Chapter 11: Entitlements
An entitlement is a governmental benefit to which a person is legally entitled if they meet certain eligibility criteria. For example, if an individual is accused of a serious crime and is unable to afford an attorney, he or she is entitled to legal representation at public expense. Similarly, an individual who loses their job may be entitled to unemployment compensation from the state in which they reside. A third example would be that of an elderly person living in the United States who is entitled to an old age pension and healthcare benefits from the federal government in the form of monthly Social Security payments and Medicare benefits.
Entitlements play a very important role in the promotion of sustainability in several ways. First, social and economic justice is a core element of sustainability. Sustainability entails more than just survivability — it is survivability within the context of an equitable social, political, and economic value structure. In modern democratic societies, the value structure providing for an equal voice in elections and equal protection under the law points us in the direction of fairness in the distribution of goods and services (often expressed in terms of the “social safety net” concept). The challenge of promoting sustainability into the future will bring us face-to-face with issues of limited resources again and again, and the difficult tradeoffs to be made between the economic vitality, environmental protection and social equity core values of sustainability will require the utmost care and skill to manage. The nation’s state and local governments and the citizens of the communities involved will be called upon to engage in this difficult tradeoff management process repeatedly in the coming decades. Given the importance of this area of concern to every community, this chapter is included in this book as a key element of the study of state and local government.
This chapter will discuss:
- the background of state and local government entitlement programs.
- the relationship between entitlements and sustainable communities.
- types of public assistance programs.
- state and local government health care programs and policies.
- the role of state and local governments in Medicare and Medicaid programs.
- the State Children’s Health Insurance Program (S-CHIP).
- public unemployment compensation programs.
While virtually all observers of modern democratic countries would agree that entitlements are essential to good governance, it is also the case that the boundaries of discussions related to governmental entitlements are often unclear. In part, this is due to the ever-changing conceptualization of the nature and proper scope of entitlements. Public health protection, for instance, once meant principally that government authority was used to isolate individuals who were infected with communicable diseases via quarantine. In some cases, such persons were simply left to die in isolated asylums. Similarly, assistance for the chronically unemployed often revolved around private charity, almshouses, and public begging in designated places. These examples from the past may appear quaint or laughable to many Americans today, but they were the most common forms of public health and welfare promotion practiced in this country in the not-to-distant past. As the demographics of our state and local government populations have changed, our collective understanding of entitlement has changed – either becoming broader in scope or more exclusive of client eligibility. This chapter will highlight a few basic entitlements associated with sustainable communities, and illuminate some of the dynamics associated with expanding and contracting conceptions of governmental entitlements. The chapter will identify some areas of likely entitlement growth, and highlight some areas where governmental entitlements might become more limited as our society seeks to promote sustainability.
Meanings of “Entitlement.”
In his 2004 Columbia Law Review article, “The Political Economy of Entitlement,” legal scholar David Super outlines six principal definitions of entitlement:
1. Subjective entitlement: this represents a belief that an individual has certain benefits due them, regardless of whether a legal foundation for that belief exists. Politicians will sometimes use phrases such as, “everyone has a right to own a home” even if there is no legal foundation to the statement.
2. Unconditional entitlement: According to Super,1 this represents a “benefit that is not subject to conditions or reciprocal obligations.” As Super correctly notes, most governmental entitlements are conditioned upon some aspect of reciprocal obligation. For example, a person receiving unemployment benefits must have been previously employed and been part of a layoff and must be looking for a job actively in order to continue to receive benefits.
3. Positive entitlement: This represents “a legally enforceable individual right.”2 This is the most familiar definition of entitlement. Individuals have a form of property right attached to a positive entitlement, such that an illegal deprivation of such an entitlement provides ground for a lawsuit based on the suffering of substantive harm.
4. Budgetary entitlement: The concept is often referred to as “mandatory spending” in the law. Social programs that are budgetary entitlements are prioritized above all other expenditures in that they are not subject to caps on spending.3
5. Responsive entitlement: These governmental expenditures are made based on a need-based formula.4 Public education programs driven by student headcounts are an example of a responsive entitlement; government payments to the victims of natural disasters would be another example of this type of entitlement.
6. Functional entitlement: There are some governmental programs that meet “some qualitatively definable need of its beneficiaries.”5 Super argues that many food and nutrition programs assume that “healthful sustenance” will be accomplished for a person if a certain food and nutritional benefits level is established. His example in this area is food stamps — a certain benefit level is established with the idea that a recipient household’s food needs will be met.
Super’s distinctions drawn in his effort to define the concept of governmental entitlement are valuable, helping us to understand what it is we mean by entitlement and, thinking normatively with respect to ‘good’ and ‘bad’ forms of government entitlement, what entitlements should be maintained to promote sustainability in the communities served by American state and local governments. In many cases where the major state and local governmental entitlement programs are discussed, it will be clear that several of Super’s subtypes of entitlements might apply to any particular policy discussed.
In contrast to Super, John Skinner provides a greatly simplified approach to thinking about entitlements.6 He distinguishes between only two forms of governmental entitlement, those being earned and those being implied. According to Skinner, Social Security is an example of an “earned” entitlement because one contributes a portion of one’s earnings to Social Security and the level of contribution directly affects the level of benefit received. In contrast, Medicare is an example of an implied entitlement because it is assumed that once one reaches retirement age one is entitled to Medicare health benefits regardless of one’s contribution level through payroll deductions over a career and regardless of your extent of need.
