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The safety net includes a number of other programs: government-subsidized school lunches and breakfasts for children from low-income families; the Special Supplemental Food Program for Women, Infants and Children (WIC) , which provides food assistance for pregnant women and newborns; the Low Income Home Energy Assistance Program, which provides help with home heating bills; housing assistance, which helps pay the rent; and Supplemental Security Income, which provides cash support for the disabled and the elderly poor.

Medicaid

Medicaid    was created by Congress in 1965 and is a joint health insurance program entered into by both the states and the federal government. The federal government helps fund Medicaid, but each state is responsible for administering the program, determining the level of benefits, and determining eligibility. It provides medical insurance for certain low-income people, including those below the poverty line, with a focus on families with children, the elderly, and the disabled. About one-third of Medicaid spending is for low-income mothers with children. While an increasing share of the program funding in recent years has gone to pay for nursing home costs for the elderly poor. The program ensures that a basic level of benefits is provided to Medicaid participants, but because each state sets eligibility requirements and provides varying levels of service, the program differs from state to state.

In the past, a common problem has been that many low-paying jobs pay enough to a breadwinner so that a family could lose its eligibility for Medicaid, yet the job does not offer health insurance benefits. A poor parent considering such a job might choose not to work rather than lose health insurance for his or her children. In this way, health insurance can become a part of the poverty trap. Many states recognized this problem in the 1980s and 1990s and expanded their Medicaid coverage to include not just the poor, but the near-poor earning up to 135% or even 185% of the poverty line. Some states also guaranteed that children would not lose coverage if their parents worked.

These expanded guarantees cost the government money, of course, but they also helped to encourage those on welfare to enter the labor force. As of 2014, approximately 69.7 million people participated in Medicaid. Of those enrolled, almost half are children. Healthcare expenditures, however, are highest for the elderly population, which comprises approximately 25% of participants. As [link] (a) indicates, the largest number of households that enroll in Medicaid are those with children. Lower-income adults are the next largest group enrolled in Medicaid at 28%. The blind and disabled are 16% of those enrolled, and seniors are 9% of those enrolled. [link] (b) shows how much actual Medicaid dollars are spent for each group. Out of total Medicaid spending, more is spent on seniors (20%) and the blind and disabled (44%). So, 64% of all Medicaid spending goes to seniors, the blind, and disabled. Children receive 21% of all Medicaid spending, followed by adults at 15%.

Medicaid enrollment and spending

The graph on the left shows that the majority of those enrolled in Medicaid are children (47%). The graph on the right shows that the majority of Medicaid spending takes place by people who are blind and disabled (44%).
Part (a) shows the Medicaid enrollment by different populations, with children comprising the largest percentage at 47%, followed by adults at 28%, and the blind and disabled at 16%. Part (b) shows that Medicaid spending is principally for the blind and disabled, followed by the elderly. Although children are the largest population covered by Medicaid, expenditures on children are only at 21%.

Key concepts and summary

The group of government programs that assist the poor are called the safety net. In the United States, prominent safety net programs include Temporary Assistance to Needy Families (TANF), the Supplemental Nutrition Assistance Program (SNAP), the earned income tax credit (EITC), Medicaid, and the Special Supplemental Food Program for Women, Infants, and Children (WIC).

References

Congressional Budget Office. 2015. “The Effects of Potential Cuts in SNAP Spending on Households With Different Amounts of Income.” Accessed April 13, 2015. https://www.cbo.gov/publication/49978.

Falk, Gene. Congressional Research Service. “The Temporary Assistance for Needy Families (TANF) Block Grant: Responses to Frequently Asked Questions.” Last modified October 17, 2013. http://www.fas.org/sgp/crs/misc/RL32760.pdf.

Library of Congress. “Congressional Research Service.” http://www.loc.gov/crsinfo/about/.

Office of Management and Budget. “Fiscal Year 2013 Historical Tables: Budget of the U.S. Government.” http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/hist.pdf.

Tax Policy Center: Urban Institute and Brookings Institution. “The Tax Policy Briefing Book: Taxation and the Family: What is the Earned Income Tax Credit?” http://www.taxpolicycenter.org/briefing-book/key-elements/family/eitc.cfm.

Questions & Answers

What is divided
Alfusainey Reply
It help us to no how to do with our money
Alfusainey
Demand curve us a graph showing the relationship between the price and quantity of a commoditiy demand
Alfusainey
Demand schedule is define as a table showing the relationship between prices and the quantity of that commoditiy demanded
Alfusainey
Demand may be defined as a quantity of good or services that consumers are walling and able to buy at a alternative prices
Alfusainey
The law of demand states that all things being equal the higher the price the lower the quantity that will be demanded vice versa
Alfusainey
The law of supply states that all things being equal the higher the price the higher the quantity of a commoditiy that will be supplied vice versa
Alfusainey
what is money
Siaw Reply
money is defined as the medium of exchange
jackie
money is anything that serves as a medium of exchange,measure of value and standard for deferred payment
Chinenye
money is legal tender that is use for buying good n service
Nak
Money is anything that has general acceptability as a medium of exchanging dabt
Alfusainey
what is economics
reekado Reply
what is the meaning of term depreciation
Niyogushimwa
I don't know tell me pls
Manuel
decrease in the valaue of currency is called depreciation.
Asit
managing the scarce resources is called economics 😉
Asit
definition of economics according to different scholars
Onesmo Reply
Economics is a science that studies human behavior as a relationship between end and scarce means which have alternative uses:by Davern spot
Dora
am I correct?
Dora
Yeah you tried
Donkiss
reason why we study economics
Moruf Reply
what is economics
Tutu Reply
economics is defined as the science which studies human behavior as a relationship between ends and scarce means which have alternative uses.
Semiat
what is a gross domestic product
Amogelang Reply
Explain what is a production possibility curve
Sharon Reply
A curve that indicates the various production possibilities of two commodities when resources are fixed...
Geoffrey
what is market?
Jasmin Reply
ware the Byers and seller's that please is called market
suresh
a place where buyers and sellers meet
Tariro
I don't like this market definition.
Jasmin
market is any arrangement whereby buyers and sellers are brought together for the purpose of transacting business. It could be a geographical location or any other means such as internet, mobile phone etc. as long as buyers and sellers are brought together for the purpose of exchange.
Agusimba
A market is a place where buyers and sellers buy and sell goods through bargaining.
Jasmin
yes ,you are correct Agusimba sir.
Jasmin
exception of the low of demond
Rohit Reply
short run AC curves?
Jasmin Reply
you mean shirt run cost curves?
REBECCA
A short-run cost curve shows the minimum cost impact of output changes for a specific plant size and in a given operating environment. Such curves reflect the optimal or least-cost input combination for producing output under fixed circumstances.
REBECCA
nooo am not from India why!?
Godwin Reply
Godwin which level of education are you please
Millionaires
millionaires am in SHS 2
Godwin
who was the father of economic ?why?
Mahesh Reply
Rationing and hoarding
Semiat Reply
how do the size of a country's population affect labour force
Evans Reply

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Source:  OpenStax, Principles of economics. OpenStax CNX. Sep 19, 2014 Download for free at http://legacy.cnx.org/content/col11613/1.11
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