The changes call on lawmakers to eliminate the expansion of Medicaid under the Affordable Care Act and transform the rest of that program into a system of capped payments to states; convert food assistance into a hybrid of commodity deliveries and traditional cash benefits; and expand requirements that low-income people work to qualify for federal assistance.
“We’re very encouraged by their approach to reforming the welfare state, both to taxpayers and the people on these programs,” said Akash Chougule, director of policy for the libertarian group Americans for Prosperity. “We’re encouraged by the president’s rhetoric and recent actions.”
Congress has final say over spending — but Monday’s budget proposal is seen as an important sign of Trump’s priorities.
Specifically, the Trump budget proposal would gut the Supplemental Nutrition Assistance Program (SNAP), better known as food stamps, by $17.2 billion in 2019 — equivalent to 22 percent of the program’s total cost last year — and implement a boxed food delivery program, a system that White House budget director Mick Mulvaney compared to Blue Apron.
The proposal would bring a fundamental change to a program that for the past 40 years has allowed recipients to use SNAP benefits at grocery stores as if they were cash. SNAP provides an average of $125 per month to 42.2 million Americans.
Under the full-scale redesign, the Agriculture Department would use a portion of those benefits to buy and deliver a package of U.S.-grown commodities — officially dubbed “America’s Harvest Box” — to recipients, using the government’s buying power to lower costs.
The deliveries of government-purchased foods would account for roughly half of the benefits for the vast majority of SNAP households.
The foods in the deliveries would include shelf-stable milk, juice, grains, cereals, pasta, peanut butter, beans, and canned meat, fruits and vegetables, according to USDA. The department estimates that it could supply these goods at roughly half the cost of retail, slashing the cost of SNAP while still feeding the hungry.
Advocates for the hungry said they are skeptical of the plan and unclear how it would work for people with specialized diets, or whether USDA would allot the same foods to, say, an elderly diabetic and a family with young children.
“The president’s budget proposes to replace in significant part the very successful current system of having SNAP recipients use EBT cards to purchase food through grocery stores, supermarkets, farmers markets, and other normal commercial channels with a Rube-Goldberg designed system of commodity distribution via food boxes that will be administratively costly, inefficient, stigmatizing, and prone to failure, and that will return the country to Depression-era anti-hunger approaches,” Jim Weill, president of the Food Research and Action Center, said in a statement.
The proposal is also likely to enrage food retailers — particularly Walmart, Target and Aldi — which stand to lose billions if food-stamp benefits are cut, analysts say. On Monday, the Food Marketing Institute, a trade association for grocery stores, condemned the Harvest Box proposal as expensive, inefficient and unlikely to generate any long-term savings.
Trump’s budget proposal calls for additional cuts of more than $213.5 billion over the next decade to SNAP, a reduction of nearly 30 percent, according to the Center on Budget and Policy Priorities.
Many of the administration’s proposed SNAP reforms are familiar. The budget suggests restricting states’ ability to issue food stamps to unemployed adults, even in areas where few jobs are available. Itrecommends eliminating SNAP nutrition education programs, raising the age limit for SNAP recipients no longer required to work, and capping the benefit amount for large families of six or more.
The push to institute broad work requirements also extends to families receiving housing vouchers, expanding on moves by nearly a dozen states to require Medicaid and food stamp recipients to work.
The reforms at the Department of Housing and Urban Development were intended “to encourage the dignity of work and self-sufficiency” and “chart a new course for the future of public housing,” the document said.
Trump’s proposed budget for the 2019 fiscal year includes a 14 percent cut to HUD, amounting to $6.8 billion below the agency’s current $48 billion spending. That’s an even deeper cut than his previous year’s proposal, which had been the most dramatic cut to HUD since the early 1980s.
The proposal would eliminate the entire fund for public housing capital repairs, a savings of nearly $2 billion a year. The cut comes at a time when public housing faces a $40 billion backlog of capital needs, said Diane Yentel, president and chief executive of the National Low Income Housing Coalition. In New York City, about 80 percent of public housing tenants suffered heating and hot water outages in recent months because the aging boiler systems are in desperate need of repair, Yentel said.
Trump also proposed cutting a federal housing subsidy program, known as Section 8 vouchers, by nearly $1 billion, which Yentel said would affect more than 250,000 low-income families.
The proposed HUD budget, like last year, would eliminate funding for Community Development Block Grants, which play a key role in disaster recovery, as well as grants to states and local governments to increase homeownership for the lowest-income Americans.
On health care for low-income Americans, Trump’s budget calls for cutting federal Medicaid funding substantially over the coming decade. This would occur, in part, by eliminating the Medicaid expansion adopted by nearly three dozen states under the ACA to allow residents with slightly higher incomes to join the program — something Congress would need to approve.
In addition, the budget would end Medicaid’s half century as an entitlement, in which the federal government gives each state a certain share of the expense of covering every resident who is eligible. Instead, the program would be converted to a system in which the government provided either a block grant or a per-person cap, while freeing states from federal rules for medical benefits and eligibility. Yearly increases would be tied to inflation — which typically rises more slowly than spending on medical costs.
To pay for part of this switch, the spending plan also would, starting in 2021, end the subsidies that help more than 4 in 5 Americans with ACA marketplace coverage pay for their insurance premiums.
The contours of these health-care changes are patterned after a Senate Republican proposal to repeal the ACA, sponsored primarily by Sens. Lindsey O. Graham (R-S.C.) and Bill Cassidy (R-La.), that failed last fall.
Dan Mendelson, president of the Washington-based health-care consulting firm Avalere Health, said the Medicaid parts of the budget are “rhetorical,” because “consensus does not exist in Congress for changes of this scale.” But Mendelson, a former OMB official during the Clinton administration, said that other parts are more realistic, including an experiment with allowing a few states to create “formularies,” sidestepping a rule that requires Medicaid to pay for every drug on the market.
All of the deep cuts to the social safety net that Trump proposed last year were rejected by Congress on a bipartisan basis, and the budget bill passed by Congress last week increased spending amounts in discretionary programs. But Yentel said she fears the cuts in Trump’s budget proposal lower the bar for what’s considered acceptable.
“The president’s budget request is always considered dead on arrival in Congress, especially in an election year,” Yentel said. “My concern is that it leaves open a space for a compromise to be less severe but still a significant cut to programs.”