While the social justice and equity concepts underlying governmental entitlements are rather evident, it must be noted that the cost of providing entitlements is tremendous. As a percentage of total costs, state and local health and public assistance programs consume a substantial portion of state and local government budgets. Critics of “social spending” argue that if existing health entitlement programs are left unchanged, they will consume an ever-growing portion of state and local budgets, thus limiting the ability of government to allocate resources on other important needs.7 One solution proposed by critics is to thoroughly reform the current public assistance and health care entitlement programs; to judiciously trim costs where possible, and to adopt “best practices” and innovative programs to more effectively target health and public assistance funds. Another approach to reform in this area is the promotion of investments in prevention of illness and early screening and diagnosis, hence achieving cost containment via citizen wellness practices and early treatment of preventable illnesses. In the 1990s, state and local governments across the country took the lead in reforming existing public assistance programs and placing limits on welfare eligibility and promoting active re-engagement in the workforce for many recipients.8 The result was a precipitous decline in the number of welfare recipients in nearly all states.
From the perspective of the former welfare recipients, many of them benefited from welfare-to-work programs; however, simply getting individuals off of welfare rolls and into the workforce is not the end of the sustainability story when it comes to entitlements. In the case of welfare reform, one of the biggest issues facing former public assistance recipients beyond employment is the difficulty of maintaining and improving existence; for example, balancing new employment with the need for quality childcare.9 The stresses and strains of life off of the welfare rolls after years of dependence often prove to be too much all at once, and the ability to deal with these pressures comes at time when the costs of services is rising and the range of family needs (e.g., access to cable TV and the Internet) is growing.
One of the areas of entitlement that was almost immediately affected by welfare entitlement reform falls under the health care policy arena. The meteoric rise of expenditures for health care entitlement programs such as Medicaid and S-CHIP, for instance, are frequently bewildering to the average citizen. Why should health care cost so much? What are the health care professionals doing with all the money? These questions may prove maddening until one understands what the term health care really means. Unfortunately, health care conjures up many out-of-date images. One image is the clean hospital bed with the considerate and caring nurse attending to the young patient with tonsillitis. Another image is that of the physician examining the expectant mother. Perhaps another image is the kindly country doctor listening to a man’s heartbeat with a stereoscope. These are all very appealing images; however, not one of them accurately captures the direction and scope of health care today…and perhaps they never did capture the true meaning of health care. Nonetheless, the myth of health care derived from the long-gone past proves persistent.
In the U.S., health care policy has been tied closely to issues of defense, economics, urban planning, immigration, age, class, race/ethnicity, and a whole host of other issues. National programs in health care began as early as the 18th century with the Marine Hospital Service. Community-level health care initiatives were primarily privately managed until the late 19th century when large-scale immigration resulted in rapid urbanization.10 Major epidemics such as a cholera outbreak in New York City led to the widespread creation of public programs for sanitation and health care in state and local governments across the entire country.11 As our society has continued to urbanize, the need for such programs has increased tremendously. Health care has progressively come to be viewed as a benefit not only to the individual receiving health care services but also to the community as a whole. Healthy people provide a good workforce, they spend more time in productive activity than under medical care, and they occasion less need for collective resources to be devoted to health care services for the indigent.
In sustainable economies of the future, all elements of production must be able to work in unison; healthy workers are a critically important part of the economic enterprise. Beyond work, there is the issue of healthy children. As a society, we commit a tremendous amount of money and time to educating and caring for young people; proper investment in the future is, after all, a critical dimension of sustainability. Children who are not healthy are unable to benefit from education, and will likely develop other physical ailments that adversely affect their social and economic potential. Technology has made us more aware of new and growing issues related to pre-natal and child health care. Problems such as birth defects and autism can be treated if diagnosed early, and those conditions can be medically managed far better today than was the case in the past.
As the Baby Boomer generation ages, an increasing proportion of our governmental resources will necessarily be spent on medical needs. A sustainable community, facing this known pending demand on its resources, must be both compassionate and pragmatic. The demonstration of governmental compassion for the elderly and infirm is very important to building inclusively within society and to promoting social justice. Pragmatically, a sustainable community is aware of the great benefit of maintaining a healthy and productive population. Older, often richly experienced individuals often bring with them economic resources (e.g., skills, social networks, accumulated wealth, etc.) that can help local economies and generate employment. Older individuals often have substantial intellectual capital gained from years of experience in the workforce; through the employment of these retirees into new professions, this intellectual capital can be tapped to improve society. Disabled individuals often possess many valuable skills and knowledge that is all too frequently “lost” to society and to the individual when physical limitation separates them from the larger community.12 While many of these individuals receive some level of federal health care benefits, there are a substantial number of disabled individuals who, in midlife and early older age years, would remain inaccessible if it were not for state and local government health resource entitlements. Health care for the elderly, therefore, is critical to improving community sustainability.
