Public Hearing
"Testimony on changes to the application procedure for the Lifeline Credit Program"

LOCATION: Committee Room 11 

State House Annex 

Trenton, New Jersey

DATE: January 23, 1997 

10:00 a.m.



Assemblywoman Rose Marie Heck, Chairwoman

Assemblyman Richard H. Bagger, Vice-Chairman

Assemblyman Paul DiGaetano

Assemblyman Kevin J. O'Toole

Assemblyman Gary W. Stuhltrager

Assemblyman Neil M. Cohen

Assemblyman LeRoy J. Jones Jr.

Assemblyman Louis A. Romano


Katharine A. Tasch

Office of Legislative Services

Aide, Assembly Policy and

Regulatory Oversight Committee

(Internet edition 1997)

ASSEMBLYWOMAN ROSE MARIE HECK (Chairwoman): Good morning. We were waiting for some testimony and a couple of other people to arrive. I want to thank you-- I wanted to greet you this morning.

This matter came to my attention by an individual from Bergen County who was very concerned about the changes in the Lifeline Program, and this Committee wanted to address those concerns as quickly as possible, so we put this hearing together.

Our Assembly members are here. Our Majority Leader, Paul DiGaetano; our Parliamentarian, Gary Stuhltrager; Kevin O'Toole; and our regular member, LeRoy Jones; and our visiting member today, Lou Romano. So I am very pleased that everyone could be here.

This is a very important topic and a very important matter to our senior citizens. We know that there has been some confusion in the communication of how this program will operate and what it will do or not do. Concerns from the seniors that I have heard in my office include the fact that moneys that might come in March would actually preclude the moneys from 1996 and just incorporate moneys for 1997.

We're going to hear from the Department who will give us information. Also, we're going to hear from people who are in favor of this program, and those who are not in favor can give us the reason why. We'll kind of air our differences.

I do want to make note that one of the questions that came to mind when this was happening is that consolidating paperwork for seniors is a very good point, to do things in one fell swoop, and to make it clear as we're doing it that it will not adversely affect the programs is important. I have always had--

I also had staff reach out to Treasury to see if, in some way, we could also consolidate the Homestead Rebate forms to make this an even better attempt at consolidating programs and make it easier for seniors to access their needs and their rights through one time during the year. But we're going to hear more about that as we progress.

We're going to start with Deputy Commissioner Susan Reinhard and Kathleen Mason from the Department of Health and Senior Services.

As you know, the Department now includes Senior Services, and we're very pleased that you came to address this matter. We have copies of the testimony that have been handed out.

D E P. C O M M. S U S A N C. R E I N H A R D: Hello, can you hear me?

ASSEMBLYWOMAN HECK: Just put on your microphone.


Assemblywoman Heck, I want to thank you and the members of the Committee for this opportunity to discuss the changes in the Lifeline application and consequences for seniors and people with disabilities. I know, as you have already noted, that there have been a number of calls. I'm sure many of the people sitting with you today have received those calls, and we really appreciate the opportunity to discuss what the change is, why it was made, and any consequences that are occurring now.

With me today is Kathleen Mason, who is the Director of the PAAD and Lifeline Programs -- she has managed that program for 17 years since its inception, so she is a wealth of knowledge -- and Scott Allocco, who is our Director of Governmental Affairs.

Let me begin by saying what the changes to the Lifeline Program are and the concerns that led to this change, which the Legislature voted on as part of the budget, the Appropriations Act, last June. The change is that we have combined the PAAD and Lifeline Program, as the Assemblywoman has already noted, into one application form and that we will accept these applications year-round and distribute benefits year-round.

There were two concerns that led to this change. First, people who could be eligible were not receiving quality services. Some seniors and people with disabilities did not know that they were eligible even though they were already receiving PAAD, and most people who are receiving PAAD are eligible for Lifeline. Hundreds more could be eligible but were denied benefits because there was an arbitrary deadline of March 15.

I'm going to come back to this a number of times, because this deadline is the central component to legislation that is out there now to go back to where we were, but let me move on for now.

Second, the previous system for sending applications was inefficient and cost $200,000 with no added benefits to beneficiaries. Because the system was set up to mail out all the Lifeline applications to all Medicaid recipients and PAAD recipients all at once in August, the process was kind of complicated. We had to hire temporary employees to try and get all of this done, and the calls kept coming in over and over again in August, September, primarily in those months, clogging up the Lifeline hot line.

Let me explain these points in more detail. It has long been realized that eight out of ten people who are eligible for Lifeline are also eligible for PAAD. Prior to July, these beneficiaries had to complete two different applications: One, for PAAD, which they could do year-round, and one for Lifeline, which had to be completed by March 15.

Approximately 240,000 Lifeline applications for PAAD and Medicaid recipients were mailed at one time in August and the hot lines, as I have indicated, were flooded with calls. This temporary workforce that we applied at the time came from Treasury. We used seasonal employees from Treasury which, right now, are not available to us. So if we were to revert backwards, we would have to handle the temporary issue. PAAD and Lifeline staff suggested that if Lifeline application questions were added to the PAAD application, beneficiaries would complete one application instead of two.

I just want to make a side point here that I have been impressed-- I am fairly new to bureaucracy, to State government. I have spent my life as a nurse, a community health nurse, and an educator and researcher also. What impressed me about this particular change is that people who for 17 years or perhaps a little less have been working with seniors in all those years came up with this idea of how they could improve services for seniors.

Some of those folks are in the room. Wade Epps (phonetic spelling), for example, is in the back. This is one of his ideas for the staff, and it really emerged from how do we do a better job for seniors. They did it. They moved it forward. They implemented it, and they're really trying their best to make sure we do improve services for seniors.

PAAD beneficiaries in the past who did not know about the Lifeline Program would not be informed about the Program because the information wasn't on the application, but now they would be. Also, since the application process would be spread throughout the year, individuals requiring assistance with Lifeline and PAAD would be able to get better service for their Lifeline, and the existing staff would be able to handle it since it would be spread out over the year.

