Mr. Chairman, Senator Moynihan, and members of the Committee: I want to
thank you for giving me the opportunity to testify today about the National
Governors' Association (NGA) resolutions on Medicaid and welfare and the
President's vision for reform in these areas.
Throughout the years, this committee has built a great tradition of
bipartisan leadership on these issues. We look forward to working closely with
you to reach bipartisan consensus on Medicaid and welfare reform legislation.
Right now, from kitchen tables to the halls of Congress, we are engaged in a
historic debate about the size, scope, and role of the federal government.
This debate is about much more than deficits and devolution. At its heart,
it's about who we are as Americans -- and what kind of legacy we want to leave
for our children.
The Clinton Administration believes that we must balance the budget in seven
years and shift more responsibility to the states and local communities. But,
we must do it in a way that is consistent with our values.
As the President has said time and time again: We can balance the budget and
find common ground -- without turning our backs on our values, our families, and
our future.
We believe we can give the states the flexibility they need -- while still
maintaining a strong federal-state partnership built on a foundation of shared
resources, accountability to the taxpayers, and national protections for the
most vulnerable Americans.
That's why the President has proposed a common sense plan that balances the
budget, gives new flexibility to the states. and reforms welfare and Medicaid,
without breaking our promises to our citizens -- from the seniors living in
nursing homes to the families struggling to break free from the chains of
poverty.
That is the challenge we must meet as we work to reform Medicaid and
welfare. That is the standard by which we must judge any reform, including the
resolutions recently adopted by the National Governors' Association.
We greatly appreciate the efforts of the NGA in fashioning a bipartisan
consensus on the foundations of a plan and their ongoing work to add further
detail to their resolutions. We believe that they have made a positive
contribution to the debate and have increased the likelihood that Republicans
and Democrats will produce bipartisan solutions to reforming our welfare and
Medicaid programs. While we applaud their tenacity and their contributions, we
do have serious questions about some of the proposals they have put forward:
questions about maintaining national objectives and the federal-state
partnership necessary to achieve them.
It is now up to this Administration and this Congress to build on the spirit
of the Governors' efforts. It is time for all of us to work together to reach
our mutual goals: flexibility for the states; incentives for AFDC recipients to
move from welfare to work; the preservation of health insurance coverage for
those who need it most; and protections for our most precious resource, our
children.
Let me turn first to the Medicaid program. Medicaid provides vitally
important health and long-term care coverage for 36 million Americans and their
families, including the following:
As part of his balanced budget plan, the President has proposed a carefully
designed and balanced approach to Medicaid reform. His plan preserves Medicaid
(title XIX of the Social Security Act) but makes important changes that will
give states unprecedented flexibility to enhance the program's ability to meet
the needs of the people it serves. The President's plan:
contributes federal savings to the balanced budget plan through the use of
a per capita cap on federal matching that adjusts automatically to changes in
state Medicaid enrollment, changes in the economy and reductions in
disproportionate share hospital payments.
As you know, the President strongly opposed -- and ultimately vetoed -- the
congressional approach to Medicaid reform because it did not meet these
standards. The Congress voted to repeal the Medicaid program and replace it
with a new "Medigrant" program that did not include meaningful guarantees of
eligibility or benefits. The Congress also proposed a "block-grant" funding
mechanism that breached the 30 year federal partnership with the states to share
in changes in state Medicaid spending.
As I mentioned earlier, NGA recently approved the outlines of its own
Medicaid reform plan, which has been helpful to the debate. In particular, we
have been pleased that the Governors appear to agree with one of the key
elements of our plan -- namely that federal financing must be responsive to
actual, and often unanticipated, changes in Medicaid enrollment in the states
and changes in the economy.
However, while the details of the NGA plan are still not completely fleshed
out, we are concerned that the elements of the NGA resolution do not reflect the
priorities set out in the President's Medicaid plan in certain areas. These
are: (1) the need for a real, enforceable. federal guarantee of coverage to a
congressionally- defined benefit package; (2) appropriate federal and state
financing; and (3) quality standards, beneficiary protections, and
accountability.
The federal guarantee of coverage and benefits
The federal "guarantee" of coverage and benefits is at the core of the
federal Medicaid program. Unfortunately, the term "guarantee" has been assigned
very different meanings in the context of the current Medicaid debate. When we
use the term guarantee in the context of a federal statute like Medicaid, we
mean a real guarantee, composed of three interrelated components: definitions of
1) eligibility; 2) benefits, and 3) enforcement.
