First Person

A Surge In Financial Aid Audits Is Trapping Low-Income College Students

It was 9 p.m. on an August night in southern California, and I was about to get my favorite burrito. I had spent the day with friends at  Shawe’s Cove, my go-to beach tucked beneath the mansions in Laguna Beach. The moment I took my first bite of Carne Asada, my friend asked: “Have you gotten your financial aid?” Confused, and a little upset she was bringing up financial aid when I hadn’t even had a chance to finish chewing, I hesitantly replied “Uhh, I’m not sure — have you?”

It turns out that for most UC-Riverside students, financial aid for the upcoming school year had been released a few days before. When I checked my bank account the next day, I had not received my reimbursement from my financial aid package.

As a senior who depends on financial aid, I’ve filled out the Free Application for Federal Student Aid, or FAFSA — the form required by the federal government in order to receive grants and loans for college — three times previously and never had a problem. But after digging through old emails, I found one I’d missed from my school’s financial aid office earlier in the summer stating “Financial Aid App Incomplete.” After logging into my school’s student web portal, I finally found the reason my aid was being withheld: I had been selected for verification.

Verification, or the auditing of student financial aid applications for additional review, is routine — even when the original information is correct. The Department of Education selects roughly 30 percent of financial aid recipients’ applications to verify, but the information they choose to review varies. I was audited for my dependency status, so over the course of the past couple of months, I have submitted my mother’s original tax returns to my financial aid office, resubmitted them with specific IRS documents after they were rejected, and then waited for weeks while they were reviewed by my school’s financial aid office. All told, the documents and late fees cost about $150

Unfortunately, my situation is far from unique. The 2018-2019 application cycle saw an unusually high number of verifications due to an algorithm adjustment from the Department of Education. The algorithm change, combined with the repeal of the 30 percent cap on audits — removed in anticipation of the new algorithm — has caused the number of verifications to skyrocket. At my own university, where more than half of students receive Pell Grants, a financial aid counselor reported that 8,000 students were selected for verification — more than double the 3,000 who went through the verification process last year.

Data show that 98 percent of students picked for verification are low-income.

Data show that 98 percent of students picked for verification are low-income, and that about half of students that are eligible for a federal Pell Grant are selected. About 95 percent of students that successfully make it through verification have no change in their aid, but many students do not make it through the process.  According to the National College Access Network, in the 2015-16 academic year — before the verification numbers spiked — 90,000 low-income students were not able to complete the verification process and receive aid.

Even students who make it through the process face delays that could be critical for those who are struggling to afford their rent, groceries, and school expenses. For me, going back to school involved taking a giant leap of faith. By the time I arrived in D.C. for the fall semester I was still without any financial aid. I spent my second day in D.C. calling my financial aid office, student business services, and the center where I would be staying. I was terrified that if my aid didn’t come through, I would be forced to drop the program.

After two hours of fighting my way through busy signals, I finally managed to find myself in queue. I was on hold for several more hours until someone told me that they had received my paperwork, but had not yet flagged it to be seen by an administrator.

This process took a total of nearly 10 weeks to complete. If it weren’t for working both during summer and the quarter, family support, and guidance from financial aid counselors at my school, I  would not have been able to make it to this point. As a first-generation college student whose family never left the town were they grew up, the 11 or so weeks I would spend more than 2,000 miles away from home might as well be 11 years.

But I am one of the lucky ones. For more than 90,000 other students like me, this all ended very different.



A Trump Immigration Rule Could Devastate Rural Hospitals

According to a recent report, the Trump administration’s proposed change to what’s known as the “public charge” immigration rule would endanger $17 billion in Medicaid reimbursements for hospitals across the United States. This could threaten some rural hospitals, which are already facing an epidemic of closures, and leave many communities without a hospital within a 35-mile radius.

