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Center on Budget and Policy Priorities

06/12/2019 | News release | Distributed by Public on 06/12/2019 09:52

Trump Poverty Line Proposal Would Hurt Seniors, People With Disabilities

The Trump Administration is considering whether to use a lower inflation measure to calculate annual adjustments to the federal poverty line. This approach would ultimately hurt millions of seniors and people with disabilities who would lose their eligibility for, or receive less help from, programs to help them make ends meet. Many programs use the poverty line to determine eligibility and benefits and, if this proposal took effect, the cuts to these programs - and the numbers of people losing assistance or receiving less of it - would increase with each passing year.

Rather than continue to use the traditional consumer price index to calculate annual adjustments to the federal poverty line, the Administration is proposing to use a lower measure of inflation such as the 'chained CPI.' That would lower the income thresholds to determine whether someone is eligible for a wide variety of federal programs, which in turn would cut or eliminate assistance to many individuals and families.

Take Medicare, which is critically important for seniors and people with disabilities. While Medicare eligibility itself doesn't depend on income, lower-income Medicare enrollees qualify for federal help to pay their premiums, deductibles, and other cost sharing obligations through Medicaid or the Medicare Low-Income Subsidy (LIS) program. In many cases, eligibility for that assistance is based on the federal poverty line.

After ten years of updating the poverty line using the chained CPI, we estimate that:

  • More than 250,000 low-income seniors and people with disabilities would lose eligibility for, or get less help from, the LIS Program, substantially increasing their prescription drug costs. Most of them would no longer be eligible for the full LIS benefit. Others would lose eligibility for the partial LIS benefit.
  • More than 150,000 low-income seniors and people with disabilities would lose eligibility for a Medicaid program that covers their Medicare Part B premium. That means they'd have to pay premiums out of pocket to maintain Medicare coverage for physician and other outpatient care. The 2019 Part B premium is $1,626 per year ($135.50 per month).
  • Many other low-income seniors and people with disabilities would lose eligibility for a Medicaid program that helps them afford their Medicare deductibles and other cost sharing. Since Medicaid would no longer cover their Medicare hospital or physician cost sharing, they could face a hospital deductible of $1,364, a physician services deductible of $185, and additional co-insurance and copays (based on 2019 program parameters), compared to generally no cost sharing today.

While making it harder for seniors and disabilities to afford health care through Medicare, the proposal would also affect Medicaid eligibility in states that expanded the program under the Affordable Care Act.

Some seniors and people with disabilities would also lose eligibility for SNAP(food stamps), which provides important nutritional support for low-income seniors and people with disabilities living on fixed incomes. For seniors, SNAP participation is linked with reduced nursing home admissions and hospitalization and less frequent skipping of needed medicines. More than one-fourth of SNAP participants have an impairment or disability, so SNAP cuts would inevitably mean more hunger and hardship for people with disabilities.

A number of other programs that assist seniors and people with disabilities also have eligibility limits linked to the poverty level, meaning that some people would no longer be eligible for them (although these programs generally don't serve all eligible people). These include, for example:

  • The Low Income Home Energy Assistance Program (LIHEAP), which helps low-income people pay their heating and cooling bills. Some 40 percent of LIHEP-eligible households include at least one person aged 60 or older. LIHEAP benefits can help aging seniors and people with disabilities stay in their homes.
  • Weatherization Assistance for Low-Income Persons, which helps low-income households by providing insulation, replacing broken windows, and fixing or replacing heaters and furnaces to make homes more energy efficient.
  • Community health centers, which provide low-cost health care for people who don't qualify for Medicaid, including seniors and people with disabilities.
  • TheChild and Adult Care Food Program, which helps pay for nutritious meals and snacks for seniors and people with disabilities served by adult day care centers.
  • The Senior Community Service Employment Program (SCSEP), the nation's oldest program to help low-income, unemployed individuals aged 55 and over find work. SCSEP matches eligible older adults with part-time jobs for community service organizations, serving nearly every county in the nation.
  • The Foster Grandparent Program, which engages low-income seniors aged 60 and over in volunteer service to provide supportive, person-to-person service to children with exceptional or special needs.
  • The Senior Companion Program, which engages low-income seniors aged 60 and over in volunteer service to provide supportive, individualized services to help adults with special needs to maintain their independence.
  • Legal Services for the Poor, which provides legal aid to low-income Americans, including seniors and disabilities. For example, the program protects the elderly from being victimized by unscrupulous lenders, and it helps people get and retain disability benefits and Americans with Disability Act protections.