    Food Stamp Program: Farm Bill Options Ease Administrative Burden,
    but Opportunities Exist to Streamline Participant Reporting Rules
    among Programs (16-SEP-04, GAO-04-916).

    Many individuals familiar with the Food Stamp Program view its
    rules as unnecessarily complex, creating an administrative burden
    for participants and caseworkers. In addition many participants
    receive benefits from other programs that have different program
    rules, adding to the complexity of accurately determining program
    benefits and eligibility. The 2002 Farm Bill introduced new
    options to help simplify the program. This report examines (1)
    which options states have chosen to implement and why, and (2)
    what changes local officials reported as a result of using these
    options. To view selected results from GAO's Web-based survey of
    food stamp administrators, go to
    www.gao.gov/cgi-bin/getrpt?GAO-04- 1058SP. To review the results
    from the local food stamp office surveys, go to
    www.gao.gov/cgi-bin/getrpt?GAO-04- 1059SP.
    -------------------------Indexing Terms-------------------------
    REPORTNUM:   GAO-04-916
        ACCNO:   A12412
      TITLE:     Food Stamp Program: Farm Bill Options Ease Administrative
    Burden, but Opportunities Exist to Streamline Participant
    Reporting Rules among Programs
         DATE:   09/16/2004
      SUBJECT:   Eligibility criteria
    	     Eligibility determinations
    	     Federal aid programs
    	     Food relief programs
    	     Locally administered programs
    	     Program management
    	     State-administered programs
    	     State/local relations
    	     Food Stamp Program
    	     HHS Temporary Assistance for Needy
    	     Families Program

    	     Medicaid Program

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    GAO-04-916

    United States Government Accountability Office

    GAO

    Report to the Committee on

    Agriculture, Nutrition, and Forestry, U.S. Senate

    September 2004

    FOOD STAMP PROGRAM

        Farm Bill Options Ease Administrative Burden, but Opportunities Exist to
                 Streamline Participant Reporting Rules among Programs

    GAO-04-916

    September 2004

    FOOD STAMP PROGRAM

    Farm Bill Options Ease Administrative Burden, but Opportunities Exist to
    Streamline Participant Reporting Rules among Programs

    As of January 2004, states chose four of the eight Farm Bill options with
    greater frequency than the others. These options provided states with more
    flexibility in requiring participants to report changes and in determining
    eligibility.

    Number of States That Have Chosen, Implemented, or Not Chosen Farm Bill
    Options as of January 2004

    Number of states 50

    40

    30

    20

    10

    1

    0 Expanded Simplified Simplified Simplified Transitional Child Simplified
    Simplified simplified standard definition definition benefits support
    determinationhomeless reporting utility of incomeof resources expenseof
    deductions shelter

                                 allowance income costs

                                       exclusion

             Not chosen Chosen, not yet implemented Chosen and implemented

    Source: GAO analysis of survey data.

    The most common reasons state officials gave for choosing the eight
    options were to simplify program rules for participants and caseworkers.

    Local food stamp officials reported mixed results from implementing the
    Farm Bill options. Although they reported some improvements for both
    caseworkers and participants from some options, no option received
    consistent positive reports in all the areas where state officials
    expected improvements. In fact, in many cases, officials were as likely to
    report that an option resulted in no change as they were to report
    improvements.

    Moreover, many local officials reported that three options introduced
    complications in program rules. One option that offered the most promise
    because it was selected by most states and affects a large number of
    participants resulted in food stamp participant reporting rules that
    differed from Medicaid and TANF. These differences resulted in confusion
    for food stamp participants and caseworkers, and some changes were made
    that undermined the intended advantages of the option. These problems
    reflect the challenge of trying to simplify rules for one program without
    making the rules of other related programs the same. Concerns about
    whether there are costs associated with aligning reporting rules may
    hinder a state's decision to pursue alignment; yet the extent to which
    program costs might increase as a result of making reporting rules the
    same is unclear.

    Highlights of GAO-04-916, a report to Committee on Agriculture, Nutrition,
    and Forestry, U.S. Senate

    Many individuals familiar with the Food Stamp Program view its rules as
    unnecessarily complex, creating an administrative burden for participants
    and caseworkers. In addition many participants receive benefits from other
    programs that have different program rules, adding to the complexity of
    accurately determining program benefits and eligibility. The 2002 Farm
    Bill introduced new options to help simplify the program. This report
    examines (1) which options states have chosen to implement and why, and
    (2) what changes local officials reported as a result of using these
    options. To view selected results from GAO's Webbased survey of food stamp
    administrators, go to

    www.gao.gov/cgi-bin/getrpt?GAO-041058SP. To view the results from the
    local food stamp office surveys, go to
    www.gao.gov/cgi-bin/getrpt?GAO04-1059SP.

    GAO recommends that the Food and Nutrition Service (FNS) work with the
    Department of Health and Human Services to (1) encourage states to explore
    the advantages and disadvantages of better aligning participant reporting
    rules, particularly for Medicaid and Temporary Assistance for Needy
    Families (TANF) and (2) provide information to states on the opportunities
    for better aligning reporting rules. In comments on GAO's draft report,
    FNS officials agreed with our recommendations and said they plan to
    explore ways to align participant reporting rules.

    www.gao.gov/cgi-bin/getrpt?GAO-04-916.

    To view the full product, including the scope and methodology, click on
    the link above. For more information, contact Sigurd Nilsen, (202)
    512-7215 nilsens@gao.gov.

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    Contents

    Letter

    Results in Brief	Background	States Chose Some Farm Bill Options More
    Frequently than Others

    to Simplify Program Rules and Ease the Administrative Burden	for
    Participants and Caseworkers

    Local Food Stamp Officials Reported Mixed Results for Farm Bill	Options;
    These Results Ranged from Improvements to 	Complications

    Conclusions	Recommendations for Executive Action	Agency Comments

                                           1

                                          3 5

    11

    20 32 33 34

    Appendix I Objective, Scope, and Methodology

    Appendix II	Farm Bill Options That States Have Implemented as of January
    2004

    Appendix III Selected Responses to State Survey

    Appendix IV Selected Responses to Local Surveys

    Appendix V GAO Contacts and Staff Acknowledgments 50

    GAO Contacts 50 	Acknowledgments 50

    Related GAO Products 51

    Table

    Table 1: Disposition of Eight Farm Bill Option Samples 39

    Figures

    Figure 1: Description and Purpose of Farm Bill Options	Figure 2: Number of
    States That Have Chosen, Implemented, or

    Not Chosen Farm Bill Options, as of January 2004	Figure 3: Important
    Reasons for Choosing Options	Figure 4: Important Reasons for Not Choosing
    Options	Figure 5: Results Reported by Local Officials on Administrative

    Burden for Participants and Caseworkers	Figure 6: Results Reported by
    Local Officials on Error Rate, 	Participation, Benefit Amount, and
    Alignment	Figure 7: Example of Possible Decisions and Actions under the
       	Expanded Simplified Reporting Option	Figure 8: Farm Bill Options States
    Have Implemented as of January 	2004	Figure 9: Number of States That Gave
    Reasons for Choosing 	Options	Figure 10: Number of States That Gave
    Reasons for Not Choosing

    Options	Figure 11: Expanded Simplified Reporting	Figure 12: Simplified
    Standard Utility Allowance	Figure 13: Simplified Definition of
    Income	Figure 14: Simplified Definition of Resources	Figure 15:
    Transitional Benefits	Figure 16: Child Support Expense Income Exclusion
       	Figure 17: Simplified Determination of Deductions

    10

    12 14 17

    22

    24

    28

    40

    41

    42 43 44 45 46 47 48 49

    Abbreviations

    CMS Centers for Medicare and Medicaid Services 	HHS Department of Health
    and Human Services	FNS Food and Nutrition Service 	TANF Temporary
    Assistance for Needy Families 	USDA U.S. Department of Agriculture

    This is a work of the U.S. government and is not subject to copyright
    protection in the United States. It may be reproduced and distributed in
    its entirety without further permission from GAO. However, because this
    work may contain copyrighted images or other material, permission from the
    copyright holder may be necessary if you wish to reproduce this material
    separately.

    United States Government Accountability Office Washington, DC 20548

    September 16, 2004

    The Honorable Thad Cochran

    Chairman

    The Honorable Tom Harkin

    Ranking Minority Member

    Committee on Agriculture, Nutrition, and Forestry United States Senate

    In fiscal year 2003, the federal Food Stamp Program, administered by the
    U.S. Department of Agriculture's (USDA) Food and Nutrition Service (FNS),
    provided about $21.4 billion in food stamp benefits. In that same year,
    the program helped a monthly average of 21 million low-income individuals,
    many of whom were children. However, the program faces a number of
    challenges. Many individuals familiar with the Food Stamp Program view its
    rules as unnecessarily complex, creating an administrative burden for both
    program participants and affected government offices. In addition, many
    food stamp participants receive benefits from other low-income assistance
    programs, such as Medicaid and Temporary Assistance for Needy Families
    (TANF). These programs, administered by the Department of Health and Human
    Services (HHS) have different rules than those allowed under the Food
    Stamp Program. Differences among these program rules add to the complexity
    of accurately determining eligibility and program benefits. In 2003,
    errors in overpayments and underpayments totaled $1.4 billion. These
    errors occurred in part because of the complexity of program rules.
    Further, FNS estimated that in September 2001, only 62 percent of
    individuals who were eligible to receive food stamps participated in the
    program. In the previous year, FNS established a goal to improve the rate
    of food stamp participation among all eligible people to 68 percent by
    2005.

    For many years, states and advocacy groups have called for changes in the
    program to help overcome these challenges. Some changes were made to the
    program beginning in the late 1990s, and the Farm Security and Rural
    Investment Act of 2002 (referred to in this report as the Farm Bill)
    introduced new options, from which states could choose, to help simplify
    the program, encourage greater participation among eligible households,
    ease the administrative burden for participants and program
    administrators, and help support low-income working families. For example,
    one option reduces participant reporting requirements, while

    another helps to ensure that families leaving TANF cash assistance
    continue to receive their food stamp benefits without requiring the family
    to reapply or submit additional paperwork. In addition, some of these
    options permit states to more closely align food stamp eligibility rules
    with the eligibility rules of other programs, an improvement that could
    streamline administrative procedures for food stamp workers, improve
    service for clients who participate in more than one assistance program,
    and help reduce state payment error rates. In order to understand whether
    the Farm Bill options have helped states streamline their programs, you
    asked us to determine (1) which options states have chosen to implement
    and why, and (2) what changes local officials reported as a result of
    implementing these options.

    To answer these questions, we surveyed food stamp administrators in the 50
    states and the District of Columbia to collect information on which Farm
    Bill options states have chosen and the reasons states chose certain
    options. We also sent over 1,300 surveys to food stamp supervisors in
    randomly selected local food stamp offices, where the options are actually
    implemented during daily contacts with participants. These survey results
    are generalizable to local offices in states that implemented the options.
    We asked them how Farm Bill options had affected several aspects of the
    Food Stamp Program, such as administrative burden on participants and food
    stamp caseworkers.1 We focused our surveys on eight of the nine

    Farm Bill options, excluding one option that allows states on a pilot
    basis to test issuing standardized benefits to residents of certain group
    facilities. To view selected results from GAO's Web-based survey of food
    stamp administrators, go to www.gao.gov/cgi-bin/getrpt?GAO-04-1058SP. To
    view the results from the local food stamp office surveys, go to
    www.gao.gov/cgi-bin/getrpt?GAO-04-1059SP.

    To augment information from our state and local surveys, we conducted
    three comprehensive site visits (Arizona, Maryland, and Michigan) and two
    structured telephone interviews (Colorado and South Carolina). We chose
    states for our site visits and telephone interviews to capture the
    variation in the following criteria: (1) number of and type of selected
    options, (2) numbers of food stamp participants and program participation
    rate, (3) program error rates, and (4) entity (state or county)
    administering the Food Stamp Program. During each visit we met with state
    officials administering and developing policy for the Food Stamp Program,
    local

    1See appendix I for a detailed explanation of the methodology we used for
    the state and local surveys.

