why closing the broad-based categorical eligibility ...€¦ · closing the bbce loophole will free...

Why closing the broad-based

categorical eligibility loophole will not bust

state budgets

FEBRUARY 6, 2019

Jonathan Ingram Vice President of Research

WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS | FEBRUARY 6, 2019 | TheFGA.org

B O T T O M L I N E :IT’S TIME TO RESTORE PROGRAM INTEGRITY

AND CLOSE THE BBCE LOOPHOLE.

A CLINTON-ERA RULE CREATED A FOOD STAMP LOOPHOLE THAT EXPANDED ELIGIBILITY.

1LOOPHOLE SUPPORTERS FALSELY PROMISED THE

LOOPHOLE WOULD LOWER ADMINISTRATIVE COSTS.

2

STATES THAT USE THIS LOOPHOLE HAVE HIGHER ADMINISTRATIVE COSTS,

ON AVERAGE.

3ADMINISTRATIVE COSTS

INCREASED AFTER STATES ADOPTED OR EXPANDED THE

LOOPHOLE.

4

Before asset tests

3 years after restoring asset tests

Not using either BBCE

policy

Using either BBCE policy

Using BBCE to increase

income eligibility

Using BBCE to eliminate

asset test

Using both BBCE policies

$159.91$179.64

$189.59 $194.70$209.83$156 $148

$144

$86

$220

$167

Not using either BBCE policy


Using BBCE to increase income eligibility

Using BBCE to eliminate asset test


$159.91

$179.64

$189.59

$194.70

$209.83Before asset tests



policy



income eligibility


asset test


$159.91$179.64

$189.59 $194.70$209.83$156 $148

$144

$86

$220

$167






$159.91

$179.64

$189.59

$194.70

$209.83

CLOSING THE BBCE LOOPHOLE WILL FREE FIVE MILLION PEOPLE FROM

WELFARE AND SAVE TAXPAYERS UP TO $7 BILLION PER YEAR.

5 CLOSING THE BBCE

LOOPHOLE COULD REDUCE ADMINISTRATIVE COSTS BY UP

TO $660 MILLION PER YEAR.

6

Before asset tests



policy



income eligibility


asset test


$159.91$179.64

$189.59 $194.70$209.83$156 $148

$144

$86

$220

$167






$159.91

$179.64

$189.59

$194.70




policy



income eligibility


asset test


$159.91$179.64

$189.59 $194.70$209.83$156 $148

$144

$86

$220

$167






$159.91

$179.64

$189.59

$194.70

$209.83

K E Y F I N D I N G S

Before asset tests



policy



income eligibility


asset test


$159.91$179.64

$189.59 $194.70$209.83$156 $148

$144

$86

$220

$167






$159.91

$179.64

$189.59

$194.70




policy



income eligibility


asset test


$159.91$179.64

$189.59 $194.70$209.83$156 $148

$144

$86

$220

$167






$159.91

$179.64

$189.59

$194.70

$209.83

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WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS FEBRUARY 6, 2019WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS | FEBRUARY 6, 2019 | TheFGA.org

States use a Clinton-era loophole to expand food stamp eligibility

Federal law aims to preserve food stamps for the truly needy by limiting eligibility for individuals with significant financial resources. The food stamp statute sets income eligibility and requires that states check the financial assets of those applying for benefits.1 But states have used federal loopholes to virtually eliminate these requirements and expand food stamp eligibility to millions of individuals who do not otherwise qualify.2

Regulations adopted by the Clinton administration—and expanded even further by the Obama administration—have allowed states to expand eligibility beyond the pro-gram’s intended purpose.3 These regulations allow states to deem anyone authorized to receive a welfare brochure as “categorically eligible” for food stamps, bypassing the federal asset test and the income eligibility limit.4

The widespread use of this loophole, known as broad-based categorical eligibility or BBCE, has allowed more than five million people—including millionaires—to enroll in food stamps without meeting federal eligibility criteria for assets, income, or both.5

Defenders of the loophole claim that it reduces adminis-trative costs and that closing the loophole to realign cur-rent policy with statutory requirements would significantly increase costs.6-11 However, there is no evidence that leav-ing this policy in place saves money. Instead, data suggests that use of this loophole has led to higher spending by states and that, by closing the loophole, the Trump adminis-tration could create real savings for taxpayers and free up limited resources for the truly needy.

The widespread

use of this loophole, known as

broad-based categorical eligibility or

BBCE, has allowed

more than five million

people—including

millionaires—to enroll in food

stamps without meeting

federal eligibility

criteria for assets, income,

or both.