The very meaning of the word “healthy” has changed substantially. One could have perfect physical health — e.g., normal blood pressure, cholesterol, heart rate, and eyesight — but suffer from severe mental health maladies. Health issues related to depression, bipolarism, and personality disorders have long existed in society. However, in the past individuals had little or no access to health care solutions for the problems of mental illness. What solutions did exist often involved institutionalizing individuals in sanitariums rather than helping them to remain within the general community and achieve a productive and respected role in society. Addressing the problems of mental health has become an increasingly important matter for state and local governments in the United States as the size of the population affected and the problems arising from mental illness for society have become more evident.13
The stresses of the school setting (high stakes testing associated with the No Child Left Behind (NCLB) policy discussed elsewhere), the workplace, and living in general under the conditions of the threat of terrorist attack and prospects of global climate change have become overwhelming for many individuals and the families within which they live. Work schedules have become extended with the advent of computers and advances in communication technology, changing the boundaries that once separated office and home settings. The itinerant nature of contemporary society and the high technology world tend to separate people from one another rather than bringing them together. The aging of the U.S. population in many cases means that older individuals have either become separated from their families or, alternatively, have become so reliant on their relatives that social and economic strains begin to appear within caregiver families. Health care issues, then, clearly extend to problems previously known, such as mental health, but all too frequently ignored as a matter of governmental concern.
As a final example, the issue of substance abuse is a growing public health care concern. In the past, substance abuse was assumed to be the rational choice of individuals — addiction and possible death, as a result, was viewed as the price one paid for a bad personal choice. A sustainable community, however, cannot rationally make the choice to simply ignore problems associated with substance abuse and drug addiction. Philosophically, societies agree to care for their members. Practically-speaking, it is a serious drain on society to simply let the forces of drug addiction and substance abuse sap the strength of the community. In all state and local government settings, drug addiction and substance abuse prevention and treatment have become important aspects of health care (and the criminal justice system). Substance abuse problems cross age, gender, and ethnicity boundaries. While substance abuse among the youth remains troublesome, there is evidence to indicate that the rate of substance abuse is either leveling off or declining among this sub-population. A rising trend, however, is the incidence of substance abuse among Baby Boomers,14 that will likely require local communities to refocus their substance abuse efforts on this demographic group.
Public assistance and health care are closely intertwined, and both areas constitute an important part of a dialogue on sustainability. Termed entitlements, policy programs falling under the auspices of public assistance and health care are far-reaching and have inspired a next generational perspective on social programs designed to address public assistance and public health problems. Many of the governmental programs previously discussed in terms of entitlements — the implication being that there are narrowly defined givers and receivers of benefit — are increasingly discussed in terms of “community” assistance and health-promotion programs. The new perspective to be discussed next recognizes that the entitlement of yesterday is more properly seen as a collective community commitment or investment made to proactively address shared needs, and that this collective response to public assistance and public health needs benefits communities as a whole.
In 1996, a bipartisan coalition of Senators and Representatives in the U.S. Congress passed the Welfare Reform Act and President Clinton signed the act into law. With an eye to achieving outcomes similar to those associated with the state and local welfare reforms of the prior decade, the Republican majority in Congress hoped to eradicate one major element of the “welfare state.” The state and local welfare policy reforms preceding the 1996 Act generally tightened eligibility requirements for recipients and placed time limits on the length of time one could receive welfare benefits. After over a decade of experience with the welfare reform movement, we can say with some confidence that the 1996 act represents the beginning of a change in American thinking about what public assistance as an entitlement might mean in a new millennium. The new target of public assistance is less the individual recipient of the benefit than it is the community as a whole. Temporary Assistance for Needy Families (TANF) is the primary federal policy on public assistance in the United States. As a result of the 1996 Welfare Reform Act, TANF replaced Aid to Families with Dependent Children (AFDC). A block grant program, TANF requires states to develop specific public assistance plans to reflect state and local values, but within the general TANF requirements.
The Office of Family Assistance (OFA), Administration on Children and Families (ACF), a unit within the U.S. Department of Health and Human Services (HHS), is the federal office, which oversees TANF block grant dispersals and oversees state policy requirements to determine if they meet TANF eligibility guidelines. With the 1996 federal statute as the primary guideline, OFA outlines four major goals for the TANF program:15
- “assisting needy families so that children can be cared for in their own homes
- reducing the dependency of needy parents by promoting job preparation, work, and marriage
- preventing out-of-wedlock pregnancies
- encouraging the formation and maintenance of two-parent families”
The TANF program limits individuals who receive federal TANF money to five years, although states can impose either shorter or longer time limits — but no more than 20 percent of the state welfare caseload can go beyond the five-year time limit. If a state wishes to use its own resources to extend welfare benefits, they may do so at their own discretion. Proponents of TANF argue that the time limits are flexible enough to allow states to make their own choices about public assistance, but critics argue that states with the greatest need are often incapable of self-financing extended welfare benefits and may not be able to access other federal, state, or local revenues to meet the needs of citizens and local communities requiring this form of support.
