Means testing is a procedure used to determine eligibility for which type of programs?

Means testing is a procedure used to determine eligibility for which type of programs?

• A. Contributory programs
• B. Noncontributory programs
• C. Universal programs
• D. Private insurance

Answer: (B)

Means testing checks whether a person’s financial situation meets a need-based threshold to qualify for benefits. This approach is a hallmark of noncontributory programs, which are funded from general tax revenues and designed to assist people with low income or limited resources, without requiring prior earnings-based contributions. Contributory programs, by contrast, rely on benefits tied to what people have paid into the system through payroll taxes, so eligibility isn’t determined by current income level. Universal programs are available to everyone regardless of means, so means testing doesn’t decide eligibility there. Private insurance operates in the market rather than as a government means-tested welfare program.

Means testing checks whether a person’s financial situation meets a need-based threshold to qualify for benefits. This approach is a hallmark of noncontributory programs, which are funded from general tax revenues and designed to assist people with low income or limited resources, without requiring prior earnings-based contributions.

Contributory programs, by contrast, rely on benefits tied to what people have paid into the system through payroll taxes, so eligibility isn’t determined by current income level. Universal programs are available to everyone regardless of means, so means testing doesn’t decide eligibility there. Private insurance operates in the market rather than as a government means-tested welfare program.