Eligibility
Let's begin with eligibility. The NGA plan sets out a number of current law
groups that states must cover in their plan. However, problems remain in the
NGA definition. First, it repeals the current law phase-in of Medicaid coverage
for children ages 13-18 in families with income below the federal poverty level
-- a bipartisan coverage expansion signed into law by President Bush.
In addition, the NGA resolution repeals the federal standard for defining
disability and replaces it with 50 separate state definitions. This has the
effect of making Medicaid coverage and benefits for those with disabilities
uncertain and variable around the nation. For example, it would be possible for
states to use restricted definitions of disability resulting in very limited
coverage for populations whose service needs are pronounced and among the most
costly. In such situations, we are concerned that narrow state definitions of
disability could preclude individuals with HIV, certain physical disabilities,
or mental illness, from receiving critically needed services under Medicaid. We
should not turn back the clock on those with disabilities by permitting 50
different state definitions for purposes of Medicaid coverage.
It appears that the Governors have retained the linkage between cash
assistance and eligibility for Medicaid. However, there are still some
outstanding questions that require clarification, including how currently
covered populations, like the welfare-to-work eligibles, will be covered after
the enactment of welfare reform.
Benefits
Eligibility is only one component of the guarantee -- because the question
is eligibility for what -- bringing us to benefits. The NGA resolution lists
benefits that are characterized as "guaranteed for the guaranteed populations
only." The resolution also says that all other benefits defined as optional
under the current program would remain optional, and that there would be an
additional set of long- term care options.
This new framework raises several unresolved questions. The first relates
to the adequacy of the benefits. Current Medicaid law and regulations already
give states substantial flexibility in defining the amount, duration, and scope
of benefits, and states have used this flexibility to respond to their unique
circumstances. This latitude is tempered by a very reasonable constraint --
benefits must be "sufficient to reasonably achieve their purpose". We have
concerns that by specifying "complete" flexibility on amount, duration, and
scope, the NGA proposal provides no standard against which to assess the
reasonableness of a state's benefit plan. Without a standard, any federal
"guarantee" is illusory. We believe the Governors understood this as they
acknowledged in their testimony last week that the provision in their resolution
on this issue has shortcomings that need to be addressed.
The NGA resolution also is silent on the current law standards of
comparability and "statewideness" of services -- among and within eligible
groups -- for mandatory as well as optional services. In the absence of further
information about such provisions, there is no standard against which the
"guaranteed" benefits and potential discrimination against certain groups or
diseases can be assessed, and therefore we are concerned about the potential for
discrimination against certain groups or diseases.
The NGA proposal also would limit the treatment portion of the Early and
Periodic, Screening, Diagnosis, and Treatment (EPSDT) program, so that states
need not cover all Medicaid optional services for children. The NGA does not
yet specify exactly how this would be done, so it is difficult to assess the
impact of the provision -- other than the certainty that some children would not
receive treatments despite the clinical recommendations for those services
arising from the EPSDT screening and diagnosis process.
Enforcement
The third essential component of the federal guarantee is enforcement.
Implicit in the concept of defined populations and defined benefits is the
notion of a meaningful enforcement mechanism. A federal cause of action for
beneficiaries assures that those seeking a remedy for the deprivation of medical
care receive the same due process rights everywhere in the United States. The
NGA resolution requires states to provide a state right of action, but
eliminates any federal right of action for individuals and providers who assert
that a state is violating federal Medicaid laws. The only access to federal
court for such claims would be the opportunity to petition the U.S. Supreme
Court for review of a decision of a state's highest court.
The NGA provisions pose a number of serious questions and concerns. Under
the proposal, we believe Medicaid would be the sole federal statute conferring
benefits on individuals with no possibility of federal enforcement by its
intended beneficiaries.
Review by federal courts also promotes efficiency. As a practical matter,
common sense tells us that those aspects of the Medicaid program that are common
to all states should be subject to consistent interpretation and administration.