Previously, the Lifeline Program had a statutory, or arbitrary, it should say, March 15 deadline for submission of applications. Last year, hundreds of applicants were denied benefits because they were late in filing their applications. This is something that will be noted by one of the consumers who is with us today.

Also, applicants had to meet the age and income requirements before January 1 each year. Again, this is a critical point of information, because if we go back to trying to distribute benefits at one point in a year, you have to establish a deadline in order to be able to do that. If a person turned 65 in January, that senior had to wait until October to get the Lifeline credit the following fiscal year.

The person who is with me today is Mr. Longfellow, who was sitting with Mr. Wade, and I believe he is going to be able to testify and answer questions that you might have for him.

Because we changed our system, Mr. Longfellow and other seniors are eligible right now. If we hadn't changed, he would have had to wait until the next benefit year. The same is true for Mr. Pratico who was here last week when we were working with Senator Singer's Committee. Mr. Pratico's income exceeded the Lifeline Program requirements last January, but he was eligible by -- I don't know, what was it?

K A T H L E E N M A S O N: A couple of hundred dollars. He was eligible then for January 1 and could get both Lifeline and PAAD under the new system.

DEPUTY COMMISSIONER REINHARD: So in other words, within a few weeks, a few months, he could become eligible, but if we stop the deadline and made him have to be eligible by January 1, he would have to wait a year. This time he didn't. He was eligible right away. He was a very happy camper.

With the change in the Lifeline application, the window of opportunity has increased and Lifeline applications will be processed all year. The March 15 deadline for submission of application has been eliminated. Lifeline benefits will now be issued shortly after the beneficiary receives his or her new PAAD card, within about four to eight weeks.

Unfortunately, during the first year, there was a one-time disruption for some beneficiaries. Some individuals will experience a delay -- I have in parentheses here (of four to eight months) -- in receiving their benefits. On the other hand, more than 39,000 seniors and people with disabilities received them earlier this year. That is 21 percent of those affected. In other words, some people did not have to wait until November or December to get their benefits. They got them in September.

I must emphasize that all individuals -- all eligible individuals -- will receive full benefits during the fiscal year. No one will lose benefits. This is another critical point that has to be made. We are not talking about using next year's money. They will get them in this fiscal year. No one will lose benefits. In fact, because more people will learn about Lifeline when they fill out one application for both PAAD and Lifeline and because there will no longer be this arbitrary deadline, we expect more people will receive benefits, and we have budgeted appropriately.

I know that this change has stimulated calls and questions, so let me anticipate some of them and answer them now. First, there are a limited number of people who have been affected by this change in procedure. Beneficiaries who have already renewed their PAAD card have already received their benefits. Already, 120,000 PAAD and Medicaid beneficiaries have received their Lifeline benefits, and this, every day, increases. Approximately 54,000 additional beneficiaries will receive their benefits between now and June.

The second point is, no beneficiary will have their utilities shut off. This is, again, extremely critical. There have been some newspaper articles out there that have scared seniors and people with disabilities who receive these benefits into thinking that they will be cold this winter. It is not true.

The utility companies worked with us last year in trying to make sure that this program would run smoothly. They have made sure that no one would be in trouble. They have, indeed, sent out that information in their utility bills. Of course, not everybody reads their utility bills very closely, I realize. Jim Dieterle (phonetic spelling) was here from PSE&G last week to talk with us, also, to explain what the utility companies are doing. You should have a letter -- I hope, in the packet that we gave to Fran yesterday -- from another utility company that validates that no one will be adversely affected.

If Lifeline beneficiaries are having difficulty paying their utility bills, they just need to call the company. The company-- There is a moratorium on any shutoffs between November and March. What the companies are suggesting, and we suggest also, is that you put yourself on an equal monthly payment plan, so it doesn't really matter when in the year this credit is allocated to your utility bill. That is particularly helpful because a lot of seniors have difficulty with their air-conditioning bills, especially if you have a very, very hot summer.

We understand that some legislators may think that we should go back to the old way or try to get the combined application form but issue the benefits during the winter. Senator Kosco has a bill, S-1786, which would force us to establish an even earlier deadline than March 15 if we were to issue all of the benefits by March.

The way it was, we had a March 15 deadline, which meant some people actually did get their benefits after March. In fact, we issued $3.5 million in benefits after March last year. Those are the people who just made the March 15 deadline. Most people tried to get in sooner. But if you were to mandate that everything had to be distributed by March, we would have to establish a January deadline. So the situation would be even more complicated.

The problem with attempting to allow people to apply all year, which is what this bill is attempting to do, to go ahead and use this one form all year-round but issue the benefits only during the winter months -- the problem with doing that is that you have to use old information to issue the benefits during that particular time.

The lag time between when the information is collected and when the benefits are issued is a major problem. We tried it several years ago. Much of the data collected changed and became unusable before benefits could be issued. We had checks being mailed to the wrong address. We had people who, unfortunately, expired. We had credits going to the wrong utility companies, and then, you have to get the credit back from that utility company, find out which one to send it to, send it to that utility company-- All that period of time, this senior is very concerned and confused, because they know that they have this particular utility company, but we're using information that is six or eight months old. It takes time to get this back and forth, and we consider this very poor customer service.

If the program is changed back to the old system of separate applications, computer systems that were just modified this year would need to be changed again, and it would be costly to do that. The temporary workforce would be needed to process all of the applications at one time, and we estimate that workforce to cost about $75,000. The printing and mailing alone, just mailing out those Lifeline applications, cost us $80,000. The program would incur total administrative costs in excess of $200,000, which is $200,000 that could be going into benefits, not an inefficient system.

More importantly, beneficiaries who have benefitted from the elimination of the deadlines of Lifeline would be negatively affected if the program reverts back to the old system.

Having said all that bureaucratese, the real problem is seniors are going to get even more confused if we try to go backwards. We have spent nearly 12 months trying to tell people as they renewed for their PAAD that when they renewed, this was all they had to do, that we were going to process it one time and everything would be handled at that time. Everyone who calls into the hot lines gets that information.

We have people here from the county Offices on Aging who have been trying to get out that information. AARP has been trying to get out that information. Clearly, we could have done a better job getting out the information, but we have been getting out information, and it's like we have the horse halfway out the barn door here or more than halfway out the barn door.

