programs will be around for those who truly need them. These welfare reform initiatives:
- Cap TANF (a cash benefit welfare program) benefits at 5 years, which is the federal standard, ending unlimited lifetime benefits for TANF in Maine (exceptions will be made for cases of extreme hardship, including for the elderly and the disabled);
- End MaineCare (Medicaid), TANF, and food stamps benefits for non-citizens;
- Impose strict sanctions for people who violate TANF rules, including a termination of benefits for adults on the first offense and a full family sanction for the second offense; and
- Require those convicted of drug felonies to be drug tested as a condition of receiving welfare.
LD 1816 – FY ’12 DHHS Supplemental Budget
Faced with a $220 million shortfall at the Department of Health and Human Services (DHHS), the Legislature closed the fiscal year 2012 portion of the budget deficit by, among other measures, reducing eligibility for MaineCare, Maine’s Medicaid program. In all, the supplemental budget enacts over $70 million in long-term, structural savings. This was crucial considering that overall Medicaid spending in Maine has increased by 45 percent over the past ten years, and Maine covered 35 percent more of its population than did the average state.
Included in the cuts was:
- A cap on non-categorical childless adults, a group of recipients covered by only seven other states in the country;
- A reduction of methadone reimbursement from $70 to $60 per week;
- Measures to ensure that private insurance is used before MaineCare when available;
- The elimination of unnecessary staff positions at DHHS;
- The substitution of generic drugs for name-brand drugs; and
- A lowering of MaineCare eligibility from 200 to 133 percent of the federal poverty level for many MaineCare recipients (most states peg eligibility at 100 percent).
In addition to these spending reductions, the bill enacted the recommendations of a streamlining task force convened in 2011, curbing expenses at DHHS by $25 million. The Legislature achieved these savings by consolidating offices, eliminating non-essential services, and tightening eligibility further.
LD 1746 – FY’13 DHHS Supplemental Budget
Faced with a $78.5 million deficit at DHHS for fiscal year 2013, the Legislature passed a supplemental budget to balance the budget and control long-term costs at DHHS. For example:
- Drug addicts on the state-funded methadone program will be limited to two years of treatment, with some exceptions, saving more than $1.3 million per year;
- Salary cuts and reorganization at DHHS will save over $1.8 million;
- The budget bill eliminates optional MaineCare coverage for able-bodied 19- and 20-year-olds, saving more than $4 million a year (only a handful of states provide this benefit);
- It reduces MaineCare eligibility for S-CHIP parents from those making up to 133 percent of the federal poverty level to 100 percent, saving $5.8 million per year;
- Many other cuts ensure the long-term sustainability of core MaineCare services.
The budget was not just about spending cuts, but about shifting spending to reflect better priorities. It includes about $26 million in new initiatives, more than paid for by the above cuts, such as
- $450,000 for indigent legal services;
- $3.7 million for E-911 service; and
- An increase from $6,000 to $10,000 in the amount of pension income exempt from state income taxes, to take effect in fiscal year 2014.
LD 1888 – Improve Welfare Fraud Detection at DHHS
LD 1888 enacts sensible measures to ensure that taxpayers’ dollars are protected from welfare fraud and abuse. It reflects Republicans’ belief that there should be stricter limits to the use of welfare benefits and that those who misuse them must be held accountable both as a deterrent to such behavior and as a matter of principle.
- Authorizes DHHS to recover improperly received general assistance and MaineCare benefits;
- Bans the use of EBT cards at liquor stores, gambling facilities and adult entertainment businesses;
- Makes the unauthorized transfer or possession of EBT cards a Class D crime;
- Conforms Maine law to federal requirements regarding suspension of payments to MaineCare providers upon determination of a credible allegation of fraud; and
- Adds 8 Fraud Investigator and 2 Office Associate II positions to the Department of Health and Human Services, Office of Family Independence.
LD 1812 – Asking Feds for EBT Photo ID
A bill to require photo identification when presenting an EBT (food stamp) card at stores was originally proposed, but found to be in conflict with federal law. The Legislature then enacted LD 1812 as a resolve, requiring DHHS to file a request with the federal government to change its rules to allow Maine to require photo identification to be presented when Maine EBT cards are used. This measure would reduce fraud considerably, as many EBT recipients have bartered their food stamp benefits to ineligible individuals in exchange for other items. The resolve also directs DHHS to find other ways of combating EBT fraud and report back to the Legislature by December 1, 2013 with its findings.
Republican legislators made incredible progress in reforming Maine’s welfare system. They were elected in part to fix the system and they followed through on that mandate with serious reforms. The work, however, is not done. There is still much that can be done to make Maine’s welfare system more efficient, more fair, less costly to taxpayers, and less encouraging of dependency. Republicans in the 126th Legislature are committed to continuing these positive reforms and making Maine a state that encourages hard work, not more welfare dependency.
David Sorensen is the communications director for the Maine Republican Party. For more information, see www.mainegop.com.