How Cash and Counseling Affects Informal Caregivers: Findings from Arkansas, Florida and New Jersey




U.S. Department of Health and Human Services


How Cash and Counseling Affects Informal Caregivers: Findings from Arkansas, Florida, and New Jersey

Executive Summary

Leslie Foster, Randall Brown, Barbara Phillips and Barbara Lepidus Carlson

Mathematica Policy Research, Inc.

July 2005

This report was prepared under contract #HHS-100-95-0046 between the U.S. Department of Health and Human Services (HHS), Office of Disability, Aging and Long-Term Care Policy (DALTCP) and the University of Maryland. For additional information about the study, you may visit the DALTCP home page at or contact the ASPE Project Officer, Pamela Doty, at HHS/ASPE/DALTCP, Room 424E, H.H. Humphrey Building, 200 Independence Avenue, SW, Washington, DC 20201. Her e-mail address is:



This report has benefited greatly from the thoughtful comments and suggestions of several people. In particular, we appreciate input from external reviewers A.E. (Ted) Benjamin (UCLA Center for Health Policy Research), Rosalie Kane (University of Minnesota School of Public Health), and Robyn Stone (Institute for the Future of Aging Services). Several members of the Cash and Counseling Demonstration and Evaluation management team--Kevin Mahoney, Marie Squillace, and members of the staff of the Centers for Medicare & Medicaid Services (CMS)--provided useful comments. We also appreciate comments from the Florida Consumer Directed Care Plus program in the Department of Elder Affairs.

Several colleagues at Mathematica Policy Research, Inc. made the report possible. Nora Paxton and Amy Zambrowski programmed the analysis, and Valerie Cheh provided comments on an earlier draft. Patricia Ciaccio edited the report, and Jill Miller produced it.

The opinions presented here are those of the authors and do not necessarily reflect those of the funders (the Robert Wood Johnson Foundation and the U.S. Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation), the Cash and Counseling National Program Office, CMS, or the demonstration states.



Cash and Counseling Is a Promising Way to Deliver Medicaid Supportive Services.

Adult Medicaid beneficiaries who have disabilities and live at home rely mostly on unpaid family members and other informal caregivers for personal care. States supplement beneficiaries' informal assistance with disability-related supportive services. These are usually delivered through a Medicaid state plan as personal care services (PCS) or through a Medicaid waiver program as home and community-based services (HCBS). If beneficiaries find their services unsatisfactory or too inflexible to meet their needs, the burden to compensate for those shortcomings often falls on informal caregivers, potentially causing them emotional, physical, and financial strain.

The Cash and Counseling Demonstration and Evaluation, implemented in Arkansas, Florida, and New Jersey, gave eligible Medicaid beneficiaries the opportunity to receive a monthly allowance to purchase supportive services of their choosing. By helping beneficiaries avoid the potential drawbacks of traditional PCS and HCBS, Cash and Counseling programs could also be expected to improve the well-being of beneficiaries' informal caregivers.

This report estimates the effects of Cash and Counseling on the caregivers who were providing the most unpaid assistance to adult beneficiaries when those beneficiaries volunteered to participate in the demonstration and completed a baseline interview. The caregivers in this analysis--identified by beneficiaries as their primary informal caregiver at baseline--were interviewed about 10 months later.

A Rigorous Design Provided Definitive Evidence of Program Effects on Caregivers.

The demonstration and evaluation used a randomized design. After a completing their baseline telephone interview, participating beneficiaries were randomly assigned to direct their own Medicaid supportive services as Cash and Counseling consumers (the treatment group) or to rely on PCS or HCBS as usual (the control group). The primary informal caregivers of treatment group consumers could be affected by Cash and Counseling if those consumers: (1) hired the primary informal caregiver as a worker or named him or her as their representative decision maker; (2) adjusted the amount, timing, and types of services used; or (3) purchased assistive devices or home modifications.

Data on caregiver outcomes were collected through telephone interviews. These were conducted between February 2000 and May 2003, depending on the state, and were completed by 1,433 caregivers in Arkansas, 1,193 in Florida, and 1,042 in New Jersey. Caregivers, who typically were related to their care recipients, were asked factual questions about the frequency, amounts, timing, and types of assistance they provided and about their labor force participation and income. They were asked for their opinions on the quality of their relationships with care recipients; their satisfaction with care recipients' care; and their own emotional, financial, and physical well-being, and satisfaction with life. Program effects were estimated by comparing outcomes for the caregivers of treatment group members with those for the caregivers of control group members. Regression models controlled for the baseline characteristics of care recipients and the demographic characteristics of caregivers.

Treatment Group Caregivers Reported Greater Well-Being in All Three States.

Despite variations in design and implementation across states, all three demonstration programs positively affected the well-being of caregivers. On average, the caregivers of treatment group members were less likely than their control group counterparts to report high levels of physical and financial strain. Treatment group caregivers worried less about insufficient care and safety and were more likely to be very satisfied with their care recipient's overall care arrangements. They were also less likely to say caregiving impinged on their privacy, social lives, and job performance. On average, treatment group caregivers were much more likely than their control group counterparts to be very satisfied with their own lives.

For some outcomes, the estimated effects were proportionally largest, relative to control group means, in Arkansas. Arkansas also had the largest proportion of treatment group members receiving the Cash and Counseling allowance when we interviewed caregivers.

As expected, some treatment group caregivers were paid for caregiving during the follow-up period (56 percent in Arkansas, 29 percent in Florida, and 42 percent in New Jersey). To explore whether Cash and Counseling affected paid and unpaid treatment group caregivers differently, we estimated program effects separately for each of these subsets. The results suggested that getting paid for caregiving was not the sole determinant of improved well-being but that it did contribute to magnitude of many treatment-control differences.

An analysis of program effects by care recipients' age group suggested that Cash and Counseling can positively affect the well-being of caregivers for elderly and nonelderly adults (as evidenced in Arkansas and Florida). The same analysis suggested that benefits to well-being may diminish if caregivers provided more hours of assistance under Cash and Counseling than they would have provided otherwise (as evidenced in New Jersey among caregivers for nonelderly care recipients).

The Implications for Medicaid Policy Are Encouraging.

The three-state findings were robust and encouraging. Viewed with earlier evaluation results, they illustrate that when Medicaid beneficiaries wish to direct their own supportive services and do so, both they and their primary informal caregivers benefit. Improvements seemed to come about because some informal caregivers became paid workers and some care recipients made service arrangements that lightened their caregiver's burden. The three demonstration states continue to operate their Cash and Counseling programs under Section 1115 authority of the Social Security Act (without random assignment). Other states have good reason to consider offering consumer-directed options as part of their Medicaid systems.