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June 2019

Families USA Comments on Consumer Inflation Measures

Families USA submitted this letter in response to The Office of Management and Budget’s request for comment on how the various alternative consumer price indexes produced by the Bureau of Labor Statistics (BLS) and Bureau of Economic Analysis (BEA) would influence the estimation of the Official Poverty Measure (OPM).

Replacing the Consumer Price Index for All Urban Consumers (CPI-U) with an alternative index produced by BLS or BEA would produce lower inflation estimates, hence a lower OPM. Instead of improving OPM’s accuracy, these alternative indexes would artificially reduce the OPM, limiting eligibility for need-based assistance and driving down the standard of living for low-and middle-income families in America.

The Department of Health and Human Services’ poverty guidelines, also known as the “Federal Poverty Level” (FPL), are based on the OPM. Using an alternative and reduced inflation measure for the OPM would lower annual adjustments of the FPL, which many public assistance programs use to determine eligibility. This would decrease access to health care and public assistance for millions of families in America.

Therefore, we recommend that the Office of Management and Budget not use any of the proposed alternative indexes as an inflation measure to adjust the Official Poverty Measure. Read the rest of our comment here.