If we revert back to the old way, the phone calls to your office and mine will continue for another year, especially from those who have had to wait a year if we go back. Those who we have just advantaged by getting rid of the deadline will now find out that they're going to have to wait a year.

Frank Solis from AARP, as I said, is here to testify and Carl West, from the Mercer County Office on Aging, which handles calls from seniors all the time.

Based on these facts, we're hopeful that you will support the continued change process, recognizing the bumps in the change process. We apologize to all of you who have had to bear the brunt of some of these calls. We are trying to figure out how we could have done it better. Undoubtedly, there are better ways to go about this, and I will take responsibility for not having done a better job. But we urge you to stick with us and see if we can serve the seniors better.

We are here to answer questions, though, and welcome them. Again, we appreciate the opportunity.

ASSEMBLYWOMAN HECK: May I respectfully suggest that when you make a dramatic change or any change that affects senior citizens that you red flag the legislators so that we can immediately respond in an intelligent and informative way to the concerns and the panic calls that we had.

I know that our office, and I'm sure your offices, as well, did not have that information to say, "Don't worry, everything will be gotten to you and your heat won't be turned off, etc., etc."

There will be other instances, I'm sure, in the future that will occur, and we would really appreciate it if your office would give us a heads up. Even though we're working on things all the time, we have to be alerted to the time that you're introducing and implementing something so that we can properly advise our constituents. We would appreciate that.

DEPUTY COMMISSIONER REINHARD: I humbly accept that advice and actually appreciate the efforts that legislators do in handling those phone calls and you can't answer questions if you don't have the--

ASSEMBLYWOMAN HECK: Well, it's not just the legislators. I think our staff in the office would appreciate it, because the calls were-- So many, hundreds-- The phone would stop ringing, it would ring immediately thereafter. After you hung up with one, another one would be on another line.

I would like to open this up for questions.


ASSEMBLYWOMAN HECK: Assemblyman Romano.

ASSEMBLYMAN ROMANO: Madam Chair, first of all, let me compliment you. I'm only here as a substitute today. I guess when they looked down the roster they tried to figure out who the senior citizen was. I know it's confusing. I look very good for my age.

I have to compliment you, Madam Chair, for bringing this issue up. You did not allow any funghi to grow under your feet.

Just let me say this, it happens to be here I'm a person who calls into Kathy Mason. I have to say this, your shop -- and I'll call it a shop, but I don't mean Little Shop of Horrors or anything like that -- has always been very responsive.

In fact, Kathy Mason took care of most of my problems in that she called directly to a senior citizen who had called with the complaint, and she was the prime person that they should have spoken to, because I know she spoke to 50 other senior citizens and told them, "I have the answer to your problems." She addressed them at a senior citizen event.

MS. MASON: Thank you.

ASSEMBLYMAN ROMANO: I have some basic questions, however. What the Chairperson has said was right on target. In fact, I was on a local cable TV station and they asked, "What do you think the problem is?" I said, "Well, I'm an old administrator and I was always guided by the six Ps: Proper Prior Planning Prevents Poor Performance." In this particular case, somebody dropped the ball.

Now my face is a little bit red, only because this was published in The Register. But I have to tell you the truth, I don't spend my time reading The Register, Madam Chairwoman, and it went unnoticed.

When this all began something should have been done to notify-- I see letters they were supposed to have received. I don't know if they received any letters. The only time this came up was when they didn't get the check. That is when they start to call, "How come I didn't get my check?" not because they got a letter that they didn't understand. I would be only too happy to sit down and, let's say, translate any sort of bureaucratic maze that might have been promulgated.

There was no preparation for this. I admire the fact that you're looking to save money for the State, making easier for a senior citizen to complete one application rather than two. That in itself is an accomplishment; however, we lose something along the way. You have to remember that we senior citizens require a little bit more. You know, we're easy going. We're not so frenetic. We don't jump at things. You have to cajole us a little bit as we do things. There was no preparation for this, and this is the big problem. To send you back to the drawing boards to come up with a new one would be like just adding to this problem over and over and over again.

I do have some basic questions, however. Just so that I have it clear in my mind, let's go back to the PAAD Program by itself. I'm under the impression that the PAAD Program is based upon the income for that particular fiscal year that you're in, the calender year. The PAAD Program goes on the calender year not on the fiscal year. So when you had Mr. Pratico, who became eligible at the end of January-- Could you explain that to me? I'm just trying to get the fine details here. What is that all about?

MS. MASON: Yes, Assemblyman, I can explain that.

Mr. Pratico would have been over the income limit last calender year, in 1996.


MS. MASON: So under the old rule, since he was not income eligible prior to December 31, he would not have been able to receive his Lifeline benefit until next winter. Under the old Lifeline rules you had to meet the income limit in the prior year.

What we did change is that now both Lifeline and PAAD eligibility is based on anticipated income for the current year. So when you fill out your PAAD form, you anticipate your income for the current year, and you will get both your PAAD card and your Lifeline benefit at the same time.

So Mr. Pratico would have been, under the old system, ineligible because his 1996 income was over the income limit.

ASSEMBLYMAN ROMANO: This is a new change in the regulations?

MS. MASON: Right.

ASSEMBLYMAN ROMANO: Through you, Madam Chair. I'm sorry for speaking directly.

But let's go back even now to the PAAD Program. The PAAD Program, as I read in here-- When the eligibility is coming up, I'm under the impression that everybody's eligibility is based the calendar year. We don't split years in the eligibility, do we? Do we start and say, "Well, no, this person is eligible from April to April"?

MS. MASON: May I address that?


MS. MASON: The eligibility is based on total calender year income for that current calender year. So you anticipate what your income would be for 1997, and if your income is under the income limit for the program in 1997, you would be eligible at the point that your renewal application is processed.

ASSEMBLYMAN ROMANO: Through you, Madam Chair.

That's based upon the idea that on, let's say, January, February, March somebody was working, and now they became retired. So now we're going on the whole year. But it isn't that we're going back one year from April 1.