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4 WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS | FEBRUARY 6, 2019

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States using the loophole have higher administrative costs, on average

Despite promises of lower administrative costs, states using the BBCE loophole have higher administrative costs on average than other states.12-15 In 2016, states using the loophole had average administrative costs of nearly $180 per enrollee, compared to less than $160 per enrollee in states using federal eligibility standards.16 States that have used the loophole to both eliminate the asset test and increase income eligibility have the highest administrative costs of all, with such costs reaching nearly $210 per enrollee.17

Even certification costs—the administrative costs associated with eligibility determinations—were higher in states using the loophole than in states not using the loophole at all.18 In states using the BBCE loophole to eliminate the asset test and increase income eligibility, federal certification costs were an average of nearly five percent more per enrollee when compared to states using federal eligibility standards.19

STATES USING THE BBCE LOOPHOLE HAVE HIGHER ADMINISTRATIVE COSTSAverage administrative cost per enrollee in fiscal year 2015, by BBCE status

Source: Foundation for Government Accountability

Before asset tests



policy



income eligibility


asset test


$159.91$179.64

$189.59 $194.70$209.83$156 $148

$144

$86

$220

$167






$159.91

$179.64

$189.59

$194.70

$209.83

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WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS FEBRUARY 6, 2019

Administrative costs did not decline after states began exploiting the loophole

Promised administrative savings have not materialized in states that have adopted the BBCE loophole. Between 2006 and 2015, at least 35 states adopted or expanded the use of this loophole, with some states expanding the use of it multiple times.20-21 Overall administrative costs and certification costs declined in fewer than 19 percent of these cases.22-23 In more than four out of five cases, adopting or expanding BBCE was followed by increases in administrative costs, certification costs, or both.24

Nearly 70 percent of these loophole adoptions and expansions were followed by increases in administrative costs, rather than significant administrative savings as promised.25-69 States witnessed their administrative costs rise by more than 10 percent, on average, with some states seeing their administrative costs rise by a whopping 30 percent in the year following the policy changes.70-72

More than 67 percent of these loophole expansions were also followed by increases in certification costs.73-117 These costs are directly related to determining eligibility for food stamps, making them the most likely place states could conceivably generate savings if loophole supporters’ claims were true. But instead of finding substantial savings, states adopting or expanding BBCE loopholes saw their certification costs climb by more than nine percent, on average.118-119 In some states, the increase in certification costs ranged as high as 40 percent.120

In more than four out of five cases,

adopting or expanding

BBCE was followed by increases in

administrative costs,

certification costs, or both.

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FEBRUARY 6, 2019 WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS

Administrative costs did not spike when states closed loopholes

Loophole defenders further claim that requiring states to verify eligibility by checking assets and other factors in accordance with federal standards would be too administratively complex to handle and would increase administrative costs. But evidence from state reforms easily deflates this myth.

Three states have recently restored asset tests to their food stamp programs and none have experienced massive spikes in administrative costs. Michigan, for example, adopted a $5,000 asset limit in fiscal year 2012.121 In the five years before this policy change—when no asset test was in place—administrative costs were growing by an average of 4.2 percent per year, and certification costs were growing by an average of 6.1 percent.122-128

In the five years after the asset test was restored, administrative costs grew by an average of just 2.2 percent per year, while certification costs grew by just 3.3 percent—both slower than the national average.129-135

Michigan also experienced declining per-enrollee adminis-trative costs after the policy change.136 In the three years before the state restored its asset test, total administrative costs averaged nearly $156 per enrollee.137 But in the three years after the state restored the asset test, total administra-tive costs had dropped to an average of $148 per enrollee—lower than the national average.138

Other states restoring asset tests have had similar experiences. In Idaho, administrative costs averaged more than $144 per enrollee in the three years before it created a $5,000 asset limit.139 In the three years that followed, administrative costs dropped to an average of less than $86 per enrollee.140 Likewise, in Pennsylvania, administrative costs averaged nearly $220 per enrollee in the three years before the state restored its asset test.141 In the three years after the asset test was restored, administrative costs dropped to $167 per enrollee.142-143

Three states have recently restored asset

tests to their food stamp

programs and none have

experienced massive spikes in

administrative costs.

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WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS FEBRUARY 6, 2019

Higher enrollment leads to higher administrative costs

There is no evidence that weakening program integrity through the BBCE loophole produces any kind of savings for taxpayers. Even if the lax verification rules would somehow help lower costs for each case worked, those marginal savings would be dwarfed by the higher costs associated with adding millions of additional enrollees to the program.

Administrative costs are primarily driven by caseloads. Over the last decade, more than 78 percent of variation in states’ administrative costs could be explained by program enrollment.144 More enrollees led to higher overall administrative costs.

The BBCE loophole has expanded food stamps to more than five million individuals who do not meet federal eligibility rules.145 Five million more enrollees on the program mean millions of additional cases for states to process, certify, and contact.

Imaginary savings are not worth compromises to program integrity

There is no evidence that using the BBCE loophole generates savings for taxpayers. But even if those imaginary savings were real, they would be far outweighed by the nearly $7 billion in higher costs caused by adding more than five million individuals to the program who do not meet federal eligibility standards.146

Those imaginary savings are also outweighed by potential compromises to program integrity. According to federal auditors, individuals made eligible through the BBCE loophole may never have their eligibility verified at all.147 Obama-era guidance issued in 2011 specifically exempts these individuals from “additional verification requirements” and instructs states not to verify their cases in food stamp quality control system.148 As a result, the number of individuals who do not meet federal eligibility guidelines could be even higher than estimated.

There is no evidence

that using the BBCE loophole

generates savings for taxpayers.

