An Updated Measure of Poverty (Re)Drawing the Line (2023) / Chapter Skim
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In other words, the SPM reflected that the stimulus payments -- along with regular in-kind government support programs such as the Supplemental Nutrition Assistance Program (SNAP) and tax benefits such as the Earned Income Tax Credit and Child Tax Credit -- helped reduce poverty during the pandemic.
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RECOMMENDATION 2.2: For the Principal Poverty Measure, the set of threshold categories should be expanded beyond the current food, clothing, shelter, utilities, telephone, and internet (FCSUti) to explicitly recognize that minimum basic needs -- as well as policies designed to help households meet those needs -- have evolved since the establishment of the Supplemental Poverty Measure.
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However, by accounting for health insurance benefits and childcare subsidies in the resource estimates, measured poverty rates will not necessarily be affected (at least for the population that receives those benefits and subsidies)
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Introduction of a basic medical care need in the PPM threshold means that medical-related benefits received by households must be accounted for in the calculation of available resources. RECOMMENDATION 3.4: The definition of resources in the Principal Poverty Measure should include a value for any health insurance benefits or subsidies received from an employer or from the govern ment but must also reflect the fact that such transfers cannot be used to pay for nonhealth needs.
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For individuals who are not covered by Medicare, this subtraction should be capped at the out-of-pocket maximum for Affordable Care Act Marketplace plans or lower, depend ing on health insurance status and other household characteristics. Medical out-of-pocket spending by Medicare recipients can also be capped starting in 2025 due to changes enacted under the Inflation Reduction Act, and the panel recommends doing so.
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RECOMMENDATION 5.1: The Principal Poverty Measure housing thresholds should be set based on shelter costs for renters only. Rental levels should be based on the Department of Housing and Urban Development's annual Fair Market Rent estimates for various shelter unit sizes, which are anchored to the 40th percentile of gross rent for a recently available "standard quality" two-bedroom unit in a given local area (metropolitan area or nonmetropolitan county)
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RECOMMENDATION 5.6: For estimating Principal Poverty Measure unit resources, implicit rental income should be included for households that own homes. In the short run, this implicit rental income could be the local Fair Market Rent (FMR)
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to improve estimates of resources in the Principal Poverty Measure (PPM)
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RECOMMENDATION 6.5: For calculating Principal Poverty Measure thresholds, the Census Bureau and Bureau of Labor Statistics should use all consumer units captured in the Consumer Expenditure Survey (CE; not just those with children) to determine the median values for basic needs categories (e.g., food, clothing, internet)
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