Ancillary Services to Support Welfare to Work. Lack of Health Insurance

06/22/1998

Introduction

Concerns regarding the need for health care benefits may deter many welfare recipients from leaving public assistance and seeking employment. Because time limits will force a severance from welfare, agencies must address both clients' lack of awareness of transitional Medicaid benefits and their limited opportunities for employment that provides private health coverage. Without adequate health coverage, former welfare recipients, particularly those with poor health, chronic medical conditions, and disabilities, may be forced to return to welfare in order to meet their health insurance needs.

This section provides information on and addresses the following questions related to health insurance needs among welfare recipients:


NEED FOR SERVICES

  • How is the lack of health insurance defined?
  • What percentage of the welfare population faces this barrier to employment?
  • What relationship does the lack of health insurance have to welfare dependency and employment?

Definition

All welfare recipients need health insurance when they exit welfare for work. The need for health insurance is particularly acute for those clients with poor health, chronic medical conditions, or disabilities, all of which can require relatively large medical expenses. We define the barrier to employment posed by the lack of health insurance simply as the proportion of the welfare population that does not receive health insurance upon exiting welfare, either from a private insurance agency, through employer-provided coverage, or through the Medicaid program. Particularly through Medicaid, adult welfare recipients may qualify for extended benefits via several routes, including Transitional Medicaid Assistance (TMA), medically needy coverage or, in some states, programs that offer extended health care coverage for people with low income. We devote particular attention to transitional Medicaid (TMA), since it is the primary route to Medicaid coverage for adults leaving welfare for work.

We concentrate our discussion on health care coverage for adult welfare recipients. Nevertheless, it is important to note that many former welfare recipients and families with low income also face significant barriers to employment because of lack of health insurance for their children, particularly children who suffer from poor health, chronic medical conditions, and disabilities.(1) Children are eligible for Medicaid through several routes, including TMA and expanded Medicaid coverage for children from families with low income. In addition, the recently-enacted State Children's Health Insurance Program (CHIP) provides funding for states to develop comprehensive health insurance coverage for children not covered by either Medicaid or employer-sponsored health insurance.(2) Health insurance coverage for children from low-income families is generally available over longer periods of time than it is for adults. Although we do not examine health insurance coverage for children in this report, many of the same program implementation issues related to coverage for adults (and discussed in this chapter) are also relevant for children.

ESTIMATION OF NEED:

Percentage of Welfare Population Facing This Issue

Health Insurance Receipt of Adult Welfare Recipients

(Medicaid) Three Months After Exiting Welfare

State/local estimates: 17 to 29 percent

Health Insurance Receipt of Adult Welfare Recipients

(Either Medicaid or Private)

One Year After Exiting Welfare

National estimate: 77 percent
  25 percent insured privately

52 percent insured by Medicaid

Health Insurance Receipt

(Either Medicaid or Private)

Three Years After Exiting Welfare

National estimate: 55 percent
  38 percent insured privately

17 percent insured by Medicaid

The estimates suggest that many eligible clients do not receive available Medicaid benefits when they leave welfare, either because they are not easily identified by case workers as eligible for these benefits, and/or because they do not know themselves that they are eligible. During the year after leaving welfare, enrollment in Medicaid increases, suggesting that clients are enrolled not at the time they exit, but throughout the following year. Over time, as eligibility for Medicaid expires, more clients rely on private insurance. However, more also go uninsured--estimates show that close to half of former welfare recipients were not covered by health insurance three years after exiting welfare. These health insurance needs are particularly acute for the estimated 10 to 20 percent of welfare recipients nationwide who suffer from a work-related (physical) disability. The chapter on Disability in this document provides more information on this topic.

Table 13 in Appendix A provides estimates from two states of the proportion of the welfare population that received Medicaid three months after leaving welfare. Tables 14 and 15 in Appendix A each provide a single national estimate of the proportion of the welfare population that received insurance--either privately or through Medicaid--one and three years after exiting welfare, respectively. The range in the two estimates from Table 13, summarized in the first box above, is due primarily to the following factor:

  • Policy Context. Differences between states in health care policy may account for some variation in state Medicaid participation rates. The availability of private health care and the coverage provided by Medicaid, combined with clients' knowledge of benefits, can all influence whether those transitioning into the workforce take advantage of Medicaid benefits.

