The Supplemental Nutrition Assistance Program

Abstract

This paper will attempt to encompass the Supplemental nutrition program, but specifically, fraud in this program. The author will detail the history of SNAP, give a description of the program itself, and then go onto analyze the program. From here, the paper will detail how how the program is exploited by fraud, how politicians present this epidemic in mainstream media, and if these claims are true. Finally, the paper will provide an alternate to SNAP, analyze its strengths and weaknesses and compare this to the current program in place. The goal of this research is to try to discover if there can be an alternate to SNAP, or if it would be more sensible to patch the holes in the existing program. Keywords: SNAP, Fraud, Alternative, staple food The Supplemental Nutrition Assistance Program

Introduction

The Supplemental Nutrition Assistance Program is a program that is designed to help people in the United States who at or below the poverty level. In an ideal state, the United States government will give a stipend to impoverished people, and they can use this money to buy food. But as with any bureaucratic program, there are a lot of holes in this program that would allow someone to take advantage of the American tax payer.

The original intent of the program was to help out a struggling American get back on its feet, a helping hand in dark times. But today, instead of a hand up, the program is being used as a hand out. According to “Time Magazine,” SNAP, also known as “Food Stamps” is a $70 billion program that provides assistance to 44 million Americans. A government program this big is bound to have some holes that allow for the system to be exploited. This paper will attempt to provide a description of the program, detail the programs structure, how fraud is committed, how politicians use this as a platform, give an alternative to the program, explain its strength and weaknesses, and compare this to the existing program. The end of the paper will decide whether to keep the current system, or whether to move towards an alternative measure. What is the Supplemental Nutrition Program and how does one Qualify? As previously discussed in the paper, SNAP, or “food stamps” is a program that is designed to help those in need. The program itself is run by the United States Department of Agriculture, however, requirements vary from State to State, and for how many people reside in that household.

For example, according to “benefits.gov”, a four-person household in the State of Florida has a maximum total income of $49,200 before taxes in order to receive benifts. Overall, standard requirements across the country require the applicant to be a citizen of the United States and a citizen of the state that you are applying for benefits from, and a Social Security number. According to the “Center on Budget and Policy Priorities”, the average household receives $253. This money is then distributed on an Electric Benefit Transfer (EBT) card and can be used like a debit card. According to the “United States Department of Agriculture: Food and Nutrition service,” EBT benefits can be used to purchase food for a household. Food can be classified into two categories; Luxury and staple. The staple foods include bread, foods fruits, vegetables, meat, fish, poultry dairy, and seeds. Luxury foods include junk food, sodas, steak, bakery items, and seafood. The benefits received can also not be used on things that are inessential to the household, such as pet food, paper products, or medicine.

Retailers and SNAP

However, it is not just people who need benefits that who have criteria to meet in regards to EBT. Retailers have to meet eligibility requirements in order to accept a customer’s EBT benefits. According to the “United States Department of Agriculture: Food and Nutrition,” there are one of two criteria that a retailer must meet. These criteria are “inventory of staple foods” and “sales of staple foods.” In order to qualify under the criteria “inventory of staple foods” the retailer has to have “three stocking units of three staple food varieties in each of the four staple food categories, including three stocking units of one perishable in at least two food categories” (United States Department of Agriculture: Food and Nutrition Services). In order to qualify for “sale of staple foods,” the retailer has to have at least 50% of its total sales come from the sales of staple foods. It is important to mention the retailer because they can commit SNAP fraud as well. What is SNAP Fraud?

According to the “United States Department of Agriculture: Food and Nutrition Services,” there are three kinds of SNAP benefit fraud. The first kind, is when SNAP benefits are exchanged for cash, or also known as trafficking. The second way to commit SNAP fraud, happens when someone lies on their application and receive benefits, or get more than they were supposed to. The third way fraud is committed is when the retailer has been disqualified from the program for prior abuse and lies on the application to get back in. Although these terms seem full of jargon, “Time” gives a couple of really good examples. According to “Time,” food stamp recipients in Ohio were selling their benefits to merchants in exchange for cash. Ever since the economy collapsed in 2008, there has been a staggering increase in benefit fraud. The most recent data, according to “Forbes,” SNAP fraud has increased 61%. What is most fascinating about this fact, is that 5% fewer people are receiving benefits. The United States Department of Agriculture estimates that every cent on the dollar is being used fraudulently by members of SNAP. It is estimated by “Forbes” that annually $592.7 million was stolen in 2016, which is comparable to $367.1 million in 2012. “Forbes also estimates in 2016 there have been 963,965 investigations nation wide. Much like the statistic stated above, although the investigations have increased by 30%, the program cut spending by $8.1 billion in a four-year period.