ASSEMBLYMAN ROMANO: It's the whole calendar year.


ASSEMBLYMAN ROMANO: And this money, where this individual -- Mr. Pratico -- all of sudden became eligible now, how does that go back? Is there a deadline or a time line on the Lifeline assistance?

MS. MASON: Not anymore. That is what was eliminated.

ASSEMBLYMAN ROMANO: How was that in there? Without reading your regulation, how was that versed?

MS. MASON: The regulation says that now we will be able to issue benefits for Lifeline throughout the year rather than just during the winter heating season. That is what was changed. Before, the regulations required that Lifeline benefits had to be issued October 1 or as soon thereafter as could be processed. We changed the regulations to say that that deadline was eliminated and now the Lifeline process is spread throughout the year just the way the PAAD process always had been.

ASSEMBLYMAN ROMANO: Well, I would say--


ASSEMBLYMAN ROMANO: --next to the final one-- As in the case which I had spoken to you on the phone about -- where this woman was going to be getting her check in early May or June because of her eligibility -- people become eligible for the program at different times, but the eligibility is predicated on the particular year we're talking about.

MS. MASON: That's exactly right.

ASSEMBLYMAN ROMANO: So you have people who don't get-- Let me put it this way, several years ago when we were concerned about the cost-of-living adjustment-- People in November, or several months before the end of the year, would be notified that according to the COLA increase of social security, it would appear that -- these are my words -- you would no longer be eligible. Because at that time, the State did not automatically add on the social security increase.

ASSEMBLYWOMAN HECK: But we took care of that problem, as you well know.

ASSEMBLYMAN ROMANO: Which you did very well, Madam Chair.

ASSEMBLYWOMAN HECK: We did a wonderful job.

ASSEMBLYMAN ROMANO: After a bit of fire to the feet.

ASSEMBLYWOMAN HECK: Well, I think-- May I just interject, I do believe that we should want to treat all of us senior citizens with TLC.

ASSEMBLYMAN ROMANO: I didn't realize that you are a senior citizen, Madam Chair.

ASSEMBLYWOMAN HECK: But we, also, should not be lulled into a sense of false security, that we are not people who stand up for our rights.


ASSEMBLYWOMAN HECK: We do that immediately.

ASSEMBLYMAN ROMANO: Madam Chair, that is why you and I are both here.


But I do want to make certain that I have this correct, this assumption that you are being more inclusive with the manner in which the regulations are put together now.


ASSEMBLYWOMAN HECK: That you have increased the number of people who will be eligible each year in a more sound way, it's faster?


ASSEMBLYWOMAN HECK: And it's more inclusive?


DEPUTY COMMISSIONER REINHARD: Yes, but I would say it's that we are letting people get in sooner, that would have eligible the following benefit period, but it happens sooner.

ASSEMBLYWOMAN HECK: And that's what the Assemblyman is ascertaining and verifying.

ASSEMBLYMAN ROMANO: If I may continue-- I won't be much longer, but--

ASSEMBLYWOMAN HECK: Through the Chair.

ASSEMBLYMAN ROMANO: What plan do you have in mind?

ASSEMBLYWOMAN HECK: I love to say this. Through the Chair.

ASSEMBLYMAN ROMANO: Through the Chair, Madam Chair, of course, of course.


ASSEMBLYMAN ROMANO: Che mossa. (laughter)

Do you have any recommendations? Because you're well aware of the bills that are pending, where people say, "Well, the money should be paid during the heating months." I have some concern with that, because we pay utility bills also during the summer. The higher bill, theoretically, is supposed to be in the winter; with air-conditioning it's not always the case, however.

But in any event, do you have any ideas how this could be smoothed out? I mean, to say, "Well, this is the first year. We won't have the problem next year" -- well, people feel they're not getting their money on time. They would like to pay it during the heavy months. For someone to say, "Well, even out your bill. The utility company should average out the bill" -- well, there are a lot of things you should do in life and some people don't want to do it.

How do you intend to make it so someone feels they're getting that money during the time to pay their utility bill, or are you saying that that is something we cannot achieve under this process?

MS. MASON: We're doing the best we can. As Dr. Reinhard said, we have already processed 70 percent of the Lifeline benefits for this fiscal year. There is about 30 percent left to do. My staff are accelerating the application processing as quickly as we can. In fact, we're working overtime the next few Saturdays to try to get as many of the applications processed as quickly as possible.

The intent of this change was to spread the workload throughout the year. If we go back to trying to push everything to the winter again, we've defeated one of the objectives of the change. But we are, because of the concern in the transition this year, working overtime and doing everything we can to get as many of those applications processed even earlier than would have normally been processed under the old PAAD system to be sensitive to those--

ASSEMBLYMAN ROMANO: Well, Madam Chair, through you.

I admire the system that you're trying to do, but still, you have not-- How should I put it? -- I won't say corrected the problem, but ameliorated the concerns raised by those who say, "Why not get the checks during the winter months?" What you're saying to me is, "Well, that's not going to happen under the system as it is. Any attempt to pay it during that time will just throw us backwards into additional costs, etc., etc."

Let me ask this, just as a suggestion. I'm not going to put in a bill about this here. Why can't we put any sort of, not liability or responsibility or -- let them share the problems with the utility companies where they would actually notify people who have been known, let's say, to be recipients of the possible programs that they might enter into?

Just off the top of my head-- We were just discussing this in our caucus room.

ASSEMBLYWOMAN HECK: Assemblyman, just as a point of clarification--


ASSEMBLYWOMAN HECK: --it is my understanding that the utility companies did send notification out for averaging out of bills, etc. Is that what you're alluding to?

ASSEMBLYMAN ROMANO: I really don't know, unless that's part of the mail that should have gone to--

ASSEMBLYWOMAN HECK: Why don't we ask the people--

ASSEMBLYMAN ROMANO: There is another bill that I know is in the hopper about third-party notification. In some of those context, I don't know if a lot of that mail--

You know, people today, Madam Chair, are getting a lot of flyers within your phone bill--


ASSEMBLYMAN ROMANO: --do you want caller X? Do you want this one or that one? People are getting things and just throwing them away.


