Reform of the federal Lifeline program took an important and much-needed step forward earlier this month as Congress heard testimony about how to create a more effective system to help low-income consumers.
In one sense, the hearing was a deserved victory for recent efforts to improve the program. Four years ago, Congress and the FCC took action to stop the program's spiraling problems of waste and fraud. Lifeline had become stereotyped more for its inefficiency than for its successes. As everyone recognized, those likely to be affected most by a continued lack of confidence in the program would be the low-income beneficiaries Lifeline was designed to help.
As Congress heard, the 2012 reform has produced tangible results. Annual program payments have dropped by more than 30% since 2012 as fraudulent and undeserving participants were dropped from the program.
But the hearing also put a necessary spotlight on the next logical part of Lifeline's reform: establishing an efficient verification system to keep out those who don't qualify.
Last month, the FCC began moving in the right direction with a new National Eligibility Verifier (NEV) to further control Lifeline's waste and abuse. The NEV is an independent third party that uses Medicaid and the Supplemental Nutrition Assistance Program (SNAP) to determine eligibility.
Until now, Lifeline relied on wireless carriers to establish program verification and the problems with that have become increasingly clear. Earlier this month, the FCC announced a $51 million fine against California-based Total Call Mobile for defrauding its Lifeline. The FCC claimed that the company enrolled tens of thousands of ineligible consumers, allegedly receiving nearly $10 million from the Lifeline program in improper payments.
Even beyond this, virtually no other carrier supported the system because it often put them in an unwinnable position of mediating qualification disputes between consumers and the Federal government.
Finally, no discussion of Lifeline can be complete without acknowledging the larger context around changing consumer demands and areas of greatest need. Clearly, Lifeline's expanded focus on mobile broadband is proving correct. Last December, the Center for Disease Control reported that almost half of all U.S. households were wireless-only and that the shift to mobile services has been even more prevalent among low-income Americans.
Millions of low-income Americans depend on the Lifeline program and Congress and the FCC deserve credit for improving it. The challenge now is to build on this success.
As Black History Month comes to a close, we must continue working to ensure the African American community and all Americans have access to the resources they need to succeed in a modern world. According to a recent New York Times article, expanding access to home broadband and public Wi-Fi, especially in low-income communities, should be a top priority for our country.
This issue has special importance since next month, the Federal Communications Commission (FCC) will consider changes to the roughly $2 billion-a-year federal Lifeline subsidy program. Among possible changes, the Commission will consider expanding the current phone-only subsidies to include home broadband.
According to The New York Times, in certain areas of Detroit, Miami and New Orleans, as many as one-third of homes do not have broadband. Students go to libraries and fast-food restaurants to use free hot spots. In some neighborhoods, school buses with free Wi-Fi are sometimes parked overnight in residential neighborhoods to allow students without home broadband to do their homework.
Given the overwhelming need for Internet access, Lifeline's lack of support for home broadband is a serious shortcoming - so is Lifeline's ongoing problem with waste and fraud, as one of the FCC's own Commissioners has documented.
The Commission's duties next month are clear-cut: First, Lifeline should be expanded to cover home broadband, both wireline and wireless. This will help young students in underserved communities gain Internet access in the convenience of their own home.
Second, the Commission should reduce the potential for fraud by having state agencies, not phone companies, determine eligibility. This step is every bit as important as the first. The Commission will miss the mark entirely if it only expands a flawed, inefficient program. Reforming the process for determining eligibility is an equally important step because it will channel program funding to where it is most needed.
The benefits of having a home broadband connection in regard to education has grown sharply in recent years and will only become more integral. Students need it for basic research, joint projects, and submitting homework. And an increasing number of teachers - approximately 7 in 10 - assign homework that requires access to the Internet.
In order to create a society with equal opportunity to quality education and employment, the FCC cannot wait any longer. It must modernize the Lifeline program now.