The rule proposed by the United States Citizenship and Immigration Services would require most immigrants seeking green cards to show that they have a middle-class income: specifically, more than 250 percent of the federal poverty line (about $62,750 for a family of four). Immigrants could also fail the test if they have received government benefits, including Medicaid and Medicare Part D, in the past or if officials feel they are likely to receive them at any point in the future. The test would also penalize use of the Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps) and housing assistance programs.

Researchers at the consulting firm Manatt found the proposed changes could drive disenrollment from Medicaid, even for people who are lawfully in the United States, eligible for coverage, and wouldn’t be subject to the public charge rule, because they fear running afoul of the new requirements. Similar fears are already pushing eligible immigrant families off SNAP, especially those in “mixed status” households that include lawful residents, citizens, and/or undocumented people.

Overall, the researchers estimate public charge could affect 13.2 million immigrants on Medicaid, including 7.6 million children, who consume nearly $70 billion in Medicaid and Children’s Health Insurance Program services annually.

When people begin to unenroll from Medicaid, the rise in uninsured people who still need health care will lead to fewer Medicaid reimbursements and a corresponding increase in uncompensated care costs. That will be particularly hard on rural hospitals, in part because rural communities rely more heavily on Medicaid coverage than their urban counterparts due to the lower number of other insurance options and high poverty rates.

While the majority of immigrants in the United States live in urban areas, they are making up an increasing share of rural communities. When rural hospitals experience even a relatively small drop in income from losing these patients, Manatt researcher April Grady notes that it “can have an outsized impact.”

Texas, California, and Nevada could see particularly acute chilling effects for their immigrant residents in both urban and rural areas if the public charge rule is approved, thanks to their large immigrant communities. Texas is already struggling with hospital closures, where changes to Medicaid policy, along with the state’s refusal to expand the program, have hit rural facilities hard.

Texas, California, and Nevada could see particularly acute chilling effects for their immigrant residents.

Sharita Thomas, a research associate with the North Carolina Rural Health Research Program (NCRHRP), observed that there have been 90 rural hospital closures since 2010, many in the South, with more on the horizon. 68 percent of rural hospitals vulnerable to full closure are Critical Access Hospitals, which are facilities that are at least 35 miles away from other hospitals, maintain 24/7 emergency care, and meet several other criteria to receive unique benefits designed to make them more financially stable, including cost-based Medicare and in some cases Medicaid reimbursement.

When the sole hospital in a rural community closes, it forces patients to search further afield for care, a particular concern with obstetrical and emergency treatment. It also has a wider negative economic impact. “In rural communities,” said George Pink, Deputy Director of the NCRHRP, “the hospital is the largest or second-largest employer in the region. When that source of employment goes away, there are often ripple effects.” This can extend to companies considering relocation but reluctant to do business in an area that lacks a hospital or doesn’t provide sufficient hospital services, depriving rural regions of economic opportunities.

Even if hospitals facing budget constraints don’t close, they could start cutting programs, with labor and delivery a frequent early target. When cuts fail to achieve the desired goal and get more drastic, a floundering hospital may ponder a merger with another health care entity. Hospital mergers in urban and rural areas alike are rapidly accelerating, with 102 in 2016 alone and a comparable number in 2017. Many of the hospital chains gobbling up smaller competitors are Christian, with the Catholic hospital system in particular expanding rapidly and cutting off access to reproductive health services in the process.

Public charge could have another unintended consequence on rural hospitals, where physicians from immigrant backgrounds make up an important component of health care access. Many rural communities are counting on immigrants to meet health care provider shortages, offering incentives to those willing to work in underserved communities. Physicians have already warned that the executive order restricting entry from majority-Muslim countries is detrimental to health care access in the U.S. and this rule could be another deterrent.

Determining the impact of public charge on rural hospitals “really is a bit of a numbers game,” said Grady, but it’s a game that the federal government has been unwilling to play. She added that while the proposed rule hints at issues like people being afraid to seek emergency care and mixed-status households withdrawing from benefits, it declined to provide estimated fiscal and social impacts.