ASSEMBLYMAN ROMANO: I don't know if something like that would deserve to be mailed to what they call the third-party notification, where someone would read it and say "Hey, mom, hey, pop, hey grandpa."


ASSEMBLYMAN JONES: That's my legislation.

ASSEMBLYMAN ROMANO: Pardon me? That's your legislation, right.


ASSEMBLYMAN ROMANO: With Nia Gill, Assemblywoman Gill.

What I'm saying here is that I don't know if people understood what they can-- My suggestion would be if maybe they could average out a bill with a terminal point of -- it does follow the fiscal year, right? -- June 30, where they deduct the $250 that they think they're going to get and average out the rest of the year. Then, by July 1 you would get that.

ASSEMBLYWOMAN HECK: You gave them an increase, $225.

ASSEMBLYMAN ROMANO: I'm sorry, $225. There I am, a tax-and-spend Democrat again. (laughter)

What I'm trying to say is, I'm trying to balance on both sides here--

ASSEMBLYWOMAN HECK: Would you like to answer that question? I think it's a question.

MS. MASON: Yes, we did work with the utility companies. Jim Dieterle, from PSE&G, was at the hearing last week, and I think you have a letter in your insert from Mary Ann Martin from New Jersey Natural Gas. They're aware of the change in Lifeline, and they are considering--

When the person calls in and identifies themselves as Lifeline, PSE&G, for example, will actually ask, "When does your PAAD card need to be renewed?" They have them look at their PAAD card and then they know when that Lifeline credit will be coming. PSE&G understands the change in system. New Jersey Natural Gas, for example, they're anticipating that the State will be issuing that credit soon and they're taking-- The customer service area is taking that into consideration when the calls come in. They are all recommending an equal-payment plan.

But each of the utility companies did have an insert in their utility bills in October or November telling people about the change in Lifeline. I know PSE&G is also continuing to have notices recommending an equal-payment plan for anyone who has concerns.

ASSEMBLYMAN ROMANO: My final question-- I just raised the point. I'm sure all of my colleagues are going to have comments, and I'm sure there is going to be a plethora of bills going in. I'm trying to take the midroad, if you will.

But finally, just let me ask you this on the PAAD card. The PAAD card then does not expire on a calendar date, it expires midyear? So that actually a person-- Let's say, I might have been eligible last year -- but they were eligible through, let's say, March 30 of this year -- and now we're over the income, they are not responsible to pay back?

MS. MASON: We still recover benefits that were paid incorrectly. If they incorrectly anticipated their income and on a renewal form-- Say a person has a renewal date of March and on the renewal form they list 1996 income that was over the income limit. The program will recover all benefits, both PAAD and Lifeline, that were paid incorrectly for the prior calendar year, the entire year.

ASSEMBLYMAN ROMANO: But we're still talking about calendar year all the time.

MS. MASON: For income purposes.

ASSEMBLYMAN ROMANO: Madam Chair, I think you have been overly generous in allowing me the extensive time that I have had here.

ASSEMBLYWOMAN HECK: Well, since we served on the original Senior Citizens and Social Services Committee together--

ASSEMBLYMAN ROMANO: And that was a pleasure.


ASSEMBLYMAN ROMANO: Was I in the majority at that time? (laughter)

ASSEMBLYWOMAN HECK: You were not, because I Chaired that Committee--


ASSEMBLYWOMAN HECK: --and I don't think they allowed the minority to Chair. (laughter)

ASSEMBLYMAN ROMANO: Thank you. Thank you very much.

But I have to just say, Kathy Mason, Velvet and yourself have always been very courteous in all my phone calls.

MS. MASON: Thank you, Assemblyman.

ASSEMBLYMAN ROMANO: I have to just say that.

Thank you, Madam Chair.

ASSEMBLYWOMAN HECK: Thank you, Assemblyman. I know of your concern and it is appreciated.

Is there anyone else who would like to--

Yes, Assemblyman O'Toole.

ASSEMBLYMAN O'TOOLE: Madam Chairwoman, I appreciate you taking the initiative and the opportunity to have a public hearing on this very important subject.

My office has had about 100 phone calls from concerned constituents and also some senior citizens who are very, very confused as to the payment and the assistance program. By virtue of us having this dialogue here, I think it's going to be a little easier for us to go back to our constituents and explain to them what exactly the changes are that have been taken, what the changes mean, too, in terms of their service.

I think the Department has acknowledged that there have been some problems with the public relations aspect, and I'm hoping that has come and that has gone, that it has been ironed out. I appreciate the Department coming here and speaking in very frank terms about the program and some of the benefits and some of the detriments of a revised distribution of Lifeline assistance.

It's a little disturbing to know that with the old program you had some 400 individuals who were denied service, and for those individuals who were denied the $225 in assistance that would mean, I'm sure, a lot in the making or breaking of meeting heating payments or rental payments or housing payments. To see that you have devised a process that is now open year-round so that benefits can be received year-round, I think it's somewhat encouraging to see that we will open that window of opportunity, as the Deputy Commissioner indicated, so that no one will be cut off or shortchanged from this program.

What concerns me just a little bit is the bill that we talked about, Senator Kosco's bill. I want to develop it. Commissioner, if you could just talk a little bit of how, in fact, if this bill were to be passed in both Houses and signed by the Governor-- Other than the obvious problems of shortchanging the services and not having the accurate information, also you're saying that it would cost the Department an additional $200,000 for a lesser product or inferior product. Are there any other problems that you would foresee internally or for the delivery of services that would convince the good Senator from Bergen not to move ahead with his legislation?

DEPUTY COMMISSIONER REINHARD: I'll begin answering that and invite Kathy Mason to add if she would care to do so. I appreciate your questions, because it has occurred to me, obviously: Well, what will you do if this happens? How will you implement a bill that moves forward?

I understand, having worked with seniors my whole life as a community health nurse, how difficult change is and how those calls come to family members, to everybody: "I'm confused this is happening. It's very upsetting." I do understand that. So I have considered how I would go about implementing this.