TANF requires that recipients meet work requirements unless approved waivers are granted by state and national TANF administrators. Two-parent families must work 35-40 hours per week, while single-parent family work requirements are 30 hours per week. Certain exceptions are made for single parents who have children under six years of age who cannot find adequate childcare, and thus cannot balance their employment requirements with childcare responsibilities. “Work” may constitute full-time employment in salaried positions, but may also include participation in employment training programs, on-the-job training, civic service activities or even successful participation in formal secondary education. Proponents of TANF argue that the work requirements are broad enough to provide TANF recipients the opportunity to gain skills necessary for financial independence post-assistance. Criticism of the work requirement generally focuses on the potential for limited access to the full scope of “work” activities in states and local communities. Ultimately, post-TANF program participation gainful employment must be found; unfortunately, in communities lacking employment opportunities TANF recipients are faced with little hope for the future after their benefits have expired. TANF does make accommodation for states to create jobs directly or provide job incentives for private employers so that TANF recipients will have a greater chance of obtaining gainful employment when their eligibility expires.
TANF monitors all U.S. state programs to determine if the federal statutory requirements associated with the program are being met. If a state fails to meet these requirements, then TANF grant amounts to the state can be reduced administratively. As a consequence of these strong sanctions, state reporting requirements are quite stringent. Proponents of TANF argue that reporting requirements keep states in line with the national goal of streamlining the program and moving welfare recipients into the workforce. Critics of TANF argue that reporting requirements excessively limit each state’s ability to be innovative and responsive with public assistance programming to meet state and local needs. Despite these complaints, however, it is indeed clear that state and local governments in the United States have a great deal of latitude in crafting public assistance programs for both individuals and the communities within which they reside as a consequence of the 1996 Welfare Reform Act.
TANF requires that the states spend a certain percentage of their own funds to support public assistance programming efforts. These local fund matches are calculated by TANF under their Maintenance of Effort (MOE) as a percentage of the amount of money spent by ACF-TANF in a given state. MOE monies are calculated in terms of state MOE requirements and in terms of state separate voluntary MOE commitments. The rate of annual increase in state monies allocated toward MOE requirements grew tremendously from 2000 until 2004, then declined in real dollar percentage terms in 2005 and 2006. Separate state MOE allocations tend to be the most variable in the analysis, possibly reflecting state budget commitments in other areas and state economic conditions. The steadiest resource base for TANF is the federal government, but as noted previously that commitment is clearly flattening out — even showing some diminishment in real dollar year-on-year percentage terms. In part, this decline in federal funding reflects the decline in the average number of recipients in TANF programs — a possible sign of success for the long process of welfare reform in the United States.
As noted in the chart above, a very significant portion of TANF expenditures is for non-assistance purposes (i.e., administrative expenditures). Between 2000 and 2002, the trend for administrative expenditure as a proportion of TANF total expenditure was on the rise. The trend reflects the fact that many expenditures made under TANF are not benefits to individuals but rather reflect administrative investments in the local community for job preparation training and job creation for the clients making a transition from public assistance to employment. According to the Child Trends Data Bank, the trends of TANF recipients is as follows:16
After rising from 6.1 million in 1970 to 9.5 million in 1993, the number of children receiving AFDC/TANF payments fell to 2.9 million in 2008. Similarly, the percentage of all children receiving AFDC/TANF steadily decreased from 14 percent in 1993 to four percent in 2008. Among children living in families below the poverty threshold, the proportion receiving AFDC/TANF decreased from 62 percent in 1995 to 21 percent in 2008. Following the recession that began in late 2007, the number of children receiving TANF payments rose to 3.3 million in 2010 and 2011, then fell to 2.6 million in 2014 (preliminary estimates), the lowest number in recent recordkeeping. The percentage of children receiving benefits also increased slightly, to five percent in 2010, before decreasing to four percent in 2014. However, as a proportion of all children living in poverty, the percentage receiving TANF has declined over this period; in 2014, the proportion was 17 percent.
|CHILD RECIPIENTS IN THE STATES (IN THOUSANDS)||5,781||4,260||3,790||3,185||3,307||2,601|
|CHILD RECIPIENTS AS A PERCENTAGE OF TOTAL CHILD POPULATION||8.1||5.9||5.2||4.3||4.5||3.5|
|CHILD RECIPIENTS AS A PERCENTAGE OF CHILDREN IN POVERTY||42.9||36.8||31.2||24.8||20.3||16.7|
Figure 11.1 TANF Recipients, Average in Fiscal Year (1998-2014)
Whereas it can be said with some confidence that welfare reform is showing some progress towards flexible adaptation and proper orientation toward sustainable community development in state and local governments across the country, health care largely remains an unresolved issue in many states and local communities. Health care entitlement programs are the subject of a great deal of current political debate, and it became a major campaign issue in the 2008 presidential election. Health care reform is clearly imminent in the United States, and serious efforts must be made to streamline the process of service delivery, improve the quality of care provided in many areas (especially in early diagnosis and preventative care), and temper rising costs.17 While revolutionary changes have and continue to occur in American health care services available to those who can pay for them by virtue of insurance coverage,18 a great deal of additional change is needed to extend that access to the many citizens who are not covered by insurance. Perhaps the greatest tragedy lies in the fact that a very substantial portion of the nation’s youth are not covered by parental health insurance and are at best only unevenly covered by state insurance programs (more on that subject below), hence the benefits of preventive medicine and early diagnosis of illness are being lost with this portion of our population whose contribution to the sustainability of our local communities is essential.