      Results in Brief

    officials in the office where services are provided, and officials
    responsible for other key assistance programs, such as TANF and Medicaid.
    2 We also reviewed Farm Bill legislation and related committee reports,
    and we reviewed FNS reports and other program analysis. We held
    discussions with program stakeholders, including officials at FNS
    headquarters and regional offices, officials at HHS, representatives of
    advocacy organizations, and other program experts. We performed our work
    from August 2003 to June 2004 in accordance with generally accepted
    government auditing standards.

    States chose four of the eight options available in the Farm Bill more
    frequently than the others and based their decisions largely on whether
    they thought the options would help simplify Food Stamp Program rules and
    ease the administrative burden for food stamp participants and
    caseworkers. The four options that states chose most frequently provided
    states more flexibility in how often participants must report changes in
    their household circumstances (such as increases in income), the way food
    stamp caseworkers in local offices calculate utility costs, what household
    income is considered when determining food stamp eligibility, and what
    household resources are considered when determining eligibility. As of
    January 2004, each of these four options had been implemented by at least
    23 states, and other states told us that they were planning to implement
    them. State officials gave many reasons for choosing these options. Among
    the most common were to decrease the workload for caseworkers, decrease
    the burden on participants, and simplify rules for participants and
    caseworkers. For example, at least 30 states cited these reasons in
    choosing the option to reduce how often participants must report changes
    in household circumstances. In addition, many states chose one or more of
    these options because officials believed the option would decrease their
    state's payment error rate, help align the Food Stamp Program with other
    assistance programs, or increase overall participation in the Food Stamp
    Program. States' decisions not to adopt

    2The Personal Responsibility and Work Opportunity Reconciliation Act of
    1996 reformed Aid to Families with Dependent Children and established the
    $16.5 billion Temporary Assistance for Needy Families block grant, which
    provides to the states federal funds to support low-income families and
    help these families reduce their dependence on welfare. Medicaid,
    established in 1965, is a joint federal-state entitlement program that
    finances health care coverage for certain low-income families, children,
    pregnant women, and individuals who are aged or disabled. Federal income
    limits for children and pregnant women range from 100 percent to 185
    percent of the federal poverty level, depending on age. Income limits for
    adults and individuals who are aged or disabled vary by state.

    the four other options also hinged on what they believed the outcomes
    would be for participants and caseworkers. These options allowed states to
    provide transitional food stamps for up to 5 months to those families that
    leave TANF without requiring the family to reapply for food stamps, change
    how caseworkers treat child support payments for noncustodial parents,
    disregard changes in certain deductions (such as child care and medical
    expenses) during certification periods, and use a standard deduction for
    homeless households that incur some shelter expenses. Specifically, fewer
    states thought these other options would reduce the administrative burden
    for participants and caseworkers. For example, many states did not choose
    the option that provides transitional food stamps for up to 5 months after
    a household leaves TANF cash assistance because officials believed it
    would make program rules for participants and caseworkers more
    complicated. Many states also thought these options would have little or
    no advantage over current policy or would create additional problems,
    including difficulties with programming their computer systems. In fact,
    the majority of states that adopted these four options reported that they
    faced some implementation hurdles, such as difficulties related to
    caseworkers' adjustment to program changes and reprogramming computer
    systems to accommodate changes.

    Local food stamp officials reported mixed results from implementing the
    options; the results ranged from anticipated improvements to complications
    in program rules. For example, some local officials reported that the
    options they implemented had the anticipated effect of easing the
    administrative burden for food stamp participants and caseworkers by
    reducing the number of times participants are required to submit paperwork
    and the amount of time caseworkers spend on paperwork. On the other hand,
    many other local officials reported that the administrative burden
    remained the same before and after implementing the Farm Bill options.
    Similarly, for options implemented in part to increase program
    participation, some local officials reported that participation increased,
    while others told us that it remained the same. Some options may have been
    associated with no change, in part because they affected few food stamp
    participants. Also, many options made minor changes to existing policy.
    Finally, local officials reported that three options introduced
    complications in program rules for both caseworkers and participants.
    Local officials told us that the option to reduce reporting requirements
    for participants-an option that local officials reported affected most
    food stamp participants-introduced complications for food stamp
    participants and caseworkers. Local officials on our site visits and in
    telephone interviews explained that this change to reporting rules was not
    consistent with how states structured the reporting rules of other
    assistance

    programs, resulting in food stamp reporting rules that are not aligned
    with Medicaid and, in all but one state we visited, are not aligned with
    TANF. For example, in one state, the Food Stamp Program requires a
    participant to report when his or her income rises above 130 percent of
    the federal poverty level, but that state's Medicaid program requires the
    same participant to report all changes in household circumstances,
    including any change in income. The variation among these reporting rules
    often resulted in confusion on the part of program participants and
    caseworkers, unnecessary work for the caseworker, and the possible payment
    of improper benefits from the Food Stamp Program and other assistance
    programs.

    In order to take advantage of existing opportunities available to states
    for streamlining participant reporting rules, we recommend that the
    Secretary of Agriculture direct FNS to collaborate with HHS to take the
    following two actions: (1) encourage state officials to explore the
    advantages and disadvantages-in terms of both administrative and benefit
    costs and savings-of better aligning participant reporting rules in their
    states, particularly for Medicaid and TANF; and (2) disseminate
    information and guidance to states on the opportunities available for
    better aligning participant reporting rules among food stamps, Medicaid,
    and TANF. In comments on GAO's draft report, FNS officials agreed with our
    recommendations and said they plan to explore ways to align participant
    reporting rules.

    Background 	The federal Food Stamp Program is intended to help low-income
    individuals and families obtain a better diet by supplementing their
    income with benefits to purchase food. FNS pays the full cost of food
    stamp benefits and shares the states' administrative cost-with FNS paying
    about 50 percent of the administrative cost. FNS is responsible for
    promulgating program regulations and ensuring that state officials
    administer the program in compliance with program rules. The states
    administer the program by determining whether households meet the
    program's income and asset requirements, calculating monthly benefits for
    qualified households, and issuing benefits to participants on an
    electronic benefits transfer card.

    Determination of Eligibility for participation in the Food Stamp Program
    is based on the

    Eligibility and Benefits 	Department of Health and Human Services' poverty
    guideline for households. In most states, a household's gross income
    cannot exceed 130 percent of the federal poverty level (or about $1,654
    per month for a

    family of three in 2003), and net income cannot exceed 100 percent of the
    poverty guideline (or about $1,272 per month for a family of three in
    2003). Net income is determined by deducting from gross income expenses
    such as dependent care costs, medical expenses, utilities costs, and
    shelter expenses. In addition, most states place a limit of $2,000 on
    household assets, and basic program rules limit the value of vehicles an
    applicant can own and still be eligible for the program.3 If the household
    owns a vehicle worth more than $4,650, the excess value is included in
    calculating the household's assets.4

    Recipients of TANF cash assistance are automatically eligible for food
    stamps-a provision referred to as "categorical eligibility"-and do not
    have to go through a separate food stamp eligibility determination
    process, although the level of their benefits must still be determined.
    Many needy families who are no longer receiving TANF cash assistance may
    receive other TANF-funded services or benefits, such as child care
    benefits. In 1999, to help ensure that these families are also eligible
    for food stamp benefits, FNS offered states the option to extend
    categorical eligibility to families receiving TANF-funded benefits or
    services. Families who are automatically eligible for food stamps do not
    have to meet the food stamp asset test in order to receive benefits but
    would have to meet the state's TANF asset test.

    States also have two ways in which they can allow households to own a
    vehicle that is worth more than the amount allowed in current regulations
    and still remain eligible for food stamp benefits. In October 2000, in
    part to help support low-income working families, the Congress enacted
    legislation that grants states the option to replace the federal food
    stamp vehicle asset rule with the vehicle asset rule from their TANF
    assistance program, which is set by the state and can vary from state to
    state. States can also opt to use the categorical eligibility option as a
    way to exclude all vehicles, as well as other assets the family may have.
    This option affects the food stamp eligibility only of food stamp families
    authorized to receive a TANF-funded service or benefit. As of October
    2003, the majority of states had either replaced their federal food stamp
    vehicle asset rule with the vehicle asset rule from their TANF assistance
    program or conferred categorical eligibility as a way to exclude vehicles.

    3Households with disabled or elderly members are exempt from the gross
    income limit. In addition, households with elderly members may have assets
    valued at $3,000.

    4If a household has no other assets, its vehicle can be worth $6,650.

    Certification and Reporting Requirements

    After eligibility is established, households are certified eligible for
    food stamps for periods ranging from 1 to 24 months. The length of the
    certification period depends on household circumstances, but only
    households in which all members are elderly or disabled can be certified
    for more than 12 months. Once the certification period ends, households
    must reapply for benefits, at which time eligibility and benefit levels
    are redetermined.5

    Between certification periods, households must report changes in their
    circumstances-such as household composition, income, and expenses- that
    may affect their eligibility or benefit amounts. States have the option of
    requiring food stamp participants to report on their financial
    circumstances at various intervals and in various ways. States can
    institute a type of periodic reporting system or they can rely on
    households to report changes in their household circumstances within 10
    days of occurrence.6 Under periodic reporting, participants may report
    monthly, quarterly, or under a simplified system. The simplified reporting
    system, available since early 2001, provides for an alternative reporting
    option that requires households with earned income to report changes only
    when their income rises above 130 percent of the poverty level.

    FNS's Quality Control System

    FNS monitors how accurately states determine food stamp eligibility and
    calculate benefits. Under FNS's quality control system, the states
    calculate their payment errors by drawing a statistical sample to
    determine whether participating households received the correct benefit
    amount.7 Improper payments, which include overpayments of food stamp
    benefits to participants, underpayments to participants, and payments to
    those who

    5Prior to welfare reform, federal regulations required households to have
    a face-to-face interview with an agency worker at each recertification.
    Current regulations give states the option to require only one
    face-to-face interview a year regardless of the length of certification.

    6States can choose from a variety of change-reporting methods. They can
    require households to report only when a member changes jobs, receives a
    different rate of pay, or has a change in his or her work status, i.e.,
    from full-time to part-time or vice versa. States can also require
    households to report only when there is a change in earnings of $100 or
    more per month.

    7The food stamp error rate is calculated for the entire program, as well
    as every state, by adding overpayments to those who are eligible for
    smaller benefits, overpayments to those who are not eligible for any
    benefit, and underpayments to those who do not get as much as they should.
    The program also calculates a negative action error rate, defined as the
    rate of improper denials or terminations of benefits.

    are not eligible, may occur for a variety of reasons. Overpayments can be
    caused by inadvertent or intentional errors made by recipients and
    caseworkers. For example, caseworkers may misapply complex food stamp
    rules when calculating benefits or participants may inadvertently or
    deliberately provide inaccurate information to food stamp offices. In the
    1990s, the states' error rate hovered around 10 percent, but it fell to
    6.6 percent in fiscal year 2003, the lowest level in the program's
    history. The 2003 combined error rate comprised $1 billion in overpayments
    to food stamp participants and underpayments of more than $300 million.
    According to USDA, about half of all payment errors are due to an
    incorrect determination of household income.

    The Farm Bill changed the Food Stamp Program's quality control system by
    making only those states with persistently high error rates face
    liabilities.8 The Farm Bill also provides for $48 million in bonuses each
    year to be awarded to states with high or most improved performance,
    including actions taken to correct errors, reduce error rates, improve
    eligibility determinations, and other indicators of effective
    administration as approved by the Secretary of Agriculture.9

    Food Stamp Participants Many food stamp participants receive benefits from
    other federally funded Receive Benefits from low-income assistance
    programs, including Medicaid and TANF. For Other Assistance Programs
    example, in 2002, about 85 percent of children who received food stamp

    benefits were also on Medicaid, and about 20 percent of food stamp
    households received assistance from TANF. Many food stamp participants
    also receive child care assistance and Supplemental Security Income.10 In

    8Before the Farm Bill, states were penalized if their combined payment
    error rate was higher than the national average. As a result, about half
    of states were subject to financial sanctions each year. States are
    required to either pay the sanction or provide additional state
    funds-beyond their normal share of administrative costs-to be reinvested
    in errorreduction efforts, such as additional training in calculating
    benefits for certain households. Under the Farm Bill, a state will be
    subject to fiscal sanction if there is a 95 percent statistical
    probability that the state's payment error rate exceeds 105 percent of the
    national average for 2 consecutive years.

