Impacts of the FCC’s Lifeline Reform Order Olivia Wein, Staff Attorney National Consumer Law Center NASUCA Mid-Year Meeting June 26, 2012 Charleston, South Carolina 1

FCC’s Revamped Lifeline Program Where low-income consumer advocates see the program advancing the goals of universal service Focus on the household instead of the house Creating a floor for eligibility criteria Movement toward a more uniform Lifeline program helps “brand” the program Intentional movement towards a portable Lifeline benefit Movement towards more flexibility for consumers to apply Lifeline to bundles and family plans (caveat: voluntary for ETCs) PLUS clear rules re preservation of voice service in the case of partial payments Low-income BB pilots and digital literacy 2

Where We See Barriers and Risk of Loss The program has gone through a serious overhaul w/ big changes: e.g., new application and documentation requirement and verification process (for all LL recipients), and changes to eligibility Numerous certifications; datafields; one-per-household worksheet(group housing; doubling-up; temp housing) New rules re duplicates and processes re dups (in-depth data valuations and the NLAD database) and de-enrollment (4 ways to de-enroll) Notice and disclosure obligations on ETCs, but could become boilerplate. Need aggressive and robust outreach and edu, but funding is an issue for CBOs and others who are on the frontline. 3

What is covered by Lifeline? Current/Old Lifeline Lifeline is a discount on basic local phone service. The federal Lifeline benefit is up to $10.00, but varies by phone carrier (tiers of support). There are landline and wireless carriers who participate in the program (ETCs). New Lifeline “Voice telephony service”; expands past “local” service. Set support amount ($9.25) Permits carriers to allow LL benefit on all residential service packages that include voice, including bundles and family shared calling plans. 4

Who is eligible? Current/Old Lifeline Eligibility varies from state to state. States can set eligibility based solely on income or factors directly related to income. Federal default eligibility (8 states/2 territories) HH income at or below 135% FPG, or Participation in Medicaid, SNAP, SSI, Federal Public Housing Assistance; LIHEAP, TANF, NSL Free Lunch Program New Lifeline All states must use, at a minimum, the federal default eligibility criteria (baseline eligibility). States may adopt additional program or income criteria. NPRM – WIC; establishing eligibility for homeless veterans 5

New Eligibility and Enrollment Highlights One Lifeline Benefit Per “Household” Doubling up/group housing process Temporary address process Moving towards automation for enrollment and verification (Medicaid, SNAP, SSI) Numerous certifications and documentation required for all applicants All Lifeline customers must verify continued eligibility New rules apply to the LI Broadband pilots 6

PrePaid Wireless Lifeline Wireless Lifeline is fairly new, but extremely popular The wireless lifeline products vary, but prepaid is the current form Characteristics of common prepaid wireless lifeline: federal Lifeline, no deposit, no monthly fees, subsidized minutes reloaded every month, set number of minutes, free handsets LL customer must activate service; 60-day inactivation procedure Portability of Lifeline will allow consumers to shop with their feet and hopefully put pressure on ETCs to provide better products. 7

54.405(e) 4 de-enrollment situations General situation: deference to state dispute resolution procedures Duplicates: ETCs must de-enroll if USAC flags a duplicate account (but need to ensure USAC has a good dispute resolution procedures: correctable denial and uncorrectable denials; concern re changing carriers) 60-day non-usage of prepaid wireless Lifeline: note the reporting requirement of number de- enrolled for this reason Failure to recertify (annual verification & 1-per- HH re-cert, and the temporary address recertification*) (*not in effect) 8

Duplicates and Database(s) Process started in the states to check for duplicate Lifeline support (in-depth data valuations) and will likely continue until duplicates database is operational. Moving to an automated check for duplicate benefits (National Lifeline Accountability Database) Need consumer’s consent to transmit info to USAC for the duplicates check SSNs (last 4 digits): privacy/security/limits access Temp/doubling up/group housing processes 9

Consumer information/data fields (b)(6) NLAD Full name Full res’l address DOB SSN/tribal ID number (last 4) Date service initiated/terminated Amount of support sought How qualified (d)(2) applications Full name Full res’l address –Temp/perm address –Check box if multiple HH at address –Billing address if different DOB SSN/tribal ID number (last 4) If program eligible, which program If income eligible, how many in HH 10

54.410(d)(3) certifications for new applicants Applicant meets eligibility criteria Duty to notify ETC if no longer eligible If applying for Tribal LL, lives on tribal land Duty to notify ETC if moves to new address If provided a temp address, duty to recertify every 90 days Household only receives one LL benefit Information is true and correct Consequences of providing false info 11

Key take-away The outreach and education will be critical to mitigate loss in participation during this transition and moving forward. Documentation; certifications; timelines Understanding de-enrollment and the processes for correcting denials Duplicates/one-per-household/NLAD 2012 – annual re-certification of all existing LL customers; More guidance will be issued re 2013 and moving forward 12

Next Steps Low Income Broadband Pilots Issues still under consideration Eligibility Database (cost/ feasibility) Digital Literacy Program WIC Eligibility for Homeless Veterans Mandatory Application of Lifeline to Bundles Lifeline Support Amount Eligible Telecommunication Carrier Requirements Tribal Lands Support Other 13

For More Information Olivia Wein, Staff Attorney National Consumer Law Center 1001 Connecticut Avenue, NW, Suite 510 Washington, DC