When the same question arises across multiple jurisdictions, decision-making in
the federal court system maximizes efficiency and predictability. This is
particularly true when Medicaid interacts, as is often the case, with other
federal statutes (such as Medicare, Social Security, SSI and AFDC). Federal
courts are more experienced in analyzing these federal programs and are better
able to understand and decide cases involving relationships among them. When
courts are being asked to interpret statutory provisions that apply to all
participating jurisdictions, we should not construct a system that will
encourage different outcomes in different states.
Suits against states filed by providers over payment rates have caused the
greatest problem to the states. Under the Administration's plan, the Boren
Amendment and related provider payment provisions would be repealed, thereby
eliminating these causes of action by providers. Thus, under the
Administration's plan, state concerns about limiting their exposure to suit in
federal court would be resolved largely.
On balance, when we assess the three components required to make any
guarantee real -- the definitions of eligibility, benefits, and enforcement in
the NGA resolution -- we continue to have concerns because the federal guarantee
of Medicaid coverage and benefits does not appear to be real and enforceable for
recipients.
Financing
The second key issue is the financing contained in the NGA resolution. The
NGA resolution would replace the current financing system with a combination of
a fixed federal payment and a payment adjustment for unexpected increased
enrollment. The Governors' financing mechanism has the potential to be creative
and a workable formula that constrains growth without providing incentives to
drop coverage. Their funding approach, which ensures Medicaid dollars increase
with enrollment, represents a constructive addition to the debate. As the
Governors have noted, however, these provisions must be fleshed out in much
greater detail before anyone can assess whether the financing actually flows
based on changes in enrollment and the economy.
The NGA proposal also includes two changes in the state share of financing
Medicaid. The minimum federal contribution to the financing of Medicaid would
increase from 50 percent to 60 percent, and states' use of provider tax and
donation financing mechanisms would once again be unconstrained.
While these proposals are appealing to many states, they raise significant
concerns. Depending on the overall structure of the program and on state
decisions about program spending, raising the minimum federal match rate from 50
percent to 60 percent either could result in significant increases in federal
spending, or reductions in state contributions to Medicaid -- and in total
Medicaid funding for health care. For example, an a Medicaid
spending growth rates up to well over 20 percent. The Congress wisely enacted
limits on these mechanisms that remain appropriate today.
In addition, the NGA proposal treats American Indians and Alaska Natives
(AI/ANs) in its category of "special grants" that includes "grants to certain
states to cover illegal aliens and to assist Indian Health Service and related
facilities in the provision of health care to Native Americans". Native
Americans have a unique status in that they have a government to government
relationship with the United States that distinguishes them from other special
populations. Based upon this legal status, they are entitled to benefits
promised under federal treaties and trust responsibilities and to any benefits
for which they are otherwise eligible as U.S. citizens. The NGA resolution
regarding Indian Health services does not acknowledge this legal relationship,
nor does it recognize the fact that American Indians possess dual citizenship.
They are citizens of both the state and their tribe. The NGA resolution does
not recognize the state government's responsibilities to American Indian
citizens. We are concerned by policies which make the federal government the
sole provider of health care to American Indians and Alaska Natives and abrogate
the right of these citizens to participate in state funded services on the same
basis as any other state citizen.
Finally, we all have to examine the NGA proposal and financing structure in
the conte Medicaid
spending growth rates up to well over 20 percent. The Congress wisely enacted
limits on these mechanisms that remain appropriate today.
In addition, the NGA proposal treats American Indians and Alaska Natives
(AI/ANs) in its category of "special grants" that includes "grants to certain
states to cover illegal aliens and to assist Indian Health Service and related
facilities in the provision of health care to Native Americans". Native
Americans have a unique status in that they have a government to government
relationship with the United States that distinguishes them from other special
populations. Based upon this legal status, they are entitled to benefits
promised under federal treaties and trust responsibilities and to any benefits
for which they are otherwise eligible as U.S. citizens. The NGA resolution
regarding Indian Health services does not acknowledge this legal relationship,
nor does it recognize the fact that American Indians possess dual citizenship.
They are citizens of both the state and their tribe. The NGA resolution does
not recognize the state government's responsibilities to American Indian
citizens. We are concerned by policies which make the federal government the
sole provider of health care to American Indians and Alaska Natives and abrogate
the right of these citizens to participate in state funded services on the same
basis as any other state citizen.
