Using Vouchers to Deliver Social Services: Learning from the Goals, Uses and Key Elements of Existing Federal Voucher Programs


Using Vouchers to Deliver Social Services:

Learning from the Goals, Uses, and Key Elements of Existing Federal Voucher Programs

March 30, 2007

By: Andrew Burwick and Gretchen Kirby Mathematica Policy Research (MPR)

Submitted to:U.S. Dept. of Health and Human ServicesAssistant Secretary for Planning & Evaluation

Project Officer: Alana Landey

Contract: HHS-233-020086, TO#5

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  1. Introduction
  2. Why Use Vouchers to Deliver Social Services?
    1. Goals of Voucher Use
    2. Legal and Policy Context
      1. Charitable Choice and the White House Faith-Based and Community Initiative
      2. The Establishment Clause and Distinctions Between Direct and Indirect Funding
      3. State-Level Policy and Blaine Amendments
  3. How are Vouchers Currently Used in Federal Programs?
    1. Voucher Use in HHS Programs
    2. Key Characteristics of Federal Voucher Programs
  4. What Are Key Implementation Experiences Among Voucher Programs?
    1. Vouchers and Child Care Assistance
      1. Assessing the "Fit" of Vouchers with Program Goals
      2. The Size and Diversity of the Service Delivery Structure
      3. Provision and Content of Consumer Education
      4. Policies and Procedures
      5. The Role of Faith-Based Organizations in Service Delivery
    2. Vouchers in Other Program Areas
      1. Facilitating Provider Participation
      2. Beneficiary Access and Response to Counseling
      3. Managing Payments and Accounts
    3. Outcomes of Voucher Programs
  5. Next Steps in Assessing the Use of Vouchers to Deliver Social Services



Vouchers have been a feature of federally funded programs for decades, but in recent years policymakers have given special emphasis to issues of individual choice and broad provider participation in these programs. In a variety of program areas — including nutrition, workforce development, child care, and others — funding services through vouchers has created the opportunity for clients to choose among a range of providers and allowed government agencies an alternative to direct service provision. In some cases, these providers include faith-based organizations, which face fewer restrictions on religious activities when they receive funding through vouchers. Proponents also argue that using vouchers can increase competition among providers and as a result help improve service quality and client satisfaction. These perceived advantages have encouraged continuing efforts to expand the use of vouchers in public service provision.

In the context of public services, the term "vouchers" encompasses a wide variety of practices and program arrangements. A voucher may be provided in the form of a subsidy; a coupon or electronic credit for a specific service or commodity; an account that is debited for the purchase of certain types of assistance or goods; or in other ways. Broadly speaking, vouchers provide benefits of a capped value and for a designated purpose, and they offer recipients some flexibility in choosing the provider of the good or service. The portability of vouchers ties benefits to an individual client. In this way, vouchers contrast with grants or contracts, which generally dedicate a set amount of government funding to a specific provider.

In response to growing interest among policymakers in maximizing client choice and expanding the service delivery network to include faith- and community-based organizations (FBCOs) among an array of providers, the U.S. Department of Health and Human Services (HHS), Office of the Assistant Secretary of Planning and Evaluation (ASPE) has contracted with Mathematica Policy Research, Inc. (MPR) to conduct a study of voucher use and provider choice for clients in HHS programs. The study will explore four main issues:

  1. The goals and policy contexts that shape voucher strategies in human services programs;
  2. The extent to which vouchers (and other indirect funding mechanisms) currently are used in select HHS programs;
  3. How voucher systems are implemented and the advantages and challenges they pose; and
  4. Lessons learned about using vouchers to expand service options available to clients, including services provided through FBCOs.

The study will focus on two programs, Temporary Assistance for Needy Families (TANF) and the Child Care and Development Fund (CCDF). Research will be conducted through discussions with policy experts and agency administrators at the state and federal levels, and through in-depth visits to several sites where HHS programs currently use indirect funding to deliver services.

This paper serves as a primer for understanding vouchers and their role in delivering social services. We begin by summarizing the reasons for considering the use of vouchers and the motivations for promoting their expansion (Section II). We then present an overview on how vouchers currently are used in public programs, with an emphasis on HHS programs (Section III). Next, we look to the experience of existing programs to provide lessons about the design and implementation of voucher programs, and assess what is known about their outcomes (Section IV). We conclude by outlining next steps for research on vouchers, particularly in the CCDF and TANF programs (Section V).

How to Obtain a Printed Copy

To obtain a printed copy of this report, send the title and your mailing information to:

Human Services Policy, Room 404E Assistant Secretary for Planning and Evaluation U.S. Department of Health and Human Services 200 Independence Ave, SW Washington, DC 20201

Fax:  (202) 690-6562


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