The federal government uses many factors to calculate the official federal poverty level. Until June 21st, 2019, the Office of Management and Budget (OMB) is accepting comments from the public on Directive Number 14, their proposal to change one of those factors.
• The OMB wants to use an inflation measure called the Chained Consumer Price Index (CPI) instead of the normal CPI, which is currently being used.
• The Chained CPI assumes that as the cost of good increases, families will purchase cheaper alternatives to save money.
That assumption isn’t true for low-income families, many of whom already purchase less expensive products by default.
If the OMB is successful in replacing the CPI measure with a Chained CPI, the federal poverty level will decrease over time, even as the cost of living increases. This approach is extremely dangerous for children and families across Maryland who rely on public assistance programs to thrive, because many of those programs have income eligibility thresholds based on the federal poverty level. If the poverty level decreases over time, more families will be ineligible to participate in critical programs like:
• Medicare Low-Income Prescription Drug Subsidy Program
• Family Planning
• Children’s Health Insurance Plan (CHIP)
• Supplemental Nutrition Assistance Program (SNAP)
• Supplemental Nutrition Program for Women, Infants, and Children (WIC)
• School breakfast and school lunch programs
• Head Start
• Low-Income Home Energy Assistance (LIHEAP) Program
• Legal Aid services, and
Tax assistance services
With the poverty level at $12,490 for an individual and $25,750 for a family of four, we know that the current federal poverty level guidelines don’t accurately reflect the cost of living in America today. The OMB knows this too. They have specifically asked that the public (should not) does not comment on how the inflation measure change might impact public assistance program guidelines. However, this is not the time to be silent. Hundreds of thousands of Maryland children and their families literally cannot afford to wait until this measure becomes a reality. Take action by sharing your thoughts on the proposed changes with the OMB.