The United States is “graying” as the Baby Boom generation moves towards retirement. Aging populations are the single greatest challenge to the nation’s health entitlement programs in terms of uncontrollable costs; this is the case in our country as it is in other developed nations.19 Some additional new challenges face the U.S. health care system which are not related to Baby Boomers, such as the virtual epidemic of childhood obesity and diabetes and the need to address the mental health and substance abuse and addiction issues alluded to above. In addition, the character of the American family unit has changed, with single and divorced parents facing multiple health challenges for themselves and their children.20 At this writing, three major forms of health care policy entitlement exist in the United States that affect state and local governments in major ways; those entitlement programs are:
Medicare is a federal health care program for the elderly. Medicaid is a state program, cooperatively managed at the state and federal levels of government to meet the health care needs of low-income individuals and families. S-CHIP, or the State Children’s Health Insurance Program, is also a state program, cooperatively managed at the state and federal level, intended to meet the health care needs of uninsured middle- and low-income children.
While a national program, Medicare is an important part of maintaining sustainable state and local communities. The Medicare plan provides for the health care needs of individuals 65 years of age or older. Recognized Medicare program health care providers privately supply health care under Medicare. There are three major components to coverage:
Part A — Hospital insurance: Part A covers specified costs of hospitalization, nursing care facility stays, home health care, hospice care, and blood transfusions for patients staying in the hospital or during covered stays in a skilled nursing care facility. Medicare does not cover all costs of every medical procedure.
Part B — Medical insurance: The Medicare program covers a percentage of Medicare-approved procedures. Costs that exceed those covered by Part B are the responsibility of the patient. The patient may choose to enroll in private health insurance plans to cover additional expenses, or choose to enroll in the government-sponsored Medigap insurance. Expenses not covered by either private insurance or Medigap are the responsibility of the patient.21
Part D — Prescription Drug Program: The prescription drug program covers expenses for various generic and brand name drugs. The co-payment of the patient will vary, depending upon the type of drug prescribed. Medicare Part D coverage limits the amounts of drug dispensed at any given time.
The oldest members of the Baby Boom generation are now in their early 60’s, close to retirement, and becoming increasingly susceptible to the infirmities of age. By 2030, it is estimated that there will be 2.7 workers for every retiree drawing health and retirement benefits.22 Clearly, economic sustainability is potentially challenged by a growing tax burden and budget constraints. The sustainability of the Medicare program, as it currently exists without significant change, is highly dubious. Either a reduction in benefits or changes in eligibility might be necessary to make the program viable for future generations if no alternative health care financing system is created.23 These policy changes at the national level, however, will not reduce the expanding health care needs of the elderly. Preventative care, good health practices, and effective outreach to at risk populations are all important ways of limiting health care needs and economizing on health care expenses. Regular exercise and balanced diets are important to maintaining good health, and avoidance of smoking (and second-hand smoke environments) and moderation in the use of alcohol are likewise important means of reducing health care costs. Public-private partnerships involving national, state, and local government are critical to making available the “wellness” information, healthful foods, and exercise facilities needed to stay healthy and providing access to geriatric nutrition information for the elderly.
The health care entitlements of Medicare are of critical importance to the health status of the nation, but they will likely fall short in providing for many of the basic everyday needs of the elderly. While the Administration on Aging, Department of Health and Human Services, provides significant guidance for eldercare and endeavors to protect the elderly from abuse, most of the resources and energy needed to sustain a quality of life for our elderly citizens will come from the hard work, personal resources, and patience of private individuals living within our local communities. Community eldercare is an important part of developing sustainability in our nation’s local communities. A growing number of middle-aged adults are seeking to balance child-raising, career, and eldercare responsibilities for relatives and friends. Many individuals already face these challenges, and more will do so in the coming years. Cooperative effort will be necessary to cope with the added responsibilities, and “family friendly” workplace policies will be needed to accommodate the persons taking on these caregiver roles.
Medicare, and its related health care programs for the elderly, provides a solid foundation for health care entitlement in the United States. Sustainable eldercare, however, involves much more than health care dollars for hospitalization, health insurance, and prescription drug benefits. The essential margins of health care sustainability for the elderly will most likely be provided by sustainable community-based eldercare; those communities which provide for the needs of both young workers and the elderly individuals for whom they care on a daily basis will likely prosper; those that leave their elderly to rely entirely upon the federal government’s Medicare program will experience serious dislocation as the Baby Boomers move into their retirement years.
Medicaid is a national-state cooperative health care plan designed to serve the medical service needs of low-income individuals and families. Standards commonly associated with eligibility for the Medicaid entitlement benefit include the following:24
1. “Families who meet states’ AFDC/TANF eligibility requirements in effect on July 16, 1996;
2. Pregnant women and children under age 6 whose family income is at or below 133% of the Federal poverty level;
3. Children ages 6 to 19 with family income up to 100% of the Federal poverty level;
4. Caretakers (relatives or legal guardians who take care of children under age 18 (or 19 if still in high school);
5. Supplementary Security Income (SSI) recipients [who meet certain requirements];
6. Individuals and couples who are living in medical institutions and who have monthly income up to 300% of the SSI income standard…”
In addition to these standards, states can establish their own eligibility requirements. Individuals who qualify for Medicaid receive hospitalization, insurance, and drug benefits similar to those received by Medicare recipients.
