Surviving welfare transition comes before reform, DHS says

(The Center Square) – An impending benefits cliff needs attention first, Pennsylvania officials say, before the state considers system reform.

This, despite concern from advocates who believe weak security controls lead to widespread exploitation and abuse of Pennsylvania’s public assistance programs.

The Department of Human Services told The Center Square on Monday it will spend the next year reorganizing Medicaid rolls as pandemic-era prohibitions on removing ineligible beneficiaries expire come April 1.

The change could impact a considerable swath of Medical Assistance recipients, said Brandon Cwalina, a department spokesman. Some 617,000 individuals may now be ineligible based on information provided during their last renewal and another 598,000 have not completed a renewal at all – and there’s overlap between the two groups, he added.

“We are confident in the eligibility determination process, and implementing new processes during this important time could create difficulties, such as unnecessary administrative burdens, for Medicaid recipients and the staff who are working with them to complete these renewals,” Cwalina said.

Changing nothing, however, will cost Pennsylvania more in the long run, said Sam Adolphsen, state policy director at the Foundation for Government Accountability.

“I think generally speaking, talking about getting off welfare as falling off a cliff isn’t right,” he said during a roundtable with the House Appropriations Committee. “I think of it more as being a pit that we need to help people climb out of.”

He warned lawmakers that Pennsylvania should follow in other states’ footsteps and speed up the redetermination process before federal funding dries up at the end of 2023. He also laid out what he calls “fraud by design” – a series of program failures that divert benefits away from those who truly need them and into the hands of those living above the income limits.

“So, when it comes to residency and household composition, who’s in the house, who lives here? Are there kids? Is there another income earner?,” he said of the state’s self-attestation process. “If I’m in Pennsylvania, and I apply for Medicaid, you’re taking my word for it. There isn’t any follow up. There isn’t any verification.”

Cross-checking data, he added, should also be tightened to revoke eligibility for former residents or those who have since died.

The reforms should also extend into the food stamps program, which although funded by Congress, serves as a “gateway” to the state’s Medicaid program, Adolphsen said.

The department said about 3.6 million people receive Medical Assistance. Another 1.8 million qualify for the food stamps program, including 420,000 that remained eligible during the temporary waiver, The Center Square previously reported.

Adolphsen suggested the state enforce both the asset test and the work requirement so that fraudsters don’t exploit the system and more people can get back to work, which he says is the most reliable path out of poverty.

“You can have a million dollar house, you can have a brand new fifth wheel RV, you can have a million dollars in the bank,” Adolphsen said. “And you will still be eligible for food stamps, if your income is under the threshold.”

“And this is not hypothetical,” he added. “We know millionaires who are on the program.”

The department did not respond directly to the claim, but Cwalina said it maintains a “robust” data exchange system that tracks income, resources, new hire information, incarceration, lottery winnings and receipt of benefits in other states.

Caseworkers who find discrepancies can request more information from the beneficiary or refer the case to the Office of Inspector General for investigation. Residents appealing determinations continue to receive benefits until the case is closed, Cwalina said.

The most recent data taken from the OSIG’s 2017-2018 Fiscal Year Annual Report shows the agency saved Pennsylvania more than $75 million in benefits that would have been incorrectly paid. It also projected a cost benefit of nearly $12 for every $1 spent on investigative activities.

Legislation pending in the Senate would beef up funding for the OSIG to investigate more fraud claims and would also revamp verification so that ineligible beneficiaries are removed from programs faster, The Center Square previously reported.