Federal Communications Commission Chairman Ajit Pai recently announced a couple of changes to the Lifeline program, which supplies phone and broadband services to people without the income to pay for them. Since his appointment in 2017, the former commissioner has worked to reduce costs while phasing out support for voice-only options in favor of high-speed Internet.
The changes are simple: Starting Dec. 1, Lifeline’s mobile carriers will have to offer 4.5 GB of data each month, up from 3 GB. This has extra urgency now, as the COVID-19 pandemic has driven unemployment to levels not seen since the Great Depression.
The announcement sent shock waves from corporate boardrooms to nonprofits that serve asset-limited people. Public interest groups fear the impasse, if left unresolved, could undermine the premise of the 35-year-old program, which is to “ensure that all Americans have the opportunities and security that phone service brings, including being able to connect to jobs, family and emergency services,” as the FCC describes Lifeline.
“As the communications marketplace continually evolves, it’s critical that minimum standards for Lifeline service increase so that Lifeline subscribers do not receive second-class service,” Pai said in the July 30 statement. The sentiment aligns with nonprofit organizations who have said 3 GB is not enough for Lifeline customers who could be conducting telehealth visits, seeking employment or connecting with services, especially during a pandemic.
Here’s the problem: Lifeline is based on the $9.25 subsidy it provides each month to qualifying customers, those who receive federal help through Medicaid, Tribal Head Start, Federal Public Housing Assistance or similar programs, or can show earnings of less than 135% of the poverty line.
In the Sarasota area, Safelink Wireless, Access Wireless and Assurance Wireless offer free Lifeline service to those who stay within prescribed limits ranging from 250 to 350 minutes and 3 GB, or pay more for additional packages.
Here’s the problem: Lifeline is based on the $9.25 subsidy it provides each month to qualifying customers, those who receive federal help through Medicaid, Tribal Head Start, Federal Public Housing Assistance or similar programs, or can show earnings of less than 135% of the poverty line.
In the Sarasota area, Safelink Wireless, Access Wireless and Assurance Wireless offer free Lifeline service to those who stay within prescribed limits ranging from 250 to 350 minutes and 3 GB, or pay more for additional packages.
“TracFone representatives explained we appreciate the chairman’s efforts to modify and harmonize the MSS formula for calculating the minimum data allowance for Lifeline mobile broadband services,” senior TracFone executive Mark Rubin noted following a conference call.
“Nonetheless, we elaborated on how an increase from the current 3 GB to the proposed 4.5 GB per month would still have a harsh impact on Lifeline consumers due to the asymmetry between the Lifeline subsidy amount – currently at $9.25 – and the retail price of service offerings that would meet the new service requirements.”
Plans including that much data cost $25 to $40 per month, said lawyer John J. Heitmann, who represents the National Lifeline Association (NaLA), who included the prices of dozens of companies in a letter to the FCC.
“There is simply no evidence in the docket to suggest that a 50% increase in the required mobile broadband data – with no corresponding increase in subsidy support – can be provided without forcing a copay on consumers,” Heitmann wrote.
What if a provider decided to pass the difference on to their Lifeline customers? Olivia Wein, an attorney with the National Consumer Law Center (NCLC), doubts that would work.
“We believe we would have a whole subset of Lifeline consumers who would not be able to handle that situation because they are unbanked or unhoused, and would not be able to come up with something as small as even a dollar or $5,” Wein said.
“We believe we would have a whole subset of Lifeline consumers who would not be able to handle that situation because they are unbanked or unhoused, and would not be able to come up with something as small as even a dollar or $5,” Wein said.
Source: Herald Tribune, Andrew Meachum