Finally, we all have to examine the NGA proposal and financing structure in
the context of the effort by the President and the Congress to achieve a
balanced budget in seven years. We do not yet know whether this plan will
achieve the scoreable savings that are required under the President's balanced
budget plan -- or under the congressional proposals. If it does not, it would
have to be modified to produce savings. Otherwise, other portions of the budget
would have to be revised to bring the budget into balance.
Protections for beneficiaries and taxpayers
The NGA resolution would repeal title XIX and create a new title for the
Medicaid program. This has the effect of seriously compromising the framework
for quality standards, beneficiary and family financial protections, and program
accountability.
The NGA resolution is silent in many areas. In other areas where the
resolution is specific, some long-standing protections would be reduced or
eliminated. For example, the NGA resolution eliminates the federal role in
monitoring nursing home quality assurance. Yet without federal monitoring and
enforcement of state and facility compliance, the bipartisan uniform quality
standards established by the Omnibus Budget Reconciliation Act of 1987 could be
undermined significantly.
The NGA resolution makes no mention of quality assurance requirements or
monitoring responsibilities for Medicaid managed care. This is a particularly
important area since Medicaid managed care enrollment is increasing so
dramatically -- about one-third of beneficiaries are now in managed care. a 140
percent increase in enrollment over the past three years. The President's plan
recognizes the need for updating managed care quality standards. It repeals
some outdated approaches and requires states to establish a quality improvement
program that must include developing appropriate standards for
Medicaid-contracting health plans and using data analysis to track utilization
and managed care outcomes.
Finally, the NGA resolution does not clearly address beneficiary and family
financial protections such as spousal impoverishment and family responsibility
protections that have been central to the Medicaid program for some time. The
NGA resolution also does not address the imposition of co-payments and other
cost sharing for Medicaid beneficiaries. Further clarification in all of these
areas is needed, because these are central elements of the financial security
that Medicaid provides today for beneficiaries and their families.
Conclusion
Let me conclude by focusing on one fundamental structural issue -- whether
we approach the task of Medicaid reform by making changes in the current title
XIX of the Social Security Act, or by repealing that program and replacing it
with a new title. We support reform, not repeal, of Title XIX. The potential
unintended consequences of repealing and replacing this program are staggering
-- for states, beneficiaries, providers, and the federal government, especially
when you consider that it would reopen thirty years of settled litigation. The
Congress can address many of the most pressing concerns about any Medicaid
reform plan by amending the current law.
From the beginning of the current Medicaid debate, the President has
maintained that Medicaid must be financed through a federal-state partnership
that ensures federal funding and provides a real, enforceable guarantee of
coverage for a defined package of health and long-term care benefits. The
President's plan proposes unprecedented new flexibility for the states in how to
operate their programs, pay providers, and use managed care and other delivery
arrangements, while retaining and revising key standards related to quality and
beneficiary financial protections. The President's proposal would achieve those
objectives in a way that would also help contribute to a balanced budget by
2002. We believe that the NGA resolution has made a significant contribution to
our mutual efforts to reform the Medicaid program. We look forward to working
with the Governors, Members of Congress, consumer groups, health care providers.
and other interested parties in the near future on this important issue.
WELFARE REFORM
Now I would like to turn to welfare reform. Let me start by reiterating
some points the President made in his State of the Union address. Welfare
caseloads have declined by 1.4 million since March of 1994 -- a decline of 10
percent. A larger percentage of those still on the rolls are engaged in work
and related activities. Fewer children live in poverty. Food stamp rolls have
gone down. Teen pregnancy rates have gone down. At the same time. child
support collections have gone up, as the Administration has improved state
collection efforts, the IRS's seizure of income tax refunds, and the ability of
the federal government to make federal employees accountable for the support
they owe their children.
Over the last three years, we have worked with governors and elected
officials to give 37 states the flexibility to design welfare reform strategies
that meet their specific needs. This Administration has encouraged states to
find innovative ways to move people from welfare to work and to promote parental
responsibility, and these efforts already are making a difference for more than
10 million recipients throughout the country. States, led by Governors of both
parties, now are demanding work, time-limiting assistance; requiring teens to
stay in school and live at home; and strengthening child support enforcement.
President Clinton also has worked with the Congress to expand dramatically
the Earned Income Tax Credit to make work pay over welfare. This program, which
President Reagan said was the most pro- family, pro-work initiative undertaken
by the United States in the last generation, meant that, in 1994, families with
children with incomes under $28,000 paid about $1,300 less in income tax than
they would have if the laws hadn't been changed in 1993.
