Three community learning groups were formed as a result of the community meeting on November 12, 2019. Each of the groups will work together during January, February, and March 2020 to advance thinking on local solutions to the benefits cliff and to co-create experiments for potential funding.
So, what can be done to ease the benefits cliff? Since the cliff springs from policy decisions, the solution must also be policy driven. Other states are recognizing the cliff's unintended consequences and are starting to devise solutions to dampen its impact.
Other states have created taskforces to study the benefits cliff, piloted programs to create multi-year transitions when families exceed income thresholds, and even created new benefits (e.g., child care tax credit) that help to offset the benefits cliff. States have also chosen options already allowed within federal guidelines to change eligibility requirements in ways that have softened the slope of the benefits cliff.
Employers should be aware of the benefits cliff and where the major thresholds lie. Employers are in a position to help mitigate the benefits cliff for their employees, but they cannot do this unless they know where these thresholds generally lie.
Most public benefits only consider income in their thresholds, but employers have latitude in crafting their compensation packages. An employer could offer an employee a contribution to a health or dependent care FSA instead of a slight raise if a given employee would make use of the account and if the employee agreed to such an arrangement. In such a case, the employee's income for benefits purposes would not rise.
Like employers, nonprofits and foundations are in a position to help mitigate the benefits cliff. Awareness of the benefits cliff and where the thresholds lie is key. Nonprofits and foundations can however, structure programs and funds with an eye towards the benefits cliff. They might even create programs designed to target those who abruptly lose benefits.
For more information about the Learning Groups, email info@abcforsyth.org .