    9The Farm Bill requires the Secretary to issue regulations for fiscal year
    2005 and thereafter that will establish criteria related to these improved
    performances and be used to award performance bonus payments.

    10Supplemental Security Income is a federal income supplement program that
    assists people who are age 65 or older, blind, or disabled, and who have
    limited income and resources. The program provides monthly cash payments
    to help those who are qualified meet basic needs for food, clothing, and
    shelter.

    most states, the Food Stamp Program is administered out of a local
    assistance office that offers benefits from these other assistance
    programs as well. Food stamp participants may provide necessary
    information to only one caseworker who determines eligibility and benefits
    for all of these programs, or they may work with several caseworkers that
    administer benefits for different programs.

    Despite the overlap in the populations served by these various assistance
    programs, program rules and requirements across these programs vary
    significantly.11 Substantial variation exists not only in program
    financial eligibility rules. The primary sources of these variations are
    generally at the federal level, although for several programs, such as
    TANF and Medicaid, states and localities have some flexibility in setting
    financial eligibility rules. They also have flexibility in the rules that
    govern how often participants are required to report changes in their
    household circumstances. While the Food Stamp Program allows states to
    choose either periodic or change reporting, Medicaid provides states with
    even broader flexibility to establish rules for when Medicaid participants
    must report changes in their circumstances. Under Medicaid regulations,
    states must have procedures designed to ensure that participants make
    timely and accurate reports of any change in circumstances that may affect
    their eligibility and that states act promptly to redetermine eligibility
    based on the reported change in circumstances. However, the terms "timely"
    and "promptly" are not defined and can be interpreted in various ways by
    the states. TANF does not mandate a particular set of participant
    reporting rules and generally allows states to develop their own rules.12

    Options Made Available by the Farm Bill

    The Farm Bill makes available to states various new options that are
    intended to simplify food stamp program rules, streamline food stamp
    eligibility and benefit rules, and help ensure that food stamp
    participants experience as smooth a transition from welfare to work as
    possible. (See fig. 1.)

    11See GAO, Means-Tested Programs: Determining Financial Eligibility Is
    Cumbersome and Can Be Simplified, GAO-02-58 (Washington, D.C. Nov. 2001)
    for a comprehensive discussion of the overlap and complexities in
    financial eligibility rules for 11 federal assistance programs, and the
    cumbersome effect for both caseworkers and participants.

    12TANF regulations require that states report information such as the type
    and amount of assistance received, work participation activities, and
    earned and unearned income. The regulations do not specify how the states
    collect such information. (45 CFR 265.) States set their own income limits
    for eligibility purposes.

    Figure 1: Description and Purpose of Farm Bill Options

    Sources: Food and Nutrition Service, Pub. L. No. 107-171; Senate Rpt. No.
    107-117 (2001); Art Explosion and Copyright  Corel Corp. All
    rights reserved (images).

    aIn addition to having these eight options, states also have the option,
    on a pilot basis, to test issuing standardized benefits to residents of
    certain group homes, such as facilities for the disabled or that operate
    drug or alcohol treatment programs. The standardized benefit would be in
    lieu of the regular food stamp benefit and would be developed by the
    state, taking into account the food stamp benefits typically received by
    residents of the covered group facilities.

    bThe Farm Bill refers to this option as Simplified Determination of
    Housing Costs.

      States Chose Some Farm Bill Options More Frequently than Others to Simplify
      Program Rules and Ease the Administrative Burden for Participants and
      Caseworkers

    States chose four of the Farm Bill options with greater frequency than the
    others. State officials gave reasons for choosing, or not choosing, the
    options that focused primarily on how they thought the options would
    affect food stamp participants and caseworkers. Other reasons were also
    important in the choice of some options. For example, the anticipated
    effect on the state's payment error rate was a key factor in the selection
    of most options. During the period when states were implementing the food
    stamp options, a number of them posed challenges for the states, such as
    difficulties related to caseworkers' adjustment to program changes and
    programming computer systems.

    States Were Most Likely to According to our survey of state food stamp
    administrators, 23 or more Choose Four of the states had implemented four
    of the options as of January 2004, while less Options than one-quarter of
    the states had implemented the other four options.

    (See fig. 2. Also see app. II for the options that individual states have

    chosen and implemented.)

    Figure 2: Number of States That Have Chosen, Implemented, or Not Chosen
    Farm Bill Options, as of January 2004

    Number of states

                                           1

    reportingsimplified d

    utility allowanceSimplified standar

    ces

                        Simplified definitionof income of resour

                      Simplified definitionansitionalbenefits t e

                                        income e

                                      Child suppor

    xpensex

    usionlc

    determinationSimplified homelessshelter costs

    rTOptions

    Not chosen

    Chosen, not yet implemented

    Chosen and implemented

    Source: GAO analysis of survey data.

    Notes:

    The Simplified Homeless Shelter Costs "chosen and implemented" category
    only includes states that indicated they did not have a Standard Homeless
    Shelter Allowance of $143 prior to the Farm Bill. The "not chosen"
    category for this option includes 21 states that indicated they already
    had a Standard Homeless Shelter Allowance of $143 prior to the Farm Bill.
    One state did not respond to Simplified Homeless Shelter Costs status
    item.

    One state did not respond to the Expanded Simplified Reporting status
    item.

    The Reasons States Gave for Choosing Options Were Largely Based on the
    Anticipated Effects on Participants and Caseworkers

    The most common reasons state officials gave for choosing the eight
    options were to simplify program rules for participants and caseworkers,
    according to our survey. For example, state officials we interviewed told
    us they thought program rules would be less confusing for participants if
    the types of income considered in eligibility determinations were more
    uniform across assistance programs, as is allowed by the Simplified
    Definition of Income option. In addition, officials in one state commented
    that they thought the Simplified Standard Utility Allowance option would
    make the rules less complicated for caseworkers because it would allow
    them to apply the standard utility allowance-a fixed amount that can be
    used in place of actual utility costs-to households sharing a residence,
    instead of having to prorate the actual utility costs of the household.
    (See fig. 3 and app. III for more detail on reasons states chose options.)

    Figure 3: Important Reasons for Choosing Options

    �= Important reason states chose this option

    Sources: GAO analysis of survey data; Art Explosion and Copyright 
    Corel Corp. All rights reserved (images).

    aSimplified Homeless Shelter Costs option only includes states that
    indicated they did not have a Standard Homeless Shelter Allowance of $143
    prior to the Farm Bill.

    bWe only asked the child support item for the Child Support Expense Income
    Exclusion option.

    In addition, two important reasons state officials gave for choosing
    options were to decrease the burden on participants and decrease the
    workload for caseworkers, as shown in figure 3. For example, several state
    officials told us they thought options such as Simplified Homeless Shelter
    Costs and Simplified Standard Utility Allowance that allow states to use a

    standard allowance rather than actual costs in determining eligibility
    would provide relief for participants and caseworkers. When standard
    allowances are used, participants do not have to furnish proof of all
    actual costs and, correspondingly, caseworkers have less information to
    verify.13 In addition, some state officials told us that they thought an
    option, such as Transitional Benefits, that decreases the frequency with
    which participants must report changes would reduce workload. Under the
    Transitional Benefits option, households leaving TANF are automatically
    allowed up to 5 months of food stamp benefits and are not required to
    report changes in household circumstances during the transitional period.

    Other reasons were also important in the choice of some options. Lowering
    their state's payment error rate was an important reason state officials
    gave for choosing seven of the options, including the Expanded Simplified
    Reporting option. States choosing this option are held responsible only
    for errors that result from miscalculating benefits at certification, or
    if income exceeds 130 percent of poverty and the change is not reported
    during the reporting period. A state's error rate is also not affected if
    the household experienced a change in its circumstances that it did not
    report. In addition, officials in one state told us they thought the
    Transitional Benefits option would lower the state's payment error rate
    because it allows for certain periods in which states are to be held
    harmless for unreported changes. Otherwise, these unreported changes could
    be included in calculating the error rate. Further, officials told us that
    the income option would make the Food Stamp Program less error prone
    because it allows states to use some of the same income definitions that
    are used when determining eligibility for TANF cash assistance or
    Medicaid. This alignment of income definitions may result in fewer errors
    because following one set of program rules is easier for participants and
    caseworkers than trying to adhere to many different sets of rules.

    Increasing participation in the Food Stamp Program, including
    participation of working families, was also an important reason for
    choosing three of the options. For example, officials in one state told us
    that they believed the Expanded Simplified Reporting option would
    contribute to higher participation rates because cases would not be closed
    as often under this option. In addition, state officials reported that
    they thought the Child Support Expense Income Exclusion option would help

    13Homeless households may have shelter costs for a variety of reasons, for
    example, if they pay to board with a family member or at a homeless
    shelter.

    more households to receive food stamps by making it easier for them to
    meet eligibility requirements. This option allows states to exclude
    legally obligated child support payments from the gross income of the
    noncustodial parent who is paying the child support when determining food
    stamp eligibility. Without the option, these child support payments are
    deducted from the noncustodial parent's income after eligibility for food
    stamps is already determined.14

    State officials we surveyed gave additional reasons for choosing some
    options, including the desire to align food stamps with other assistance
    programs, increase benefit amounts for participants, and encourage payment
    of child support. Aligning the Food Stamp Program's definition of income
    and resource rules with those used by TANF or Medicaid-that is, conforming
    the definitions of income and resources states use in the Food Stamp
    Program to the definitions they use in their TANF or Medicaid program-was
    an important reason for choosing the income and resources options.
    Increasing benefit amounts for participants was an important reason for
    choosing some options, including Transitional Benefits. Officials in one
    state told us they thought this option would result in greater benefit
    amounts for households leaving TANF because the new income that rendered
    them ineligible for TANF is not included in the calculation of their
    benefit amount for the transitional period. If this additional income were
    taken into account, it would most likely result in a lower benefit amount.
    Finally, among other reasons, state officials chose the Child Support
    Expense Income Exclusion option because they thought it would encourage
    payment of child support.

    The Reasons States Gave for Not Choosing Options Were Primarily Related to
    Anticipated Effects on Participants and Caseworkers and Other Aspects of
    the Program

    State officials gave a number of reasons for not choosing options. Among
    the most common was their belief that the option would complicate rules
    for participants and complicate rules for caseworkers in their state.
    Because of the variability among states in the design of Food Stamp
    Programs and other assistance programs, an option that simplified
    processes in one state may have a different effect in other states. For
    example, officials in two states commented that they thought the
    Simplified Determination of Deductions option might confuse participants
    and caseworkers because it would create additional, and sometimes

    14Deductions are subtracted from the household's gross income to determine
    net income. Deductions include household expenses such as those for
    shelter, utilities, and medical care. Absent the option, the amount paid
    for child support would be deducted as a household expense.

    conflicting, participant reporting rules in their state. As one state
    official noted, this option, which allows states to disregard reported
    changes in certain deductions during the certification period, could be
    confusing for caseworkers because of its inconsistency with her state's
    policy to act on all reported changes. (See fig. 4. Also see app. III for
    more detail on reasons states did not choose options.)

                  Figure 4: Important Reasons for Not Choosing Options

    �  = Important reason states did not choose this option

    Sources: GAO analysis of survey data; Art Explosion and Copyright 
    Corel Corp. All rights reserved (images).

    Note: Data for Simplified Homeless Shelter Costs option are not available.