Relationship to Welfare Receipt

  • Interviews and focus groups with welfare recipients in two states showed that about three-fifths of welfare recipients did not know that they could work full-time and receive Medicaid through TMA (Shuptrine et al. 1998; and Shuptrine and McKenzie 1996b).
  • Concern for health care benefits prompts many welfare recipients to continue receiving public assistance and acts as a disincentive to seeking employment. Welfare families with high predicted medical expenses are significantly less likely to exit welfare than families with low predicted medical expenses, despite the availability of transitional Medicaid (Ellwood and Adams 1990). In California, families with expected monthly medical expenses of $200 are about 20 percent less likely to leave welfare than similar families who expect only $25 per month in medical expenses (Ellwood and Adams 1990).
  • Self-reported poor health increases by nearly 12 percentage points the chance that a woman exiting welfare will return to it (Davidson and Moscovice 1989).

Relationship to Employment Status

  • Results from the Postemployment Services Demonstration show that less than half of all welfare recipients get jobs that offer health insurance as a benefit (Rangarajan 1996).
  • Analyses from the state of Texas project that by the year 2000 about half of all employment opportunities for clients forced to leave welfare because of time limits will not offer health insurance as a benefit (Lawson and King 1997).
  • A review of literature from 1989 to 1996 suggests that family health issues affect both the transition rate from welfare to work and the probability that single women with children will stay employed (Wooldridge and Hoag 1996).

WELFARE AGENCY APPROACHES:

  • What can welfare agencies do to ensure that clients' medical needs are met through the provision of health insurance?
  • What does the evidence suggest about the effectiveness of addressing this barrier?
  • What do we know about program costs?
  • What do we know about program implementation?

The two critical program features of an agency's approach to addressing the need for health insurance among clients exiting welfare for work are (1) identifying which clients do not have health insurance, and (2) determining which type of program strategy to implement.

Client Identification

All clients need health insurance, particularly as they move from welfare to work and continue to progress toward self-sufficiency. For people with chronic health conditions, disabilities, and mental illnesses, adequate health care coverage is critical. To ensure that clients' medical needs are met, welfare agencies must be able to identify accurately and expeditiously those clients who need health insurance when they exit welfare and then ensure that they are covered through the Medicaid program or some other health care plan. The process of identifying clients who need health insurance, including those with specific medical needs, essentially involves a two-part process:

  • Conducting outreach with clients at intake, redeterminations, and at other relevant times in order to educate them about (1) the availability of Medicaid and other health insurance benefits after they exit welfare for work, and (2) the importance of notifying caseworkers when they leave welfare in order to facilitate continued Medicaid coverage.
  • Periodic follow up with those clients recently new to the workforce in order to monitor the status of health insurance coverage, including the Medicaid program, subsidized private health insurance plans, and employer-sponsored health insurance plans.

State and local welfare agencies use different methods to identify clients without adequate health insurance. A promising approach involves conducting education and outreach through user-friendly brochures and informational materials designed to increase staff, client, and community awareness about the availability of transitional and other health care benefits for clients when they exit welfare for work. This critical first step can be used in combination with automated management information systems that link together data from various public assistance agencies, thereby facilitating the process of tracking and identifying clients who may need health insurance after they exit welfare.

