Dynamics of Children's Movement Among the AFDC, Medicaid, and Foster Care Programs Prior to Welfare Reform: 1995–1996. Future Research - A Post-Welfare Reform Comparison


After sufficient time has passed for families to experience fully the effects of welfare reform, it would be beneficial to update this study in order to evaluate the effects of welfare reform in the three states.  Although such a study will require more information than what is currently contained in our databases, in addition to careful design, we believe that it is a promising approach given the longitudinal data available for the entire populations of children in the three programs.

Understanding the meaning of changing transition rates will not be straightforward.  For example, in the era of AFDC, a permanent transition from cash assistance was likely to be a positive outcome for families because it often corresponded with an increase in income for the family.  With welfare reform, and time limits in particular, we can no longer assume that moving off the TANF caseload represents enhanced economic well-being for children.  Time limits and sanctions for noncompliance may force families to leave cash assistance without parents first securing employment or other sources of income.(10)  Another possibility is that families may choose not to use benefits for which they are eligible (both Medicaid and TANF) or they may preemptively leave TANF in order to save their benefits for future use.  Likewise, changes in the movement from TANF to Medicaid only will be difficult to interpret.  We have outlined the multiple ways in which we will see a rise or decline in the rate at which these transitions will occur.  Unraveling the partial contributions of the range of behavioral change will be the challenge.

Information on what aspects of policy are affecting children directly or indirectly would be crucial.  For example, detailed information on the sanctions applied to families and the work experiences of parents during and after welfare receipt will be critical.  It will also be necessary to have more in-depth information on the policy, programmatic and economic environment across time for each of the states in order to control for differences across geography and time.  Whether data are available or can be collected on the implementation of policy that matches the time frame of the administrative data is an open issue.  Many researchers strongly believe that we will not be able to measure policy and programmatic differences across states or, in some cases, counties accurately.  The flexibility that is provided to states, and in turn to workers, may be difficult to capture.  Methods used to undertake implementation and process evaluation may offer promising strategies to enrich the administrative data.(11)

To better understand the meaning of changing rates of transition from cash assistance to system exit, and from cash assistance to Medicaid-only, future analyses can employ administrative data detailing reasons for case closing in conjunction with Unemployment Insurance (UI) data.  The UI data can determine the employment status and income level of former TANF clients.  Such data records employee participation in the federal Unemployment Insurance program and would enable us to distinguish those who are not receiving benefits because of income ineligibility.  In addition, tracking food stamp participation among families will also provide additional information on income.

In a follow-up to this baseline, it may also be necessary to look at different transitions is more detail.  In this report, we focused on the transitions that appeared to be the most common or the most relevant.  For example, a focus on the Medicaid population may be necessary if the TANF population continues to become smaller.

It is also possible, and ultimately necessary, to extend this study to other program and social outcomes, such as Food Stamps, WIC, SSI, child abuse and neglect reports, and fertility (adolescent parenthood) and issues of juvenile justice.  However, unless we know what is causing the dynamics in these outcomes, independent of antipoverty policy, it will be difficult to tie changes to welfare reform.  Although the findings on abuse and neglect reporting should mirror the foster care findings, there may be differences in reporting after welfare reform if families become more self-sufficient.  As states and localities become more punitive with juvenile offenders, we may see changes in the juvenile offender population that are not at all related to welfare reform.  Cross-state comparisons and perhaps intra-state comparisons may be necessary to determine which policy and programmatic factors interact and influence changes in the wider array of social programs addressing both the problems of children and their basic needs.