How Effective Are Different Welfare-to-Work Approaches? Five-Year Adult and Child Impacts for Eleven Programs. Employment and Employer-Provided Coverage

12/01/2001

As discussed in Chapter 4, UI records data show that most of the programs began increasing employment within a year or two of random assignment, and the biggest effects were in Riverside LFA and HCD, Grand Rapids LFA, and Portland. The employment impacts also lessened over time. By the end of year 5, only Riverside LFA and HCD and Portland continued to show significant positive impacts. This pattern also holds with the survey data. The upper panel of Table 8.1 shows impacts on employment at the time of the five-year survey. In Riverside LFA, Riverside HCD, and Portland, more individuals in the program group than the control group were working at the five-year point, although the difference in Portland is not statistically significant.

The middle panel of Table 8.1 shows the percentage of program and control group members who were employed with health care coverage, either public or private. A comparison of this panel with the upper panel shows that a significant proportion of those working (ranging from 20 to 30 percent across sites) did not have health coverage. For example, 54 percent of control group members in Atlanta were employed, but only 37 percent were employed and had coverage, meaning that about 70 percent of those working had coverage. Control group rates were highest in Riverside and Portland. In Riverside, the high welfare benefit levels meant that more welfare recipients could work and still remain eligible for some welfare and, therefore, Medicaid.(7) In Portland, the high coverage rate may reflect the existence of the state's public health program  the Oregon Health Plan (OHP).(8)

The lower panel of Table 8.1 shows the percentage of program and control group members who were employed with employer-provided coverage. Between 15 and 30 percent of control group members were working and had employer-provided coverage. A comparison of these numbers with the upper and middle panels highlights several points. First, only about one-third to one-half of those who were employed had employer-provided coverage. In Atlanta, for example, 54 percent of the control group worked, but only 19 percent of the control group worked and had employer-provided coverage, meaning that only 35 percent of workers had coverage through their jobs. Second, 40 to 60 percent of workers with coverage had employer-provided coverage (compare the middle and lower panels), showing that other programs were an important source of coverage among low-wage workers. Other sources of coverage, for example, are Transitional Medicaid and coverage from a spouse (as shown in Chapter 9, from 10 to 20 percent of respondents were married at the five-year point). The percentage with employer-provided coverage is especially low in Riverside, where 40 percent of controls were working and had coverage, but only 15 percent had employer-provided coverage, meaning that 38 percent of insured workers had coverage through their jobs.

One reason for the relatively low rates of employer-provided coverage is that some respondents were offered but declined to enroll in their employer's plan. In Riverside and Atlanta, about 70 percent of those offered coverage accepted it compared with about 80 percent of those in Grand Rapids and Portland. The low employer-provided coverage rates in Riverside may reflect the fact that relatively more workers were still eligible for welfare and Medicaid. Individuals who have Medicaid are probably more likely to turn down an employer's offer of coverage.

 

Table 8.1
Impacts on Employment and Health Care Coverage

Site and Program

Sample Size Program Group (%) Control Group (%) Difference
(Impact)
Percentage Change (%)

Employed at interview

Atlanta Labor Force Attachment 1,071 57.2 54.3 2.9 5.4
Atlanta Human Capital Development 1,146 52.9 54.3 -1.4 -2.5
Grand Rapids Labor Force Attachment 1,097 65.1 67.7 -2.6 -3.8
Grand Rapids Human Capital Development 1,109 66.2 67.7 -1.5 -2.2
Riverside Labor Force Attachment 1,219 55.0 48.9 6.1** 12.4
Lacked high school diploma or basic skills 657 48.9 43.0 5.9 13.6
Riverside Human Capital Development 778 51.1 43.0 8.0** 18.7
Portland 504 61.7 58.3 3.4 5.9

Employed with health care coverage at interview

Atlanta Labor Force Attachment 1,071 39.1 36.9 2.2 6.0
Atlanta Human Capital Development 1,146 38.0 36.9 1.1 3.1
Grand Rapids Labor Force Attachment 1,097 49.4 51.8 -2.4 -4.6
Grand Rapids Human Capital Development 1,109 51.9 51.8 0.1 0.2
Riverside Labor Force Attachment 1,219 40.9 39.6 1.4 3.4
Lacked high school diploma or basic skills 657 38.5 33.8 4.6 13.7
Riverside Human Capital Development 778 40.6 33.8 6.8* 20.0
Portland 504 47.8 47.7 0.1 0.2

Employed with employer-provided health care coverage at interview

Atlanta Labor Force Attachment 1,071 22.2 19.0 3.2 16.6
Atlanta Human Capital Development 1,146 21.2 19.0 2.2 11.5
Grand Rapids Labor Force Attachment 1,097 30.5 30.0 0.5 1.7
Grand Rapids Human Capital Development 1,109 30.4 30.0 0.4 1.5
Riverside Labor Force Attachment 1,219 17.5 15.0 2.5 16.6
Lacked high school diploma or basic skills 657 12.0 10.9 1.1 9.8
Riverside Human Capital Development 778 14.8 10.9 3.9 35.5
Portland 504 31.6 27.3 4.4 16.0
SOURCE:  MDRC calculations from the Five-Year Client Survey.
NOTES:  See Appendix A.2

Only Riverside HCD produced a statistically significant increase in the number of respondents who were employed and had coverage (of any type) at the end of year 5. None of the programs had a statistically significant impact on being employed and having employer-provided coverage. However, the impacts on employer-provided coverage are similar in size to the impacts on employment in Atlanta, Grand Rapids, and Portland, although somewhat smaller in Riverside. This suggests that the program group members who were encouraged to work had jobs at the end of year 5 that were at least as likely to have insurance as the jobs held by control group members.