Yet, as the President said in January, we should take advantage of
bipartisan consensus on time limits, work requirements, and child support
enforcement to enact national welfare reform legislation. The President has
consistently called for bipartisan welfare reform and the Administration
applauds the way Republicans and Democrats came together to put forth the NGA
recommendations. As you may recall, the President started us down this road
when he brought together a bipartisan group of congressional leaders, Governors,
and federal and local officials to discuss welfare reform at the Blair House
last year.
We all want welfare reform that promotes work, requires responsibility, and
protects children. Real welfare reform is first and foremost about work:
requiring recipients to make the transition into the work force as quickly as
possible and giving them the tools they need to enter and succeed in the labor
market. This will require a change in the culture of welfare offices so that
every action provides support and encouragement for the transition to work.
The President, as part of his balanced budget plan, has proposed a balanced
approach to welfare reform that achieves these goals. It replaces welfare with
a new, time-limited, conditional entitlement in return for work and gives states
new flexibility to design their own approaches to welfare reform. Within two
years, parents must go to work or lose their benefits, and after five years,
benefits end. The plan provides vouchers for children whose parents reach the
time limit, and protects States in the event of economic downturns or population
growth. It also has tough child support enforcement measures and preserves the
national commitment to nutrition assistance, foster care, and adoption
assistance, preserving states' ability to respond to growing caseloads.
The Administration will continue to judge legislation adopted by the
Congress on the basis of whether it promotes work, responsibility, and family,
and protects children. And, following the example of the NGA and the Senate
last fall, we strongly hope for legislation that will be endorsed by a majority
of Democrats and Republicans in both chambers of Congress.
The NGA proposal makes numerous modifications to the conference welfare
bill--many of which, if adopted by the Congress, would be improvements. Some of
NGA's recommendations fall short and should be improved.
On the positive side, the NGA proposal reflects an understanding of the
child care resources states will need in implementing welfare reform. By adding
$4 billion for child care above the level in the conference report for H.R. 4,
the NGA proposal acknowledges that single parents can only find and keep jobs if
their children are cared for safely. The additional investment is essential to
ensure that child care resources are available for those required to move from
welfare to work and -- equally important -- to ensure that child care is
available for low income working families at-risk of welfare dependency. We are
troubled, however, that the NGA proposal fails to include Senate provisions for
ensuring safe and healthy child care, and that the increased federal spending
does not require a state match.
By adding $1 billion to the H.R. 4 contingency fund and allowing states to
draw fends if poverty rises, the NGA proposal properly recognizes that states
may experience unexpected changes in population or downturns in their economy.
In the event of a national economic downturn, however, even a $2 billion
contingency fund might be exhausted quite rapidly. During the last recession,
for example, total AFDC benefit payments rose from $17.2 billion in 1989 to
$21.9 billion in 1992, a $4.7 billion increase over the base year in one year
alone. A provision should be added to the bill allowing states to draw down
matching dollars during a national recession even if the $2 billion in the
contingency fund has been expended. We also believe the trigger mechanism
should be improved to ensure greater responsiveness to the states' need for
additional resources.
The NGA proposal also would eliminate the requirement in the Senate bill
that states meet their full 1994 level of effort in order to be eligible for the
contingency fund. The removal of this requirement would allow a state to draw
down additional federal dollars while actually reducing its own contribution to
the family assistance program. It is difficult to understand why a state in
need of contingency fund dollars to meet the demand for assistance would
simultaneously be allowed to cut its own spending on poor families below the
1994 level. We support restoring the contingency fund maintenance of effort
provision contained in H.R. 4.
The NGA proposal also properly recognizes the importance of child support
enforcement to welfare reform. Last year, the President insisted that welfare
reform include the toughest child support enforcement reforms in this country's
history. Since then, Republicans and Democrats have worked together in a
bipartisan spirit and included all of the major proposals for child support
enforcement reform that the President requested: streamlined paternity
establishment, new hire reporting, uniform interstate child support laws,
computerized statewide collections, and drivers license revocation. We applaud
the efforts of the NGA and the members of this Committee for their hard work on
the child support enforcement provisions. It has been bipartisanship at its
best.
