It's Time to Re-write the Rules
Correcting a Michigan policy that causes enormous cost and friction
By Samuel Brennan
As a design researcher, I have spent hundreds of hours at kitchen tables, in living rooms, and in offices working to understand the public benefits system through the eyes of Michigan residents and state workers. As I listen to people’s stories, I grow increasingly perplexed by some of the rules that govern our public benefits system and the situations they put people in: Why do some people end up re-applying for food assistance 14 times over the course of five years? Why do families sometimes find that their food benefits have been shut off at the grocery store, out of the blue? Why do applicants need to prove again and again that they only have $0.58 in their bank account?
The more time I have spent with applicants, the more I want to know: Why are the rules written the way they are? How might we change the rules to work better for everyone? It turns out that this type of “rulemaking” has a name: policy.
A journey into the weeds
Once I started reading policy, I couldn’t stop. I sifted through hundreds of pages of federal regulations, state laws, and departmental procedures. The more dense the text I parsed through, the more opportunities I saw for courageous leaders to change the way policies were written. Leaders in the state were making things harder for themselves—and for the people they served—than they needed to.
In all of my research, there was one policy topic that I kept coming back to: personal assets. Michigan law requires their Health and Human Service agency (MDHHS) to conduct an asset test every time a person applies for public assistance. The asset test is basically an assessment that measures how much money a person has. The current rule stipulates that applicants must have less than $5,000 in personal assets in order to receive assistance.
The million dollar edge case
The origins of the asset test lie in a sensational story in which a Michigan lottery winner was caught using food stamps despite their $1 million prize. After the news broke in 2012, the Michigan legislature proposed the $5,000 asset limit. As Senator Tonya Schuitmaker (R-Antwerp Township) stated, the intent of the rule was “to prohibit the very practice of somebody winning a million dollars but still living off the taxpayer dime.”
While it makes for a good government-fail story, the situation in which a lottery winner ends up receiving public benefits is extremely uncommon. Of the 2.5 million people who receive assistance each year, lottery winners committing fraud account for less than 0.000004 percent of all cases.
Understanding the consequences
While the asset test was written to address an edge case, implementing it has had far-reaching consequences for applicants and caseworkers. Through years of fieldwork, I’ve become intimately familiar with the biggest source of friction the policy has introduced: documents.
To prove their assets fall beneath the threshold, the test requires applicants to provide a statement for each of their accounts. Applicants have to travel miles, often by bus, to collect documents to prove that they are, indeed, broke. State workers receive thousands of confused calls each month about what documents are required. When the paperwork fails to get processed on time, applicants are denied and asked to start the application process all over again.
The data tell a similar story. Statewide, MDHHS collects over 2 million bank statements every year. The majority of bank accounts have less than a $5 balance. At the end of the day, 96 percent of all cases fall below the $5,000 limit.
Still, millions of documents are collected, transported, mailed, faxed, printed, scanned, uploaded, saved, and shredded every year—without having any significant impact on case determinations. These documents generate clerical errors and prevent many applicants from accessing the benefits they are qualified to receive.
The asset test has introduced enormous cost and friction into the system for little gain.
Looking across state lines
Talking to policy experts, I learned that Michigan is one of only 16 states in the country that requires an asset test. I also found that, while advocacy groups in Michigan have spent years trying to raise the asset limit or eliminate it entirely, there has been much less attention placed on alleviating the pain of the paperwork itself.
As I expanded my research across state lines, I discovered policies that Virginia, Nebraska, and Texas have implemented to make the asset test less burdensome. These examples show how Michigan could redefine the asset test to avoid the headache of collecting millions of documents each year while still complying with current state legislation. By taking executive action, leaders in the department could rewrite the rules and radically change the system to be more compassionate, more effective, and less expensive to operate.
Making the case for change
When we shared our findings with MDHHS leadership, we learned of their common desire to simplify the department’s policies in order to better serve Michigan residents and their staff. We’re still in the early stages of conversation, but the department is actively evaluating ways to streamline their asset test. If they do, the decision will positively impact millions of residents and thousands of frontline staff each year.
By looking deeply at policy through the eyes of the people most impacted by it, we’ve uncovered new opportunities to transform the systems we work in. While rewriting policy is not an easy path, we believe it’s essential to ensuring our institutions work better for everyone.
And so, into the weeds we go.