The best I can answer you is that I would have to establish a January 1 deadline, which is more stringent than the March 15 deadline that we used to have. Then, we would have to embark on a public relations campaign even more ambitious than the one we should have had to explain why this has changed again. We could, however, keep the joint application. We don't have to change the application form. It's a matter of collecting the data at a certain point in time.

So I would have to find appropriations, I suppose, to hire temporary staff that would have to be hired, particularly in August, September, and October of each year, train them, etc., establish this new deadline, get the information out to seniors, and deal with the calls of people who are now upset that they can't get the benefits that year. That is the best I can answer.


MS. MASON: No, I think you answered it completely.

DEPUTY COMMISSIONER REINHARD: So we are in a quandary. You know if-- Oh, he left, but one thought I had about a particular constituent who just doesn't understand, and that can happen, "I just can't understand why I'm going to get my benefit in February" or whatever, there is the option for us to change their benefit -- their whole benefit -- PAAD and everything -- move it to October or November or something. So this particular constituent would be okay, but it's very complicated to do that. It's not something I would recommend on a regular basis.

Kathy is probably having a heart attack as I'm saying it, but--

ASSEMBLYWOMAN HECK: I could just picture everybody calling you to have that date.

DEPUTY COMMISSIONER REINHARD: Yes. But if there were a particular hardship case or something that somebody just could not figure out what to do with, exceptions can be made.

ASSEMBLYMAN O'TOOLE: That's my question. Thank you very much.


ASSEMBLYWOMAN HECK: Thank you, Assemblyman.

Are there any other questions? (no response)

Are you anticipating that you're going to save that $200,000 in 1997?


ASSEMBLYWOMAN HECK: The administrative costs?


ASSEMBLYWOMAN HECK: Thank you very much.


MS. MASON: Thank you.




ASSEMBLYWOMAN HECK: Assemblyman Jones.


I just had a question that is basically derived from what the--

ASSEMBLYWOMAN HECK: The question I asked--

ASSEMBLYMAN JONES: --Assemblywoman just asked you. You're anticipating saving $200,000 in 1997. Are we talking about calendar year now or fiscal year?


ASSEMBLYMAN JONES: But then there was just testimony that there has been extensive overtime. In addition to the overtime, you're going to still save?

MS. MASON: The $200,000 was really saved by not having to do the second mailing of the Lifeline form and the processing that would have happened. It's correct that there will be some overtime, but that won't nearly approach the $200,000 in savings that was anticipated.

ASSEMBLYMAN JONES: You didn't anticipate the overtime, but you anticipated the savings?

MS. MASON: No, that's--

DEPUTY COMMISSIONER REINHARD: It's not unusual, however, in any business or government, to have bumps in somewhere that you have to hire part-time workers or temporary workers to handle a particular crisis of some sort. In this case, it's PAAD, but I expect in my tenure I'll have other instances where I'll have to bring on extra people and have to figure out where I'm going to find the funding for that. So we are hiring to get through this part just so we can improve customer service, particularly at this time.


DEPUTY COMMISSIONER REINHARD: It's not something I wish I had to do, but we need to do it.

ASSEMBLYMAN JONES: Right. Through the Chair, I just didn't understand where this savings still would be-- You know savings arrived at $200,000 when there was unanticipated overtime as a result of just trying to arrest a very difficult situation that had occurred. So that was my concern. I didn't see how-- I still don't see how those numbers come out to be that, but--

DEPUTY COMMISSIONER REINHARD: The savings already occurred--

ASSEMBLYWOMAN HECK: You know that the Assemblyman will be checking on that. (laughter)


ASSEMBLYMAN JONES: Thank you, Madam Chair. I'm done.

ASSEMBLYWOMAN HECK: If there are no other questions of the Department-- (no response)

Thank you very much. Will you be remaining just in case?


ASSEMBLYWOMAN HECK: Thank you very much.

Our next speaker, our next person-- I'm going to ask Walter Longfellow to come up.

You have a short statement you wish to make?

W A L T E R L O N G F E L L O W: Chairwoman Heck, members of the Committee, thank you for the opportunity to testify. I have a short statement.

I am an 80-year-old PAAD beneficiary. I have been enrolled in PAAD since March 1, 1982, and I have benefitted from the program.

Over the last 14 years or so, I have helped many other applicants to complete and submit the required forms. It is more convenient to complete one application to obtain the benefits for both PAAD and Lifeline. Also, the single application is a help, because often applicants set the forms aside, do not recognize their importance, or do not submit them timely, and a single application provides for an easier way to correct the problem.

The elimination of a deadline for applying for Lifeline benefits means that applicants can apply for utility benefits after March 15. Last year, my sister became 65 on February 16. The old Lifeline law made her ineligible for Lifeline during the entire Fiscal Year 1995-1996 because she was not 65 by December 31, 1995. Under the current provisions, she could apply for Lifeline when she applied for PAAD, 30 days before her 65th birthday or any time after January 16. In my sister's case and in the case of other PAAD and Lifeline applicants, I think the recent changes help.

I want to thank the Governor, the Legislature, and the staff of the PAAD/Lifeline Programs for their assistance. I don't believe the program should be changed back to two applications and a Lifeline deadline.

Thank you very much.

ASSEMBLYWOMAN HECK: Thank you, Mr. Longfellow.

Mr. Longfellow, if it were able to be done and we could include the Homestead Rebate question in the same time frame -- all at the same time -- would that be of help to you as a senior, as well?

MR. LONGFELLOW: I'm not too-- Would you repeat that again? I don't think I got it.

ASSEMBLYWOMAN HECK: If we had one form for you to fill out for PAAD, Lifeline, and the Homestead Rebate for senior citizens, would that be advantageous, would that be a good thing for you?

MR. LONGFELLOW: Oh, yes, I think I spoke about that in the statement.


MR. LONGFELLOW: I think it would be good for everybody. The question is--

ASSEMBLYWOMAN HECK: Just to have one date and one paperwork.

MR. LONGFELLOW: Once people are wise to it, I think they'll say it's better, the new way they're doing it. But with senior citizens, you know, they're so used to having things done this way-- As soon as you start changing things, why, they think they're being denied something.

ASSEMBLYWOMAN HECK: It makes it difficult. Yes.