Program Strategies

As welfare recipients move from welfare to work, state and local agencies are enhancing program efforts to ensure that clients' medical needs are met through the provision of health insurance. Our review of programs suggests that there are at least three broad program strategies designed to address barriers to employment caused by lack of health insurance. This review is concerned chiefly with examining what welfare agencies can realistically hope to accomplish in terms of ensuring the provision of health insurance for clients when they leave welfare for work.(3) We categorize these strategies below. The distinctions drawn are not intended to suggest that agencies design programs around a single strategy or that these strategies are necessarily mutually exclusive. They are provided instead to foster thinking about the range of programmatic objectives possible, to help agencies define their own service needs, and to classify the programs described at the end of this section for agencies interested in pursuing further information. The three broad program strategies are as follows:

Educational Outreach. Programs with this strategy, by providing training to staff from welfare agencies, community organizations, and employers of low-income workers, aim to increase awareness and use of public assistance benefits, including those available through the Medicaid program after clients exit welfare for work. Informational brochures and other materials are used to supplement training and increase staff (and ultimately client) awareness of these benefits.

Service Coordination. Programs with this strategy strive to institute improved coordination systems or procedures between agencies to help clients access services and benefits. Coordination takes numerous forms, including the availability of on-site medical services and the use of statewide automated information systems to track client needs, benefits, and services over time.

Increased Service Capacity. Programs with this strategy aim to support clients moving from welfare to work by increasing the availability of some form of health coverage. These programs include those that offer subsidized private health insurance, cover part of the cost of employer-sponsored health insurance (for instance, employee premiums), and expand public health care benefits.

Program Outcomes

We know very little about the impact and comparative effectiveness of different types of welfare agency strategies that aim to increase clients' access to and receipt of health insurance after they exit welfare. Educational outreach efforts, in combination with sophisticated management information systems, represent simple and sensible approaches to increasing Medicaid participation after clients exit welfare, for instance, through TMA. Moreover, timely and accurate dissemination of benefit information can help prevent clients from avoiding work out of a mistaken fear of losing health insurance after exiting welfare. While results from a study of the outreach initiative of the Southern Institute on Children and Families suggest that this initiative led to increased knowledge about transitional and other benefits (Shuptrine and McKenzie 1996a), no evidence exists about whether actual enrollment in TMA increased or whether the disincentive to work was minimized. Likewise, while enhancements to management information systems in several states may increase the likelihood that TMA participation will increase, studies to support this have not been identified. While TMA participation data from several states are available through the Health Care Financing Administration's Medicaid State Information System, few states have systematically tracked the use of TMA benefits.

Although evidence is not available on the impact of welfare agency efforts to meet clients' medical needs through assistance with procuring health insurance, research consistently has shown that health insurance is a critical factor in helping clients make a successful transition from welfare to work. Although most of this research was conducted prior to welfare reform, recent extensions to transitional Medicaid benefits and welfare time limits have probably offset some of the disincentive to work of clients fearing the loss of health insurance when they exit welfare. Relevant findings that support the importance of health insurance to clients as they exit welfare for work are highlighted below.

Effect of Health Insurance on EMPLOYMENT(4)

  • Projections suggest that if private health coverage were extended to all working female heads of household, employment would increase by 14 percent (Moffitt and Wolfe 1992).
  • In the context of welfare reform, if the TMA participation rate were increased from 20 percent to 50 percent during the first six months after clients leave welfare and from 15 to 25 percent during the second six months, the employment of former welfare recipients would increase by 6 percent during the four-year period after clients exit welfare (Wooldridge et al. 1997).

Effect of Health Insurance on WELFARE RECEIPT

  • Projections suggest that if private health coverage were extended to all working female heads of household, welfare caseloads would be reduced by 11 percent (Moffitt and Wolfe 1992).
  • Extending private health insurance to clients when they exit welfare reduces by five percentage points the likelihood of returning to welfare one year later (Davidson and Moscovice 1989).
  • Descriptive data collected by the state of Minnesota suggest that the MinnesotaCare program (a managed care program for low-income families not receiving welfare) has led to small reductions in the welfare caseload (press release 1995).

Program Costs

No information was identified in the literature on the actual costs to welfare agencies of operating programs designed to increase health insurance coverage among clients after they exit welfare for work. The relative cost of different types of program strategies, however, varies considerably. For instance, straightforward educational outreach efforts are relatively inexpensive to develop, though may require modest amounts of staff time once implemented. Service coordination strategies that use sophisticated management information systems to improve the processes of client tracking, eligibility determination, and service delivery are likely to decrease staff time necessary to complete tasks and, ultimately, increase the overall efficiency of welfare agency operations. In contrast, strategies to increase service capacity by extending transitional Medicaid coverage have relatively high initial costs; however, these may be assumed largely by the state Medicaid agency.

