Cost of welfare benefits skyrockets during pandemic
Increased eligibility, need drive spending increases
USE OF VARIOUS welfare assistance programs skyrocketed amid the pandemic, particularly as federal unemployment benefits dried up, according to new data provided by the Department of Transitional Assistance. The higher spending is also driven by state policymakers’ decisions to increase the level of assistance that is available.
Department of Transitional Assistance Commissioner Amy Kershaw said cash assistance to the elderly is at a historic high. “We’ve never seen it at that level before,” Kershaw told the House and Senate Ways and Means Committees at a legislative budget hearing Tuesday.
The hearing focused on the budget of the Executive Office of Health and Human Services. Kershaw was one of several state agency heads who operate under the office and testified before legislative budget writers. Her testimony highlighted the growing need that many families have had for assistance during the pandemic, even as the overall economy is recovering and jobs are returning. Baker’s budget proposal anticipates giving the Department of Transitional Assistance a $831 million budget in fiscal 2023, a 5 percent increase from the current year.
The state has two cash assistance programs: Transitional Aid to Families with Dependent Children, which serves families with children, and Emergency Aid to the Elderly, Disabled, which primarily serves older adults. The TAFDC program was helping 33,500 households as of December, which is 12 percent more than pre-pandemic. The EAEDC caseload was around 25,000, a historic high for the program and 31 percent more than pre-pandemic.
The record-high caseloads were driven in part by changes the Legislature made to eligibility and benefits. The Legislature increased income thresholds, increased grant amounts by 20 percent, and eliminated asset limits in both cash assistance programs. This was the first time in decades that the benefit levels had been increased. The data show a sharp increase in payouts after July 2021 when the eligibility and benefit levels changed.
There was another increase in September 2021, which is when pandemic-related federal unemployment benefits expired.
“Our economic assistance accounts experienced incredible volatility during the pandemic as federal policies waxed and waned, and new state level policy changes came in,” Kershaw said.
The cost of these benefits to the state is significant. In fiscal 2023, the governor’s budget proposal funds TAFDC at $295.9 million and EAEDC at $122.2 million. Kershaw told lawmakers the agency will continue monitoring caseload trends over the next few months and provide updates as lawmakers move to finalize the state budget.
Advocates for low-income individuals have been pushing the state for years to make it easier to apply for different types of state benefits, particularly MassHealth and SNAP, by providing one common application, since many of the eligibility requirements for the programs overlap. The advocates say it is clear from the numbers of enrollees that there are many people who are eligible for food assistance but do not apply.Kershaw said the department has begun making changes to its paper application so people, primarily seniors, applying for MassHealth can also indicate interest in food assistance. The administration is planning to upgrade the online MassHealth application this July so more people can use it as a means to also start applying for SNAP.
Another area the state has focused on expanding is the Healthy Incentives Program, an initiative that lets a shopper using SNAP benefits spend $1 and buy $2 of produce from a local farmer. The state has occasionally had to suspend the program in the winter because of a lack of funding, drawing complaints from vendors and participants. Kershaw said DTA kept the Healthy Incentive Program in place year-round in fiscal 2022 and plans to do the same in fiscal 2023.