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FEBRUARY 6, 2019 WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS

The Trump administration can restore program integrity

The BBCE loophole was originally created and later expanded through regulation and sub-regulatory guidance.149 Current BBCE policies conflict with the plain meaning of the food stamp statute and even the initial guidance acknowledged that the loophole did not meet the intent of categorical eligibility.150-151 Because the loophole was first created by regulation, the Trump administration would be on firm footing to roll it back through rulemaking.

Rolling back this disastrous policy would restore categorical eligibility to its statutory purpose. Categorical eligibility could continue for individuals actually receiving benefits from other welfare programs, not those individuals “authorized to receive” copies of welfare brochures or toll-free numbers providing eligibility information.

This policy change would also remove individuals with significant financial resources—including millionaires and lottery winners—from food stamps and preserve limited resources for those who actually qualify for the program.

If the Clinton-era rule is reversed and realigned with the food stamp statute, more than five million individuals who do not meet federal eligibility guidelines would be removed from the program, saving taxpayers up to $7 billion per year.152 Moving more than five million enrollees off the program could generate further administrative savings, potentially reducing overall administrative costs by up to $660 million per year.153-155

Reining in this out-of-control abuse of the food stamp program can help restore much-needed program integrity and protect resources for the truly vulnerable.

Moving more than five million

enrollees off the program

could generate

further administrative

savings, potentially

reducing overall

administrative costs by up to

$660 million per year.

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9WHY CLOSING THE BBCE LOOPHOLE WILL NOT BUST STATE BUDGETS | FEBRUARY 6, 2019

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APPENDIX 1

ELIMINATING THE BBCE LOOPHOLE WOULD SAVE UP TO $7 BILLION PER YEAR

STATE ENROLLMENT DECLINE ANNUAL SAVINGS

Alabama 98,400 $163,800,000

Alaska N/A N/A

Arizona 159,000 $192,600,000

Arkansas N/A N/A

California 631,700 $878,400,000

Colorado 59,000 $92,700,000

Connecticut 70,100 $108,000,000

Delaware 23,200 $32,500,000

District of Columbia 18,100 $29,500,000

Florida 542,300 $770,600,000

Georgia 200,300 $343,600,000

Hawaii 27,900 $73,100,000

Idaho 4,200 $6,000,000

Illinois 284,700 $418,600,000

Indiana 17,700 $30,500,000

Iowa 60,700 $69,800,000

Kansas N/A N/A

Kentucky 84,100 $122,900,000

Louisiana N/A N/A

Maine 13,700 $9,300,000

Maryland 123,000 $171,000,000

Massachusetts 122,200 $157,700,000

Michigan 69,300 $73,700,000

Minnesota 75,200 $82,300,000

Mississippi 70,200 $117,200,000


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STATE ENROLLMENT DECLINE ANNUAL SAVINGS

Missouri N/A N/A

Montana 14,900 $22,900,000

Nebraska 11,000 $16,000,000

Nevada 58,000 $77,400,000

New Hampshire 16,900 $17,900,000

New Jersey 134,800 $163,200,000

New Mexico 60,200 $84,800,000

New York 358,300 $610,100,000

North Carolina 239,500 $304,100,000

North Dakota 8,000 $10,700,000

Ohio 184,700 $299,900,000

Oklahoma 66,300 $97,700,000

Oregon 128,100 $167,000,000

Pennsylvania 264,200 $383,400,000

Rhode Island 26,900 $35,800,000

South Carolina 89,400 $143,000,000

South Dakota N/A N/A

Tennessee N/A N/A

Texas 257,800 $190,700,000

Utah N/A N/A

Vermont 16,600 $18,200,000

Virginia N/A N/A

Washington 168,000 $214,000,000

West Virginia 42,900 $59,400,000

Wisconsin 123,100 $129,400,000

Wyoming N/A N/A

TOTAL 5,024,500 $6,989,500,000

APPENDIX 1 (CONTINUED)

Source: Author’s calculations


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APPENDIX 2

ELIMINATING THE BBCE LOOPHOLE COULD REDUCE ADMINISTRATIVE COSTS BY UP TO $660 MILLION

STATE POTENTIAL SAVINGS

Alabama $7,700,000

Alaska N/A

Arizona $16,900,000

Arkansas N/A

California $171,600,000

Colorado $10,000,000

Connecticut $13,600,000

Delaware $3,800,000

District of Columbia $4,700,000

Florida $18,400,000

Georgia $13,400,000

Hawaii $5,000,000

Idaho $300,000

Illinois $21,600,000

Indiana $2,400,000

Iowa $5,000,000

Kansas N/A

Kentucky $10,600,000

Louisiana N/A

Maine $1,300,000

Maryland $16,800,000

Massachusetts $13,500,000

Michigan $8,800,000

Minnesota $14,900,000

Mississippi $4,900,000


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APPENDIX 2 (CONTINUED)

STATE POTENTIAL SAVINGS

Missouri N/A

Montana $2,300,000

Nebraska $1,500,000

Nevada $4,900,000

New Hampshire $2,600,000

New Jersey $35,200,000

New Mexico $5,800,000

New York $70,500,000

North Carolina $22,400,000

North Dakota $2,700,000

Ohio $16,500,000

Oklahoma $5,600,000

Oregon $20,900,000

Pennsylvania $32,100,000

Rhode Island $2,600,000

South Carolina $5,400,000

South Dakota N/A

Tennessee N/A

Texas $17,300,000

Utah N/A

Vermont $3,700,000

Virginia N/A

Washington $21,900,000

West Virginia $3,300,000

Wisconsin $17,900,000

Wyoming N/A

TOTAL $660,200,000

Source: Author’s calculations


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REFERENCES1. Jonathan Ingram and Nic Horton, “Closing the door on food stamp fraud: How ending broad-based categorical

eligibility can protect the truly needy,” Foundation for Government Accountability (2018), https://thefga.org/wp-content/uploads/2018/12/BBCE-Its-Time-To-Close-Food-Stamp-Loopholes.pdf.

