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Benefits Cliffs in Florida

In the state of Florida, benefits cliffs refer to a phenomenon where individuals experience a sudden loss of government assistance as their income exceeds a certain threshold. This loss of benefits can create a disincentive for individuals to increase their earnings, as they may end up worse off financially due to the loss of assistance. The biggest drivers of Florida’s benefits cliffs are the Medicaid program, the Temporary Assistance for Needy Families (TANF) program, and the Supplemental Nutrition Assistance Program (SNAP).

Florida’s Most Common Benefits Cliffs

In the state of Florida, there are several benefits cliffs that create challenging situations for individuals and families trying to improve their financial situation. Addressing these cliffs may require changes to eligibility criteria or benefit structure, as well as efforts to increase access to affordable health care and other services.

Florida’s Medicaid Cliff

One of Florida’s most significant benefits cliffs is related to the state's Medicaid program. Under the Affordable Care Act (ACA), states have the option to expand Medicaid coverage to low-income adults, but Florida has not done so. As a result, many Floridians face a benefits cliff when their income exceeds the eligibility threshold for Medicaid, but they are still unable to afford private health insurance.

Florida’s TANF Cliff

Another example of a benefits cliff in Florida is the state's Temporary Assistance for Needy Families (TANF) program. Families receiving TANF benefits can experience a sudden loss of assistance if their income exceeds a certain threshold, which can create a disincentive to work more hours or accept a higher-paying job.

Florida’s SNAP Cliff

Florida's Supplemental Nutrition Assistance Program (SNAP), which provides food assistance to low-income individuals and families, also has a benefits cliff. If a household's income exceeds a certain threshold, they can experience a sudden loss of benefits, which can create a disincentive to increase their earnings.

Business Impact of Florida’s Benefits Cliffs

There is limited data on how benefits cliffs impact Florida employers specifically, but research on similar programs in other states suggests that employers in Florida would be susceptible to many of the common workforce challenges related to benefits cliffs. Addressing these issues may require collaboration between employers, policymakers, and community organizations to ensure that workers have the support and resources they need to succeed.

Florida Cliffs and Employee Work Hours

One potential impact of benefits cliffs is that they can create a disincentive for employees to increase their earnings or work more hours. This can make it difficult for employers to retain workers or fill open positions, particularly in industries that require low-wage workers. Employers may need to offer higher wages or more flexible schedules to entice workers to stay or work more hours, which can increase labor costs.

Florida Cliffs and Employee Turnover

Another potential impact is that benefits cliffs can lead to turnover among employees who are trying to improve their financial situation. If employees face a sudden loss of benefits when their income increases, they may need to switch jobs or reduce their work hours to maintain their benefits. This can create instability for employers who rely on these workers and may need to invest in additional training or recruitment to replace them.

Florida Cliffs and Lack of Skilled Workers

Finally, benefits cliffs can contribute to a cycle of poverty that makes it difficult for employers to find skilled workers. When individuals are unable to access healthcare, education, and other resources that improve their economic prospects, they may be less likely to develop the skills and experience that employers need. The result is a skills gap that limits employers' ability to grow and innovate.

Policy Approaches to Florida’s Benefits Cliffs

Florida has implemented several welfare reform efforts aimed at reducing dependence on government assistance and promoting self-sufficiency among its residents.

In 1996, Florida implemented the federal welfare reform law known as the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), which required able-bodied adults receiving welfare to work or participate in work-related activities. Florida also implemented the Temporary Assistance for Needy Families (TANF) program, which provided cash assistance to low-income families with children.

In 2011, Florida Governor Rick Scott signed a law requiring drug testing for welfare applicants. However, the law was challenged in court and ultimately struck down by a federal judge as unconstitutional.

In 2014, Florida created a pilot program called the One-Stop Employment Assistance Program, which provided job training, education, and support services to TANF recipients. The program was later expanded statewide.

In 2015, Florida established the 'Welfare Transition Program', which provided job training, education, and support services to TANF recipients with the goal of helping them transition to long-term employment and self-sufficiency.

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