Entitlement reforms in Maine have led to a decline in the amount of one type of program fraud occurring in the state, state officials report.
In February, state Department of Health and Human Services (DHHS) Commissioner Mary Mayhew said the value of Maine Food Supplement Program transactions occurring in other states significantly declined between 2011 and 2015.
In 2011, individuals receiving Supplemental Nutrition Assistance Program (SNAP) funds, distributed to electronic benefit transaction (EBT) cards issued through the state’s Food Supplement Program, improperly spent $15.9 million in other states. In 2015, entitlement spending outside the state had declined by more than 44 percent, to $8.9 million.
‘Quite a Shocker’
Liam Sigaud, a policy analyst with the Maine Heritage Policy Center, says out-of-state SNAP transactions are a red flag indicating potential entitlement fraud.
“One of the big issues in the past has been the use of EBT cards out of state, in exchange for drugs,” Sigaud said. “The drug trade in Massachusetts and New York had several investigations into drug dealers. They have revealed in the past that EBT cards are frequently used as a currency. That was quite a shocker.”
‘Acute’ Connection to Drug Trade
Sigaud says investigating entitlement fraud has caused fraud rates to decline.
“What Gov. [Paul] LePage has done is significantly increase the number of investigators at DHHS to try to uncover these fraudulent activities,” Sigaud said. “The drug issue in Maine is quite acute. There’s been a heroin epidemic sweeping across the Northeast. I think that sees people resorting to whatever currency they have. In the last five years, nearly $1 million have been ordered in restitution for fraud.”
Getting People Back to Work
Sigaud says tying entitlements to work requirements, another reform enacted by LePage, has helped people become independent, reducing their reliance on government.
“In late 2014, LePage required childless, able-bodied adults, of which there were about 13,000, to either participate in community service as a volunteer or work at least 20 hours a week or participate in a job training program in order to continue to receive those food stamp benefits,” Sigaud said. “The rolls decreased significantly, from about 13,000 to fewer than 3,000, in just a couple months. It’s been a spectacular success.”
Work Reforms Are Working
Rachel Sheffield, a policy analyst with the DeVos Center for Religion and Civil Society at The Heritage Foundation, says work requirements are important for fiscal responsibility.
“Maine has done a great job with work requirements for able-bodied adults without dependents,” Sheffield said. “Having a work requirement in itself can really address fraud as well. Sometimes, individuals have a job they aren’t reporting to the state, whether that’s working under the table or whatnot. So, having that work requirement would insure they aren’t receiving the benefit when they don’t actually qualify for it.”
Kimberly Morin ([email protected]) writes from Brentwood, New Hampshire.
Erik G. Luna, Pepperdine Law Review, “Welfare Fraud and the Fourth Amendment,” May 15, 1997: https://heartland.org/policy-documents/welfare-fraud-and-fourth-amendment/