All these strategies seek to increase health care coverage among welfare clients as they make the transition to work. When health care coverage expands through increases in Medicaid utilization rates, the costs of the Medicaid program will increase as well. To the extent that these initial Medicaid cost increases are offset by longer-term reductions in welfare--as more clients are able to sustain employment and, ultimately, shift their health care coverage from Medicaid to private insurance--long-term savings to states are likely to be result. Recent microsimulation analyses show that, in the context of welfare reform, increases in Medicaid utilization through TMA would ultimately lead to small cost savings for states, as increases in state Medicaid expenditures due to higher TMA enrollment would be offset by reductions in welfare costs and increases in federal Medicaid matching funds (Wooldridge et al. 1997).

Program Implementation

Some welfare agencies have recently increased efforts to ensure that welfare clients are enrolled in health insurance plans such as transitional Medicaid when they leave welfare for work. In addition, state governments have expanded the period over which welfare clients can receive health care benefits after they exit welfare, and some private social services organizations have coordinated efforts with health care systems to help underwrite low-cost health coverage for low-income workers. Lessons have been learned from all these efforts about how to provide health insurance to low-income workers. At some level, these lessons are all relevant to welfare agencies as they address clients' health insurance needs. Our synthesis of various program strategies leads to a discussion of implementation issues welfare agencies and other organizations face in four key areas: (1) program staff, (2) coordinated delivery of services through enhanced management information systems, (3) employment integration, and (4) service capacity. Along with the discussion, we recommend steps welfare agencies should take to successfully meet clients' health care needs.

Program Staff

A critical first step for successfully increasing Medicaid coverage for eligible clients after they exit welfare involves educating clients about available transitional Medicaid benefits. This requires a substantial commitment to training staff and providing them with appropriate outreach materials. TMA participation is lower than expected (Kaplan 1997). Since clients must be informed about the availability of these transitional Medicaid benefits and welfare agency staff must take administrative steps to determine eligibility and enroll clients in the program, accessing benefits can be difficult and burdensome for both clients and staff. The underutilization of benefits results in large part from low awareness of available benefits among clients. For instance, when clients exit welfare for work without notifying caseworkers of their employment status, it can make it much more difficult for caseworkers to determine if a client is eligible for transitional benefits. The underutilization of transitional benefits may be heightened if clients mistakenly believe that Medicaid benefits are time-limited or count towards clients' lifetime welfare limits. In addition, the administrative burden on staff is exacerbated by limits on their time during client interactions and scarcity of appropriate educational materials (Kaplan 1997).

Staff play a critical role informing clients about benefits, determining eligibility, and helping clients obtain appropriate benefits as their needs change. To prepare staff to perform these roles requires initial and ongoing training on transitional benefit issues, including how to convey critical information to clients, as well as how to conduct outreach to provide information on transitional benefits to community-based service providers and employers of low-income workers. The use of informational brochures and other materials can be used to strengthen staff capacity to disseminate this information effectively. In addition, periodic follow-up with clients after they exit welfare could be used as a means to discuss the availability of continued Medicaid coverage.

Recent legislation authorizes $500 million in federal funds to be used to match, at an enhanced rate, state expenditures on Medicaid outreach and educational activities. Welfare agencies might wish to consider working with Medicaid agencies to tap into federal matching funds that support outreach and educational activities aimed at increasing TMA enrollment (Kaplan 1997).

