After the shutdown, SNAP will still be in trouble

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0:24Like many of us, Nate Singer spent the 4th of July at a barbecue in jeans and a t-shirt. It was a decent day. It wasn't too hot. Red, white, and blue tablecloths. Nate is a father of four, and he's one of those dads who likes to hang out literally at the barbecue. Flipping burgers for people. Is that normally your job as the burger flipper? It's a good thing to do. You just hang around the grill, not so social. It's strange that I work in human services. Yeah, Nate is a big muckety-muck at the Oregon Department of Human Services. He runs the division that signs people up for programs like food stamps.

1:00And Nate, he's like a bureaucrat's bureaucrat, the type of person who carries around a pen and a high letter in case he needs to mark up a document. My kids think that I have my own coloring books that are just really boring coloring books. This July 4th barbecue was no exception. Whenever Nate got a break from grilling, he'd pull out some folded up paper from his back pocket and he would read the text of President Donald Trump's signature bill, the one big beautiful bill act. You know this bill. President Trump signed it on July 4th. And the reason Nate was reading it and highlighting it was that this bill made big cuts, including to food stamps, which is a program he oversees.

1:41This bill had been changing as it went between the House and the Senate. It got amended hundreds of times, but now it was final. And Nate, highlighter in one hand, you know, greasy spatula in the other, was surveying the damage. Yeah, like how bad is this for food stamps and the one out of every six Oregonians, 750 ,000 of them on the program? And what he sees is that the bill cuts who qualifies for food stamps, how much they'll get, and maybe most importantly for him, it changes who pays for the food stamp program. And that part? That is a big deal. The federal government has always paid for all of the food stamps that go out.

2:25But this law, for the first time, shifts some of that cost to states. And the rationale here is that states themselves, they're the ones in charge of giving food stamps out. They're the ones with teams of bureaucrats reviewing applications, figuring out how much each applicant gets. So the White House and congressional Republicans, they want states to be more accountable and to cut back on what they're calling waste, fraud and abuse. How much are states going to have to pay? Well, Nate gets to the section about this and he reads that lawmakers have tied the amount that states are going to have to pay to an obscure statistic called the payment error rate.

3:03Basically, whether Nate's team is accurately determining how much people should be getting in food stamps and if not, how far off they are. Did we process it right? And did you get the right benefit amount? The higher that error rate, the less the federal government will pay for Oregon's food stamps in the future. Which was a problem for Nate in particular, because he's been working on getting Oregon's stubbornly high error rate down for years now. With serious progress, but not nearly enough to meet this new goal. When you read that line? When I read that line, I flipped burgers for the next half hour at the barbecue and just thought in my own head, how much would this be because of where we are?

3:51Right then and there, Nate did the math. If he could get the error rate down to this goal that the law set for him to under 6%, the feds would continue to pick up the entire tab for food stamps. But if he couldn't, the state of Oregon was going to be on the hook for$250 million a year, which basically means the fate of Oregon's food stamp program now largely depends on Nate. So they've set up a challenge for you. It is a challenge, yes. Are you up for this challenge? I would say yes. Yes. Yes. Let me try that better with more confidence for you. Yes. No offense to Nate, but that is not the sound of confidence.

4:41Hello and welcome to Blade of Money. I'm Nick Fountain. And I'm Jeff Guo. There is obviously a lot happening in food stamps this week. Thanks to the government shutdown, people may not be getting their food stamps at all. That is a huge deal. But this change that we're talking about, shifting who pays for food stamps, it is arguably a much bigger deal. Today on the show, the looming crisis in food stamps. We go to Oregon to find out how Nate is going to try to cut Oregon's error rate by more than half without inadvertently knocking people off food stamps, without making people go hungry.

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6:03No need to panic. With your iPhone, you can tap to pay using Apple Card with Apple Pay. And earn unlimited daily cash back when you do. Apple Card is ready when you need it. Subject to credit approval. Apple Card issued by Goldman Sachs Bank USA, Salt Lake City Branch. Terms and more at AppleCard.com. This message comes from Insperity. Excellence takes drive, work, perseverance. Tiger Woods brings it to the course. Insperity brings it to your business. Want to be the best? Work with the best. Insperity. How you HR matters. Learn more at Insperity.com slash Tiger. Nate Singer, lover of highlighters and director of the Oregon Eligibility Partnership, has been in charge of getting Oregon's error rate down for a couple of years now.