Medicaid is a very important program with respect to advancing sustainable states and local communities. Without the benefits provided under the Medicaid program, a great many low-income individuals would have extremely limited access to health care. In many cases, low-income individuals are the virtual backbone of a sustainable community, working in low salary jobs in the agricultural, service and production industries. Increasingly, private sector employers are eliminating employer-provided health care benefits for their workers, leaving low-income workers and their families in a highly vulnerable position. Without access to health care, worker absenteeism tends to be high and productivity low; undiagnosed illness, which could be treated inexpensively frequently become acute and require extremely expensive emergency treatment and hospitalization. Poor access to health care for children, in particular, has a depressing effect upon their school attendance and learning. Sustainable communities will require high levels of employee productivity and the production of high quality goods and services, and they will require that children are making adequate progress in their education. Health care entitlement programs, such as Medicaid, represent a critically important societal commitment to low income individuals and the sustainability of the local communities in which they live and work. The Medicaid program is a quintessential illustration of how the “social safety net” connects to the promotion of sustainability.
While clearly a direct benefit to the promotion of sustainable communities and to the low-income individuals who need attention to health care concerns, Medicaid is a substantial and growing financial burden on state government. Beneficiary enrollments since the beginning of the millennium increased by 28 percent, from 42.8 million to 50.1 million individuals between 2000 and 2004. Even more dramatically, health care payments during that same period increased by a staggering 53 percent, from $168.4 billion in 2000 to $257.2 billion in 2004. Despite dramatically rising costs, Kronick and Rousseau conclude from their careful studies that with close management of costs and a modest degree of reform, the Medicaid program is sustainable for a considerable period.25 A streamlined and more efficient process of Medicaid benefit delivery and a reformed reimbursement for service schedule are two methods of reforming Medicaid believed to improve program viability.
According to Medicare.gov in 2018:26
73,355,220 individuals were enrolled in Medicaid and CHIP in the 51 states reporting June 2018 data. 66,861,199 individuals were enrolled in Medicaid and 6,494,021 individuals were enrolled in CHIP (please see contextual information below regarding CHIP enrollment). More than 15.7 million additional individuals were enrolled in Medicaid and CHIP in June 2018 as compared to the period prior to the start of the first Marketplace open enrollment period (July – Sept. 2013), in the 49 states that reported relevant data for both periods, representing Nearly a 28 percent increase over the baseline period. (Connecticut and Maine aren’t included because they did not report data for both periods).
More than 35.4 million individuals are enrolled in CHIP or are children enrolled in the Medicaid program in the 48 states that reported child enrollment data for June 2018. Children enrolled in the Medicaid program and individuals enrolled in CHIP make up over 50.6 percent of total Medicaid and CHIP program enrollment.
Community health centers are another important tool in developing sustainable community health programs. The health centers are particularly important in rural communities, which lack readily accessible hospital facilities. Farmers, ranchers, and farm laborers and their families are important beneficiaries of community health services. In urban settings, community health services can reduce the inflow of patients into emergency rooms for medical care. Urgent care facilities set up in local communities are also designed to ease the burden on emergency rooms. In terms of cost, community health care and urgent care facilities are often far cheaper to operate and maintain than hospital emergency room facilities. In smaller communities, local hospitals are acquiring the role of community health centers, not only providing the hospital bed and surgical services but also conducting active health-promotion campaigns of many types that promote prevention and early detection of illness.
Community health centers serve as important cost-effective hubs for preventative care services. Child immunization services and health screening can be done effectively in community health facilities. Health education classes can be taught in community health centers for both the young and the elderly. Drug and alcohol dependency programming are also important parts of community outreach services to be coordinated through community health centers. In essence, community health centers represent the widespread recognition in urban and rural areas alike that sustainable communities require high quality health care provide through a variety of means. Wellness and good health practices are seen as both individual benefits and community benefits rather than as commodities to be purchased solely by those individuals who can afford it.
Community health centers might also help to overcome current inequities in Medicaid patient care delivered by private commercial providers. Landon and his colleagues found that Medicaid patients served by commercial providers tend to receive lower quality care than privately enrolled patients in commercially provided care programs.27 Community health centers might also be a long-term solution to the need to combine health and public assistance benefits with day care for working mothers, an unfilled need, which may weaken the benefits of the aforementioned programs.28
The S-CHIP program is a state and nationally funded program that began in 1997. The program is intended to extend health insurance to children who would not meet the income requirements of Medicaid. Eligibility for S-CHIP is a function of a child’s age, family size, and household income level. The S-CHIP program serves children from working class and middle-income families. This health care entitlement helps these families remain in the middle class and working poor categories — without this health care entitlement, the eligible families would likely lose their socioeconomic status in the case of any type of serious medical condition arising for their children. As with Medicaid, S-CHIP offers health insurance, emergency medical care, immunization programs, and a health-screening program. S-CHIP also helps reduce the cost of adult health care by managing health care needs of adolescents before health problems become chronic and expensive to treat.
