Incentives to Help SNAP Households Purchase Healthy Foods

“Lower prices for some healthier foods, such as low-fat milk and dark green vegetables, are associated with decreases in children’s Body Mass Index,” concluded researchers at USDA in a 2011 report. “These results show that the effect of subsidizing healthy food may be just as large as raising prices of less healthy foods.”¹

Incentives make a lot more sense than restrictions if the goal is to encourage SNAP participants to choose healthy foods. As the research above suggests, for example, incentives could achieve the same goal intended by restricting soda purchases, but without stigmatizing families and making decisions on the details of daily life for working adults.

The 2008 farm bill authorized $20 million for a Healthy Incentives Pilot (HIP) to test whether SNAP households would take advantage of matching funds to purchase more fruits and vegetables.² State agencies from across the country were invited to compete to host the pilot. Hampden County, MA, was selected on the basis of a proposal submitted by the Massachusetts Department of Transitional Assistance.³ Hampden County is home to two of the poorest cities in Massachusetts (Springfield and Holyoke) and has the second-highest obesity rate of the state’s 14 counties.⁴

The pilot will begin in November 2011 and run for 15 months. For every dollar that SNAP households spend on fruits and vegetables, they will receive an additional 30 cents in benefits, up to a limit of $60 per month. “What this is doing is leveling the playing field for low-income folks, so that a healthier diet is within their reach,” explains Julia Kehoe, state commissioner of the Department of Transitional Assistance.⁵

To stretch their food budgets, poor households have little choice but to sacrifice the quality of food. Healthy foods like fruits and vegetables are more expensive and less filling than calorie-dense, processed foods. The latter are simply better at keeping hunger pangs at bay. For example, a dollar’s worth of potato chips buys five times as many calories as a dollar’s worth of vegetables—and seven times as many as fresh fruit.⁶

In 2010, 43 percent of SNAP participants lived on incomes that were 50 percent or less of the poverty level⁷—the definition of “deep poverty” in the United States. For a family of four, 50 percent of the poverty line means $7.55 per person per day for all expenses: food, housing, transportation, utilities, healthcare, and everything else.⁸

Incentive programs within SNAP are not new. State and local governments partnering with private industry and nonprofits have tied “bonus bucks” to making purchases at farmer’s markets. Wholesome Wave, a Connecticut-based nonprofit, sponsors an incentive program around the country to encourage SNAP recipients to shop at farmer’s markets, including one in Abingdon, VA. “The incentives get people to the market,” says Sara Cardinale, manager of the Abingdon Farmer’s Market. “We know that people are coming back, so eating habits appear to be changing.”⁹

Marie Crise is one of those who uses her SNAP benefits at the Abingdon farmer’s market. Crise’s situation is all too common. She fled an abusive husband with her 4-year-old son Lee. Currently homeless, they are staying with a relative, using a “couch-surfing” approach until they can afford a room or apartment. Crise is a nursing student at the local community college and she understands how important good nutrition is for Lee at this stage of his life. The farmer’s market is important to her because of the quality of the food. With the bonus bucks, she can feed her son well without having to sacrifice as much healthy food for herself.

After deciding how much she wants to spend from her SNAP benefits, Crise purchases tokens from the market’s manager. For every $10 in SNAP benefits that she converts to tokens, she receives an additional $5 to spend at the market. The manager swipes the SNAP debit card through a wireless point-of-sales machine, the same one used to swipe customers’ credit and bank debit cards.

Over the past decade, the Food Stamp Program/SNAP has made many changes to reduce the stigma once associated with the program. Perhaps the most significant has been the change from paper coupons to an electronic benefit transfer (EBT) card. At the grocery store, customers can access their SNAP benefits inconspicuously, as though they were using a bankcard. The EBT card has reduced the potential for fraud and the use of SNAP benefits for purposes other than food, but unfortunately the card has also made it harder for SNAP recipients to shop at farmer’s markets. Purchases made with SNAP benefits at farmer’s markets have plummeted since the introduction of EBT,¹⁰ because most vendors at the markets still deal in cash only. The Abingdon Farmer’s Market is among the small fraction able to handle electronic transactions.

Farmer’s markets offer an ideal opportunity to strengthen the relationship between U.S. nutrition and farm policy. USDA offers help to farmer’s markets that want to process SNAP benefits, but the technology to do so is expensive—the point-of-sales machine at the Abingdon Market cost $3,000—and the help USDA offers is mostly instructional, not financial. There are government programs that provide benefits for seniors and WIC families to shop at farmer’s markets, but not yet a similar program for SNAP participants. The United States has more than 40 million people receiving SNAP benefits. If the program provided participants with greater incentives to shop at farmer’s markets, markets across the country would have a powerful reason to invest in the necessary technology, while SNAP families would have more incentive to shop at farmer’s markets.

Nutrition education is key to getting people to try new foods. Most people don’t decide to improve their diets before they know what their options are. Farmer’s markets are an optimal environment for nutrition education. In fact, most are already engaged in some form of it, such as offering samples and recipes—nutrition education by another name could be just plain direct marketing. For the best results, trained personnel should be leading outreach efforts. In 2010, USDA’s Expanded Food and Nutrition Education Program (EFNEP) provided nutrition education to more than 600,000 adults and youths. The impressive results reported—at least 84 percent of adults and 57 percent of youth made improvements in diet, nutrition, and/or food savings—are typical for the program since its launch 40 years ago.¹¹

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