Dynamics of Children's Movement Among the AFDC, Medicaid, and Foster Care Programs Prior to Welfare Reform: 1995–1996. Findings


Transitions from AFDC to Medicaid or system exit.  The indicators that we use to characterize the dynamics of a child's transition from AFDC to Medicaid or leaving these two programs completely vary greatly among the three states.  North Carolina reports many more children leaving AFDC within one year of entry (73%) than Illinois (47%) or California (42%) (see table 4).  North Carolina, as a result of the short durations, has the highest percentage of children who move to Medicaid at one year (31%), as well as the highest percentage of children (42%) participating in no programs at one year.

Even though the percent of children leaving AFDC at one year is similar in California and Illinois, the particular outcomes vary tremendously.  California reports percentages nearly twice those of Illinois for children entering Medicaid from AFDC (23% vs. 12%), while Illinois has twice the percentage of children exiting the system entirely.  California, as a result, has the highest percentage of leavers (55%) who receive Medicaid after their exit from AFDC (see table 4).


Table 4.
Summary of Indicators for Transitions from
AFDC to Medicaid-Only or to No Program Use (system exit)
Indicator Illinois California North Carolina
% of AFDC cohort that leave AFDC by one year 47% 42% 73%
% of AFDC cohort that after one year transition to Medicaid-Only 12% 23% 31%
% of AFDC cohort that after one year exit the system 35% 19% 42%
Among AFDC exiters at 1 year, the percent who use Medicaid 26% 55% 43%

Transitions from AFDC to no participation in Medicaid (or foster care) are most likely among the oldest children in all three states (Tables IL1, CA1 and NC1).  This suggests, consistent with other findings, that families with the youngest children are the most acutely needy and likely to remain on AFDC longer than families with older children.  The fact that adolescents are likely to be part of AFDC grants for a shorter time period may also reflect the fact that they are much more likely than younger children to detach themselves from the family.

The dynamics surrounding the transition to Medicaid from AFDC are somewhat different.  Transitions to Medicaid-only are more likely for younger than for older children in North Carolina while the opposite is true in Illinois and California.  The Illinois and California findings are somewhat counter-intuitive given the focus on Transitional Medicaid Assistance for younger children.  However, this finding is very much a reflection of the study population.  Because we follow only new cases, we expect the transition to Medicaid to be higher for those types of cases most likely to exit AFDC.  Because in North Carolina a greater percentage of children have left AFDC by the end of one year, a policy that promotes TMA for young children is more apparent because a large number of young and older children have exited AFDC.  Because children receive AFDC for longer periods in Illinois and California, we will not see as many children having exited and therefore the transition to TMA is not an issue for them.  Again, it is important to understand the experiences of children while on AFDC when analyzing the exit outcomes.  If we followed a point-in-time population, it is likely that more of the exiters would be adolescents, since these populations are comprised of more families who have long AFDC durations than entry cohorts.  Similarly, if we had followed an exit or "leaver" cohort, we would have expected all of the children to have been considered to receive TMA.

The effects of race on transition to system exit in North Carolina look similar to those observed in California and Illinois.  White children are more likely to make a transition to system exit than African-American children, reflecting their shorter lengths of stay on AFDC.  African American children are less likely than other groups to transition to Medicaid in all three states.