6:50So our error rate was 23 % then. That was not ideal. Yeah, they were third worst in the nation. But in the years since, he has pushed that error rate down to 14%, ninth place. Improvement, but nowhere near the 6 % they need that error rate to be. That's where they need to get under if they want the federal government to keep paying for all their food stamps. Now, the way that food stamps work is that every state determines who qualifies for them and how much they get. And it's based on a bunch of rules that Congress made. Those rules, they're pretty complex. But basically, states ask a bunch of questions like how much do people make?

7:30How much they have in the bank? How many people in their family they're feeding? What are their expenses? And they plug all the answers they get into a formula and voila, that is how much that person is going to get in food stamp money. Yeah, simple stuff. In Oregon, if you're single, you have to earn less than about$31 ,000 a year to even qualify. $64 ,000 for a family of four. The average amount people get is about$5.75 per day. Now, states try to follow Congress's rules on how much federal taxpayer money they're giving out. But sometimes they are a little off. Sometimes they give out too much, sometimes too little, though that's less common.

8:11And if they are off by more than$57 in a given month, the federal government counts that as an error. And the error rate, that is the percentage that they are off overall across the whole state over the year. And a big part of getting that error rate down is asking the right questions. That's what most of the people who work in Nate's division are focused on. And we're going to talk with the people who ask those questions. But before we do that, I want you to meet Vicki Aguilar, who walked me through what it's like to answer those questions accurately. Tell me about you, Vicki. I am 59 and single, and I love it.

8:56We met up with Vicki in front of her mom's house in Salem, Oregon. Should we sit down? We sat on a bench next to a wheelchair ramp, facing her mom's big flagpole with the American flag flying. Vicki told us she actually got her EBT card filled up just the day before. EBT cards are like food stamp debit cards. And when Vicki's card got loaded up, she went to not one, but two grocery stores in search of deals. I went to Winco. Then I went to Safeway. Safeway is never cheaper than Winco. No, but if you get onto the app and download the app. I hate the app. I hate how they make it. I work there.

9:39The story of how Vicki ended up getting approved for food stamps starts not long ago, back when she had two jobs. Part-time nights at Safeway and also full-time as a caregiver for her uncle. She took care of him for 16 years as a home health aide, getting paid$22 an hour. He had stage two bladder cancer, and he was a quadriplegic with a trach, and he was just tired. He was tired. It was just going to get worse. So he went on to hospice, and he passed away August 21st. And that was the beginning of a tough time for Vicki. She missed her uncle a lot, and she also no longer had that full-time job.

10:22She was just down to that part-time one. And my food soared. You know, it was getting short. Yeah, it was getting kind of gone. There was no other income except for a Safeway, and they don't really pay that great. How much? $15.50. Yeah. Vicki says she asked for more hours, but they weren't giving them. So she could barely cover rent. And that is when Vicki walked into the Oregon Department of Human Services office in her neighborhood. It was pretty busy. The receptionist asked her a few simple questions just to get her into the system, like, what's your social? What's your birthday? She gave Vicki an application with some more in-depth questions.

11:03And right there on the spot, she also gave Vicki an EBT card with the words Oregon Trail and a picture of a covered wagon on it. But there wasn't any money on it yet. To get the money for food, the woman told Vicki, she'd have to wait for a call from someone who would ask more in-depth questions, an eligibility worker. And this interview, this is where the errors that Oregon needs to reduce, this is where they start to maybe get introduced. Because the error rate goes up when one of basically three things happens. Either one, the interviewer doesn't ask all the questions that they should, or they don't ask the right questions.

11:41or two, the Vickys of the world do not answer those questions accurately or honestly or three, someone makes a typo. Yes. Vicky did not want to wait for her call. So she called them. A woman picked up and asked her a series of questions. Like, who does she live with? No one. She asked me how much I paid in rent. What do I pay as, you know, gas or electric? Which I paid the rent, gas, electric, and my cell phone bill. You have a lot of bills. Yeah, just like everybody else does. All those bills, they're factored into the way that states, under the rules set by Congress, calculate how much in food stamps Vicki and others are going to get.

12:24And each little piece of information that they get from her, that is an opportunity for error. For instance, Vicki says the interviewer asked some more questions about income, asked her to pull out a pay stub and tell her what it said next to gross pay. And right here, something really interesting happened. And so I said it wrong to her. And she goes, are you sure that's right? I was like, oh, wait a minute. No, no, no, it's not. This is what it is. Void what I said. This is what it is. To be clear, Vicki told me she wasn't trying to pull a fast one. She was just confused by the pay stub, who amongst us hasn't been.