Coordinated Delivery of Services

To facilitate the process of enrolling eligible clients in Medicaid, welfare agencies should design management information systems that better track and identify clients who lack insurance and then automatically enroll these clients in available health insurance plans. Eligibility for welfare and Medicaid are currently less closely linked than they were before welfare reform, which makes the procedures related to administering transitional Medicaid benefits somewhat more burdensome (Ku and Coughlin 1997). As a result, many states have enhanced or are currently enhancing their management information systems in order to simplify and expedite Medicaid eligibility determination and enrollment after clients exit welfare. If welfare agencies more closely integrate or link the TANF system and its data with those from the Medicaid agency, they might help minimize administrative steps, better track clients once they exit welfare, facilitate the timely determination of transitional Medicaid eligibility, and expedite the enrollment of eligible clients. Improving management information systems to better track clients and identify their needs after they leave welfare for work is a step that welfare agencies should take to ensure that more clients receive health insurance. Doing so will require that welfare agencies closely coordinate efforts with state Medicaid agencies.

Employment Integration

To support clients as they move from welfare to work, welfare agencies should offer services directly linked to helping clients obtain jobs that provide health insurance and other important benefits. Since less than half of welfare recipients who exit welfare for work get jobs that offer employer-sponsored health insurance as a benefit (Rangarajan 1996), developing ways to help clients access such jobs is an important challenge for welfare agencies. Few welfare agencies offer programs that directly combine job search assistance and other employment-related strategies with systematic efforts to access jobs that provide health insurance. Meeting this challenge will require balancing the need to employ clients quickly because of the welfare time limits with the need to help clients identify and obtain jobs that offer adequate health care benefits.

Welfare agencies, on both a state and a local level, should develop job banks highlighting potential employers who offer health insurance and other important benefits, either at the point of hire or after a specified period of time. Welfare clients and staff can use such job banks to search for appropriate long-term employment. To the extent possible, welfare agencies should also tailor education and job-training strategies to better fit the hiring criteria of employers who offer important benefits. Conducting outreach with these employers may help to strengthen the relationship between welfare agencies and employers, increase employer awareness of clients' need for health insurance after Medicaid benefits expire, and, ultimately, facilitate the process of helping clients obtain good jobs.

 

Service Capacity

To meet the health care needs of welfare clients and former clients successfully, welfare agencies must assess the extent to which current local health care capacity provides insurance for clients and, where gaps exist, help to address shortages. Since most states do not provide indefinite health insurance benefits to low-income families, and since few welfare recipients get jobs that offer health insurance as a benefit, increasing the availability of health insurance for clients as they move from welfare to work is a priority. State governments have already taken a variety of steps to expand health care coverage for clients, through both the Medicaid program and private and employer-sponsored plans. In addition, welfare agencies could contribute to subsidized efforts that expand transitional Medicaid benefits or that insure more clients through private or employer-sponsored health insurance. To the extent possible, welfare agencies should consider coordinating efforts with state Medicaid agencies, employers of low-income workers, HMOs, and other managed care plans to help increase the capacity of the health care system to provide insurance to former welfare clients.

Program Models(5)

  • What are welfare agencies doing to address this issue?
  • Whom can I contact?

The following programs are presented alphabetically by state. The reader can determine the relevance of a program by noting its primary program strategy and geographic location and then refer to the brief descriptions and contact information on the subsequent pages. We have used primary objective(s) to assign program strategies, though a program may have many objectives.


Expansions to State Health Care Benefits

States of Maryland, Minnesota, Vermont, and Wisconsin

Program strategy: Service capacity

Location: Statewide


Improvements to Automated Management Information Systems

States of Ohio and Tennessee

Program strategy: Service coordination

Location: Statewide


Southern Institute on Children and Families

Educational Outreach Initiative

Columbia, South Carolina

Program strategy: Educational outreach

Location: Available in urban/suburban/rural counties in most southern states


New Hope Project, Inc.