On Food Stamps, the NGA proposal makes two important improvements to the
H.R. 4 conference bill. First, it does not impose a funding cap on the Food
Stamp program as the conference bill did. A cap on Food Stamp spending would
jeopardize the ability of the Food Stamp program to get food to people who need
it. Second, the NGA proposal protects families with relatively high shelter
costs -- mostly families with children -- by adopting the Senate's approach to
the program's deductions from income.
The NGA proposal also makes substantial improvements to the performance
bonus provisions in the conference agreement by establishing a separate funding
stream to pay for bonuses -- rather than allowing states to reduce their
maintenance of effort. It makes modifications to the work requirements to make
them more feasible and less costly for states to meet. In particular, the
Administration is very supportive of provisions that allow part-time work for
mothers with pre-school age children and that reduce the maximum number of hours
per week from 35 to 25.
The Governors' proposal also is noteworthy because it limits proposed cuts
to the Earned Income Tax Credit. We cannot be serious about welfare reform if
we cripple the primary work incentive for low- income parents. Along with child
care and health coverage, the EITC is vital to helping people move from welfare
to work.
Finally, the Administration is supportive of several provisions that the NGA
adopted from the Senate-passed bill -- a 20 percent caseload exemption from
the time limit for battered women, women with disabilities and others who may
need a hardship exemption; a state option to implement a family cap; and
requirements that teen mothers live at home and stay in school.
The Federal-State Partnership
While the NGA proposal improves on the conference bill in a number of ways,
the Administration has serious concerns about several provisions. While it is
critical that states have the flexibility to design programs to meet their
specific needs, it is equally essential that the federal government ensure
accountability in the use of tax dollars and make certain the safety net for
poor children is maintained. The federal-state match system under current law
always has been the "glue" that holds this partnership together and was part of
the welfare reform plan the Administration proposed as part of its balanced
budget plan.
A serious concern about the NGA proposal generally is that the federal-state
partnership is severely weakened. As I have already mentioned, the
Administration prefers the provision in the Senate bill that requires 80 percent
maintenance of effort of the 1994 level, and a requirement for a 100 percent
maintenance of effort for access to the contingency fund. We also oppose the
NGA provision allowing a state to transfer up to 30 percent of its cash
assistance block to other programs such as Title XX, the Social Services Block
Grant. Since most states spend considerable state dollars on social services,
this transfer effectively permits substitution of federal dollars for state
dollars.
The problem is exacerbated in the Governors' proposal by the fact that the
additional $4 billion in child care funds requires neither a state match nor
even maintenance of the FY 1994 level of state effort on child care.
In total, these provisions imply that states could, by law, reduce their
spending substantially under the MOE and transfer provisions while federal
spendink grants current entitlements for adoption,
foster care, independent living and family preservation. With disturbingly
uneven state performance in this area, it also is troubling that the NGA's
proposed redesign of the nation's child protection system fails to include a
mechanism to enforce protections vital for the lives and well-being of abused
and neglected children. The NGA proposal also would block grant important
programs focused on prevention of child abuse and neglect. If the system
includes no targeted prevention funding, crisis-driven decision-making may
deplete resources for prevention.
Food Stamps and Child Nutrition. On behalf of the Secretary of Agriculture,
I'd like to discuss a few issues relating to the nutrition programs. While the
NGA agreement does include some improvements to the conference report's
provisions on Food Stamps, the NGA proposal did not go as far as it should, and
serious concerns remain:
-
The NGA proposal continues to provide a state option fafety
net for poor children. Federal and state child protection programs provide an
essential safety net for the nation's abused, neglected and adopted children,
and children in foster care. As we embark upon bold new welfare reform
initiatives, it is critical to maintain a strong child protection system for
these extremely vulnerable children. Unlike the Senate's bipartisan approach
to child protection, the NGA proposal jeopardizes this essential safety net by
allowing states to replace with block grants current entitlements for adoption,
foster care, independent living and family preservation. With disturbingly
uneven state performance in this area, it also is troubling that the NGA's
proposed redesign of the nation's child protection system fails to include a
mechanism to enforce protections vital for the lives and well-being of abused
and neglected children. The NGA proposal also would block grant important
programs focused on prevention of child abuse and neglect. If the system
includes no targeted prevention funding, crisis-driven decision-making may
deplete resources for prevention.