13:01And she read off the net pay rather than the gross. But the state worker on the other end of the line, it turned out she knew the answer to the question. Because she had access to a database with a bunch of payroll information in it. And she was double-checking as much of what Vicki said as she could. And Vicki didn't feel offended by the prompt to correct her wrong answer. She thinks it's important. Do you think there's a lot of fraud in the system? Yes, I do. Do you know that? Just being a cashier. OK, so I've had customers come to my line using multiple food stamp cards. And, you know, it could be their family members.

13:46But, you know, that's not your card. You shouldn't be using it. This is a problem. Oregon actually has special cops, a division that looks into fraud. If you get caught, you have to pay back the money. Last year, Oregon had 34 cases of confirmed food stamp fraud. Total out of 750 ,000 recipients. But Nate says that the vast majority of errors, that stat that the feds care about and that Oregon is going to be punished for, those do not come from fraud. They come from inadvertent errors, honest mistakes like the one that Vicky made. It was like, where is my pay? I could not find it. So, yeah. So, Vicky's story gave us a good idea of how these errors get introduced.

14:29Next, we wanted to understand how Nate and his team of bureaucrats are trying to eliminate these errors. So we went to the office where Vicki first applied for food stamps to talk to the people asking questions on the other end of the call, the eligibility workers. When I walked into the office, nobody was waiting to get interviewed in person. So I asked if I could watch as someone did one on the phone. Can I sit next to you while you do your job? Of course. Amazing. Bridget Faust, eligibility worker, former food stamp recipient herself, and, judging by the framed photo in her cubicle, Big Nick Cage fans.

15:03That's amazing. There's a whole story there. No time for that. Bridget has an interview to do. She dials the client. Hi, this message is... And voicemail. I will try back in five minutes. Thank you. Which means we have a few moments to talk game plan with Bridget. How is she going to get that error rate down? Bridget has been in the job a couple years now, and she says she has gotten the message that Nate's team is trying to get this error rate down and that she is the first line of defense. Her bosses have dragged her into training after training, trying to make her less of a data entry person and more of a, not a detective, but someone who thinks about what the person applying for food stamps is saying and tries to make sense of it.

15:47So they've given her a checklist to make sure that she asks all the questions, even the awkward ones. And Nate has put nudges into the computer system she uses that flag discrepancies as she's filling in the boxes. These are like little pings that say, hey, are you sure about that answer? Are you sure? You know, they're paying a thousand dollars, you know, rent and they make, you know, a hundred dollars a month. This stuff isn't easy. The questions Bridget has to ask are always changing, like all the time. In the brief few minutes I was sitting with her, a notification popped up on her computer.

16:25New guidance about the One Big Beautiful Bill Act. You just got an email that says HR1 updates and resources. We get a lot of emails going up. Yeah, all these updates and emails, they're actually a big problem for Oregon. Because every time there is a little teensy change in policy, the error rate goes up. And this big, beautiful bill act, it has a lot of changes. So one very of the moment thing that Nate has done to keep those errors down is he's made a little AI tool called Eligibility Bot. I call her Ellie for short. And when Bridget gets stumped by a complicated case, she can just hit up Ellie and get the most up-to-date information way quicker than before.

17:12Right. So thanks to the work that Nate's been doing over the last few years, Bridget now has a lot of tools to help her avoid errors. This is Bridget at the Oregon Department of Human Services calling for your appointment. Yeah. Bridget gets her guy on the phone. All right. And just to verify, you are applying for SNAP benefits. Is that correct? Yes. It's a simple case. Bridget is bouncing back and forth between her checklist of questions, the state website where she inputs all the info, and also the website where she can double-check this guy's income. And on the system I have that you were married but separated, is that still accurate?

17:49Yes. Okay. At the end of the call, she gives the good news. All right, you are approved for SNAP benefits. All right, so we've learned how errors are introduced. We've learned how Nate's team is trying to avoid them. But we also know that errors are still creeping in. How? Why? The person most qualified to answer that question is the person charged with finding the errors and reporting them to both the state and the federal government. Shelley, good to meet you. Shelley Wickersham is a member of the elite 11-person team tasked with finding errors, tasked with auditing people's food stamp cases.

18:31Now, are people thrilled to be audited? No! So Shelly tries to reframe that audit. Tell them, hey, we pull 100 cases a month. It's like winning the lottery, you know? Yay, maybe, you know, it's just, it's going to be okay. You know, we try to develop some sort of relationship. And then, like, I had a guy tell me the other day, he's like, yeah, well, if I could buy the lottery, I wouldn't need food stamps. As you can tell, Shelly really does try to put on a charm offensive when she's calling someone, especially when she has to do it for like the 40th time. Is there a rule that your boss gives you on how much calling is annoying?