I thank you very much for coming here.

MR. LONGFELLOW: Thank you.

ASSEMBLYWOMAN HECK: Are there any questions for Mr. Longfellow? (no response)

We do have Frank Solis from the AARP.

I saw the opposed, and I thought you were opposed to the regulations, but I see you want to speak on S-1786, on the bill that would change it back again.

F R A N K S O L I S: Yes, Madam Chair. That 1786 is very confusing. When I first read it, it seemed to say everything I wanted to say until I got to the last, I guess, or next to the last sentence. It says, "Everything in brackets is to be omitted," and everything in brackets is what I liked. (laughter) But this bill should not go forward because it will change things back.

I thank you for the opportunity to speak, Madam Chair and Committee members.

My name is Frank Solis. I am the Vice-Chairman of the New Jersey State Legislative Committee of AARP. We have more than 1.2 million AARP members in New Jersey.


MR. SOLIS: The AARP State Legislative Committee has long sought to simplify the request-for-aid process affecting the senior citizens and others. We are very happy with the EASE process, which allows one-stop shopping for health benefits.

The changes approved by the legislation in June of last year -- which combines PAAD and the Lifeline applications on one form, eliminates the Lifeline deadline of March 15 and allows benefits to be spread throughout the year -- is a move in the right direction. You legislators are to be commended for these improvements.

The old March 15 deadline, if missed, denied benefits until the following year. Also, the old requirement of reaching age 65 prior to January 1 of the current heating season denied the first winter benefits to recipients with birthdays early in the year. Under the new system, applications can be submitted on one's 65th birthday no matter when it falls. This will enable recipients to receive benefits for the current season instead of waiting a year.

The new system is more efficient. It not only gets benefits to recipients sooner, but also eliminates a huge glut of calls regarding questions on the application form which always preceded the March 15 deadline.

If the system is so good, what went wrong that prompts a return to the old system even as the new system is substantially underway? Apparently, the new program and its transition was not fully explained prior to its implementation.

Seniors are very concerned about paying their bills and know the exact day to expect various income checks. When checks are delayed, they worry. This worry was exacerbated by a statewide news article pointing out the negative aspects and not including statements such as "No utility will be turned off; Utilities will extend credit and modify payments where credits are delayed during a transition period"; and other positive statements. This would have helped immeasurably and has helped in the one or two cases I've encountered.

Certainly a number of the recipients are confused and agitated, but the answer is not to confuse them further by changing the system again in midstream. The answer is to explain the benefits of the new system.

You are requested to vote against S-1786. Do not undo the good you did with last year's approval.

That is my testimony. I have 15 copies here.

ASSEMBLYWOMAN HECK: Oh, very good. Thank you. Thank you, Mr. Solis.

Are there any questions for this gentleman? (no response)

Thank you very much.

MR. SOLIS: Thank you.

ASSEMBLYMAN ROMANO: Madam Chair, however--

ASSEMBLYWOMAN HECK: We want to thank him for being our representative for the AARP.

ASSEMBLYMAN ROMANO: I don't know if I belong to New Jersey or the U.S.A. Somebody said to me, "You don't belong to the local chapter."

MR. SOLIS: New Jersey; 1.2 million from New Jersey, 33 million in the U.S.A.

ASSEMBLYMAN ROMANO: I belong to New Jersey, right?

ASSEMBLYWOMAN HECK: He wants to know--

ASSEMBLYMAN ROMANO: No, which one I belong to--



MR. SOLIS: Right.

ASSEMBLYMAN ROMANO: Your chapter or the national?

MR. SOLIS: I don't know what chapter you're a member of. You're a member of the national AARP, that's for sure.


MR. SOLIS: You have to do something to join a particular chapter in your area.


MR. SOLIS: I invite you to do so.

ASSEMBLYMAN ROMANO: I belong to you.

ASSEMBLYMAN COHEN: Assemblyman Romano was mixed up and he joined the B'nai B'rith by mistake. (laughter) But that's being corrected by the administration, also.

ASSEMBLYMAN ROMANO: I do have a question, Madam Chair, but not for Mr. Solis. In this conversation, it brought up another point they had.

ASSEMBLYWOMAN HECK: For Kathy Mason or the doctor?

ASSEMBLYMAN ROMANO: The good doctor. Which good doctor?


Are you a doctor? I thought you meant-- There is another doctor here from the Department of Health.


DEPUTY COMMISSIONER REINHARD: I am Dr. Reinhard. I'm a Deputy Commissioner.

ASSEMBLYWOMAN HECK: She is Dr. Reinhard.

ASSEMBLYMAN ROMANO: Oh, you are Dr. Reinhard. Well, you didn't use it in here. (indicating) Flaunt it. I have a doctorate. They call me doctor.

In your statement, you talked about there being a moratorium on shutoffs of utilities between November and March.

Madam Chair, you'll find this interesting, because I think I'm going to raise a very good point, Madam Chair.

Ho, ho, ho, what happens to the person who is not getting paid until April, May, or June?

How about that one, Madam Chair?

ASSEMBLYWOMAN HECK: That's a good question.


DEPUTY COMMISSIONER REINHARD: What we said earlier is that the utility-- There is an official moratorium that has always been there, even in the old system.


DEPUTY COMMISSIONER REINHARD: There is a moratorium not to shut off utilities. But, in addition, the utility companies have committed not to disrupt service of any sort to any Lifeline beneficiary. They understand the change that is going forward. They know they're going to get their credit, so nothing will happen.

What we meant to state in there is there has always been an official--

ASSEMBLYMAN ROMANO: Yes, but, Doctor--

ASSEMBLYWOMAN HECK: Year-round, he's talking about time.

ASSEMBLYMAN ROMANO: What I'm going by is-- When you said here there is a moratorium on shutoffs--


ASSEMBLYMAN ROMANO: That unofficial moratorium, or whatever the case might be, is that going to include the last possible day that someone can get a check, meaning the month of June?

DEPUTY COMMISSIONER REINHARD: There will be no turnoff of any utilities, that's correct, and that's at any time. That is what the utility companies have promised.

