Recommendations for a 21st-Century SNAP

The Supplemental Nutrition Assistance Program, commonly known as SNAP, is shaping up as a key appropriations battleground for the new Congress. As extra, pandemic-era SNAP benefits ended in 32 states this month, Republicans on Capitol Hill signaled intentions to move to permanently reduce SNAP benefits and/or tighten eligibility requirements as part of negotiations over a new Farm Bill. American Enterprise Institute  Senior Fellow and Rowe Scholar in Poverty Studies Angela Rachidi has just published a new paper making recommendations on how best to reform the program while adding nutritional value. Rachidi spoke with Spotlight recently about her proposals; the transcript of that conversation has been lightly edited for length and clarity.

Angela, why don’t we go through the four areas for reform that you outline for SNAP in the paper, unless you’d like to frame your thoughts to start.

Maybe I can do a little bit of both. Overall, I think the main point of the paper and generally the way I’m thinking about SNAP right now is that the Farm Bill does provide an opportunity to address the underlying problems with SNAP that I think have been ignored for many years. SNAP obviously has benefits for low-income families — the evidence is pretty clear that it does have positive aspects to it. But I think because it has those positive aspects, policymakers have ignored some of these underlying problems, and those underlying problems are represented in the four areas that I identified.

Employment is a key one. The research is pretty clear that SNAP discourages employment or at least reduces employment levels, and to the extent that SNAP does contribute to low employment levels, there are certain things that the program can improve on. Some of the recommendations I included in the paper include tightening up the work requirements for non-disabled recipients. Work requirements for non-disabled adults age 18-49 without children have existed since 1996, but they apply to a narrow population and the federal government has allowed states to waive them too broadly in my opinion for many years, not just during the pandemic or the aftermath of the pandemic.

The next main area is there’s approximately $500 million in federal funding towards SNAP employment and training and there’s really very little evidence of effectiveness. That program is looked to as a way to counteract these employment disincentives, but it’s just not an effective program. I’m proposing really taking a look at that program and figuring out how to either make it effective or discontinue it and start over or at least think through new strategies. That’s a pretty big chunk of money and if it’s not leading to better outcomes, then policymakers should really think about why they’re spending it.

Can you talk just a little bit more about that and why it hasn’t been effective?

In almost all the states, these programs are voluntary and so the engagement is very low. There are just very few people who take advantage of it and then the ones who are motivated to take advantage of it would likely do fine in the labor market even without those programs. Studies show that people who don’t participate have very similar outcomes to those who do participate in terms of employment and earnings and things like that. So, I think part of the problem is just engagement, but then the other problem is the services that are provided are just not very robust and not very beneficial to participants.

And I apologize for interrupting you — did you want to say more about employment?

I think those are the main areas, and tightening up work requirements for able-bodied recipients is critical. Those policies only go up to age 49 and the largest growing share of the SNAP caseload is actually 50- to 64-year-olds. So, there’s a real concern about older adults who aren’t disabled and not working and don’t have a work requirement. My concern is two-fold. The federal government should not support idleness, but I am equally concerned that SNAP’s work disincentives harm individuals by contributing to social isolation and denying people the financial and nonfinancial benefits of employment.

Nutrition is next?

Yes. I would place nutrition as probably the priority area in terms of where SNAP has the worst outcomes and really fails participants. SNAP contributes to poor diet. The health outcomes for SNAP participants are as bad or worse, in terms of obesity and diet-related disease, as, the general population. And SNAP isn’t really doing a whole lot to try to improve nutrition, even though that’s a stated goal of the program. I propose a number of things that Congress could do, but at the most basic level there should be a declaration of policy for SNAP that nutrition is a goal. That may sound unimportant, but I actually think it is important because if that was a stated policy declaration, then the Food and Nutrition Service would need to track nutrition outcomes. I propose a couple ways to do that — just tracking diet for SNAP participants, tracking obesity rates, tracking the healthy eating index, and looking at the data year to year to see if SNAP actually is having a positive effect on the nutrition side of things. I think those two things are crucial and should be uncontroversial and can hopefully be one area where there could be some bipartisan agreement.

