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One in Five Rhode Islanders on Public Assistance

Thursday, October 25, 2012

 

At least one fifth of Rhode Islanders receive some form of public assistance, including housing, health care, food stamps, and cash assistance, according to figures collected from several state departments and federal agencies by GoLocalProv.

Welfare, strictly defined as direct cash payments, benefits a small slice of the population, about 22,000 individuals. But when all forms of public assistance are included, the number balloons to at least two hundred thousand.

By far, the largest public assistance program is Rhode Island Medicaid, with 199,199 eligible residents in August 2012 and $1.6 billion budgeted for medical benefits in the current fiscal year.

Other key programs include:

■ Food Stamps: As of last August, 175,000 Rhode Islanders were on food stamps, technically known as the Supplemental Nutrition Assistance Program, or SNAP. Total cost of benefits paid out: $24 million.

■ State Medicaid: The main state Medicaid program, RIte Care, had a core enrollment of 117,000 as of August and an expected cost of $595 million this year.

■ Social Security SSI: Unlike retirement and disability benefits, Supplemental Security Income is a function of need, rather than contributions by beneficiaries, and is paid out of general revenues, rather than the Social Security Trust Fund. As of December 2011, 32,000 Rhode Islanders were on Social Security SSI at an estimated annual cost of $205 million.

 ■ Public Housing: About 20,000 local families received some form of public housing assistance in 2012, at a total cost of $123 million, according to figures provided by the U.S. Department of Housing and Urban Development.

In all, the total estimated annual cost of public assistance in Rhode Island is currently $2.3 billion. (See below table for more information.)

One third of U.S. on government assistance

The total number of Rhode Islanders who depend on public assistance, however, cannot be determined on the basis of the data provided because the enrollment numbers for one program may overlap with another. For example, many of the Rhode Islanders who receive food stamps may also be enrolled in a state Medicaid program.

But it is apparent from the enrollment figures that at least 19 percent, or, on average one in five Rhode Islanders is on one or more public assistance programs.

“It doesn’t surprise me that that many Rhode Islanders qualify, given how miserable the economy is,” said Ken Block, a businessman and prominent advocate of efficiency in government services who ran for Governor as the Moderate Party candidate in 2010.

U.S. Census figures offer some clue as to what the actual total may be in Rhode Island. Overall, about 107 million Americans, a third of the total population, receive public assistance, according to the Census figures, which were not available in a state-by-state breakdown.

 Food stamp program increases faster in RI than US

Many of the state public assistance programs have seen slight increases, but the most significant is in food stamps, reflecting a nationwide trend, according to David Burnett, the associate director of the Executive Office of Health and Human Services, which oversees the bulk of the state-run public assistance programs.

Nationwide, the number of Americans on food stamps has increased by 3.2 percent over the last year. In Rhode Island, the rate of increase is double that, at 6.4 percent, according to the Food Research and Action Center.

Burnett said the economy was the main factor behind the increase. He suggested that the upward trend in food stamp enrollment reflects the rising unemployment rate.

Bad economy taxes welfare system

The number of Rhode Island on public assistance should be cause for concern, said House Minority Leader Brian Newberry.

“In a society when you reach the point where too many people are on public assistance, you run out of people who can pay for it,” said Newberry, R-North Smithfield.

But economist Leonard Lardaro said the number of enrollees in public assistance is not as large as the public may think. He said the welfare reforms enacted under Gov. Don Carcieri have likely reduced the number of people who would otherwise be on public assistance. “The old stereotypes of Rhode Island are probably not as valid as they were in the past,” said Lardaro, who teaches at the University of Rhode Island.

He said public assistance enrollments will fluctuate, depending upon economic conditions and demographic factors, such as age and health needs.

“The number of people on public assistance is not just some God-given number,” Lardaro said. “When an economy is not doing that well more people will qualify for public assistance. That’s just the way the system is built … but, when the economy improves, fewer people will qualify and so it would automatically come down.”

Rep Joseph McNamara, who chairs the House Health, Education and Welfare Committee, said those on food stamps don’t fit the usual stereotypes, especially in rough economic times. “These aren’t people that are sitting around drinking six packs and smoking cigarettes,” said McNamara, D-Warwick. “These are people that are working.”

He said food stamps are going to Rhode Islanders who are underemployed and barely earn enough to maintain their mortgages and provide for their families. “Food stamps are enabling these folks to stay in their home and, in some cases, get training for better employment,” McNamara said.

He suggested that there shouldn’t be a stigma against receiving food stamps, invoking a quotation from Muhammad Ali—Inside of a ring or out, ain’t nothing wrong with going down. It’s staying down that’s wrong. “Many Rhode Islanders have been knocked down by the economy and programs like food stamps … enable them to get back up,” McNamara said.

State to launch new fraud unit

Health and Human Services Secretary Steven Costantino is committed to making changes that will increase accountability and transparency for the some two dozen public assistance programs that fall under his jurisdiction, Burnett said.

He said Costantino plans on putting more information about state public assistance programs online, with details on the number of residents served and the corresponding costs. He said state officials are also working on calculations on the total number of Rhode Islanders on public assistance—although the results were not available in time for publication.

The Executive Office of Health and Human Services also is in the process of setting up a new unit that targets fraud, waste, and abuse. “It’s incredibly important that the integrity of these programs be protected,” Burnett said, adding that it doesn’t help the people they serve if there’s a perception that there is fraud and abuse in those programs and that the money spent on them is therefore a waste.

Nationwide, states started paying more attention to waste and fraud in food stamps and Medicaid, Burnett said, but the new unit in Rhode Island will not be limited two just those two areas, examining all the health and human service programs in the state. Members of the unit will not be field investigators. Instead they will use sophisticated data mining tools to identify patterns of unusual behavior, questionable purchases, and unusual billing by third parties.

The unit will also be working with Block, who has been volunteering his services to help the state identify potential waste and fraud in its food stamp program. (Block declined to discuss specifics of his work for the state yesterday, citing a confidentiality clause in his contract with the state.)

The unit’s findings will be used to tighten oversight of the programs with the goal of delivering better benefits to individuals in need. And, if circumstances warrant, the unit may turn over information on potential cases of criminal fraud and abuse to the appropriate law enforcement authorities, including the Attorney General’s Medicaid Fraud Control and Patient Abuse Unit, Burnett said.

The unit, formally known as the Office of Program Monitoring, will have a five-person staff with an annual budget of $150,000 for this, its first year of operation. (The allocation accounts for the fact that the unit will not be fully staffed at the beginning of the year.)

The new unit was part of the Governor’s original budget submission and made it into the final budget that passed the General Assembly. Burnett said his office plans to report to the General Assembly on its progress on investigating waste and fraud during the next session, although there is no fixed deadline for doing so.

Asked how much fraud the state suspects there is, Burnett indicated that state officials aren’t sure, but he cited national studies showing that generally 2 percent of Medicaid funds are fraudulently spent.

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