New Hope Demonstration Program

Milwaukee, Wisconsin

Program strategy: Service capacity

Location: One urban community


Program Name

Expansions to State Health Care Benefits

States of Maryland, Minnesota, Vermont, and Wisconsin

 
Program strategy: Service capacity

Location: Statewide

Brief Program Description

To expand access to health insurance and minimize the extent to which medical needs act as a barrier to employment for welfare recipients, many states have expanded health insurance for individuals through, for instance, changes to Transitional Medicaid Assistance (TMA). Such expansions have been realized under federal waivers and in a variety of different ways, for example:

  • Maryland, TMA Benefits in Lieu of Cash Assistance. Maryland extended TMA to include low-income families who are at-risk of receiving cash assistance through welfare. TMA benefits are extended to such families for up to 15 months in order to divert them from welfare.
  • Minnesota, Expanded Enrollment in the MinnesotaCare Program. Minnesota expanded access to health care for low-income families who do not qualify for Medicaid. Families with income up to 275 percent of the federal poverty level can buy into the MinnesotaCare program, with the buy-in cost determined by a sliding-fee scale.
  • Vermont, Extended TMA Benefits. Vermont extended Transitional Medicaid Assistance to 36 months after clients exit welfare or until the family's income reaches 185 percent of the poverty level, whichever comes first. Reporting of income is required semiannually. Benefits over the extended period are intended to enable former welfare clients to move into higher-wage jobs that provide health insurance coverage before their transitional benefits are exhausted.
  • Wisconsin, Expanded Health Insurance Coverage. The state of Wisconsin plans to offer expanded access to health insurance for families with incomes up to 185 percent of the poverty level, with copayments required for families with incomes exceeding 165 percent of the poverty level.

Program Name/Contact

Improvements to Automated Management Information Systems

States of Ohio and Tennessee

State of Ohio: Greg DePorter

Ohio Department of Human Services, Office of Communications

614-466-6650

 

State of Tennessee: Carol Brown

Tennessee Department of Human Services, Information Technology

615-313-5197

Program strategy: Service coordination

Location: Statewide

Brief Program Description

Through coordinated efforts with state Medicaid agencies, many state welfare agencies have enhanced or are currently enhancing their management information systems in order to simplify and expedite the process of determining client eligibility, tracking client needs, and enrolling clients in Transitional Medicaid Assistance (TMA). These systems help to ensure that more clients receive health insurance when they exit welfare for work.

State of Ohio. The Ohio Department of Human Services' CRIS-E management information system has enabled Ohio to improve its outreach capabilities to ensure that clients eligible for Medicaid after they exit welfare are identified correctly. Ohio uses a common application form for all public assistance programs except emergency assistance. This has helped to streamline the public assistance eligibility process and to facilitate the tracking of clients over time. Since the CRIS-E system links eligibility for welfare with eligibility for Medicaid and other public assistance programs, eligibility for transitional Medicaid and other benefits can be easily identified when clients exit welfare. For instance, when case workers update client files, the system automatically guides them through a series of steps, allowing them to ensure quickly and easily that eligible clients are enrolled in transitional Medicaid.

State of Tennessee. Tennessee's ACCENT management information system, an adaptation of Ohio's CRIS-E system, links together client data related to welfare, Medicaid, and food stamps and permits eligibility for these programs to be determined. The state Medicaid program uses ACCENT to track clients' eligibility for TMA and 45 other categories of Medicaid coverage. Prompted by the ACCENT system, eligibility for 18 months of TMA is established by the case manager at the point when the welfare cash grant is closed. The use of the integrated ACCENT system helps to ensure that a seamless transfer of Medicaid benefits occurs when families move from welfare to work.

Program Name/Contact

Southern Institute on Children and Families, Educational Outreach Initiative

Columbia, South Carolina

Sarah Shuptrine, Gerry McKenzie

Southern Institute on Children and Families

803-779-2607

Program strategy: Educational outreach

Location: Available in urban/suburban/rural counties in most southern states

Brief Program Description

The Southern Institute on Children and Families is an independent, nonprofit public policy organization that seeks to improve opportunities for children and families in the South, with a focus on serving disadvantaged children. Through special projects and surveys, the institute focuses on health, social, educational, and economic issues of regional significance. For instance, it seeks to increase health coverage for children and their families. It also works to encourage public/private sector collaboration and seeks to remove bureaucratic and other barriers that restrict access to needed services.