And does that all have to be done through the vehicle of the Farm Bill, or can some of it be done through rule making at USDA?

The declaration of policy cannot be done administratively. They can set administrative goals and things like that, but the declaration of policy is in the legislation. It wouldn’t have to happen through the Farm Bill, but it would have to happen through some sort of legislation. But to your point, the FNS (Federal Nutrition Service) could track data on nutrition. They don’t need Congress to tell them to, they could do that on their own. It’s just that they have not really done that, for whatever reason.

What about eligibility and benefit levels?

I get into the Thrifty Food Plan in my report, which I viewed as an improper administrative action by the USDA to raise benefit levels and I make a couple of recommendations about how to counteract it. One is, consistent with the nutrition aspect, taking that 25% increase that happened in fiscal year 2022 and turning it into a cash value benefit where it can only be used for fruits and vegetables. USDA raised benefit levels under the argument that this would help people afford more nutritious food, but then there is no expectation and no requirement that they actually purchase more nutritious food. And the evidence shows that most SNAP recipients spend a large portion of their benefits on non-nutritious foods that actually harm health. So, I recommended either this cash value benefit or rolling it back until we know how increased benefit levels actually affect health. There are some other things that Congress could do. They could ensure that any future Thrifty Food Plan updates are done in a cost neutral way, or that even if they’re not cost neutral, it still requires congressional action to raise benefit levels.

And then once you right size the benefit levels, I think there is opportunity to take a look at whether it would be effective to increase benefits or to change shelter allowances and things like that. I’m not saying that the benefit levels are exactly where they should be. I’m just saying the process needs to be done properly. It needs to have evidence to support it. And I think that’s where the USDA fell short. A report by the Government Accountability Office confirmed that. I have a few recommendations for how they can actually look at benefit levels in a more scientific way and see what works best for people using that lens of supporting nutrition.

And your final area was fraud and integrity?

Right. So, part of the concern about such an explosion in SNAP expenditures through the Thrifty Food Plan change and increased participation overall is that it will mean more fraud and trafficking. The improper payment rate has almost doubled in the last decade and that means a lot of federal expenditures are being wasted. Another area of concern is benefit trafficking. This is when retailers improperly use benefits by giving people cash and pocketing the benefits, which is a very difficult thing to police. USDA knows it’s a difficult thing to police because you have to actually put people out into the stores and try to catch them. So, it’s a very difficult thing to catch. Whether it is intentional or unintentional fraud resulting in improper payments or benefit trafficking, it is a waste of federal dollars and as the program gets bigger, it becomes more of a problem.

I think there are some things that the USDA could do, and that Congress could legislate, like getting data from the retailers on purchases. That would help the USDA identify outliers, help identify bulk purchases, and you could target retailers that they think might be a problem. The other thing is to have tougher consequences — and probably financial consequences — for states that have a high rate of improper payments so that states really take the improper payments seriously and put efforts in to fixing them.

How does the call by some to increase online access for SNAP benefits play into that?

This involves two issues. The first is allowing people to apply and recertify benefits online rather than having to enter an office. Allowing online eligibility determination certainly raises the risk of improper payments, but it also increases convenience for participants. So there is a trade-off. Just knowing how SNAP eligibility is determined, there’s a lot of documents that have to be shared and reviewed. When you do it online, there’s just more opportunity for errors. So, I think it raises the risk, which is partly why there needs to be stronger consequences for payment errors because if states are going to do online eligibility determination, they have to make sure they have the systems in place that can counteract those risks. The other issue is whether SNAP should allow participants to use benefits for online purchases. This has been happening since around 2014 and was especially helpful during the pandemic. I think it is appropriate to allow online retailers to participate in SNAP, but again it raises the risk for improper use of benefits. For example, people can more easily make bulk purchases for resale. However, the USDA can use retailer data to monitor those types of purchases and require that retailers address them when discovered.