2. Ibid.

3. Ibid.

4. Ibid.

5. Ibid.

6. The Center for Law and Social Policy falsely claims that the loophole “lowers administrative costs through streamlining processes.” See, e.g., Jessica Gehr, “Eliminating asset limits: Creating savings for families and state governments,” Center for Law and Social Policy (2018), https://www.clasp.org/sites/default/files/publications/2018/04/2018_eliminatingassetlimits.pdf.

7. For many years, the Center on Budget and Policy Priorities has falsely claimed that use of the loophole “cut[s] administrative costs.” See, e.g., Dorothy Rosenbaum et al., “Cuts contained in SNAP bill coming to the House floor would affect millions of low-income Americans,” Center on Budget and Policy Priorities (2013), https://www.cbpp.org/sites/default/files/atoms/files/9-6-13fa.pdf.

8. The Center on Budget and Policy Priorities continues to falsely claim that the loophole “reduces administrative complexity and cost.” See, e.g., Dorothy Rosenbaum et al., “President’s budget would cut food assistance for millions and radically restructure SNAP,” Center on Budget and Policy Priorities (2018), https://www.cbpp.org/sites/default/files/atoms/files/2-15-18snap.pdf.

9. The Florida Policy Institute falsely claims that the loophole is needed to “simplify operations and reduce administrative costs.” See, e.g., Esubalew Dadi, “House Bill 581 would cut food assistance for thousands of Florida families,” Florida Policy Institute (2017), https://www.fpi.institute/wp-content/uploads/2017/03/HB-581-SNAP-Report-FINAL-2.pdf.

10. The Food Research and Action Center falsely claims that eliminating the loophole will “significantly increase states’ administrative costs and burdens.” See, e.g., Food Research and Action Center, “Analysis of the House Farm Bill: The Agriculture and Nutrition Act of 2018 (H.R. 2),” Food Research and Action Center (2018), http://frac.org/wp-content/uploads/frac-analysis-hr2-agriculture-and-nutrition-act-2018.pdf.

11. The Florida Policy Institute falsely claims that eliminating the loophole will “reduce efficiency and needlessly increase workload and administrative costs.” See, e.g., Esubalew Dadi, “House Bill 581 would cut food assistance for thousands of Florida families,” Florida Policy Institute (2017), https://www.fpi.institute/wp-content/uploads/2017/03/HB-581-SNAP-Report-FINAL-2.pdf.

12. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on total administrative costs and federal certification costs in fiscal year 2016, disaggregated by BBCE policy adoption.

13. Food and Nutrition Service, “Broad-based categorical eligibility,” U.S. Department of Agriculture (2018), https://fns-prod.azureedge.net/sites/default/files/snap/BBCE.pdf.

14. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2016,“ U.S. Department of Agriculture (2017), https://fns-prod.azureedge.net/sites/default/files/snap/FY16-State-Activity-Report.pdf.

15. When adjusted for regional cost differences by utilizing the Bureau of Economic Analysis’ 2016 state-level regional price parities, the average cost in states using the BBCE loophole grow even larger relative to states not using the loophole.

16. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on total administrative costs and average monthly enrollment in fiscal year 2016, disaggregated by BBCE policy adoption.

17. Ibid.

18. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on federal certification costs and average monthly enrollment in fiscal year 2016, disaggregated by BBCE policy adoption.

19. Ibid.

20. Authors’ calculations based upon data provided by Mathematica Policy Research on BBCE policies adopted between December 2006 and May 1, 2013. See, e.g., Elizabeth Laird and Carole Trippe, “Programs conferring categorical eligibility for SNAP: State policies and the number and characteristics of households affected,” Mathematica Policy Research (2014), https://www.mathematica-mpr.com/download-media?MediaItemId={9135CB5F-F3E1-43E6-ADE2-C232B26593EB}.

21. Between December 2006 and May 2013, 35 states adopted or expanded BBCE policies a total of 42 times. In April 2015, Pennsylvania expanded its BBCE policy to eliminate the asset test altogether, reversing a previous change to adopt a $5,000 asset test, bringing the total policy changes for this analysis to 43. BBCE policy changes made prior to 2006 or after 2015 are not included due to a lack of data.

22. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on total administrative costs and federal certification costs one year before and one year after each BBCE policy adoption or expansion.

23. Administrative costs and certification costs decreased the year following the policy change in only 8 of the 43 BBCE policy expansions included in this analysis.

24. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on total administrative costs and federal certification costs one year before and one year after each BBCE policy adoption or expansion.

25. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on total administrative costs one year before and one year after each BBCE policy adoption or expansion.

26. Administrative costs increased the year following the policy change in 30 of the 43 BBCE policy expansions included in this analysis.

27. On February 1, 2010, Alabama adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $70.1 million. In the fiscal year after the policy change, administrative costs totaled $84.4 million—an increase of more than 20 percent.


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28. On June 1, 2007, Arizona adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the

federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $76.2 million. In the fiscal year after the policy change, administrative costs totaled $99.1 million—an increase of more than 30 percent.

29. On July 1, 2009, California adopted BBCE to eliminate the asset test for households with children. In the fiscal year preceding the policy change, administrative costs totaled $1.1 billion. In the fiscal year after the policy change, administrative costs totaled $1.3 billion—an increase of more than 18 percent.

30. On April 1, 2011, California expanded BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $1.3 billion. In the fiscal year after the policy change, administrative costs totaled $1.4 billion—an increase of more than six percent.

31. On April 24, 2013, California expanded BBCE to increase income eligibility for some households. In the fiscal year preceding the policy change, administrative costs totaled $1.4 billion. In the fiscal year after the policy change, administrative costs totaled $1.6 billion—an increase of nearly 17 percent.

32. On March 1, 2011, Colorado adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $85.5 million. In the fiscal year after the policy change, administrative costs totaled $94.3 million—an increase of more than 10 percent.

33. On July 1, 2009, Connecticut adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $54.8 million. In the fiscal year after the policy change, administrative costs totaled $62 million—an increase of more than 13 percent.

34. On July 1, 2010, Florida adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $187.6 million. In the fiscal year after the policy change, administrative costs totaled $204.8 million—an increase of more than nine percent.

35. On March 1, 2008, Georgia adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $118.3 million. In the fiscal year after the policy change, administrative costs totaled $121.8 million—an increase of nearly three percent.

36. On March 01, 2010, Illinois adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $245.8 million. In the fiscal year after the policy change, administrative costs totaled $253.8 million—an increase of more than three percent.

37. On January 1, 2011, Iowa adopted BBCE to eliminate the asset test and increase income eligibility to 160 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $46.1 million. In the fiscal year after the policy change, administrative costs totaled $46.1 million—an increase of less than one percent.

38. On October 1, 2010, Maryland expanded BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $98.4 million. In the fiscal year after the policy change, administrative costs totaled $109.1 million—an increase of nearly 11 percent.

39. On June 9, 2008, Massachusetts expanded BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $88.6 million. In the fiscal year after the policy change, administrative costs totaled $90.7 million—an increase of more than 2 percent.

40. On December 1, 2006, Minnesota adopted BBCE to increase the asset limit and to increase income eligibility to 165 percent of the federal poverty level for some households. In the fiscal year preceding the policy change, administrative costs totaled $90.3 million. In the fiscal year after the policy change, administrative costs totaled $110.5 million—an increase of more than 22 percent.

41. On March 1, 2009, Montana adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $17.7 million. In the fiscal year after the policy change, administrative costs totaled $19.7 million—an increase of more than 11 percent.

42. On September 1, 2010, Montana expanded BBCE to increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $19.5 million. In the fiscal year after the policy change, administrative costs totaled $22.3 million—an increase of more than 14 percent.

43. On March 16, 2009, Nevada adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $29.5 million. In the fiscal year after the policy change, administrative costs totaled $37.1 million—an increase of nearly 26 percent.

44. On May 1, 2009, New Hampshire adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level for households with children. In the fiscal year preceding the policy change, administrative costs totaled $13.3 million. In the fiscal year after the policy change, administrative costs totaled $15.1 million—an increase of more than 13 percent.

45. On April 1, 2010, New Jersey adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $220.6 million. In the fiscal year after the policy change, administrative costs totaled $249.3 million—an increase of more than 13 percent.

46. On January 1, 2008, New York adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $644.5 million. In the fiscal year after the policy change, administrative costs totaled $738 million—an increase of nearly 15 percent.

47. On March 1, 2009, New York expanded BBCE to increase income eligibility to 200 percent of the federal poverty level for households with dependent care expenses. In the fiscal year preceding the policy change, administrative costs totaled $706.7 million. In the fiscal year after the policy change, administrative costs totaled $757.5 million—an increase of more than seven percent.

48. On July 1, 2010, North Carolina adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $145.5 million. In the fiscal year after the policy change, administrative costs totaled $168.1 million—an increase of nearly 16 percent.


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49. On June 1, 2009, Oklahoma adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $80.9 million. In the fiscal year after the policy change, administrative costs totaled $95.8 million—an increase of more than 18 percent.

50. On October 1, 2008, Pennsylvania adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, administrative costs totaled $302 million. In the fiscal year after the policy change, administrative costs totaled $350.1 million—an increase of nearly 16 percent.

51. On June 27, 2009, Pennsylvania expanded BBCE to increase income eligibility to 160 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $302 million. In the fiscal year after the policy change, administrative costs totaled $350.1 million—an increase of nearly 16 percent.

52. On April 27, 2015, Pennsylvania expanded BBCE to eliminate the asset test, which had previously been restored. In the fiscal year preceding the policy change, administrative costs totaled $289.9 million. In the fiscal year after the policy change, administrative costs totaled $323 million—an increase of more than 11 percent.