    State officials gave additional reasons for not choosing some of the
    options. An important reason for not choosing two of the options was that
    officials believed the options would result in little or no increase in
    the amount of food stamp benefits for participants in their state. For
    example, officials in several states noted that according to their
    calculations, implementing the child support option would not increase
    food stamp

    benefit amounts for participants in their state who pay child support. In
    addition, some state officials commented that they did not choose the
    deductions option, which allows states to disregard reported changes in
    certain deductions during the certification period, because they believed
    the option could prevent participants from receiving additional benefits
    if their expenses increased during this period.

    State officials also reported an important reason they did not choose
    three of the options was because of their belief that the options would
    affect very few participants in their state. For example, some state
    officials reported that the number of households that would be helped by
    the Transitional Benefits option in their state would be relatively small
    because their state had implemented simplified reporting systems that
    provided similar advantages, such as allowing households to forgo
    reporting most changes between scheduled reporting periods. Similarly,
    officials in one state commented that they thought the child support
    option would not increase the number of eligible households in their state
    because many of the affected households would already be categorically
    eligible for food stamps.

    In addition, an important reason state officials gave for not choosing
    five of the options was that they thought the options would have little or
    no advantage over current policy in their state. For example, officials in
    some states commented that the income and resources options would not
    allow them much additional flexibility in their Food Stamp Program
    definitions because FNS placed restrictions on the types of incomes and
    resources that could be excluded under these options, while one other
    state official noted that before these options became available, they had
    already largely aligned TANF and Medicaid definitions of resources with
    those used by the Food Stamp Program. In addition, other state officials
    told us the deductions option would be duplicative in their state because
    they had already implemented simplified reporting options that exempt
    participating households from reporting changes in the deductions covered
    by this option during the certification period.

    Other reasons were important for not choosing some options, including a
    possible increase in the state's payment error rate or the difficulty in
    programming the state's computer system to implement the change. Officials
    in some states said they thought the Expanded Simplified Reporting option
    might increase the payment error rate in their state. Simplified reporting
    systems reduce the frequency with which households must report changes,
    which may make the reporting rules of food stamps different from those of
    other assistance programs in the state that require

    households to report changes on a more regular basis. These differences in
    reporting rules could lead to errors by participants and caseworkers, who
    often determine eligibility for more than one assistance program. In
    addition, some state officials reported that they did not choose the
    Transitional Benefits option because the required changes would be too
    difficult to program into their state's computer systems. Food stamp
    computer systems in many states are integrated with other assistance
    programs, such as TANF and Medicaid.

    Implementation Challenges for States Choosing Certain Options

    In states that did choose specific options, a number of these options
    posed challenges for the states during initial implementation. Reported
    challenges included difficulties related to caseworkers' adjustment to
    program changes, lack of alignment with other assistance programs, and
    programming state computer systems. For example, officials in one state
    told us caseworkers had trouble adjusting to the new reporting system
    under Simplified Determination of Deductions because many were accustomed
    to the former system in which participants reported, and caseworkers acted
    on, changes in some household deductions within 10 days of the change. In
    addition, state officials told us some options, such as Expanded
    Simplified Reporting, lessened the degree to which Food Stamp Program
    rules aligned with those of other assistance programs, which also
    presented challenges. Food stamp officials in one state told us they
    selected the Expanded Simplified Reporting option even though they knew it
    was going to result in food stamp reporting rules that were different from
    those of another assistance program because they thought the option would
    have many benefits for participants. Finally, difficulties with
    programming computers were commonly mentioned challenges to
    implementation. We heard from officials in two states that had implemented
    the Transitional Benefits option that this integration posed difficulties
    for them. These officials reported that they had to delink the connection
    with other programs so that the food stamp benefit remained frozen during
    the 5-month transitional period, regardless of the information recorded in
    the computer system for the other assistance programs. Officials from
    seven states provided cost estimates for implementing the options. The
    cost estimates ranged from $14,880 to $3.7 million, almost all of which,
    in six of the states, represented the costs of changing the state's
    computer system. These estimates included costs for such expenses as
    programming and testing the computer systems. Other states did not provide
    estimates for the costs of implementing the options.

      Local Food Stamp Officials Reported Mixed Results for Farm Bill Options; These
      Results Ranged from Improvements to Complications

    Local food stamp officials, who often have day-to-day contact with
    frontline caseworkers and food stamp participants, reported mixed results
    from implementing the Farm Bill options; the results ranged from
    improvements to complications. They reported that most of the options
    achieved at least some of the improvements anticipated by state officials.
    However, in a number of cases, local officials reported that the options
    did not result in expected improvements, or their opinions differed on
    whether the option achieved the anticipated result. Finally, local
    officials reported that three options introduced complications in program
    rules for both caseworkers and participants.

    Local Food Stamp Officials Reported the Options Achieved Some, but Not
    All, Anticipated Improvements

    Administrative Burden on Participants

    Local food stamp officials reported on our survey that the options
    resulted in some, but not all, of the improvements anticipated by state
    officials. The officials' views were mixed on whether the administrative
    burden was reduced for program participants and caseworkers. For example,
    many local officials reported that the options reduced paperwork for
    participants. However, officials were less likely to report that the
    options reduced the actual time participants spent applying for food
    stamps or reporting changes in household circumstances. In addition, some
    local officials reported that participation increased as a result of
    implementing options intended to increase participation, while others told
    us that those options had no effect on participation. Similarly, for the
    two options expected to increase alignment of program definitions with
    TANF and Medicaid, most officials agreed that these options made the
    definitions of income and resources the same as in TANF, but officials'
    opinions differed on whether the options helped increase alignment with
    Medicaid.15

    Local food stamp supervisors reported mixed results on whether the options
    eased the administrative burden on participants-a primary reason that
    states chose most of these options-as measured by both the amount of
    paperwork required and the time spent applying for food stamps and
    reporting changes.16 These local officials reported on our survey that the
    Expanded Simplified Reporting option eased the

    15States provided a reason for selecting the Child Support Expense Income
    Exclusion (encourage payment of child support) option that we did not
    measure at the local level.

    16This section excludes a discussion of the effects of the Simplified
    Homeless Shelter Costs option because the majority of local officials we
    surveyed indicated that they were already using a food stamp policy that
    allowed them the same homeless shelter cost deduction as this Farm Bill
    option.

    administrative burden on participants, particularly those who do not
    receive benefits from other assistance programs, by decreasing the time
    needed to prepare paperwork and report changes in their household
    circumstances.17 (See fig. 5.) For five other options, local officials
    differed in their views; some reported that the administrative burden on
    participants decreased while others reported no change. These five options
    are Simplified Standard Utility Allowance, Simplified Definition of
    Income, Simplified Definition of Resources, Transitional Benefits, and
    Simplified Determination of Deductions. For example, about the same number
    of local officials reported that the Transitional Benefits option
    decreased the administrative burden on participants as reported that it
    remained the same. Further, most local officials from states that adopted
    the deductions option reported that the administrative burden under this
    option remained the same for participants. This may be because three of
    the four states that implemented this option also implemented Expanded
    Simplified Reporting, which already decreased the administrative burden
    for participants in a similar way.

    17It is likely that many local officials reported improvements that
    pertain to all households covered by the Expanded Simplified Reporting
    option, that is, earned-income and most other food stamp households,
    including unearned-income households.

    Figure 5: Results Reported by Local Officials on Administrative Burden for
                              Participants and Caseworkers

    Administrative Burden on Caseworkers

    Indicates an improvement reported by most officials, i.e., decreased
    administrative burden
    Indicates no change reported by most officials
    Indicates about the same number of officials reported an improvement as
    reported no change
    - Indicates that this was not an important reason states chose this option

    Sources: GAO analysis of survey responses from local food stamp officials;
    Art Explosion and Copyright  Corel Corp. All rights reserved
    (images).

    Although five of the Farm Bill options-Expanded Simplified Reporting,
    Simplified Standard Utility Allowance, Simplified Definition of Income,
    Simplified Definition of Resources, and Simplified Determination of
    Deductions-were chosen by state officials to ease the administrative
    burden on caseworkers, local officials reported that most of these options
    had little effect on reducing the administrative burden on the
    caseworkers. (See fig. 5.) Overall, local officials reported no effect on
    the number of contacts with participants and time spent with participants
    during those contacts. However, local officials reported some reduction in
    the time spent on paperwork. For example, local officials told us that the
    utility option reduced the amount of time caseworkers spent on paperwork

    Payment Error Rate, Program Participation, Benefit Amount, and Program
    Alignment

    because they no longer had to conduct an additional complicated procedure
    to determine the correct benefit amount for certain participants. (See
    app. IV for additional details from our surveys regarding how Farm Bill
    options affected participants and caseworkers.)

    Similarly, for options implemented in part to achieve other goals-to
    decrease payment error rate, increase program participation, and increase
    benefit amount-some local officials reported improvements, while others
    told us that the options had no effect. (See fig. 6.) Although about
    onequarter of local officials reported that they did not know how most
    Farm Bill options affected their payment error rates, some others
    attributed improvements in error rates to two options.18 About half of the
    local officials that responded said that Expanded Simplified Reporting and
    the utility option decreased the error rate, and the other half reported
    that the error rate remained the same. For options that state officials
    thought would increase program participation, local food stamp officials
    reported that the options had little effect on participation. For example,
    although state officials thought that the Child Support Expense Income
    Exclusion option would increase participation, local officials reported
    that it did not. There was no consensus on whether the other two options
    chosen to increase participation-Expanded Simplified Reporting and
    Transitional Benefits-resulted in increased participation. For options
    that state officials thought would increase food stamp benefit amounts,
    some locals reported improvements, while others reported no change.
    Specifically, local officials reported that the utility option increased
    benefit amounts for participants, while about half reported that the
    income option increased benefits and about half reported it did not.

    18Although some factors, such as the time spent on paperwork, may affect
    the administrative burden on participants and caseworkers, local officials
    may not have been able to relate changes in error rates to specific
    options because local officials are not immediately aware of whether an
    error has occurred (when determining eligibility and benefits). Moreover,
    according to an official at FNS, 4 months elapse between collecting the
    information for the payment error rate analysis and when FNS reports the
    payment error rate to the states, thus making it even harder for local
    officials to tie changes in error rates to specific options.

      Figure 6: Results Reported by Local Officials on Error Rate, Participation,
                             Benefit Amount, and Alignment

    Indicates an improvement reported by most officials, i.e., decreased error
    rate, increased participation, increased alignment Indicates no change
    reported by most officials Indicates about the same number of officials
    reported an improvement as reported no change - Indicates that this was
    not an important reason states chose this option

    Sources: GAO analysis of survey responses from local food stamp officials;
    Art Explosion and Copyright  Corel Corp. All rights reserved
    (images).

    aWe did not measure this item at the local level.

    Most local officials reported increased alignment of the definitions of
    income and resources between food stamps and TANF from the income and
    resources options. States selected these two options in part to increase
    alignment by making these definitions the same in their Food Stamp Program
    and TANF. For example, local food stamp officials from one state we
    visited told us that aligning the definition of income under the income
    option eliminated a food stamp form that was not required for TANF or
    Medicaid. This form was used to verify loans from educational
    institutions, such as community colleges, regarding the amount and
    duration of the loan. They told us that obtaining this information from
    educational institutions could take a month and possibly require several

    follow-up contacts with the institution. This decrease in paperwork for
    both participants and some caseworkers demonstrates one benefit from
    increased alignment. However, on our survey, officials' opinions differed
    on whether the income and resources options helped increase alignment of
    definitions between food stamps and Medicaid.

    Local officials may have reported little or no change from certain options
    because they affected relatively few food stamp participants or they did
    not affect caseworkers' responsibilities. For example, most local
    officials reported that four options-income, resources, transitional
    benefits, and child support-affected less than 20 percent of their
    caseload. In addition, most options made only slight changes to
    caseworkers' administrative processes, and others may not have affected
    their processes at all because some changes were automatically
    incorporated into state computer systems.19 For example, local officials
    reported that the child support option was automatically incorporated into
    state computer systems, so caseworkers' responsibilities were not affected
    by this change.

