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A Review of U.S. Federal and State Means-Tested Programs

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Abstract

This report presents a review of the major U.S. federal and state means-tested programs, including a review of how they operate, common features, and rules governing eligibility. The review covers the nature of the target recipient population, the nature of the benefits (cash or in-kind), whether the program is an entitlement, as well as financial and nonfinancial eligibility rules and benefit determination. Each of the features is compared to that of the Supplemental Security Income (SSI) program. The review reveals that SSI has many common features with other transfer programs, and that many other differences follow naturally from its particular goals and aims. However, large differences between SSI and other programs exist in financial eligibility rules. The current upper income limits for SSI are in the approximate range of 75 to 80 percent of the poverty line for single and married-couple recipients, respectively, below the 100- to 130-percent of the poverty line income limits for Supplemental Nutrition Assistance Program (SNAP), the 130- to 185-percent limits for school food programs, the 185 percent limits for Women, Infants, and Children (WIC), the 138-percent limits for Medicaid, and the 100-percent limits for Workforce Innovation and Opportunity Act (WIOA). Another significant difference is in resource and asset tests in SSI, which have been held constant in nominal dollars since 1989 and hence have been becoming more restrictive in real terms over time. Most other transfer programs have been moving in the opposite direction, reducing the restrictiveness of their asset tests, exempting additional items from countable assets, and in many cases eliminating asset tests entirely.

Key Findings

  • The Supplemental Nutrition Assistance Program (SNAP) has a much broader definition of the family unit than SSI, as well as having higher income limits for eligibility and much more liberal resource tests, especially for vehicles.
  • The Medicaid program is composed of four different programs and, for the program covering nonelderly, nondisabled parents and children, income limits for eligibility for children are much higher than those in SSI. Limits for parents are also higher for states that enacted ACA Medicaid expansion plans, and most households in these groups do not face resources tests.
  • The Temporary Assistance for Needy Families (TANF) program has income eligibility levels considerably below those of the SSI program, but resource limits on financial assets and vehicles, although more stringent than those in SSI in a handful of states, are generally more liberal than those in SSI and some states have eliminated asset tests entirely.
  • Subsidized housing programs require that income be less than limits which differ from area to area, but are generally above the poverty line income for each family size. The programs do not have asset tests but use a broad definition of income from assets when assessing income eligibility.
  • Child care subsidy programs pay a fraction of child care expenses for families with income below state-specific levels that are generally above the poverty income. Asset limits are a state option, but are rarely used.
  • Job training and employment programs do not use low-income eligibility criteria for all of their target groups but, for those that do use income criteria, maximum income for eligibility is around the poverty line. Asset limits are not used.

Citation

Moffitt, Robert. 2018. “A Review of U.S. Federal and State Means-Tested Programs,” Ann Arbor MI: University of Michigan Retirement Research Center (MRRC) Working Paper, WP 2018-376. https://mrdrc.isr.umich.edu/wp376/

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Project

Paper ID

WP 2018-376

Publication Type

Working Paper

Publication Year

2018