53. On April 1, 2009, Rhode Island expanded BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $16.8 million. In the fiscal year after the policy change, administrative costs totaled $18.7 million—an increase of more than 11 percent.

54. On January 1, 2009, Vermont adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $16.9 million. In the fiscal year after the policy change, administrative costs totaled $19.9 million—an increase of nearly 18 percent.

55. On October 1, 2008, Washington expanded BBCE to increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, administrative costs totaled $104.7 million. In the fiscal year after the policy change, administrative costs totaled $115.8 million—an increase of nearly 11 percent.

56. On May 1, 2013, West Virginia expanded BBCE to increase income eligibility to 200 percent of the federal poverty level for some households. In the fiscal year preceding the policy change, administrative costs totaled $27.1 million. In the fiscal year after the policy change, administrative costs totaled $29.5 million—an increase of more than 9 percent.

57. On March 15, 2010, Washington, D.C. adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

58. On October 1, 2010, Hawaii adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that certification costs rose following the policy change.

59. On June 1, 2009, Idaho adopted BBCE to eliminate the asset test. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

60. On June 1, 2010, Kentucky adopted BBCE to eliminate the asset test. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

61. On May 12, 2010, Louisiana adopted BBCE to eliminate the asset test. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that certification costs rose following the policy change.

62. On August 1, 2010, Maine expanded BBCE to increase income eligibility to 185 percent of the federal poverty level. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

63. On November 1, 2010, Minnesota expanded BBCE to increase income eligibility to 165 percent of the federal poverty level. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

64. On June 1, 2010, Mississippi adopted BBCE to eliminate the asset test. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

65. On October 1, 2011, Nebraska adopted BBCE to increase the asset limit to $25,000. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

66. On April 1, 2010, New Mexico adopted BBCE to eliminate the asset test and increase income eligibility to 165 percent of the federal poverty level. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

67. On October 1, 2010, North Dakota adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that certification costs rose following the policy change.

68. On October 1, 2008, Ohio adopted BBCE to eliminate the asset test. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that certification costs rose following the policy change.

69. On October 1, 2008, West Virginia adopted BBCE to eliminate the asset test. Administrative costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

70. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on total administrative costs one year before and one year after each BBCE policy adoption or expansion. The figure here represents the median change in administrative costs, but the weighted average is also above 10 percent.

71. Ibid.

72. The average growth in administrative costs experienced in states adopting or expanding BBCE policies was significantly higher than the average growth experienced by the nation as a whole.


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73. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on federal certification costs one

year before and one year after each BBCE policy adoption or expansion.

74. Certification costs increased the year following the policy change in 29 of the 43 BBCE policy expansions included in this analysis.

75. On February 1, 2010, Alabama adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $22.7 million. In the fiscal year after the policy change, certification costs totaled $28.3 million—an increase of nearly 25 percent.

76. On June 1, 2007, Arizona adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $18.2 million. In the fiscal year after the policy change, certification costs totaled $23.9 million—an increase of more than 31 percent.

77. On July 1, 2009, California adopted BBCE to eliminate the asset test for households with children. In the fiscal year preceding the policy change, certification costs totaled $206.8 million. In the fiscal year after the policy change, certification costs totaled $289.7 million—an increase of more than 31 percent.

78. On April 1, 2011, California expanded BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $289.7 million. In the fiscal year after the policy change, certification costs totaled $403.6 million—an increase of more than 40 percent.

79. On April 24, 2013, California expanded BBCE to increase income eligibility for some households. In the fiscal year preceding the policy change, certification costs totaled $403.6 million. In the fiscal year after the policy change, certification costs totaled $516.4 million—an increase of nearly 28 percent.

80. On March 1, 2011, Colorado adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $23.8 million. In the fiscal year after the policy change, certification costs totaled $31 million—an increase of more than 30 percent.

81. On July 1, 2009, Connecticut adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $9.8 million. In the fiscal year after the policy change, certification costs totaled $10.5 million—an increase of nearly 7 percent.

82. On July 1, 2010, Florida adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $48.4 million. In the fiscal year after the policy change, certification costs totaled $55.2 million—an increase of more than 14 percent.

83. On October 1, 2010, Hawaii adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $8.5 million. In the fiscal year after the policy change, certification costs totaled $9.4 million—an increase of more than 10 percent.

84. On March 01, 2010, Illinois adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $70.6 million. In the fiscal year after the policy change, certification costs totaled $74.2 million—an increase of more than five percent.

85. On January 1, 2011, Iowa adopted BBCE to eliminate the asset test and increase income eligibility to 160 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $13.6 million. In the fiscal year after the policy change, certification costs totaled $17.4 million—an increase of more than 28 percent.

86. On May 12, 2010, Louisiana adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $49.3 million. In the fiscal year after the policy change, certification costs totaled $50.3 million—an increase of nearly two percent.

87. On October 1, 2010, Maryland expanded BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $36.9 million. In the fiscal year after the policy change, certification costs totaled $46.2 million—an increase of more than 25 percent.

