Iowa lawmakers OK ‘asset test’ for those seeking food, health assistance

DES MOINES — A proposal to add eligibility and verification requirements for low-income Iowans receiving health care and food assistance from government programs is en route to Iowa Gov. Kim Reynolds after being approved by Republican state lawmakers Thursday.

Reynolds’ office did not respond when asked Thursday whether she plans to sign the bill into law.

The new requirements would apply to the food assistance program known as SNAP, Medicaid, the children’s health care program known as CHIP, and the Family Investment Program, which provides cash assistance to needy families.

The legislation would disqualify from food assistance any Iowans who have assets totaling more than $15,000 or a second vehicle worth more than $10,000, or income of more than 160 percent of the federal poverty level. That income threshold equates to $23,328 for an individual or $39,776 for a family of three.

The legislation also would require all public assistance recipients to complete a computerized identity verification questionnaire and would require SNAP and Medicaid recipients to cooperate with Child Support Services regarding child support payments.

Iowa Rep. Joel Fry, a Republican from Osceola who managed the bill in the House, said Thursday during debate that the legislation ensures that the programs will benefit the Iowans who most need their services while also protecting taxpayers’ investment.

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“This keeps everybody at the table. It keeps those in need, it keeps the taxpayer, it balances for all,” Fry said.

Critics of bill

Critics of the bill say it is projected to knock eligible, needy Iowans off public assistance programs. An analysis by the state’s nonpartisan Legislative Services Agency, said 1 percent of Iowans eligible for assistance would have their benefits canceled due to discrepancies during the state budget year that ends in June 2026,

That equates to 8,000 Medicaid recipients, 2,800 SNAP recipients, 600 CHIP recipients and 100 FIP recipients, according to the Legislative Services Agency.

Critics also noted that Medicaid and SNAP fraud are exceptionally rare: 195 out of 278,800 SNAP recipients were disqualified for fraud during the 2022 state budget year, according to a state report. There were 235 open fraud cases in the state’s Medicaid program, which has more than 886,000 people enrolled, according to another state report.

Medicaid and SNAP are funded by the federal government. Medicaid is administered by the state — Iowa has hired private companies to manage the state’s program — and SNAP is administered jointly by the state and federal governments.

The changes, if signed into law, would require the addition of more than 200 new state government workers in the Health and Human Services department. It would cost the state $7.5 million in the first two years to implement the new measures, and ultimately result in a net reduction in state spending of just more than $8 million in the 2027 state budget year, according to the Legislative Services Agency.

“It is a terrible economic decision. And even worse, it is morally reprehensible,” said Rep. Josh Turek, a Democrat from Council Bluffs.

New technology

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House Speaker Pat Grassley, a Republican from New Hartford, noted a portion of the legislation’s projected costs are related to the implementation of a new technology system that he said is much-needed.

“We don’t have a good enough system, in my opinion, to really be able to track what we’re implementing and who’s getting those (benefits),” Grassley told reporters after the bill’s passage.

“This is the way that we actually will run the department not more efficiently from the standpoint of just saving money, but also more importantly making sure that the services that people should be getting they are getting, and also making sure that they will qualify.”

The legislation, Senate File 494, passed the Iowa House Thursday on a largely party-line vote, 58-41, with only Republicans supporting. The bill previously passed the Iowa Senate on a similar party-line vote, 34-16.

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