The Southern Institute conducted an educational outreach initiative in numerous southern states during 1996 and 1997 to educate different groups about public assistance benefits for individuals exiting welfare, including transitional Medicaid, transitional child care, the Earned Income Tax Credit (EITC), food stamps, Medicaid for children, and state income credits and policies. The groups targeted by the educational initiative were welfare recipients (particularly those exiting welfare), low-income working families, community organizations, and employers who hire low-income workers. The Southern Institute developed brochures, videos, and other materials to increase knowledge of and access to transitional benefits for families exiting welfare. Three versions of the brochure were developed, each targeted to a different audience: welfare recipients, low-income working families, and low-wage employers. Training was provided on the use of the materials--caseworkers were instructed about how to review transitional benefits with clients, and employers were instructed about how they could help low-income workers connect with benefits. To date, 10 southern states have adopted this educational outreach initiative, and the remaining 7 (plus the District of Columbia) plan to do so.

Evaluation

The Southern Institute conducted a descriptive study and pre-post survey in Georgia to measure knowledge of transitional and post-transitional benefits among recipients of welfare or transitional Medicaid, representatives of community organizations, and employers. A similar study was conducted in North Carolina (Shuptrine and McKenzie 1996b).

Findings

The study in Georgia showed that focus group participants--including welfare clients, transitional Medicaid recipients, community organization representatives, and employers--had fairly low levels of knowledge about transitional benefits before the educational initiative. However, after being exposed to the brochures, these groups attained noteworthy gains in knowledge.

Program Name/Contact

New Hope Project, Inc.

New Hope Demonstration Program

Milwaukee, Wisconsin

Julie Kerksick, Executive Director

New Hope Demonstration Program

414-342-3338

Program strategy: Service capacity

Location: One urban community

Brief Program Description

The New Hope Project, a demonstration program operated in Milwaukee, Wisconsin, by a community-based nonprofit organization, is designed to move low-income individuals into long-term employment and to reduce poverty. Four key service methods are used: (1) job search development and job search assistance, including access to a short-term community service job if competitive employment can not be obtained; (2) subsidized health insurance, which phases out gradually with increases in earnings; (3) subsidized child care, which phases out gradually with increases in earnings; and (4) monthly earnings supplements for full-time workers that, combined with federal and state Earned Income Tax Credits, brings income near or above the poverty level.

The project targets individuals age 18 and over whose household income is at or below 150 percent of the federal poverty level, who are willing and able to work at least 30 hours per week, and who live in one of two urban neighborhoods in Milwaukee, Wisconsin. The project serves the welfare population, as well as others meeting the eligibility criteria. Using a case management model of service delivery, New Hope staff actively work with clients to provide employment-related assistance, to explain benefits and services, and to make appropriate referrals. Health insurance is viewed by many clients and staff as the most important benefit offered by the program (Brock et al. 1997). Those participants who are not covered by Medicaid or employer-provided insurance and who meet the program's work requirement are eligible to receive insurance through a choice of HMOs that provide comprehensive services. The New Hope project subsidizes the cost of this insurance by paying the per-capita Medicaid rate for clients who participate. Participant copayments are set to reflect income and household size and are intended to fall within the range of premiums typical of employer-sponsored plans.

Evaluation

The New Hope Project is currently under evaluation by the Manpower Research Demonstration Corporation. A randomized experimental design is being used to compare the employment and other experiences of a New Hope treatment group with those of a control group. The evaluation also includes cost-benefit, implementation, and ethnographic studies.

Findings

Although impact results are not yet available, an interim implementation study has been completed (Brock et al. 1997). Program data show that in the first year of implementation nearly three-quarters of clients worked full time and received an earnings supplement, nearly two-fifths accessed private health insurance through New Hope, and nearly one-quarter accessed child care assistance through New Hope.

Further Information

Further information on issues related to medical needs is available from the following

Organizations

American Public Welfare Association of Information Systems Management (APWA-ISM)

202-682-0100

Website: www.state.mo.us/dss/apwa-ism

The APWA-ISM is an association of state, local, and federal government information systems professionals working in the health and human services fields. It seeks to promote the design and operation of effective automated systems in the health and human services fields.