88. On December 1, 2006, Minnesota adopted BBCE to increase the asset limit and to increase income eligibility to 165 percent of the federal poverty level for some households. In the fiscal year preceding the policy change, certification costs totaled $24.9 million. In the fiscal year after the policy change, certification costs totaled $30.9 million—an increase of more than 24 percent.

89. On March 1, 2009, Montana adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $4.7 million. In the fiscal year after the policy change, certification costs totaled $4.8 million—an increase of nearly three percent.

90. On September 1, 2010, Montana expanded BBCE to increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $5.1 million. In the fiscal year after the policy change, certification costs totaled $5.1 million—an increase of more than one percent.

91. On March 16, 2009, Nevada adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $9.4 million. In the fiscal year after the policy change, certification costs totaled $10.1 million—an increase of more than seven percent.

92. On April 1, 2010, New Jersey adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $55.8 million. In the fiscal year after the policy change, certification costs totaled $68.7 million—an increase of more than 23 percent.

93. On April 1, 2010, New Mexico adopted BBCE to eliminate the asset test and increase income eligibility to 165 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $18.7 million. In the fiscal year after the policy change, certification costs totaled $22.1 million—an increase of more than 18 percent.

94. On January 1, 2008, New York adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $127.6 million. In the fiscal year after the policy change, certification costs totaled $144.6 million—an increase of more than 13 percent.

95. On July 1, 2010, North Carolina adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $55.4 million. In the fiscal year after the policy change, certification costs totaled $61.1 million—an increase of more than 10 percent.


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96. On October 1, 2010, North Dakota adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $4.5 million. In the fiscal year after the policy change, certification costs totaled $5.1 million—an increase of more than 13 percent.

97. On October 1, 2008, Ohio adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $49.3 million. In the fiscal year after the policy change, certification costs totaled $53.8 million—an increase of more than nine percent.

98. On June 1, 2009, Oklahoma adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $28.8 million. In the fiscal year after the policy change, certification costs totaled $34.1 million—an increase of more than 18 percent.

99. On October 1, 2008, Pennsylvania adopted BBCE to eliminate the asset test. In the fiscal year preceding the policy change, certification costs totaled $84.4 million. In the fiscal year after the policy change, certification costs totaled $98.1 million—an increase of more than 16 percent.

100. On June 27, 2009, Pennsylvania expanded BBCE to increase income eligibility to 160 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $84.4 million. In the fiscal year after the policy change, certification costs totaled $98.1 million—an increase of more than 16 percent.

101. On April 27, 2015, Pennsylvania expanded BBCE to eliminate the asset test, which had previously been restored. In the fiscal year preceding the policy change, certification costs totaled $115 million. In the fiscal year after the policy change, certification costs totaled $129.5 million—an increase of nearly 13 percent.

102. On April 1, 2009, Rhode Island expanded BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. In the fiscal year preceding the policy change, certification costs totaled $2.5 million. In the fiscal year after the policy change, administrative costs totaled $2.6 million—an increase of more than two percent.

103. On May 1, 2013, West Virginia expanded BBCE to increase income eligibility to 200 percent of the federal poverty level for some households. In the fiscal year preceding the policy change, certification costs totaled $9.4 million. In the fiscal year after the policy change, certification costs totaled $10.3 million—an increase of nearly 10 percent.

104. 104 On March 15, 2010, Washington, D.C. adopted BBCE to eliminate the asset test and increase income eligibility to 200 percent of the federal poverty level. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

105. On March 1, 2008, Georgia adopted BBCE to eliminate the asset test. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that total administrative costs rose following the policy change.

106. On June 1, 2009, Idaho adopted BBCE to eliminate the asset test. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

107. On June 1, 2010, Kentucky adopted BBCE to eliminate the asset test. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

108. On August 1, 2010, Maine expanded BBCE to increase income eligibility to 185 percent of the federal poverty level. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

109. On June 9, 2008, Massachusetts expanded BBCE to eliminate the asset test. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that total administrative costs rose following the policy change.

110. On November 1, 2010, Minnesota expanded BBCE to increase income eligibility to 165 percent of the federal poverty level. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

111. On June 1, 2010, Mississippi adopted BBCE to eliminate the asset test. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

112. On October 1, 2011, Nebraska adopted BBCE to increase the asset limit to $25,000. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

113. On May 1, 2009, New Hampshire adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level for households with children. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that total administrative costs rose following the policy change.

114. On March 1, 2009, New York expanded BBCE to increase income eligibility to 200 percent of the federal poverty level for households with dependent care expenses. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that total administrative costs rose following the policy change.

115. On January 1, 2009, Vermont adopted BBCE to eliminate the asset test and increase income eligibility to 185 percent of the federal poverty level. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that total administrative costs rose following the policy change.

116. On October 1, 2008, Washington expanded BBCE to increase income eligibility to 200 percent of the federal poverty level. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change, particularly in light of the fact that total administrative costs rose following the policy change.

117. On October 1, 2008, West Virginia adopted BBCE to eliminate the asset test. Certification costs declined following the policy change, though it is unclear what share—if any—is attributable to that policy change.

118. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on federal certification costs one year before and one year after each BBCE policy adoption or expansion. The figure here represents the median change in certification costs, but the weighted average is more than 19 percent, more than double the median.


