U.S. Government paid $1.6 billion in 2011 to cover the cellular bill for 12.5 million Americans
discount or free service for a landline or a cellphone. The program gives a $30 discount for the activation of a handset, and covers $10 monthly on an actual wireless bill. This works out to about 250 free minutes with the kind of plan required for the basic handsets used in the program. Food Stamp recipients, those who receive Medicaid or other Federal Aid, or those who earn as much as 35% over the federal poverty guidelines, qualify for the program.
But as with any Government program, there are those who abuse the system. Businesweek says 269,000 Lifeline customers are getting free service from two or more carriers. Senator Claire McCaskill (D-Mo.) has requested that the FCC investigate and the agency has obliged by building a database to see if a subscriber has more than one subsidized phone. While that might have been a useful tool from the beginning of the program, the FCC says after "modernizing" Lifeline, it has set a target of saving $200 million this year by catching those using the system for more than one account. So far, after ridding the rolls of those 269,000 users with multiple accounts, the FCC says it has saved $33 million.
The next time you are complaining about how "laggy" your high-end smartphone is, or you are upset about the latest feature just added to the newest model which you missed out on buying (like that 3300mAh battery), be thankful that you don't have to qualify for a basic handset from Uncle Sam to obtain cellular service.