ASSEMBLYMAN ROMANO: Okay, so what you're saying-- This is the ordinary moratorium that has been preexisting.


ASSEMBLYMAN ROMANO: But you're saying additionally now, through the months of October and June, no one will have their electric shut off.

DEPUTY COMMISSIONER REINHARD: That's correct, and I should make that clear in the testimony and in points made to the public. Thank you.


Thank you, Madam Chair.

ASSEMBLYWOMAN HECK: Thank you very much.

ASSEMBLYMAN ROMANO: I think it was a very good point on my part, Madam Chair.

ASSEMBLYWOMAN HECK: It was a wonderful point, Assemblyman.


ASSEMBLYWOMAN HECK: Carl West from the New Jersey Association of Area Agencies on Aging.

C A R L F. W E S T: Thank you, Madam Chairwoman, members of the Committee.

My name is Carl West. I am the Executive Director of the Mercer County Office on Aging and also the Legislative Chair for the New Jersey Association of Area Agencies on Aging.

As most of you know, I'm sure, each of the 21 counties has an area agency on aging but has the responsibility of a number of areas. One, of course, is advocacy. The Federal charge to the area agencies is very significant in that area. I am here today as part of that advocacy responsibility.

We have examined the recent changes that have taken place, instituted by the Department of Health and Senior Services. We acknowledge the fact that it has caused a significant amount of problems regarding confusion on the part of senior citizens. We have, in fact, through the 21 county area agency network, received numerous calls regarding confusion and misunderstanding as to possible loss of benefits of their Lifeline Program.

We have found that when explained, most of our seniors understand and are not very welcome to that change; however, they recognize, in fact, that they will not lose any benefits. We also recognize within the network, because of the fact that our network has the responsibility of filling out and assisting in the completion of thousands of applications for PAAD and Lifeline, that it has been a confusing program in the past.

We frequently received calls in the past under the old system from older persons inquiring as to where their benefit checks are. In many cases, the delay has been caused due to the fact that due to the onslaught of the many applications that were received based on the deadline, the processing of those applications, oftentimes, delayed those checks. So we have had the need to communicate with the PAAD Program over the years to try to assist our older residents in receiving their checks.

We feel that the new system will promote a much more mellifluous processing of the claims. We feel that it is much better for our agency staff, who will also have the responsibility of assisting individuals, and also that it will provide for year-round eligibility, which had been a problem in the past because, oftentimes, even though with many of our agencies providing of bulletins and notices to the older adults about the deadline, there were often times when people became confused and missed those deadlines, and therefore, had to wait until the following year to receive services. We feel that this program is much superior to the former program.

We must acknowledge the fact that we kind of concurred with the Committee, Dr. Reinhard, in terms of there probably could have been a much better public relations job in terms of informing people. However, we know-- I don't want to say that older people are any different than anyone else. Oftentimes, change is not well received, and sometimes, change causes confusion.

I don't want to put that burden solely on old folk, and I think we ought to have that understanding quite clear, that often younger folks get confused, as well. I think it's a natural response when a change does occur, there will be some confusion, there will be some misunderstanding; however, I think in the long run, the older person will be the beneficiary of this new system.

With that, I close my remarks, Madam Chair.

ASSEMBLYWOMAN HECK: Mr. West, if I am correct in hearing you, you believe that this will result in a better delivery of services, particularly in the PAAD area, these changes?

MR. WEST: I think it definitely will, Madam Chair. As a matter of fact, we have always worked toward trying to streamline and make benefits less restrictive for our older residents. I think this is a move in the right direction, and for that, I must commend the Department of Health and Senior Services.

But, again, we recognize that there was some dropping of the ball in terms of public relations and notifying older people. However, again, I'm not sure even with the most ambitious promotion that, in fact, we still would not have a tremendous amount of confusion. Because, oftentimes, as we all do, we receive notices within our public service bills and what have you, and the only thing we look at is the bill. We throw the rest of it away, and there could be some very important information in that.

I think there was an attempt to try to notify individuals who were receiving benefits. I think we tried as an area agency on aging to notify people; however, we do recognize that there was a substantial number of people who went lacking in terms of information and understanding as to the change in program.

ASSEMBLYWOMAN HECK: I have to add to that, Mr. West, the information we got from some Paramus seniors. They were afraid that they were going to miss one year's worth of Lifeline benefits because of the change in dates. We have learned here today that is not the case.

Are there any questions?

Assemblyman Romano.

ASSEMBLYMAN ROMANO: Madam Chair, you have to allow me to compliment you again. Your earlier remark that when something was coming down the pike they should have, at least, notified the legislators, because then you, I, and all of our colleagues would find it upon ourselves to make sure that the word got out--

So I would just reiterate that and stand along side -- proudly along side -- of Chairperson Heck in her comment that I think we should be given a heads up on these sort of situations.

Again, I have to compliment you, Chairperson Heck.

ASSEMBLYWOMAN HECK: Oh, thank you, Assemblyman Romano, for those kind words.

MR. WEST: I would just like to add one additional item, Madam Chair, and that is that we do have safety nets for older people in the event that they are subjected to any cutoff. There are adult protective services programs that exist in each of the counties, and we do have resources that can assist in the case of emergency kinds of situations where there is a threat of cutoff of heating services.

ASSEMBLYWOMAN HECK: I must add, also, that the AARP and the Office on Aging does an outstanding job, because when there is a problem, they're certainly an outreach to the legislative offices immediately, and we had not gotten that kind of heads up from your organization. But, again, there were misunderstandings here we had to clarify and find that this is something beneficial and not detrimental to the delivery of services to our seniors.

Certainly, we thank you for coming here to clarify that, as well.

MR. WEST: Thank you, Madam Chair.

ASSEMBLYWOMAN HECK: Are there any other questions? (no response)

Thank you very much, Mr. West.

MR. WEST: Thank you.

ASSEMBLYWOMAN HECK: I don't believe there is anyone else present who wishes to speak. I thank everyone for making certain that we've gotten the message, and we can deliver the message to those seniors who were so very, very concerned.

If there is no further business, this hearing is adjourned.

Thank you.