    Several of the Farm Bill options made only slight changes to existing food
    stamp policy, such as the utility, child support, and Simplified Homeless
    Shelter Costs options. For example, the utility option expanded the
    existing standard utility allowance policy to cover two additional types
    of households that were previously excluded: households sharing a living
    space and public housing residents who were charged for only excess
    utility costs. Also, of the local officials we surveyed on the homeless
    option, the majority indicated that they implemented a similar policy
    prior to its availability under the Farm Bill.

    Many Local Food Stamp Officials Reported That Certain Options Introduced
    Complications in Program Rules for Participants and Caseworkers

    Many local officials reported on our surveys that three options-Expanded
    Simplified Reporting, Transitional Benefits, and Simplified Determination
    of Deductions-introduced complications in program rules for participants
    and caseworkers. Of these options, the Expanded Simplified Reporting
    option-an option that local officials told us affected most of their
    caseloads-introduced the most serious complications because of how it
    interacts with participant reporting rules for other assistance programs.
    Officials told us that adopting the Expanded Simplified Reporting option
    resulted in Food Stamp Program reporting rules that

    19We generally found no differences between the responses of local
    officials in states that implemented an option in the first 6 months after
    it became available and those in states that implemented the option later.

    differed in important ways from the reporting rules of other assistance
    programs, such as Medicaid and TANF, depending on how their states have
    structured these programs. About one-third of local officials we surveyed
    reported that this option decreased alignment between Food Stamp Program
    reporting rules and those of Medicaid; about one-half reported a decrease
    in alignment with TANF.

    Local officials told us that these differences in reporting rules often
    resulted in confusion on the part of food stamp participants, particularly
    because most participate in other assistance programs. They explained that
    although the caseworkers provided information to help participants
    determine which changes they were required to report (i.e., changes that
    increased their income to over 130 percent of the federal poverty level),
    some participants still reported changes that were not required. According
    to a recent case study, some participants may believe they need to report
    these changes to maintain their food benefits.20 On the other hand, local
    officials told us that some participants think that the new reduced
    reporting requirements apply to other assistance programs in addition to
    the Food Stamp Program. Consequently, some participants do not report
    changes they are required to report for these other assistance programs,
    and in some cases, participants might face interruptions in benefits or
    penalties for not reporting changes for other programs.

    In addition to reporting complications for participants, local food stamp
    officials on our site visits and in telephone interviews told us that
    different participant reporting rules for assistance programs are
    confusing for caseworkers because they are uncertain whether to act on a
    change for the Food Stamp Program when reported for another assistance
    program. Moreover, trying to determine whether to act on a change for the
    Food Stamp Program can cause them to perform additional work. When a
    participant reports a change that is required for Medicaid or TANF,21 but
    not for food stamps, caseworkers must decide whether to act on that

    20Carole Trippe, Liz Schott, Nancy Wemmerus, and Andrew Burwick,
    Simplified Reporting and Transitional Benefits in the Food Stamp
    Program-Case Studies of State Implementation. Final Report. Mathematica
    Policy Research, Inc. E-FAN-04-003 May 2004 (Economic Research Service).

    21In some cases, a change reported by a participant may not result in a
    change in Medicaid or TANF benefits. For example, a person may have a
    change in income but the change does not affect that person's Medicaid
    eligibility.

    change for the Food Stamp Program.22 Caseworkers, who often determine
    benefits for more than one assistance program, first must decide if a
    change will increase the participant's food stamp benefit. To make this
    decision, caseworkers typically enter the information into the computer
    system as if they were going to act on the change in order to determine if
    the change will result in an increase in the participant's food stamp
    benefit. If the caseworker determines that the change reported by the
    participant will increase the participant's benefit, caseworkers are
    required to act on the change. On the other hand, if the caseworker
    determines that the change reported by the participant will decrease the
    benefit, the caseworker must then determine whether or not to act on this
    change. (See fig. 7 for one example of how this process would work.) FNS
    regulations mandate that states not act on changes that would result in a
    decrease in benefits for participants unless one of three exceptions is
    met: (1) the household voluntarily requests that the case be closed, (2)
    the participant's TANF (or, in some areas, General Assistance) grant is
    changed, or (3) the information about the change is considered "verified
    upon receipt."23 A reported change is considered verified upon receipt
    when the information is not questionable and the provider is its primary
    source, such as information about earnings provided by the participant's
    employer.24 Many local officials suggested that aligning food stamp
    reporting rules with Medicaid and TANF, by making them the same across
    these programs, would help to simplify this process.

    22Caseworkers can also learn of some changes through an automated process
    that matches participants' information with other databases, such as a new
    hire database, that could indicate a change in household circumstances
    that might merit a change in the food stamp benefit.

    23These exceptions are noted in current USDA regulations related to
    Simplified Reporting: 7 CFR 273.12 (a)(1)(vii)(A). Proposed regulations
    for Expanded Simplified Reporting maintain these same exceptions. 69 Fed.
    Reg. 20762.

    24Information is considered verified upon receipt when the source is, but
    is not limited to, specific data from the Social Security Administration,
    data from the U.S. Citizenship and Immigration Services, and Unemployment
    Compensation data from a state agency.

    Figure 7: Example of Possible Decisions and Actions under the Expanded
    Simplified Reporting Option

    Sources: GAO analysis; Art Explosion and Copyright  Corel Corp.
    All rights reserved (images).

    aThis example assumes the caseworker is the same for food stamps, TANF,
    and Medicaid.

    State officials generally believed that the Expanded Simplified Reporting
    option would help states reduce their food stamp payment error rates.
    However, local officials told us that caseworkers' confusion about the
    reporting rules for different assistance programs could result in improper
    food stamp and other assistance program benefits. A recent case study
    found that caseworkers were concerned that they might make errors in
    benefits because of the complexity of the decision-making process involved
    in determining when to act or not to act on a change.25 Moreover,
    supervisors told us that payment error rates of other assistance programs
    might increase if participants do not report required changes to these
    assistance programs because they believe the Expanded Simplified Reporting
    rules apply to these other programs.

    In an attempt to address these issues, many states have modified this
    option in a way that may undermine some of its benefits. Officials in 17
    of the 33 states that implemented this option told us that rather than
    having caseworkers decide whether or not to act on a change, they have a
    waiver from FNS that requires caseworkers to act on all changes reported
    by participants, including those that would decrease benefits. Some states
    choosing this waiver did so because acting on some but not all changes
    would require significant reprogramming of their computer systems and may
    be difficult for their caseworkers to understand. However, acting on all
    changes counteracts the potential reduction in workload for caseworkers.
    Further, when the participant reports a change during the reporting
    period, having the waiver does not reduce exposure to errors in the way
    that the option does for states without the waiver. In short, the more
    changes caseworkers make, the more opportunity there is for a change to be
    processed incorrectly. In addition, in certain circumstances, a change
    might result in lower benefits for participants in states with this waiver
    as opposed to states without this waiver.26

    In April 2004, USDA proposed some revisions to simplified reporting
    regulations in order to help alleviate some of these complications with
    this waiver.27 USDA proposed that state agencies that have this waiver not
    be required to act on changes a household reports for another public

    25See Economic Research Service: E-FAN-04-003 May 2004.

    26Specifically, if a participant reports a change that would decrease the
    benefit but does not meet any of the three exceptions as explained on page
    28, the change would not be made in states without the waiver but would be
    made in states with the waiver.

    2769 Fed. Reg. 20724-64.

    assistance program when the change does not trigger action in that other
    program. For example, if a household receiving food stamps and Medicaid
    reports an increase in income to its Medicaid caseworker that is not
    required to be reported for food stamp purposes, the state agency would
    not have to reduce the household's food stamp benefit if the income change
    does not affect its Medicaid eligibility or benefits. This proposed change
    would simplify the procedure for caseworkers and, in some cases, eliminate
    the possibility that benefits would be reduced in states with this waiver.
    However, while this proposal addresses issues for caseworkers and
    participants in states with this waiver, we found that local officials in
    states without the waiver were more likely to report that this option
    introduced complications for caseworkers than local officials in states
    with the waiver.

    States have flexibility to align the reporting rules for Medicaid and TANF
    with their food stamp reporting rules available under the Expanded
    Simplified Reporting option, but many have not done so. Although one of
    the three states we visited achieved some alignment of reporting rules
    between TANF and food stamps, none of the three states, despite
    preliminary discussions between Medicaid and food stamp officials, had
    been successful in aligning Medicaid and food stamp reporting rules.28
    Food stamp officials in these states told us the discussions had not
    resulted in alignment of reporting rules largely because Medicaid
    officials believed that Medicaid benefit costs could increase. For
    example, if a participant experienced a household change that would not
    affect the participant's food stamp benefit but would affect Medicaid
    eligibility, the participant might receive Medicaid benefits for longer
    periods than he or she would have under a state's current reporting rules.
    Thus Medicaid benefit costs could increase. A recent study of four states
    found that states are often reluctant to make changes in policies that may
    increase TANF or Medicaid benefit costs or caseloads, particularly when
    states experience budget shortfalls.29 For example, because states
    contribute a nationwide average of 43 percent to Medicaid benefit costs
    (while food stamp benefits are 100 percent federally funded), increases in
    Medicaid caseloads or costs would place demands on state budgets that
    increases in food stamp

    28A recent informal study that gathered information from 12 states that
    are using the simplified or expanded simplified reporting option showed
    that 3 states have aligned TANF and food stamp rules. Upon further
    clarification, no state has aligned Medicaid and food stamp rules. See
    www.NAPIPM.org (www.napipm.org/simp%20reporting.htm 5/10/04).

    29See Economic Research Service: E-FAN-04-003 May 2004.

    caseloads would not. In addition, another report noted that changes to
    rules and procedures typically require that a state reprogram its computer
    to apply the new policies, and these changes may result in increased cost
    to the state.30 However, the extent to which program costs might increase
    as a result of alignment is unclear, and in two of the three states we
    visited, state officials had little or no information on possible costs
    associated with implementing such changes.31

    A case study also noted that in some states, staff responsible for these
    various benefit programs work in different agencies with varied
    priorities, and there is no incentive to coordinate policy across these
    programs.32 Finally, an official from HHS's Centers for Medicare and
    Medicaid Services (CMS) noted that there are numerous groups of eligible
    Medicaid participants, and many groups, depending on state eligibility
    rules, may receive continuous eligibility for 12 months.33 For these
    participants, reporting on a 6-month schedule for Medicaid would not be
    appropriate.

    Two additional options introduced complications in program rules, though
    to a lesser extent. Some local officials reported that the Transitional
    Benefits option introduced complications for the caseworkers, again
    because of interactions between this option and other assistance programs.
    For example, transitional benefits from Medicaid are for persons
    transitioning to work and are provided for up to 1 year. On the other
    hand, transitional food stamp benefits are for persons leaving TANF and
    are granted for a maximum of 5 months. In addition, program experts told
    us that reporting rules for the two types of transitional benefits are not
    aligned, and this creates an additional administrative burden for
    caseworkers. Medicaid requires persons receiving transitional benefits to
    report household financial circumstances at the 4th, 7th, and 10th month
    of transitional benefits, whereas persons receiving food stamp
    transitional benefits must reapply at the end of the 5th month. About a
    third of local

    30Liz Schott, Stacey Dean, Jocelyn Guyer, Coordinating Medicaid and Food
    Stamps: How New Food Stamp Policies Can Reduce Barriers to Health Care
    Cover for Low-Income Working Families. Center on Budget and Policy
    Priorities, September 2001.

    31One state provided preliminary analysis of estimated costs for aligning
    reporting rules for TANF and child care programs to 6-month reporting for
    earned-income households only.

    32See Economic Research Service: E-FAN-04-003 May 2004.

    33Federal Medicaid statute identifies over 25 different eligibility
    categories of persons who may be covered under a state Medicaid plan.
    According to a CMS official, a state could have as many as 50 groups of
    eligible Medicaid participants.

    Conclusions

    officials reported that they would like transitional food stamp benefits
    to be available for 6 months or to be aligned with transitional benefits
    from Medicaid.