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119. The average growth in certification costs experienced in states adopting or expanding BBCE policies was significantly

higher than the average growth experienced by the nation as a whole.

120. Ibid.

121. Elizabeth Laird and Carole Trippe, “Programs conferring categorical eligibility for SNAP: State policies and the number and characteristics of households affected,” Mathematica Policy Research (2014), https://www.mathematica-mpr.com/download-media?MediaItemId={9135CB5F-F3E1-43E6-ADE2-C232B26593EB}.

122. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and federal certification costs in Michigan between fiscal years 2006 through 2011.

123. Food and Nutrition Service, “Food Stamp Program state activity report: Federal fiscal year 2006,” U.S. Department of Agriculture (2008), https://fns-prod.azureedge.net/sites/default/files/2006_state_activity.pdf.

124. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Federal fiscal year 2007,” U.S. Department of Agriculture (2009), https://fns-prod.azureedge.net/sites/default/files/2007_state_activity.pdf.




128. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2011,” U.S. Department of Agriculture (2012), https://fns-prod.azureedge.net/sites/default/files/2011_state_activity.pdf.

129. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and federal certification costs in Michigan between fiscal years 2011 through 2016.

130. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2011,” U.S. Department of Agriculture (2012), https://fns-prod.azureedge.net/sites/default/files/2011_state_activity.pdf.

131. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2012,” U.S. Department of Agriculture (2013), https://fns-prod.azureedge.net/sites/default/files/snap/2012-state-activity.pdf.

132. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2013,” U.S. Department of Agriculture (2014), https://fns-prod.azureedge.net/sites/default/files/snap/2013-state-activity.pdf.

133. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2014,” U.S. Department of Agriculture (2015), https://fns-prod.azureedge.net/sites/default/files/FY14%20State%20Activity%20Report.pdf.

134. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2015,” U.S. Department of Agriculture (2016), https://fns-prod.azureedge.net/sites/default/files/snap/FY15-State-Activity-Report.pdf.

135. Food and Nutrition Service, “Supplemental Nutrition Assistance Program state activity report: Fiscal year 2016,” U.S. Department of Agriculture (2017), https://fns-prod.azureedge.net/sites/default/files/snap/FY16-State-Activity-Report.pdf.

136. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and average monthly enrollment in Michigan between fiscal years 2008 through 2014.



139. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and average monthly enrollment in Idaho between fiscal years 2008 through 2010.

140. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and average monthly enrollment in Idaho between fiscal years 2012 through 2014.

141. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and average monthly enrollment in Pennsylvania between fiscal years 2009 through 2011.

142. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and average monthly enrollment in Pennsylvania between fiscal years 2012 through 2015.

143. Pennsylvania eliminated its asset test in the middle of fiscal year 2015. If the post-implementation period is shortened to two years instead of three years in order to exclude the half-year where the asset test was no longer in effect, administrative costs averaged $164 per enrollee.

144. Authors’ calculations based upon data provided by the U.S. Department of Agriculture on administrative costs and average monthly enrollment between fiscal years 2007 through 2016.

145. Jonathan Ingram and Nic Horton, “Closing the door on food stamp fraud: How ending broad-based categorical eligibility can protect the truly needy,” Foundation for Government Accountability (2018), https://thefga.org/wp-content/uploads/2018/12/BBCE-Its-Time-To-Close-Food-Stamp-Loopholes.pdf.

146. Ibid.

147. Office of Inspector General, “FNS quality control process for SNAP error rate,” U.S. Department of Agriculture (2015), https://www.usda.gov/oig/webdocs/27601-0002-41.pdf.

148. Food and Nutrition Service, “Questions and answers on broad-based categorical eligibility,” U.S. Department of Agriculture (2011), https://web.archive.org/web/20130414110232/http://www.fns.usda.gov/snap/rules/Memo/2011/013111.pdf.


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150. Food and Nutrition Service, “Letter to regions on categorical eligibility,” U.S. Department of Agriculture (1999), https://fns-prod.azureedge.net/sites/default/files/a-raletter2.pdf.

151. Although federal law requires that categorically eligible individuals actually receive benefits from a TANF-funded program, the regulations implementing BBCE unlawfully expanded the policy to include anyone “authorized to receive” benefits.


153. Authors’ calculations based upon data from the U.S. Department of Agriculture on administrative costs and average monthly enrollment between fiscal years 2007 through 2016 and data from a proprietary microsimulation model estimating the impact of eliminating the BBCE loophole in each state. Potential changes in administrative costs were modeled utilizing best-fit logarithmic and power trends in both overall administrative costs and per enrollee administrative costs relative to overall enrollment levels in each state.

154. Potential administrative savings outlined in this analysis are nearly 30 percent lower than the product of current per enrollee administrative costs and the projected decline in enrollment following elimination of the BBCE loophole, likely due in part to the fact that fixed administrative costs are less responsive to enrollment levels.

155. This analysis potentially understates administrative savings, as the best-fit logarithmic and power trends used for the analysis produced results significantly lower than an univariate and multivariate regression on both overall administrative costs and per enrollee administrative costs relative to overall enrollment levels in each state.

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