Intergovernmental Health Policy Project, National Conference of State Legislatures

202-624-5400

Website: www.ncsl.org/ihpp

The Intergovernmental Health Policy Project (IHPP) is a nonprofit organization that provides policy-relevant research, as well as information on key initiatives, trends, and exemplary practices within states, to state officials and other state-based organizations.

National Association of State Medicaid Directors

(202) 682-0100

Website:www.medicaid.apwa.org

The National Association of State Medicaid Directors (NASMD), a nonprofit organization of state Medicaid agency representatives, provides information to states on issues relevant to the Medicaid program.

Southern Institute on Children and Families

(803) 779-2607

The Southern Institute on Children and Families is a nonprofit organization that seeks to improve opportunities for children and families in the South. The institute recently conducted an outreach initiative in 10 states to educate different groups about health care and other benefits for individuals exiting welfare. Detailed information is provided in the section entitled Program Models.

Further information on issues related to medical needs is available in the following

Documents

Kaplan, J. "Transitional Medicaid Assistance." Available at http:// www.welfareinfo.org/ tmedicaid.htm, December 1997.

In the context of recent welfare reform legislation, this report discusses a series of policy issues related to Transitional Medicaid Assistance (TMA), including: How can states determine whether eligible families are utilizing TMA? What barriers might states encounter in administering TMA? What can states do to increase TMA utilization and provide health care coverage to people moving from welfare to work? Research findings and innovative practices relating to TMA are also discussed.

Ku, L., and T. Coughlin. "How the New Welfare Reform Law Affects Medicaid." Washington, DC: The Urban Institute, available at http:// newfederalism.urban.org/html/ anf_a5.htm, December 1997.

This paper discusses key changes to Medicaid eligibility resulting from the recent welfare reform legislation, including the decoupling of welfare and Medicaid eligibility. Implications for state and local governments and health care providers are discussed.

Meyer, J., and S. Silow-Carroll. "Options to Assure Access to Health Care for People Leaving Welfare for Work." Prepared for the Annie E. Casey Foundation, Washington, DC: Economic and Social Research Institute, September 1996.

This report develops a series of key health care policy options for state and federal officials to consider when attempting to increase access to health care for people exiting welfare. Options examined include those that help people obtain insurance, often through expansions in existing health care service capacity, and those that enhance or redesign the health care service infrastructure in underserved areas.

Shuptrine, S., and G. McKenzie. "Information Outreach to Reduce Welfare Dependency: A Georgia Welfare Reform Initiative: Final Report." Prepared for the Department of Human Resources, Division of Family and Children Services, State of Georgia. Columbia, SC: Southern Institute on Children and Families December 1996.

This report provides detailed information on the educational outreach initiative conducted by the Southern Institute on Children and Families in the state of Georgia. Implementation challenges and recommendations are also discussed.

Wooldridge, J., and S. Hoag. "Medicaid's Role in Encouraging Transitions from Welfare to Work." Princeton, NJ: Mathematica Policy Research, Inc., October 1996.

This report examines how the Medicaid program affects welfare clients as they move from welfare to work. Based on a synthesis of existing literature, the report examines the Medicaid-welfare relationship both before and after welfare reform. It also provides a review of research on welfare-to-work transition rates and the role of Medicaid and private insurance in these transitions. In addition, it explores various policy options for insuring low-wage workers.

1. A review of national, state, and local studies shows that between 11 and 21 percent of children from welfare families have some medical limitation or disability (Olson and Pavetti 1996).

2. For more information on health care coverage for children from low-income families, refer to the "Southern Regional Initiative to Improve Access to Benefits for Low-Income Families with Children" (Shuptrine et al. 1998).

3. Our review did not identify programs that specifically address the health insurance needs of individuals with poor health, chronic medical conditions, or disability, for whom the magnitude of the health insurance barrier is relatively greater.

4. Reported impacts are not always impacts that have occurred exclusively for welfare recipients.

5. For an explanation of how programs were selected, please refer to the discussion included in the Introduction under the paragraph heading "Program Models."