Childhood obesity, for instance, has led to serious concerns about the future health care needs of Americans. Related to obesity, many children are being diagnosed with diabetes, which can lead to other serious health care issues, principally vision, renal, coronary and circulatory disorders. Obesity itself can also lead to heart problems, stroke, and premature death. Increasing access to medical testing, preventive treatment and information through the insurance resources of the S-CHIP program mean that chronic health issues can be either prevented or effectively treated to forestall serious health consequences in many cases.
Enrollment in S-CHIP has risen dramatically since 2000. In just six years, enrollment increased from 3.36 million children in 2000 to over 6.6 million children in 2006. In percentage terms, the increase has been over 97 percent! S-CHIP expenditures also reflect this tremendous rise in program enrollment, which increased from $1.93 billion in 2000 to a staggering $7.03 billion in 2006 — nearly a 511 percent increase in expenditures in just six years. A state-federal entitlement, S-CHIP is a noteworthy commitment to many middle class American families with young dependents, helping many of those families to avoid economic devastation and offering hope to millions of children. What certainly cannot be ignored, however, is the rapid growth of the program and the constraints that level of growth places on state budgets; state program managers must prioritize and manage a myriad of state and local community needs. However, to place matters into some perspective, it is useful to consider the following: as a program, S-CHIP costs less than 0.5 percent of all state and local government receipts combined.29
Successful sustainable communities possess the capability of relying upon the ability of the individuals and families living in those communities to respond to changing conditions and needs. S-CHIP helps working class families, whose relatively acceptable economic status could quite easily be transformed into economic devastation by the health care needs of their children should serious illness occur.30 This program allows these families to maintain the slack resources needed to respond to other changing needs, such as care for an elderly relative or to cover the costs of further education. Slack resources might also be used to help other community members in times of need — providing shelter and food for a neighbor who lost their home or suffered a medical malady that will require the support of their close friends.
A national government policy administered through and supplemented by the states,<P>UUOr unemployment compensation represents a commitment made to address temporary economic dislocations. The program is funded at the national, state, and local levels, using a combination of sources of funds. It is intended to provide financial assistance to unemployed individuals through direct payments to be used to purchase many of the basic necessities of life. Unemployment compensation is an example of a policy commitment type of entitlement, recognizing that there are times when other members of our local and state communities are incapable of fending for themselves due to circumstances beyond their control.
The states and the federal governments have different roles in managing unemployment compensation. Federal government responsibilities include the following: 31
1. ensure conformity and substantial compliance of state law, regulations, rules, and operations with federal law;
2. determine administrative fund requirements and provide money to states for proper and efficient administration;
3. set broad overall policy for administration of the program, monitor state performance and provide technical assistance as necessary; and
4. hold and invest all money in the unemployment trust fund until drawn down by states for the payment of compensation.
State government responsibilities under this program include the following:32
1. determine operation methods and directly administer the program;
2. take claims from individuals, determine eligibility, and ensure timely payment of benefits to workers; and,
3. determine employer liability and assess and collect contributions.
Unemployment compensation is generally fixed at 26 weeks, although some states such as Massachusetts offer a 30-week initial compensation period. During periods of sustained high unemployment, where it is highly unlikely that an unemployed person would be able to regain employment, extended unemployment benefits are generally paid for an additional 13 weeks. FedeUUUnemployment compensation tax money is collected from employers by state governments, but is then deposited with the federal government under federal statutory guidelines.
In the broadest consideration, the sustainability construct we are using in this book can be viewed as a requiring a rather inclusive discussion of the need to balance rights and responsibilities in a society that relies less on resource extraction and environmental degradation and more on the careful and wise use of the renewable resources available to all individuals. Sustainability requires due consideration of the needs of today but keeps in mind the needs and conditions of future generations. For now, we are here — alive, thinking, speaking creatures. One of the reasons that societies first formed was because individuals and groups of individuals tried to figure out a better way to amass and distribute the resources needed to make life bearable and to increase the likelihood that their offspring and future generations would both survive and be able to improve their respective lots in life.
Viewed in the context of sustainability, entitlements focus our attention on both short term and long-term goals associated with the community well being. In the short term, entitlements are designed to meet the immediate objectives of providing for the educational, economic and social welfare benefits of individuals who are often unable to provide for themselves. In doing so, entitlements provide for the long-term goal of making survival and improvement possible for the beneficiaries and for future generations of people living in that community. In this sense, the entitlement programs discussed in this chapter touch directly upon the social and economic objectives of sustainability.
Reform efforts are bringing social safety net entitlements closer into line with the environmental and economic core objectives of sustainability. The evolution of entitlements in the 20th century focused attention on the rights of the individual within society. Many entitlement policies focused state and local government efforts on issues of social welfare for the indigent; policies designed to help those who had or who were currently suffering from the effects of historic racial, ethnic, and gender-based discrimination; and policies promoting equality in education. The sustainability paradigm embraces these initiatives to promote social equity; however, sustainability calls for a somewhat broadened view of rights and responsibilities. Increasingly, the focus of our attention is on communal rights and the rights of nature. Should community benefit and the environment, broadly defined, be considered in a discussion of entitlements? The focus on such issues is so current that it would be foolhardy to decide how it will be decided in the end; nevertheless, it is a central part of the sustainability paradigm and would significantly change the way states and local communities consider the issue of sustainability in the governance process.