19:10No. No. I will. I need to get my information. So if you're annoyed with my calls, probably just give me the information. I'm going to get it. Shelley works for Oregon, but she also kind of works for the federal government. Because remember, all food stamp money up until this point has been federal taxpayer money. So even before this new law, the feds were pushing states to reduce these errors. And they had their own rules and procedures for how to catch them. Yeah, here's how this works. Every month, Shelley's team picks from the 750 ,000 plus food stamp recipients in Oregon, a random sample of 100 or so cases to go through with a fine-toothed comb and calculate the error rate.

19:54What should these people have been getting in food stamps? And what has Oregon been giving them? And how big is the difference between them? So Shelly, basically, she redoes the entire original interview. But unlike the original interviewer, she is required to leave no stone unturned. She will ask the elderly, ma 'am, are you in school? Or do you have any daycare costs? She will search around in their lives for hidden income. Any side money coming in? Any cans or bottles? Really? Cans or bottles is the thing you ask about? Yes. Because it's income. Oops. Yeah. Okay. Oops. Yeah. Does that eligibility interview also do that?

20:36Should be. Should be. Okay. But on the other hand, those initial interviews, the ones that Bridget does, those are often people's first interactions with the food stamp system. So eligibility workers, they're trying to strike a kind of delicate balance between following the federal guidelines, of course, but also getting people food who need it. So during that initial interview, they're not super pushy, and they generally don't ask for a lot of documentation. And that is a choice that the state of Oregon is making. Shelly doesn't have that choice. Her job is to ask all the questions. How much rent costs, how much utilities are, how much interest someone is earning from bank accounts.

21:20And also get the proof, the documentation. Shelly needs it all. A lot of her time is spent hounding people for that documentation. He said Shelly with Oregon Department of Human Services. I was calling regarding the email I sent you, asked me to send you. But this, this right here, this is the tension, right? This work of doing extensive interviews, checking documents, of leaving no stone unturned. If eligibility workers did it at the very first interview, the error rate would drop like a ton for sure. Yeah, Nate's been talking with states that have low error rates, trying to steal their best ideas.

21:57And they have told them that they do ask for more documentation during those first interviews, sometimes multiple times a year. So Nate and Oregon officials know that that's an option, but they also know that there's a cost. Those states that ask for more documentation and have lower error rates, they also often have lower participation rates. Fewer people on food stamps. And you can see why. Providing documents can be hard. So even people who qualify might just give up on trying to get food stamps. Yeah, not everyone can convince people to hand over their documents as charmingly as Shelly can.

22:33Have a great day. Bestie. Yeah, I can tell. After Shelly's done hounding the lucky folks that she's auditing for their documents, asking every question that she possibly can, she calculates how far off the state of Oregon was. But it doesn't end there. The federal government then audits about half of her audits to make sure she's doing it right. And then they compile all the cases that our team has put together and come up with the official error rate. Right now, that rate is hovering around 14 percent, which means unless they can get it down, Oregon is going to have to start paying up for food stamps for the first time ever in a serious way.

23:18After the break, we're going to talk to the person who's really in charge in Oregon, the$250 million question.

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24:53Capital One. What's in your wallet? Terms apply. Details at CapitalOne.com. For the past few months, Nate Singer, the person tasked with saving Oregon's food stamp program, has been working nonstop trying to figure out any way he can to squeeze that error rate down. Yeah, like remember that system to check people's income, the one that caught Vicky's gross net pay flub? It was janky. So Nate's been working to make it just pop up automatically into the system that eligibility workers input the data into. He is very close to rolling that one out. Next week. Next week. Wow! And you're spending all afternoon hanging out with me?

25:33And say, it is there, it's built, it's tested. So next week, staff will be able to see it directly in their systems and be able to pull it up and get the information from there. Nate is hopeful that with incremental tweaks like that, he can get the error rate down to 10 % this year, which would save Oregon from the worst of it. Where do you get the other 4 %? The other 4 % is a mixture of a hope and a prayer. Does that mean you think you've squeezed all the juice you can out of this error rate without making it onerous for people to sign up or keep their benefits? I think we're approaching that level.

26:18There's limited opportunities to continue to improve without changes to really how we approach this in Oregon. Yeah, Nate says those decisions, they are higher than his pay grade. They are more on the level of this person. Governor, can you hear me? I can hear you. How's my sound? I can't hear you respond. I'm going to switch headphones. I tried meeting up with Governor Tina Kotek when I was in Salem. She was a little busy. It's been a weird month in Oregon. Luckily, the Oregon State Library has a sound booth. Say some more things. Say who you are and what you do. Governor Kotek, state of Oregon.