Food Stamps and Child Nutrition. On behalf of the Secretary of Agriculture,
I'd like to discuss a few issues relating to the nutrition programs. While the
NGA agreement does include some improvements to the conference report's
provisions on Food Stamps, the NGA proposal did not go as far as it should, and
serious concerns remain:
- The NGA proposal continues to provide a state option for a Food Stamp
block grant. The nutrition and health of millions of children, working
families, and elderly could be jeopardized if many states took advantage of this
option, as they might under the terms contained in the proposal. Although the
Administration is committed to simplification and increased flexibility in the
Food Stamp program, we are strongly opposed to a Food Stamp block grant.
- In addition, the NGA proposal continues the proposed Simplified Program to
households which receive both Food Stamps and AFDC. While the Administration
supports a Simplified Program and has developed its own proposal, the NGA
proposal undermines national standards that work and creates a hidden cost for
states.
- The NGA proposal severely time limits Food Stamp receipt for many
unemployed adults. Anyone who is not willing to work should be removed from the
program. But those who are willing to work should have the opportunity and the
support necessary to put them to work. Many who are willing to work could lose
their Food Stamps because states are unwilling or unable to provide sufficient
work and training opportunities. Without resources to provide work
opportunities, states could face the burden of caring for thousands of people
who have lost nutrition assistance.
- The NGA proposal retains the conference bill's provision for school
nutrition block grant demonstrations. The block grant demonstrations would
undermine the program's ability to respond automatically to economic changes and
to maintain national nutrition standards.
Guarantees of fair and equitable treatment. The NGA proposal does contain a
requirement that states set forth and commit themselves to objective criteria
for the delivery of benefits and fair and equitable treatment. This is an
improvement over the conference bill, which contained no guarantees that states
would commit to objective eligibility and other criteria and promptly and
equitably serve those who met them to ensure that applicants and recipients are
not subject to arbitrary treatment -- for example, being placed on waiting lists
- state plans should be explicit, contain certain elements, and bind the states
to their commitments. Among those commitments should be applications,
eligibility and sanctions criteria, and procedures and time frames for
decisions. Moreover, statewideness and equity across families in each state
must be the goal. Applicants and beneficiaries should be told the reasons for
decisions on their rates. Mistakes in the administration of the program should
be correctable. Once these objectives are met, applicants, recipients and other
taxpayers in each state will understand the benefits and concomitant
responsibilities under their state plans.
Restrictions On Benefits To Immigrants
The recent NGA proposal does not address the immigrant provisions included
in the H.R. 4 welfare reform conference bill. That bill would have banned most
legal immigrants. including the disabled, the elderly, and children, from
receiving means-tested benefits. It also would have excluded illegal aliens
from all child nutrition benefits, creating an unprecedented local
administrative burden and ultimately denying benefits to millions of eligible
children. This provision alone would require all 45 million students enrolled
in participating schools to document their citizenship to participate in the
federally- supported school lunch program, placing an enormous administrative
burden on local school systems.
The Administration opposes deep and unfair cuts in benefits to legal
immigrants.
Instead, the Administration strongly supports strengthening and enforcing
sponsor responsibility for immigrants, by extending deeming provisions until
citizenship. It is particularly important to note that the NGA, in its letter
to the welfare conferees dated October 10, 1995, specifically supported the
deeming approach of the Administration and opposed the banning provisions in
H.R. 4. We are deeply concerned that the legal immigrant provisions of H.R. 4
will represent an enormous cost shift to certain states, as well as to federal
taxpayers, leaving state and local governments solely responsible for assistance
to legal immigrants.
In short, the NGA welfare proposal represents an important bipartisan step
forward in enhancing the ability of the states to reform welfare by promoting
work, encouraging parental responsibility and protecting children. It needs to
be improved in important ways. We look forward to working in a bipartisan way
to build on the improvements that have been made and to achieve welfare reform
of which we can all be proud.
In conclusion, Mr. Chairman, let me restate the Administration's commitment
to enact both a balanced budget and Medicaid and welfare reform legislation. As
the President has said, budget cutting shouldn't be wrapped in a cloak of
reform. Let's pass needed Medicaid and welfare reforms. Let's cut the deficit.
But let's not mix up the two and pretend that one is the other.