“There’s administration hurdles that are not fully explored in the proposed rule,” she said.



‘Feel-Good’ Holiday Stories Are Actually Just a Symptom of a Crumbling Society

Over the Black Friday weekend, Mother Jones editor-in-chief Clara Jeffery saw a need on the popular education crowdfunding site DonorsChoose, where teachers request financial assistance for classroom supplies. For 22 hours, Jeffery tweeted out fundraiser after fundraiser, until her followers raised $60,000 by responding to the lone Twitter thread. They sent paper and pencils to San Francisco, books to fire evacuees in Chico, an instructor’s computer to a tribal school in South Dakota, warm weather gear to East Flatbush, and much more.

Throughout the thread, Jeffery expressed frustration that teachers’ needs were so dire. “She [is] asking for pencils and gluesticks ffs,” Jeffery commented on a fundraiser for a low-income San Francisco school. On a request for help buying laundry equipment, she said: “These asks for ways to help kids and their families get and clean clothes are so sad. We need to serious[ly] overhaul our society.”

No teacher should have to beg for help with buying pencils, but here we are. As Jeffery notes, “so many more teachers are paying for essentials out of their own, far-too-small, paychecks.”

While she was quick to put her fundraising in context, her efforts could have easily fallen prey to a media trend of stories that follow a familiar formula: A person sees an individual injustice and takes a step to remedy it, everyone gets inspired, the end.

The boss buys a car for an employee struggling with transportation issues. Coworkers donate sick days to a teacher undergoing cancer treatment so they don’t lose employment benefits. A garbage truck driver helps an elderly customer evacuate a wildfire. A LASIK surgeon donates procedures to veterans. Well-paid celebrities offer generous tips to wait staff having hard days. News station buys up, and forgives, medical debt.

Websites specializing in “good” and “uplifting” news love circulating this kind of content, but they aren’t alone, especially at this time of year, when readers and viewers are hungry for a feel-good story. But these stories should not make anyone feel good. They are stark illustrations of inequality in the United States and the reasons why it’s so pernicious. Circulating narratives like these reinforces the attitude that they are personal problems that can be solved by an act of charity, instead of institutional injustices that must be remedied through legislation.

That employee who got a car from their boss doesn’t need a one-time gift from a generous CEO: They need reliable transit and a fair wage so they can be empowered to make their own decisions about how they get to work. Meanwhile, the oil industry continues to fight transit improvements while transit systems across the country are plagued by deferred maintenance, insufficient capacity, and accessibility issues. The federal minimum wage has remained at $7.25 hourly for almost a decade, with states slowly working on increases.

An employee with cancer doesn’t need donated sick pay — a growing trend, along with donating paid time off to new parents so they can take leave with their newborns or recently-adopted family members. They need adequate sick leave to meet their needs, along with paid family leave to help them care for their relatives and chosen family when necessary. The United States is the only industrialized nation that lacks national paid leave requirements: Just 13 percent of private sector workers have access to paid family leave, the majority do not have paid medical leave, and 29 percent have no paid sick leave.

These are systemic problems, not personal ones.

A garbage truck driver shouldn’t have to lift a 93-year-old woman into the cab of a sanitation truck and help arrange shelter at the other end of the journey. Local authorities should proactively identify residents in need of evacuation assistance and dispatch trained personnel to assist. The costs of failing to do so are high: During 2017’s Hurricane Irma, 12 Florida nursing home residents died due to inadequate disaster preparation. That same year, residents of eldercare facilities in Santa Rosa, CA were abandoned in advance of a wildfire – fortunately, the community was able to rescue them.

LASIK surgeons shouldn’t be donating procedures to veterans. The Veterans Administration should be addressing long wait times for benefits and gaps in coverage.

Waitstaff shouldn’t have to rely on random $500 tips from strangers who feel guilty about their wealth. They should be making a living wage and receiving employment benefits that allow them to access health care, paid leave, educational opportunities, and other supports. The federal tipped minimum wage has been flat since 1991 and service workers are subject to wage theft, racial inequalities, high poverty rates, and city councils and legislatures that overturn the wage increases voters asked for.