According to “CNN,” we should expect to see another $17 billion cut in 2019. What should be taken away from these statistics, is that the USDA is doing its job by cracking down on fraud. The Statistics These statistics were provided by the “Center on Budget and Policies Prioritie” article “SNAP is effective and efficient.” These statistics show people who were both over paid, and under paid from the years 1990-2011. According to the “Center on Budget and Policy Priorities,” over paid is defined as “benefits either went to to ineligible house holds, or went to eligible house holds in incorrect amounts.” As we can see by this graph, less than three percent of household were overpaid in 2011. Moreover, the article goes on to say that a majority of the time, overpayment is not done out of malicious intent, but rather, are honest mistakes by either the applicant, the application reviewers, or by the data enters. The United States Department of Agriculture has begun to put in safety net systems to make sure that all eligible households are receiving the proper amount, and ineligible households are declined from the program. Punishment for Fraud Depending on how much an individual fraudulently took, they can be charged with either a felony or a misdemeanor in the state of Florida.

According to “Hussein and Webber Law Firm,” anytime a person uses less than $200 a month for twelve consecutive months, this individual will be charged with a misdemeanor in the first degree, which is punishable by a $1,000, a year of probation, or a year in jail. If an individual has taken more than $200 a month for twelve consecutive months, this individual can be charged with a felony in the third degree, which is punishable by a $10,000 fine, five years in jail or five years of probation. SNAP Fraud in Politics The past couple of years, SNAP has become the target of the republican party. In an effort “protect the American tax payer,” several politicians have made made the reform, or at least targeting abusers, of the Supplemental Nutrition Assistance Program a part of their platform. As a result, the Obama and Trump administrations have aggressively targeted abusers of the program. The most recent statistics on fraud was published in 2017 by the “United States Department of Agriculture: Food and Nutrition Services,” which claims they used a “robust investigation process” which has lead to 849 stores being permanently removed from the program, and sanctioned 549. In 2012, 1,400 were permanently removed from the program. These statistics give credibility to their claim that they indeed have among the lowest fraud rate in federal programs.

Anti-Obesity SNAP: An alternative

There has been a vein of thought running through the Public Administration community which Craig Gurdsen addresses in “SNAP Matters: How food stamps effect Health and Well-being,” which is that SNAP leads to higher levels of obesity. The individuals who contend this point that by moving SNAP in the direction of anti-obesity, they can begin to eradicate fraud, and end a perceived problem of recipients of SNAP being obese. Logic would tell one, that you cannot make someone do something that they do not want to do. As Gurdsen notes, this program was founded to help end hunger in the country. Although he did find that SNAP had positive effects on obesity on a subset of the population, if this program was implemented, it would be likely that both poverty and hunger levels will rise across the country. People who receive the benefits would rather use the cash-like system to continue to buy what they want, rather than being constrained to fight the new criteria of an “anti-obesity” welfare service. American Harvest Box: An alternative According to “CNN,” Another reform to the program that the Trump administration has suggested is taking an approach much like “Blue apron” and providing “meal kits.” What the administration dubs “American Harvest Box,” includes canned good and cereals. Considering the constraints that the institution faces, this is as realistic of an alternative where the government distributes food is going against.

This American Harvest Box the idea of “staple foods” which allows the individual to buy nutritious food, and instead would deliver the box of food to the door of the recipient. When this idea is given some thought, it is easy to see how terrible this idea is. The recipient would go from receiving benefits to buy nutritious foods, to receiving food which Jill Filipovic calls “canned sodium saturated goods.” If the administration implements this, sure it would solve a short term problem of ending fraud and extortion of the American tax payer, but the long term implications are much scarier than the current implications. Much like the anti-obesity reform, it is possible to see an increased level of poverty, but also the level of obesity would increase because of the content of the food being distributed. Besides this, because it would be a large government-operation, it would be possible for the food to go bad, and to still be distributed. Although this is the most feasible option to end the Supplemental Nutrition Assistance Program, it is still not a good reform. Final decision After considering the anti-obesity program and the American Harvest Box, the choice is clear.

The Supplemental Nutrition Assistance Program, with all of its flaws, is the best option. Even though there is a problem with fraud, the United States Department of Agriculture has implemented new investigative techniques, and has announced new programs that would allow for States, such as Massachusetts to communication with the headquarters in Washington DC, and communicate with other states. “Communicate” in the Context of the previous sentence means to exchange information regarding potential fraudulent occurrences. With the Anti-Obesity program, there was in fact a positive relationship between Obesity and receiving SNAP benefits, but to change the entire program because of a subset of the population is unreasonable. There are certain needs that an individual needs that cannot be catered to if they have to abide by a certain standard of food under the program. There is a similar problem with the American Harvest Box. This program would deny people the freedom to buy their own food, and would instead give them a box food that could have gone bad, regardless of their health conditions, such as allergies or high blood pressure. While both of these programs have potential, you cannot deny the allure of freedom to buy the foods that you need.

A potential way to fix the problem in the Supplemental Nutrition assistance program, is to only allow chain retailers to use benefits, instead of anyone who meets the minimum requirements, because most cases of fraud come from small stores. Another way to fix the problem, is to create a wider safety net around the application pool, by making sure both the date entered, and the application is reviewed properly, and entered into their system correctly, to make sure that households are neither receiving more benefits than they need, or receiving less benefits. Conclusion To conclude, the problem of fraud is not as wide spread as it once was. Under previous administrations, the United States Department of Agriculture has been given the tools necessary to end the exploitation of the tax payer.

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