The FCC wants less fraud for Lifeline subsidy funds

Proposed order would tighten eligibility rules

The Federal Communications Commission continues to look for ways to lessen fraud in the Lifeline program, the low-income subsidy for landline, cellular and broadband connections.

Among new requirements that could go into place under a proposed order being considered by the FCC is a stipulation that carriers can be reimbursed only for Lifeline subscribers who are alive.

Yes, that is a concern, and it’s not a new one. Fraud has been a legitimate concern of the program, which initially let service providers certify subscribers and subsequently receive the Lifeline funds for the discounts provided to subscribers.

Yet a 2017 Government Accountability Office report found 6,000 people enrolled or re-enrolled in the proFCC, gram were deceased. The GAO also was unable to confirm the eligibility of about 1.2 million subscribers, more than one-third (36%) of the subscribers it reviewed.

Begun in 1985, the Lifeline initially subsidized landline service for low-income individuals but over the years has expanded to cover other connectivity. Qualifying individuals and families get a $9.25 monthly discount on their bill. In 2018, the Lifeline program distributed $1.14 billion to more than 9 million U.S. households.

That figure is down from $1.5 billion in 2016, the same year the FCC initiated a reform plan for the program. Included in the reforms is a national identification program to ensure subscribers to the programs are legitimate.

As part of its stricter review process, the Lifeline program last year de-enrolled 134,000 subscribers to the program who did not respond to queries from reviewers, according to the 2018 annual report filed by the overseeing Universal Service Administrative Co.

A proposed order being considered by the commission, according to the would attempt to further strengthen efforts to prevent fraud with several proposals aiming at better identifying duplicate and fictitious subscribers.

In addition to more stringent verification measures, the proposal could prohibit carriers’ agents earning commissions based on number of Lifeline applications or enrollments that they sell.

States also would have a larger role in designating carriers that can participate in the Lifeline program.

The order does not address the FCC’s 2017 recommendation that the Lifeline program have an annual budget that is capped.

Two years ago, FCC Chairman Ajit Pai said after his Senate reconfirmation hearing that “the Lifeline program is an important component of the Commission’s efforts to bring digital opportunity to low-income Americans.”

However, senators were concerned “that the program is in need of serious reform,” Pai said. “For starters, we need to crack down on waste, fraud and abuse.”