A news station shouldn’t have to buy up debt for pennies on the dollar and forgive it, passing along potentially serious tax implications. People should have access to health coverage and living wages that keep them out of debt in the first place. Medical debt is the leading cause for debt collection calls. It doesn’t have to be that way.

Nothing has to be this way.

These are systemic problems, not personal ones, and they could be better addressed through policy interventions than on a case-by-case basis. Access to things like paid leave, safe housing, transit, and health care shouldn’t be dependent on whether someone can make their story trend on Twitter or package it for a local news entity. Every time these stories are shared and re-shared, it pulls attention away from the institutional issue in favor of a highly-personal quick fix.

Individual acts of generosity like these can feel rewarding: People see a fellow human in distress and they help alleviate it, for an immediate hit of gratification (and guilt reduction, when these gifts come from people who may have contributed to the underlying problem). But they do not necessarily make a long-term meaningful difference in the recipient’s life, and they do nothing to resolve the inequities that created the situation in the first place. For every one of these happy endings, there are millions of others facing the same precarious situations with no helping hand in sight.

What happens when that employee faces car insurance and registration fees she can’t afford for the car she didn’t ask for? When that waitress receives a tax bill for her $500 tip? When that elder’s home burns, hospitality runs out, and her insurance refuses to pay out, leaving her homeless and adrift? When a teacher’s fundraising efforts for classroom cleaning supplies fail and students work in increasingly dirty conditions for the rest of the school year?

We create problems like these by putting the feelings of people who want to perform charity before the actual needs of low-income people. The consequences are the parts of the story we never see, and the illustration that far from making us feel good, these stories should make us feel very, very bad.



Low-Income People Pay When Government Tech Contracts Sour

Earlier this year, the tech company Novo Dia Group announced it would not continue as a vendor with the U.S. Department of Agriculture, due to a switch in federal contractors. What seemed a run-of-the-mill business decision threw a very real wrench into the availability of locally-grown foods for low-income Americans.

The problem was that Novo Dia held the only keys to a USDA program dedicated to Supplemental Nutrition Assistance Program processing software and equipment for 1,700 farmers’ markets nationwide. Without Novo Dia providing this service, markets would have no way to accept SNAP — a disruption that would cost farmers income and SNAP recipients food.

If you’ve ever attempted to switch your cell phone provider but keep your actual device, you might be able to relate: Farmers’ markets had perfectly functional and expensive equipment that simply would not work with any other SNAP processing software. It’s the government equivalent of trying to keep your iPhone when you move from Verizon to AT&T.

This episode raised a lot of questions about the government’s relationship with tech companies tasked with administering public programs: How does it choose who to hire? How does it hold those companies accountable? And how do those decisions affect the daily lives of low-income Americans who rely on being able to access their benefits?

The answers are vitally important: Governments are increasingly relying on new technologies to sort applications, manage caseloads, and distribute benefits. How such technology is contracted, developed, and deployed will have real impacts on millions of low-income Americans.

Take, for instance, what happened in Washington, D.C. In the fall of 2016, the city’s Department of Human Services, along with the contractor Infosys Public Services Inc., replaced a computer system the District had been using since the early 1990s to enroll low-income residents in SNAP and cash assistance programs. The Food and Nutrition Service, the USDA agency responsible for administering the country’s nutrition assistance programs, issued a letter to the D.C. Department of Human Services, warning against launching the new system without having done adequate testing.

But two months later, D.C. rolled out the system anyway — to repeated outages and glitches, including benefits not being loaded onto Electronic Benefit Transfer cards.

Frustrations between agency employees and customers ran so high that there were physical altercations in some enrollment offices, causing the union representing the workers to issue a formal grievance. The union asked that the agency return to using the previous technology or distribute hazard pay to employees.