    Finally, some local officials reported that the Simplified Determination
    of Deductions option introduced complications for the participants and the
    caseworkers. For example, local officials told us that this option
    complicates decisions about whether to act on changes reported by
    participants. Local officials told us that when participants report a
    change that is not required under the deductions option, caseworkers must
    first determine if the household is subject to reporting rules under
    Expanded Simplified Reporting or not. If the household falls under
    Expanded Simplified Reporting, the caseworkers must follow the
    decision-making process for Expanded Simplified Reporting depicted in
    figure 7 above. If the household does not fall under Expanded Simplified
    Reporting and the change is to a deduction from household income, the
    caseworkers must not act on the change.

    Since the late 1990s, and most recently in the Farm Bill, the Congress and
    FNS have offered states a number of options to simplify and streamline the
    administration of the Food Stamp Program. These options presented states
    with additional opportunities to tailor their Food Stamp Programs to the
    social and economic needs of their own states. Moreover, these changes
    coincided with actions taken by the Congress to grant states considerable
    flexibility in the design and administration of other key assistance
    programs, such as TANF and Medicaid, and the growing realization that the
    Food Stamp Program provides crucial support to lowincome working families.

    Local officials, who have day-to-day contact with frontline caseworkers
    and food stamp participants, reported mixed results from implementing the
    options. Although they reported some improvements for both caseworkers and
    participants from some options, no option received consistently positive
    reports in all the areas where state officials expected improvements when
    they selected the option. In fact, in many cases, officials were as likely
    to report that an option resulted in no change as they were to report
    improvements. This may be due in part to the fact that the Farm Bill
    options made only slight changes to policy and, as reported, affected
    relatively few program participants.

    Of all the options, the Expanded Simplified Reporting option offered the
    most promise because it was selected by the most states, affects a large

    number of participants, and has the potential to significantly streamline
    the participant reporting process. The fact that local officials reported
    that adopting this option actually complicated program rules in many
    states reflects the challenge of trying to simplify requirements for one
    program without efforts by states to adjust the rules of other related
    assistance programs. This is particularly relevant because most food stamp
    recipients also participate in other assistance programs. The reported
    complications resulted in problems, such as confusion for the caseworker
    and a possible increase in payment errors. In response, many states
    adopted a waiver that negated many of the potential benefits of Expanded
    Simplified Reporting for caseworkers and participants. Although USDA
    proposed a change to this waiver, the change will not address the
    complications reported by local officials in states without the waiver.
    Moreover, neither the waiver to act on all changes nor USDA's proposed
    change to the waiver will address overall alignment issues related to
    reporting rules among various assistance programs.

    Although federal law and program rules allow states to align participant
    reporting rules among assistance programs, state officials in most states
    have not made the broad changes that would result in greater consistency
    among programs. Concerns regarding whether there are costs associated with
    aligning participant reporting requirements may hinder a state's decision
    to make program changes that increase alignment. These concerns may
    include the cost of programming changes into state computers and the
    concern that benefit costs may increase in those programs that require a
    higher proportion of state funds, such as the Medicaid program. On the
    other hand, savings could result from reducing the administrative burden
    on caseworkers. Yet it is unclear whether costs would rise or savings
    would be realized. In addition, aligning Medicaid reporting rules with
    food stamp rules may work for some groups of Medicaid participants, but
    not others. Although alignment of state program rules may not be
    advantageous in every circumstance, many government officials told us that
    they were interested in improved alignment. In general, increased
    alignment remains important to simplification and ease of service
    delivery.

    Recommendations for In order to take advantage of existing opportunities
    available to states for streamlining participant reporting rules, we
    recommend that the SecretaryExecutive Action of Agriculture direct FNS to
    collaborate with HHS to take the following two actions:

      Agency Comments

    1. 	Encourage state officials to explore the advantages and
    disadvantages-in terms of both administrative and benefit costs and
    savings-of better aligning participant reporting rules in their states,
    particularly for Medicaid and TANF, and

    2. 	Disseminate information and guidance to states on the opportunities
    available for better aligning participant reporting requirements among
    food stamps, Medicaid, and TANF.

    We provided a draft of this report to the U.S. Department of Agriculture
    for review and comment and on August 20, 2004, we met with FNS officials
    to get their comments. The officials said they agreed with our findings,
    conclusions, and recommendations. They stated that they are interested in
    helping states better align their participant reporting requirements and
    that they plan to contact HHS to initiate discussions on ways to help
    states align these reporting requirements. They also said they plan to
    provide best practices information to states regarding the administration
    of the Food Stamp Program and that they would explore disseminating
    information on any progress states have made in streamlining their
    participant reporting rules. FNS provided us with technical comments,
    which we incorporated where appropriate.

    We are sending copies of this report to the Secretary of Agriculture,
    appropriate congressional committees, and other interested parties. We
    will also make copies available to others upon request. In addition, the
    report will be available at no charge on GAO's Web site at
    http://www.gao.gov. Please contact me at (202) 512-7215 if you or your
    staffs have any questions about this report. Major contributors to this
    report are listed in appendix V.

    Sigurd R. Nilsen Director, Education, Workforce, and Income Security
    Issues

      Appendix I: Objective, Scope, and Methodology

    To accomplish our research objectives, we surveyed state food stamp
    administrators and local food stamp supervisors on the implementation of
    the Farm Bill food stamp options. To augment information from our state
    and local surveys, we conducted three comprehensive site visits (Arizona,
    Maryland, and Michigan) and two semi-structured telephone interviews
    (Colorado and South Carolina). We chose states for our site visits and
    telephone interviews to capture variation in the following criteria: (a)
    number of and type of selected options, (b) number of food stamp
    participants and program participation rate, (c) program error rate, and
    (d) entity (state or county) administering the Food Stamp Program. During
    each visit we met with state officials administering and developing policy
    for the Food Stamp Program, local officials in the office where services
    are provided, and officials responsible for other key assistance programs,
    such as Temporary Assistance for Needy Families (TANF) and Medicaid. We
    also reviewed Farm Bill legislation and related committee reports, and we
    reviewed Food and Nutrition Service (FNS) reports and other program
    analysis. We held discussions with program stakeholders, including
    officials at FNS headquarters and regional offices, representatives of
    advocacy organizations, and other program experts. We performed our work
    from August 2003 to June 2004 in accordance with generally accepted
    government auditing standards.

                                  Survey of State Food
                                  Stamp Administrators

    To learn about state-level use of the food stamp options made available
    under the Farm Bill, we conducted a Web-based survey of food stamp
    administrators in the 50 states and the District of Columbia. For each of
    the eight Farm Bill options, we asked state officials to provide
    information on whether or not their state had chosen and implemented the
    option, reasons for choosing (or not choosing) the option, program
    challenges in implementing the option, changes because of the options, and
    potential improvements to the option. In addition, we asked for other
    information, including cost estimates for implementing the options,
    estimates of time and cost savings as a result of implementing the
    options, efforts to align the Food Stamp Program with TANF and Medicaid,
    and other food stamp options states had implemented prior to the Farm
    Bill. We administered the survey between December 9, 2003, and January 30,
    2004. We also contacted some respondents via phone or e-mail to clarify
    their responses after the Web survey was completed. Food stamp
    administrators in all 50 states and the District of Columbia participated
    in the survey, for a response rate of 100 percent. To view selected
    results of GAO's Web-based survey of food stamp adminstrators, go to
    www.gao.gov/cgi-bin/getrpt?GAO-04-1058SP.

    Appendix I: Objective, Scope, and Methodology

    We believe the state survey data are sufficiently reliable to be used for
    the applicable questions of our work. We pretested the survey with several
    state Food Stamp administrators and modified the survey to take their
    comments into account. We also compared our survey responses on which of
    the states had implemented the options with information published by FNS
    and found our data had a reasonable level of consistency with the agency's
    data, with the exception of data for the Simplified Homeless Shelter Costs
    option. Our analysis indicated fewer states had implemented this option
    than are listed in the FNS report. The cause of the discrepancy is that
    many states were already using a homeless shelter allowance of $143 prior
    to the Farm Bill, and many of these states are included in the information
    published by FNS as having implemented the Farm Bill option. However, for
    the purposes of our study, we decided to limit our analysis to only those
    states that implemented the homeless shelter allowance of $143 after the
    Farm Bill became effective.

    Survey of Local Food Stamp Supervisors

    To learn about local-level use of the Farm Bill options, we administered
    1,328 mailed surveys to supervisors in local food stamp offices in the
    states that had implemented the options. These survey results are
    generalizable to local offices in states that implemented the options. We
    conducted a separate survey for each of the eight options and used a
    separate sample for each of the surveys. On all eight surveys, we asked
    supervisors in local offices for their opinions about the extent to which
    the Farm Bill option had affected change in several areas of the Food
    Stamp Program, including administrative burden on participants and
    caseworkers, the error rate, program participation, and alignment with
    other assistance programs. In addition, we asked the supervisors for their
    opinions about the proportion of the local office's food stamp caseload
    that was affected by the option and changes the local office officials
    would like to see to the option. To view the results from the local food
    stamp office surveys, go to www.gao.gov/cgi-bin/getrpt?GAO-04-1059SP.

    We chose to survey food stamp supervisors because we believed they would
    be aware of the changes for participants and caseworkers resulting from
    the Farm Bill options. We collected the opinion of these supervisors
    because we did not find existing data on the information we needed to
    complete the objectives of this study, including the number of food stamp
    recipients affected by each option and the time costs or savings for food
    stamp participants and caseworkers because of the implementation of the
    options. We conducted the surveys between December 2003 and April 2004. We
    also contacted some respondents via phone or e-mail to clarify their
    responses after the mailed survey was completed.

    Appendix I: Objective, Scope, and Methodology

    Local Survey Sample Design

    Sampling and Nonsampling Errors

    For each Farm Bill option, the population of interest was the set of all
    local food stamp offices located in states that adopted the option.
    Because we could not survey the entire population of local offices, we
    selected a sample of local offices to be representative of this population
    of interest. In each sample, the sampling unit is the local food stamp
    office. To determine the eight samples, we contacted state and county food
    stamp officials to compile a complete mailing list of food stamp offices
    in the 50 states and the District of Columbia. We compiled our own list
    because we were unaware of any other such comprehensive list. From these
    lists of local offices, we selected a simple random sample of local
    offices located in states that, according to information provided by FNS,
    had already implemented the option.1 For example, if the FNS report
    indicated 12 states had implemented an option, we drew the sample for that
    option from the combined list of the local offices in those 12 states.

    Since many states had chosen multiple options, we capped the number of
    surveys a local office could receive at three in order to minimize
    response burden. Only one local office was randomly selected to receive
    more than three surveys. To make sure this office did not receive more
    than three surveys, we randomly selected two of the five options for which
    we had drawn this office. We then randomly selected two replacement
    offices to receive the surveys. To select the replacement offices, we used
    the remaining offices on the list.

    Because we surveyed a random sample of local food stamp offices, our
    results are estimates of the responses we would have received had we
    surveyed the entire population of interest, and are thus subject to
    sampling errors. We are 95 percent confident that each of the confidence
    intervals in the local survey results will contain the true values of the
    population of interest. All percentage estimates from the local survey
    have sampling errors of plus or minus 10 percentage points. We calculated
    confidence intervals for our local survey results using methods that are
    appropriate for probability samples of this type.

    1We used draft information provided by FNS, which we later supplemented
    with information from its October 2003 report, released in November 2003:
    United States Department of Agriculture, Food and Nutrition Service, Food
    Stamp Program: State Options Report, Third Edition, October 2003. The FNS
    State Options Report was the only source of which we were aware at that
    time that listed which states had implemented the option. We could not use
    our state survey data to develop the list of states that had implemented
    the option because we had not completed the state survey at the time we
    needed to draw the sample for the local survey.

    Appendix I: Objective, Scope, and Methodology

                                     Response Rates

    In addition to sampling errors, the practical difficulties in conducting
    surveys of this type may introduce other types of errors, commonly
    referred to as nonsampling errors. For example, questions may be
    misinterpreted, the respondents' answers may differ from those in local
    offices that did not respond, or errors could be made in keying completed
    questionnaires or in the preparation of data files for analysis. We took
    steps in the development, collection, and analysis of the local surveys to
    minimize these errors. For example, we pretested each of the eight local
    surveys with at least one local food stamp official prior to mailing the
    surveys.

