Factbox: What Republicans mean when they talk about U.S. welfare reform

Published 01/08/2018, 01:04 PM
Updated 01/08/2018, 01:10 PM
© Reuters. President Donald Trump speaks to the media after the Congressional Republican Leadership retreat

By Amanda Becker

WASHINGTON (Reuters) - President Donald Trump had indicated he would like to rein in spending on U.S. social welfare programs to follow up on his 2017 victory in overhauling the U.S. tax code.

Some Republicans, including House of Representatives Speaker Paul Ryan, welcomed the effort. Others, including Senate Republican leader Mitch McConnell, indicated they are hesitant to tackle this politically volatile issue in a congressional election year.

Trump said after speaking to congressional leaders that they may need to delay pursuit of a welfare overhaul, prioritizing immigration changes and infrastructure spending.

There are roughly 80 welfare programs. Here are some that Republicans, who voted last month to add $1.5 trillion to the U.S. national debt over 10 years to pay for tax cuts, may target as they seek to cut federal spending.

MEDICAID

Federal and state governments jointly fund Medicaid. The health insurance program for low-income, disabled, elderly and other individuals is administered by the states.

About 68 million people - about one in five Americans - are insured by Medicaid. The program cost about $553 billion in 2016. It is open-ended, meaning its cost can fluctuate if more individuals qualify for Medicaid coverage.

Ryan has said capping Medicaid spending is a long-time goal.

As a candidate, Trump promised not to cut spending for Medicaid, the Medicare health insurance program for the elderly or the Social Security retirement program. But a White House budget blueprint released in May proposed slashing more than $600 billion from Medicaid's budget over a decade.

The Trump administration is examining ways to limit Medicaid eligibility. Seema Verma, head of the Center for Medicare and Medicaid Services, said in November the administration would encourage states to add work requirements to the program.

CHIP

The Children's Health Insurance Program (CHIP) offers health insurance for 8.9 million children in lower-income families. It is run jointly by the federal and state governments.

Congress allowed CHIP funding to expire at the end of September 2017. States warned that they could be forced to shut down their programs or freeze enrollment.

Under a deal to keep the government open through Jan. 19, Congress approved $3 billion for in CHIP funding through March, when it will need another congressional reauthorization.

TANF

The Temporary Assistance for Needy Families program (TANF) provides federal block grants to states for programs to help needy families. TANF grants in 2017 aided 1.1 million families. The program has an annual budget of about $16.5 billion, which Trump proposed trimming by 10 percent in his May blueprint.

EITC

The Earned Income Tax Credit (EITC) is a refundable tax credit for low- and moderate-income taxpayers, particularly those with children. Roughly 28 million taxpayers claimed it in 2015. Republican tax legislation approved in December left the EITC largely unchanged.

CHILD TAX CREDIT

The Child Tax Credit is a partially refundable tax credit for taxpayers with children, which is phased out at higher income levels. The Republican tax legislation increased the credit to $2,000 from $1,000, setting the refundable portion at $1,400 for those with earned income of $2,500 or more.

The bill made the credit available to higher-income families. The credit now phases out as income surpasses $400,000 for married couples filing joint tax returns. Children must have a Social Security number for their parents to claim the credit.

SNAP

The Supplemental Nutrition Assistance Program (SNAP) is better known as food stamps. It helped nearly 44 million Americans in 2016, with an annual budget of about $71 billion.

Trump's budget proposed cutting more than $192 billion from SNAP over a decade. The Agriculture Department said recently it will give states greater control over SNAP, potentially opening the door to drug testing or stricter work requirements.

WIC

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) provides federal block grants to states for supplemental nutrition and nutrition education for infants, young children and pregnant and post-partum women. More than half of all U.S.-born infants get WIC benefits.

WIC provided about $6.5 billion in assistance in the 2017 fiscal year. About 7.7 million individuals received WIC benefits per month in 2016. Trump proposed cutting $200 million from WIC's 2018 budget. House Republicans suggested a similar figure.

SSDI

Social Security Disability Insurance (SSDI) provides income benefits to disabled people unable to work who have paid past payroll taxes, which fund the program. SSDI benefits can be temporary or permanent. They are based on past earnings and do not run out so long as the person is disabled and cannot work.

About $143 billion in SSDI benefits were paid in 2016 to 10.2 million people. Trump's budget proposed reducing the time-frame for which recipients can obtain retroactive benefits and cutting $64 billion from the program over the next decade.

SSI

Supplemental Security Income (SSI) provides need-based assistance to disabled or elderly people with little income and few assets, including severely disabled children.

Like SSDI, it is administered by the Social Security Administration. Unlike SSDI, it is not paid for with Social Security payroll taxes, but from general Treasury dollars. SSI will pay an estimated $51.6 billion in benefits to more than 8 million people in the 2018 fiscal year.

© Reuters. President Donald Trump speaks to the media after the Congressional Republican Leadership retreat

Trump and House Republicans have proposed reducing disabled children's SSI benefits on a sliding scale if another member of their family also receives SSI.

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