Rhode Island, meanwhile, has been struggling to serve its SNAP recipients since it rolled out a new $364 million computer system in 2016 — known as the Unified Health Infrastructure Project — causing delays in distribution by the thousands. Recently, the Food and Nutrition Service threatened to withhold more than $900,000 in federal reimbursements due to Rhode Island’s continued failure to address a list of nearly 30 items related to system functionality, issuance of benefits, backlogs, certification, and more.

In turn, state Department of Nutrition Services Director Courtney Hawkins blamed Deloitte Consulting, the company contracted to build the computer system saying, “This formal warning underscores the fact that Deloitte has not yet delivered a fully functioning system that works on behalf of Rhode Islanders.” In April, the company apologized for its disastrous roll-out.

To date, two federal class action lawsuits have been filed against Rhode Island over its SNAP program. Recently, it was reported that the total cost of its new computer system had reached “$647.7 million through the 2019-20 federal fiscal year, with $138 million of that amount to be covered by state taxpayers and the rest by the federal government.”

Part of the problem in developing these systems is how the government chooses which companies to hire, said Dave Guarino, director of GetCalFresh, a project of Code for America. He notes that there are only “a small number of vendors who know how to navigate the procurement process, and they’re the ones who get the contracts.”

Thus, the proposal and bidding process limits the amount of competition and creates stagnancy in the technology developed for government programs. It also leaves out newer, smaller, and more innovative companies.

In theory, this is because the government process is designed to decrease risk, given the high amount of sensitive and confidential information managed by these systems, so it’s the well-known contractors with a track record of managing large projects who ultimately get the gig.

But Guarino says that government technology crises, such as IT disasters for SNAP recipients, highlight the need for a true shift in thinking about risk and agility. “We should be demanding better software and better experiences,” said Guarino. “But if we want government to be able to act more nimbly and quickly, we also need to be able to say that government can take more risks.”

Short-sighted decisions and worse implementation of new government tech can adversely impact scores of people.

While risk-taking can have downsides, Guarino said the best practice is to test new ideas “on a really small scale in a way that minimizes risk, but maximizes learning” — a concept that could have helped to prevent harm caused by the failure of the D.C. system roll-out, as problems could have been spotted and fixed with a relatively small control group.

Guarino also noted the importance of working with a broad range of partners to develop and administer technology, as well as dividing up tasks to “the best firm for each job.”

His own project, GetCalFresh, is one such successful model. GetCalFresh offers online SNAP applications for 36 counties in California, and its technology was developed to measure and remove barriers that often prevent low-income people from accessing their benefits. Users can easily submit SNAP applications by mobile phone or computer, often in fewer than 10 minutes, and can also send verification documents securely via their phones. And by working with a wide range of partners, including Code For America, state and county agencies, and organizations, Guarino said the project is more successful than it would be with a single entity at the helm.

“These things often aren’t talked about as dimensions of why poverty persists and why some poverty solutions don’t reach everybody they could,” said Guarino, “But they’re a really huge deal.”

The thousands of farmers and customers affected by the Novo Dia debacle would likely agree. And as D.C., Rhode Island and surely other places have proven, short-sighted decisions and worse implementation of new government tech can adversely impact scores of people. Indeed, if we want innovative, effective poverty solutions in today’s digital landscape, we need to think hard about tech.


First Person

How Chicago Is Making its Own Affordable Housing Crisis Worse

For low-income people, a lot of our time is taken up by jobs that don’t give paid time off, children who need attentive parents, and relationships that require work. The gaps are filled in with everything else life brings. There’s no time left over to go on a treasure hunt just to find an affordable place to call home. In the winter of 2012, my move to Chicago would set me on the path to have to do just that.

I traded in my MetroCard for a CTA pass and moved to the Hyde Park neighborhood of Chicago. There was a creative black community, my $750 rent was affordable, and I still had enough money to get bottom-shelf whiskey if I went out. A new job opportunity took me from the beauty of the Southside to an $800 gem in Humboldt Park.