    The response rates for the eight surveys ranged from 74.0 percent to 86.1
    percent (see table 1 below). Some respondents returned the survey to us
    but indicated that their local office had not implemented the option we
    asked them about or that they implemented the option prior to the date the
    Farm Bill became effective. We refer to these surveys as "out of scope."
    There are several reasons surveys could be out of scope, including the
    time lag between the FNS report we used to determine our sample and the
    launch of our survey and possible delays in state-level policy decisions
    being implemented on the local level. Given how quickly the status of the
    Farm Bill options can change in states, the number of out of scopes is not
    surprising. In this report we did not use out-of-scope surveys in the
    estimates derived from local survey data.

    We did not use the data we collected from the local survey on the
    Simplified Homeless Shelter Costs option because we had used the FNS list
    of states that had implemented the option to draw our sample, but later we
    learned of the discrepancy between our definition of the option and the
    data provided by FNS that had implemented this option. We concluded our
    sample for this option was flawed and the results should not be used in
    the local survey analysis.

                     Appendix I: Objective, Scope, and Methodology

             Table 1: Disposition of Eight Farm Bill Option Samples Sample

             Farm Bill option        Sample Received Out of scopes Response ratea
    Expanded simplified reporting    192      157             3          81.5%
           Transitional benefits        165      134            10          80.0%
         Simplified definition of       181      152            37          79.9%
                  income
         Simplified definition of       170      141            48          76.2%
                 resources
        Simplified homeless shelter     176
                   costs
        Simplified standard utility     179      155             6          86.1%
                   costs
        Simplified determination of     126      100             8          78.0%
                deductions
    Child support expense income   139        112            35          74.0%
                 exclusion

    aThe response rates shown in table 1 are calculated using the following
    formula:

    (Total number of responses - Number of out of scopes) = Response
    rate(Total sample size - Number of out of scopes)

      Appendix II: Farm Bill Options That States Have Implemented as of January
      2004

    Figure 8: Farm Bill Options States Have Implemented as of January 2004

    aSimplified Homeless Shelter Costs option only includes states that
    indicated they did not have a Standard Homeless Shelter Allowance of $143
    prior to the Farm Bill.

      Appendix III: Selected Responses to State Survey

    Figure 9: Number of States That Gave Reasons for Choosing Options

    aSimplified Homeless Shelter Costs option only includes states that
    indicated they did not have a Standard Homeless Shelter Allowance of $143
    prior to the Farm Bill.

    bWe only asked child support item for Child Support Expense Income
    Exclusion option.

    Appendix III: Selected Responses to State Survey

         Figure 10: Number of States That Gave Reasons for Not Choosing Options
                                                                                                                                                                                                                                                                                                                                                                                                  Relative
                                                                                                                                                                                                                                                                                                                                                                                                  advantage
                                                                                                                                                                                                                                                                                                                                                                                                 Would have
                                                                                                          Computers                                                                                                                                                                                                                                                                               little or
                                                                                                             Too                                                                                                                                                                       Would not                                                                                                     no
                                                                                                         difficult to                                                                                                                                                                  encourage                                                                         Would                    advantage
                                                                                                           program                                                                                                                                                                   participants                                                                        make it                 over policy
              Options                                                                                      computer                                                                              Little or no                                                                        to transition                   Would                   Would                       more                       rules
            (Number of                                                                                      system                                                                               increase in                                                                         from welfare                  decrease                  decrease                    difficult               already in                                             Would raise
              states                                                                                     Participants                              5 2 3 1 18 19 28              5 2 1 2 11 9 26   benefit                                                             2 0 0 2 1 0 5    to work                  participation               participation               to align                place Error                                           administrative 2 1 0 0 5 3 2           a a a a a   a Other 1 7 1 4 4 3 12
            chosen and                                                                                       and                                                                                 amounts for                                                                         Participation                of working                 of elderly                  Food                    rate Would                                                costs
            implemented                                                                                  caseworkers                                                                             participants                                                                            Would                     families                  and/or                      Stamp                    increase                    Would not
              option)                                                                                       Would                                                                                                                                                                      decrease                                              disabled                    Program                 error rate                   work well
                                                                                                           increase                                                                                                                                                                     overall                                              Alignment                   with                       Other                       with
                                                                                 Child                   workload for                                                                                                                                                                participation                                           Would make it               Medicaid                  reasons                      other
                                   Simplified            Simplified              support                 caseworkers                                                                                                            Very few                                              in program                                             more                                                   Would                     Farm Bill                                             Would not
                         Expanded  standard   Simplified definition              expense   Simplified                                     Would                        Would                                                  participants                   Would                                                                           difficult to                                         decrease                     options                                              encourage
                        simplified utility    definition     of     Transitional income    determination                               complicate                    complicate                                                 would be                    increase                                                                         align Food                                          application 5 6 5 6 11 23 20   state                                                payment
                        reporting  allowance  of income  resources  benefits (N  exclusion of deductions              4 2 1 0 22 17 14  rules for                    rules for                                                affected by                  burden on                               0 0 1 0 2 2 1                             Stamp Program 0 1 0 0 0 0 0                           process   5 2 0 0 7  12 12 chose to                                              of child
    Reasons              (N = 9)   (N = 12)    (N = 7)    (N = 12)     = 27)     (N = 35)  (N = 44)                   3 2 2 1 13 7  10 caseworkers                  participants                              1 4 4 5 9 20 15    change    1 2 5 7 7 18 8 participants                             0 0 0 0 0 1 0               0 0 0 0 0 1 1 with TANF     2 0 0 0 5 6 9           3 0 0 0 3 5 4 timeliness  0 0 0 0 0  1  1  implement 1 0 0 0 6 2 15                               support            4

    Source: GAO survey.

    Notes: Data for Simplified Homeless Shelter Costs option are not
    available. aWe only asked child support item for Child Support Expense
    Income Exclusion option.

      Appendix IV: Selected Responses to Local Surveys

                        Figure 11: Expanded Simplified Reporting
                                                                                             Changes for Changes for
                                                                                              food stamp the
                                                                                            participants participants
                                                                                             Participant Time spent
                                                                                          administrative reporting                                                                                                                                                        Changes for
                                                                                                  burden changes                                                                                                                                                              the
                                                                                                measures Amount of                                                                                                                                                         caseworker
    Percentage                                                                               Participant paperwork                                                                                          Time spent                                                    Decisions on
    of food                                                                            simplification required                                                            Number of                         with                       Time spent on                    whether to
         stamp                                                    1% 8% 9% 18% 39% 22% 4%       measures Changes for                                                         contacts                      participants                     paperwork                        apply
      caseload                                                                               Changes for the                                                                 with                             during                       (including                       changes
      affected                                                                                food stamp participants                                                        participants                    contacts                     verification)                   reported by
     None (0%)                                                                               caseworkers Rules         Greatly    Somewhat  Remained  Somewhat                                                                                                            participants
                                                                                              Caseworker related to   decreased  decreased  the same  increased    Greatly                                                                                                Frequency of
                                                                                          administrative reporting or  13% 19%    48% 42%   32% 27%    5% 10%     increased                                                                                                 benefit
                                                                                                  burden documenting   Greatly    Somewhat  Remained  Somewhat      3% 2%                                                                                                 calculation
                                                                                                measures changes      simplified simplified the same complicated   Greatly
                                 About             Almost                                     Caseworker Changes for     17%        30%        8%        33%     complicated                                                                                                            Greatly    Somewhat  Remained  Somewhat     Greatly
                 Few     Some     half     Most     all     All                           simplification the           Greatly    Somewhat  Remained  Somewhat   12% Greatly                                                                                                           simplified simplified the same complicated complicated
               (1-19%) (20-39%) (40-59%) (60-79%) (80-99%) (100%)                               measures caseworker   decreased  decreased  the same  increased   increased               9% 48% 33% 9% 2%              2% 18% 61% 16% 4%               6% 36% 37% 12% 9%                16% 4%    47% 18%   29% 31%    7% 27%      1% 20%

    Source: GAO survey.

    Note: These estimates are accurate to within plus or minus 10 percentage
    points at the 95 percent level of confidence. Rows may not sum to 100
    percent because of rounding errors.

                    Appendix IV: Selected Responses to Local Surveys

                    Figure 12: Simplified Standard Utility Allowance
                                                                                                          Changes for
                                                                                                          the
                                                                                                          participants
                                                                                                          Time spent
                                                                                                          applying for
                                                                                                          food stamps
                                                                                              Changes for or reporting
                                                                                               food stamp changes
                                                                                             participants Amount of
                                                                                              Participant paperwork
                                                                                           administrative required
                                                                                                   burden Changes for                                                         Time spent on
                                                                                                 measures the                                                                 paperwork                                                            Decisions on
    Percentage                                                                                Participant participants                                                        (including                                                            whether to
    of food                                                                             simplification Rules                                                               verification)                                                           apply
         stamp                                                    1% 19% 10% 3% 12% 46% 8%       measures related to                                                          Changes for                                                           changes in
      caseload                                                                                Changes for reporting or                                                        the                                                                    utility
      affected                                                                                 food stamp documenting                                                         caseworker                                                              costs
     None (0%)                                                                                caseworkers utility                                                             Calculation                                                          reported by
                                                                                               Caseworker expenses                                                            of food stamp                                                        participants
                                                                                           administrative Changes for                                                         benefits
                                                                                                   burden the
                                                                                                 measures caseworker
                                                                                               Caseworker Number of     Greatly    Somewhat  Remained
                                                                                           simplification contacts     decreased  decreased  the same  Somewhat     Greatly
                                                                                                 measures with           1% 5%     25% 46%   71% 48%   increased   increased
                                                                                                          participants  Greatly    Somewhat  Remained    3% 1%       0% 0%
                                                                                                          Time spent   simplified simplified the same  Somewhat     Greatly
                                                                                                          with            18%        42%       36%    complicated complicated                  10%        43%       44%
                                 About             Almost                                                 participants  Greatly    Somewhat  Remained 4% Somewhat 0% Greatly                 Greatly    Somewhat  Remained 3% Somewhat 0% Greatly
                 Few     Some     half     Most     all     All                                           during       decreased  decreased  the same  increased   increased                simplified simplified the same complicated complicated
               (1-19%) (20-39%) (40-59%) (60-79%) (80-99%) (100%)                                         contacts       3% 5%     20% 25%   73% 67%     4% 3%       0% 0%                     16%        40%       37%        7%          0%                   26% 43% 24% 6% 1%

    Source: GAO survey.

    Note: These estimates are accurate to within plus or minus 10 percentage
    points at the 95 percent level of confidence. Rows may not sum to 100
    percent because of rounding errors.

                    Appendix IV: Selected Responses to Local Surveys

                       Figure 13: Simplified Definition of Income
                                                                                                        Changes for
                                                                                                        the
                                                                                                        participants
                                                                                                        Time spent
                                                                                                        applying for
                                                                                            Changes for food stamps
                                                                                             food stamp or reporting
                                                                                           participants changes
                                                                                            Participant Amount of
                                                                                         administrative paperwork
                                                                                                 burden required                                                            Time spent on
                                                                                               measures Changes for                                                         paperwork
    Percentage                                                                              Participant the                                                                 (including
    of food                                                                           simplification participants                                                        verification)                                                        Determination
         stamp                                                                                 measures Rules                                                               Changes for                                                          or
      caseload                                                    0% 62% 16% 5% 9% 6% 2%    Changes for related to                                                          the                                                                  redetermination
      affected                                                                               food stamp reporting or                                                        caseworker                                                           of eligibility
     None (0%)                                                                              caseworkers documenting                                                         Calculation
                                                                                             Caseworker income                                                              of food stamp
                                                                                         administrative Changes for                                                         benefits
                                                                                                 burden the
                                                                                               measures caseworker
                                                                                             Caseworker Number of                Somewhat  Remained
                                                                                         simplification contacts      Greatly   decreased  the same  Somewhat     Greatly
                                                                                               measures with         decreased   39% 56%   56% 38%   increased   increased
                                                                                                        participants   3% 3%     Somewhat  Remained    2% 3%       0% 0%
                                                                                                        Time spent    Greatly   simplified the same  Somewhat     Greatly
                                                                                                        with         simplified    56%       27%    complicated complicated                             47%       41%
                                 About             Almost                                               participants 8% Greatly  Somewhat  Remained 7% Somewhat 2% Greatly                7% Greatly  Somewhat  Remained 4% Somewhat 1% Greatly
                 Few     Some     half     Most     all     All                                         during       decreased  decreased  the same  increased   increased                simplified simplified the same complicated complicated
               (1-19%) (20-39%) (40-59%) (60-79%) (80-99%) (100%)                                       contacts       1% 1%     28% 30%   67% 62%     4% 7%       0% 0%                      6%        46%       42%        5%          2%                      3% 47% 43% 5% 2%

    Source: GAO survey.