A major reason for writing this book in this way at this time is that the present generation of college students will doubtless be the deciding generation for this critical question. If the core values of economic vitality, environmental protection, and social equity are to be achieved in our communities, the challenge of providing a sustainable set of entitlements as a collective benefit to all citizens will have to be met by those who manage our state and local governments and those citizens who take an active interest in the wellbeing of their communities – through participating in civic affairs, through volunteering in community organizations, and through doing their fair share to promote wellness and good health in their own lives and those of their family members.
The concept of individual rights and responsibilities is deeply embedded in the institutional arrangements of American state and local governance. Liberal democratic governance was built around the idea of inalienable individual rights and the promotion and protection of individual freedom and equality, carried out within the confines of orderliness in civil society. Notions of global justice and trans-generational justice, for instance, were likely not at the forefront of 17th and 18th century liberal democratic thinkers’ minds. Nonetheless, t the thoughts and words of our Founding Fathers and their predecessors continue to govern American political institutions. A major challenge facing the leaders of state and local government today is that of incorporating into the American individual rights tradition sufficient regard for the thoughtful consideration of future consequences so that collective action can take place to preserve the social safety net as progress is made toward maintaining vitality in our economic activities and protecting our environmental heritage.
Entitlements—What Can I do?
As we learned in this chapter, the nation’s largest health insurance program is Medicare, which covers people 65 or older and some people under 65 who are disabled. Perhaps you have someone in your family—such as parents or grandparents—who receives Medicare benefits? Ask them about how the program works for them including costs and benefits of coverage.
Go to your city’s or county’s website and try to identify what types of entitlement programs are offered by your local government. Try to identify if these programs contain intergovernmental revenues from the state or federal governments.
Go to Google’s video search website and type in “entitlements.” There are many videos of elected officials, commentators, and interest groups of all ideological orientations. Try to identify videos of different perspectives, watch a couple, then see what you think of the various perspectives. Many of the videos will argue that entitlements are not sustainable with the upcoming retirement of many “baby boomers” (the generation born in the middle of the twentieth century).
Google video search: http://video.google.com/
Governing for sustainability means that we are committed to one another in our individual and collective pursuit of a good society. Part of commitment means ensuring that vulnerable individuals are offered assistance based on their needs. The elderly, children, unemployed individuals and the poverty-stricken are four examples of groups who are vulnerable and who often require the special attention of society. In sustainable governance, commitment is not about charity; it is about maximizing the opportunity of all members of society to contribute to the common welfare. For the elderly, opportunity means the chance to live a good life and to contribute the wisdom of experience to the community — be it the shared knowledge of living through challenging times and experience implementing tried-and-true methods of meeting those challenges, or sharing child-rearing responsibilities for young adult family or community members who work full time. For children, among the most vulnerable of any community’s residents, opportunity means the chance to grow up and mature into healthy and happy adults; reliable access to quality health care is a critical part of achieving this goal. For the unemployed and the poverty-stricken, opportunity means the chance to regain the dignity associated with economic independence; the opportunity to experience gainful employment provides that dignity.
The concept of “entitlement program” is used here because it is a term that is most frequently associated with the aforementioned programs; it is one that reflects a philosophically liberal tradition regarding the rights of the individual and the need for the state to promote social justice. While the rights of the individual are critical in sustainable governance, the programs detailed here are equally important for the preservation of sustainable community existence. A focus on sustainability, therefore, requires policy makers and citizens to re-conceptualize the meaning of entitlements, painting for themselves a broader understanding of the use and value of such programs. We are increasingly aware that we are all givers and we are all recipients of the benefits offered by such programs, and there is evidence that the entitlement policies of the United States are responding to this recognition.33
No Child Left Behind (NCLB)
Social Safety Net
Sustainable Community-based Eldercare
Temporary Assistance for Needy Families (TANF)
Welfare Reform Act, 1996
1. What are the various types of state and local government entitlement programs? What is (are) the purpose(s) of these programs?
2. Discuss the relationship between entitlement programs and sustainable communities? Is it possible to cut entitlement programs and yet maintain sustainability?
3. What are the various types of state and local public assistance and health care programs?
4. Discuss the role of state and local governments in the Medicare and Medicaid programs.
D. Malpass, “Monetary Policy and the Growing Fiscal Imbalance,” CATO Journal 27(2007): 219-230.
L.D. Schaeffer, “The New Architects of Health Care Reform,” Health Affairs 26(2007): 1557-1559.
P. Starr, The Social Transformation of American Medicine: The Rise of a Sovereign Profession and the Making of a Vast Industry (New York: Basic Books, 1982).
27. B. Landon, E.C. Schneider, S.L. Normand, S.H. Schoelle, L. Pawlson, L. Gregory, and A.M. Epstein, “Quality of Care in Medicaid Managed Plans and Commercial Health Plans,” Journal of the American Medical Association 298(2007): 1674-1681.
P.K. Robins, “Welfare Reform and Child Care: Evidence from 10 Experimental Welfare-to-Work Programs,” Evaluation Review 31(2007): 440-468.
31. Work Force Security. Unemployment Insurance Benefits. URL: http://workforcesecurity.doleta.gov/unemploy/ pdf/partnership.pdf (accessed December 30, 2008).