Things were going decently until the neighborhood — filled with “2 Flats,” an affordable Chicago housing staple — began to change. Moving trucks were constantly present, and I began to see a lot more white faces. A 2018 study from the Institute of Housing Studies at DePaul University states that due to gentrification, 2 Flats in neighborhoods like mine — which often house multiple generations — were being purchased and turned into single family homes, pushing out lower-income residents.

My building was purchased by a management company who slapped on a coat of fresh paint, put one washer/dryer set in the basement ($4 per load), and then slid a note under my door telling me they were raising my rent. Within three years, the rent went from $800 to $1,200. In August of 2017 I got another notice: the rent was going up to $1,475.

A single-person household in Chicago earning under $36,000 yearly is considered to be very low income — that was me. Factoring in transportation, bills, student loans, helping family, food and more, there was no way I could survive in this or many other Chicago neighborhoods. Survival included entertainment, such as seeing a film or treating myself to my favorite lunch spot, even though the world chastises poor people for trying to get moments of joy in our everyday lives.

I needed a place to live and fast. I had to stay in Chicago; I built a life here with relationships and a budding career. I couldn’t afford to start over. I scoured the internet and tucked away in the news tab of Google was an article about an initiative that I had never heard of. The Affordable Requirements Ordinance, as it’s called, requires developers to dedicate 10 percent of their units to affordable housing or pay into a low-income housing fund; most developments, unsurprisingly, opt to pay out. A new twist to the ordinance was being tested in the areas of Logan Square, Avondale, and West Town (The Hipster Triangle), along with some Near North/West areas. It required developers to commit 15 percent of new residential buildings to affordable rentals or build affordable housing within two miles of the development.

This sounded like my key to staying in Chicago, but getting that affordable housing would prove to be a difficult and time-consuming task. There was no list of participating properties, no one answered at the phone number I found, and the only contact email was for buyers of low-income units. I walked around the city and collected numbers from the temporary signage of 18 developing properties. With every phone call, my inquiries were met with exasperation, confusion, or false promises of a returned phone call.

Getting affordable housing would prove to be a difficult and time-consuming task.

After a few weeks, one building set me up with an interview to obtain an application. A leasing agent asked about my educational background, my work experience, and if I was in programs like LINK and Medicaid. I was being vetted to make sure I was the “proper” low-income resident. They didn’t want to make their wealthy future residents uncomfortable. They wanted someone who could not be clocked as poor on top of being black when they saw me checking my mail. After more interviews and massive amounts of paperwork that included a copy of my degree and character letters from my managers, I was offered a studio. I had played their game and three weeks later I moved in.

It’s not just the city that has a vendetta against its non-wealthy residents; it’s the surrounding suburbs as well. The 85 percent lily white and wealthy suburb of Tinley Park, for example, recently reached a settlement with the Department of Justice and Department of Housing and Urban Development after an affordable housing development that would have brought black and brown faces failed to get approval after being opposed by residents. This historically racist suburb is paying out over $2 million in damages. This didn’t happen on some very special episode of a 1960’s sitcom. This happened in real life in a place that is 45 minutes outside of Chicago.

Developers are cashing in when they pay into the aforementioned low-income housing fund instead of offering an affordable unit. They get about half of that $225,000 fee back in tax credits and that’s just one of the incentives the city offers; more than $4 million has gone missing from the fund. Chicago has to stop rewarding developers for opting out of helping the poor. These buildings need to increase the amount of units available to low-income people and be required to offer them, no buying your way out. They should then be required to help fund housing in forgotten communities, helping them to rebuild and thrive.

This Affordable Requirements Ordinance Pilot Project is one way to address housing affordability and segregation, but communication and access are key to making it work. A visit to the city’s website or an appointment at the local Department of Human Services should have residents well on their way to finding housing that they can afford and be proud to call home. Residents shouldn’t have to become a detective at the poorly proposed West Side police and fire academy to find proper housing.