    Note: These estimates are accurate to within plus or minus 10 percentage
    points at the 95 percent level of confidence. Rows may not sum to 100
    percent because of rounding errors.

                    Appendix IV: Selected Responses to Local Surveys

                     Figure 14: Simplified Definition of Resources
                                                                                                         Changes for
                                                                                                         the
                                                                                                         participants
                                                                                                         Time spent
                                                                                                         applying for
                                                                                             Changes for food stamps
                                                                                              food stamp or reporting
                                                                                            participants changes
                                                                                             Participant Amount of
                                                                                          administrative paperwork
                                                                                                  burden required                                                            Time spent on
                                                                                                measures Changes for                                                         paperwork
    Percentage                                                                               Participant the                                                                 (including
    of food                                                                            simplification participants                                                        verification)                                                        Determination
         stamp                                                                                  measures Rules                                                               Changes for                                                          or
      caseload                                                    0% 55% 18% 6% 12% 9% 1%    Changes for related to                                                          the                                                                  redetermination
      affected                                                                                food stamp reporting or                                                        caseworker                                                           of eligibility
     None (0%)                                                                               caseworkers documenting                                                         Calculation
                                                                                              Caseworker income                                                              of food stamp
                                                                                          administrative Changes for                                                         benefits
                                                                                                  burden the
                                                                                                measures caseworker
                                                                                              Caseworker Number of     Greatly    Somewhat  Remained
                                                                                          simplification contacts     decreased  decreased  the same  Somewhat     Greatly
                                                                                                measures with           4% 6%     33% 46%   60% 46%   increased   increased
                                                                                                         participants  Greatly    Somewhat  Remained    2% 1%       0% 0%
                                                                                                         Time spent   simplified simplified the same  Somewhat     Greatly
                                                                                                         with            10%        46%       39%    complicated complicated                             44%       44%
                                 About             Almost                                                participants  Greatly    Somewhat  Remained 4% Somewhat 1% Greatly                9% Greatly  Somewhat  Remained 3% Somewhat 0% Greatly
                 Few     Some     half     Most     all     All                                          during       decreased  decreased  the same  increased   increased                simplified simplified the same complicated complicated
               (1-19%) (20-39%) (40-59%) (60-79%) (80-99%) (100%)                                        contacts       3% 2%     22% 28%   69% 62%     6% 8%       0% 0%                      3%        33%       62%        1%          1%                      4% 42% 51% 2% 1%

    Source: GAO survey.

    Note: These estimates are accurate to within plus or minus 10 percentage
    points at the 95 percent level of confidence. Rows may not sum to 100
    percent because of rounding errors.

                    Appendix IV: Selected Responses to Local Surveys

                            Figure 15: Transitional Benefits
                                                                                                        Changes for
                                                                                                        the
                                                                                                        participants
                                                                                                        Time spent
                                                                                                        applying for
                                                                                            Changes for food stamps
                                                                                             food stamp or reporting
                                                                                           participants changes
                                                                                            Participant Amount of
                                                                                         administrative paperwork
                                                                                                 burden required                                                            Time spent on
                                                                                               measures Changes for                                                         paperwork
    Percentage                                                                              Participant the                                                                 (including                                                           Decisions on
    of food                                                                           simplification participants                                                        verification)                                                         whether to
         stamp                                                                                 measures Rules                                                               Changes for                                                             apply
      caseload                                                    5% 77% 14% 2% 2% 0% 1%    Changes for related to                                                          the                                                                    changes
      affected                                                                               food stamp reporting or                                                        caseworker                                                           reported by
     None (0%)                                                                              caseworkers documenting                                                         Calculation                                                          participants
                                                                                             Caseworker income                                                              of food stamp
                                                                                         administrative Changes for                                                         benefits
                                                                                                 burden the
                                                                                               measures caseworker
                                                                                             Caseworker Number of     Greatly    Somewhat  Remained  Somewhat
                                                                                         simplification contacts     decreased  decreased  the same  increased    Greatly
                                                                                               measures with          12% 15%    40% 34%   41% 41%     7% 9%     increased
                                                                                                        participants  Greatly    Somewhat  Remained  Somewhat      0% 0%
                                                                                                        Time spent   simplified simplified the same complicated   Greatly
                                                                                                        with            16%        35%       30%        15%     complicated                  14%        19%       41%        21%
                                 About             Almost                                               participants  Greatly    Somewhat  Remained  Somewhat   4% Greatly                 Greatly    Somewhat  Remained  Somewhat   4% Greatly
                 Few     Some     half     Most     all     All                                         during       decreased  decreased  the same  increased   increased                simplified simplified the same complicated complicated
               (1-19%) (20-39%) (40-59%) (60-79%) (80-99%) (100%)                                       contacts       2% 3%     32% 20%   53% 68%    13% 9%       0% 0%                     15%        27%       31%        26%         1%                   15% 22% 26% 29% 7%

    Source: GAO survey.

    Note: These estimates are accurate to within plus or minus 10 percentage
    points at the 95 percent level of confidence. Rows may not sum to 100
    percent because of rounding errors.

                    Appendix IV: Selected Responses to Local Surveys

                   Figure 16: Child Support Expense Income Exclusion
                                                                                                        Changes for
                                                                                                        the
                                                                                            Changes for participants
                                                                                             food stamp Time spent
                                                                                           participants applying for
                                                                                            Participant food stamps                                                   Time spent on
                                                                                         administrative Amount of                                                     paperwork
    Percentage                                                                                   burden paperwork                                                     (including
    of food                                                                                 measures required                                                      verification)                                                        Determination
         stamp                                                                              Changes for Changes for                                                   Changes for                                                          or
      caseload                                                    0% 77% 19% 3% 2% 0% 0%     food stamp the                                                           the                                                                  redetermination
      affected                                                                              caseworkers caseworker                                                    caseworker                                                           of eligibility
     None (0%)                                                                               Caseworker Number of                                                     Calculation
                                                                                         administrative contacts                                                      of food stamp
                                                                                                 burden with                                                          benefits
                                                                                               measures participants  Greatly  Somewhat  Remained Somewhat   Greatly
                                                                                             Caseworker Time spent   decreased decreased the same increased increased
                                                                                         simplification with           0% 0%     0% 1%   84% 76%   16% 23%    0% 0%                                1%       76%        23%
                                 About             Almost                                      measures participants  Greatly  Somewhat  Remained Somewhat   Greatly                0% Greatly  Somewhat  Remained  Somewhat   0% Greatly
                 Few     Some     half     Most     all     All                                         during       decreased decreased the same increased increased               simplified simplified the same complicated complicated
               (1-19%) (20-39%) (40-59%) (60-79%) (80-99%) (100%)                                       contacts       0% 0%     3% 1%   83% 84%   15% 15%    0% 0%                     0%         5%       79%        16%         0%                      0% 5% 81% 14% 0%

    Source: GAO survey.

    Note: These estimates are accurate to within plus or minus 10 percentage
    points at the 95 percent level of confidence. Rows may not sum to 100
    percent because of rounding errors.

                    Appendix IV: Selected Responses to Local Surveys

                   Figure 17: Simplified Determination of Deductions
                                                                                                           Changes for
                                                                                                           the
                                                                                                           participants
                                                                                                           Time spent
                                                                                                           applying for
                                                                                               Changes for food stamps
                                                                                                food stamp or reporting
                                                                                              participants changes
                                                                                               Participant Amount of
                                                                                            administrative paperwork
                                                                                                    burden required                                                            Time spent on
                                                                                                  measures Changes for                                                           paperwork
    Percentage                                                                                 Participant the                                                                  (including                                                          Decisions on
    of food                                                                              simplification participants                                                        verification)                                                         whether to
         stamp                                                                                    measures Rules                                                                Changes for                                                            apply
      caseload                                                    0% 24% 35% 14% 13% 13% 2%    Changes for related to                                                               the                                                               changes
      affected                                                                                  food stamp reporting or                                                         caseworker                                                          reported by
     None (0%)                                                                                 caseworkers documenting                                                         Frequency of                                                         participants
                                                                                                Caseworker deductions                                                             benefit
                                                                                            administrative Changes for                                                          calculation
                                                                                                    burden the
                                                                                                  measures caseworker
                                                                                                Caseworker Number of                Somewhat  Remained  Somewhat
                                                                                            simplification contacts      Greatly   decreased  the same  increased    Greatly
                                                                                                  measures with         decreased   26% 35%   65% 57%     5% 3%     increased
                                                                                                           participants   3% 4%     Somewhat  Remained  Somewhat      2% 2%
                                                                                                           Time spent    Greatly   simplified the same complicated   Greatly
                                                                                                           with         simplified    41%       23%        24%     complicated                             40%       43%
                                 About             Almost                                                  participants 2% Greatly  Somewhat  Remained  Somewhat   10% Greatly               7% Greatly  Somewhat  Remained 9% Somewhat 2% Greatly
                 Few     Some     half     Most     all     All                                            during       decreased  decreased  the same  increased   increased                simplified simplified the same complicated complicated
               (1-19%) (20-39%) (40-59%) (60-79%) (80-99%) (100%)                                          contacts       1% 2%     29% 24%   55% 60%    13% 13%      3% 2%                      9%        39%       39%        11%         2%                   7% 29% 23% 35% 6%

    Source: GAO survey.

    Note: These estimates are accurate to within plus or minus 10 percentage
    points at the 95 percent level of confidence. Rows may not sum to 100
    percent because of rounding errors.

      Appendix V: GAO Contacts and Staff Acknowledgments

    GAO Contacts 	Kay Brown, (202) 512-3674, brownke@gao.gov Elizabeth
    Morrison, (202) 512-9641, morrisone@gao.gov

    Acknowledgments 	Katharine Leavitt and Anne Welch also made significant
    contributions to this report. In addition, Carl Barden, Kevin Jackson,
    MacDonald Phillips, and Jay Smale were responsible for sampling, survey
    design, and data analysis,and Corinna Nicolaou assisted in the report
    development.

      Related GAO Products

    Food Stamp Program: Steps Have Been Taken to Increase Participation of
    Working Families, but Better Tracking of Efforts Is Needed. GAO-04-346.
    Washington, D.C.: March 5, 2004.

    Food Stamp Employment and Training Program: Better Data Needed to
    Understand Who Is Served and What the Program Achieves. GAO-03-388.
    Washington, D.C.: March 12, 2003

    Food Stamp Program: States' Use of Options and Waivers to Improve Program
    Administration and Promote Access. GAO-02-409. Washington, D.C.: February
    22, 2002.

    Food Stamp Program: States Seek to Reduce Payment Errors and Program
    Complexity. GAO-01-272. Washington, D.C.: January 19, 2001.

    Means-Tested Programs: Determining Financial Eligibility Is Cumbersome and
    Can Be Simplified. GAO-02-58. Washington, D.C.: November 2, 2001.

    Food Stamp Program: Various Factors Have Led to Declining Participation:
    GAO/RCED-99-185. Washington, D.C.: July 2, 1999.

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