The Future of the Affordable Connectivity Program

Blog Post #2: Analyzing the Impact of Potential Changes to Program-Based Eligibility 

In the first post of this series on the future of the ACP program, we analyzed potential changes to the income threshold used to determine ACP eligibility. In this second post, we turn our attention to potential changes to the eligibility criteria based on participation in social benefits programs such as Medicaid, Supplemental Nutrition Assistance (SNAP), Supplemental Security Income (SSI) and Public Assistance Income (PAP). In many ways, these potential changes would have broader impacts since the National Verifier (NV) uses program participation rather than income to confirm eligibility for over 90% of ACP applications (see the most recent NV data here). This is unsurprising since program-based eligibility can be automatically verified through NV connections to federal and state program databases, thus reducing the administrative burden on potential recipients.

What would be the impact of dropping income-based eligibility altogether?

If ACP eligibility were solely based on participation in social benefits programs, our estimate is that the number of eligible households nationwide would drop by about 13%. This is similar in magnitude to the drop in eligible households that is estimated if the income threshold is lowered from the current 200% to 135% of the Federal Poverty Line (FPL). However, discontinuing income-based eligibility would disproportionately penalize states that have not expanded Medicaid (all of them red states as shown in Figure 1): of the ten states with the largest relative decrease in the number of eligible households, half of them (Wyoming, Kansas, Alabama, South Carolina and Tennessee) are non-expansion states. 

Figure 1: Relative decrease in ACP households without income-based eligibility by state 

What would be the impact if Medicaid or SNAP were no longer qualifying programs?

Conversely, if Medicaid were no longer used as a qualifying program, the impact would disproportionately fall on households in high-income, Democratic states. This is particularly true if the income threshold were kept at 200% of the FPL, whereas if the income threshold were lowered to 135% of the FPL the impact would be significantly larger (tripling in magnitude in several states) and more evenly distributed across red and blue states (Figure 2).

Figure 2: Relative decrease in ACP households by state without Medicaid-based eligibility

Participation in SNAP is the method most used by households to prove eligibility when applying to receive ACP, accounting for 38% of qualification options. Interestingly, discontinuing SNAP as a qualifying program (while keeping the income threshold at 200% of the FPL) would have almost no effect on the number of eligible households (Figure 3). The most likely explanation is that these households would still be eligible on an income basis or because of participation in Medicaid or other qualifying programs (recent research by HHS shows that 84% of SNAP recipients also participated in other federal benefit programs). However, when combined with a reduction in the income threshold to 135% of the FPL, the impact of dropping SNAP would be very significant in states with low Medicaid participation.

Figure 3: Relative decrease in ACP households by state without SNAP-based eligibility

How would these potential changes impact disadvantaged populations?

Turning now to the impact on covered populations as defined in the IIJA, if ACP eligibility were solely based on participation in social benefits programs (but not income), veterans and older adults would be affected the most, with about 1 in 3 currently eligible households where a member is a veteran or elderly no longer eligible for ACP. For other populations the relative impact would be somewhat smaller, with a decrease of about 20% in the number of eligible households.

The impact would nonetheless be very significant for specific groups in some states. For example, in Alabama and South Carolina, where Blacks represent about a quarter of the population, dropping income-based eligibility would result in a decrease of about 27% in the number of ACP-eligible Black households. In Texas, which is about 40% Hispanic, the same change would reduce the number of ACP-eligible Hispanic households by about a third.

The pattern is similar if SNAP were no longer used as a qualifying program, with the brunt of the impact on veterans and the elderly. When dropping Medicaid, however, a somewhat different pattern emerges. At the current income threshold of 200% of the FPL, the impact falls disproportionately on veterans (21% fewer households eligible), those that speak English “less than well” (18% decrease) and Hispanic households (17% decrease). If this is combined with a reduction in the income threshold to 135% of the FPL, the relative impact is much larger, and falls mostly on veterans (41% decrease in eligible households), older adults (35% decrease), Hispanics (34% decrease) and those that speak English “less than well” (34% decrease).

The dashboard below (Figure 4) allows users to see the estimated impact of different potential changes to the ACP eligibility criteria on disadvantaged populations at the state level. To get started, select changes to the eligibility criteria and the subpopulation of interest on the right panel.

Figure 4: Relative decrease in ACP households by state for covered populations

Key takeaways

Any potential changes to the ACP eligibility criteria must be carefully assessed and calibrated due to negative impacts for eligibility among vulnerable households. In this post, we evaluate the impact of changes to ACP qualifying programs, with focus on the two most commonly used by applicants: SNAP and Medicaid. The key takeaway is that the level of participation in these programs at the state level largely determines the magnitude and type of impact. Further, combining changes in program-based eligibility with a lower income threshold would result in large drops in eligibility among some of the least connected groups, including veterans, older adults and Hispanic households.

Tools to estimate the impact of changes to the ACP eligibility criteria

With this post, we are releasing several interactive tools that allow for further exploration of the impact of potential changes in ACP eligibility criteria. The ACP Eligibility Tool lets users specify various combinations of qualifying criteria, including any income level between 0% and 200% of the FPL and different social benefits programs. The results are estimates of the number of eligible households under the selected criteria for different geographies (states, counties, congressional districts, ZIP/ZCTAs, or Metropolitan Divisions). This tool also generates results for most covered populations as defined in the IIJA, including older adults, veterans, racial/ethnic minorities, people with disabilities and those than speak English “less than well.”

The state-level dashboard illustrates how this data can be visualized. The dashboard allows exploration of state-level results for covered populations. Users can select a combination of program criteria and population of interest to display the relative change in ACP eligibility, at two income levels – the current 200% FPL and 135% FPL—in one or several selected states. To get started, use the right panel to select one or more states, a population of interest, and the changes in ACP eligibility criteria.