How Effective Are Different Welfare-to-Work Approaches? Five-Year Adult and Child Impacts for Eleven Programs. Transfer Payments and Benefits

12/01/2001

As discussed in Chapter 5, all of the programs in the evaluation decreased welfare and Food Stamp payments to program group members over the follow-up period. As shown in Table 13.7, the impacts on welfare payments ranged from -$571 in the Detroit program to -$3,058 in the Riverside HCD program. During the same period, reductions in Food Stamp payments ranged from $160 in the Atlanta HCD program to over $1,000 in the Riverside HCD and Columbus Integrated programs. In sum, program group members received from about $900 (Detroit and Atlanta) to over $4,000 (Riverside HCD) less in cash payments over the five-year period than their control group counterparts.

 

Table 13.7
Estimated Program-Control Group Differences in
Transfer Payments and Administrative Costs per Sample Member
Within a Five-Year Follow-Up Period (in 1999 dollars)
Component of Analysis Atlanta LFA ($) Atlanta HCD ($) Grand Rapids LFA ($) Grand Rapids HCD ($) Riverside LFA ($) Riverside HCD ($) Columbus Integrated ($) Columbus Traditional ($) Detroit ($) Portland ($)

Transfer payments

Welfare -919 -747 -2,711 -1,860 -2,868 -3,058 -1,575 -1,148 -571 -2,783
Food Stamps -434 -160 -643 -396 -928 -1,040 -1,052 -673 -341 -848
Medicaid -1,159 -727 -1,026 -775 -510 -766 -1,102 -875 -309 -2,598
Total -2,512 -1,633 -4,380 -3,031 -4,306 -4,864 -3,728 -2,696 -1,222 -6,228

Administrative costs

Welfare -119 -97 -434 -298 -258 -275 -173 -126 -91 -918
Food Stamps -67 -25 -99 -61 -143 -160 -162 -104 -53 -131
Medicaid -46 -29 -51 -39 -71 -107 -44 -35 -15 -208
Total -233 -151 -584 -397 -472 -543 -379 -265 -159 -1,257
Sample size 2,938 2,992 3,012 2,997 6,726 3,135 4,672 4,729 4,459 4,028
SOURCES:  MDRC calculations from state welfare and Food Stamp payment records, unemployment insurance (UI) earnings records, and published data on administrative costs.
NOTES:  Estimates reflect discounting and adjustment for inflation.
Estimates were regression-adjusted using ordinary least squares, controlling for pre-random assignment characteristics of sample members.
Rounding may cause slight discrepancies in calculating sums and differences.
Tests of statistical significance were not performed.

In addition to cash benefits, sample members were also eligible for Medicaid benefits. In low-grant states especially, Medicaid benefits can have a larger cash value than welfare payments. Sample members and their children were categorically eligible for Medicaid while receiving welfare. In addition, those who left welfare because of employment were eligible for Transitional Medicaid for one year.(20) Eligibility for these programs was estimated using welfare administrative data, Transitional Medicaid take-up rates calculated from the Five-Year Client Survey,(21) and published data on Medicaid expenditures.(22)

As noted in Chapter 8, the programs in the NEWWS Evaluation did not result in significant differences in health care coverage between program and control group members at the end of the follow-up period. It is important to note that the earlier chapter looked at differences in health coverage at a single point in time, that is, in the month before the five-year survey. As shown in Figure 5.1, in most programs the smallest differences in rate of welfare receipt were observed at the end of the follow-up period. However, as shown in Table 5.1, the differences in months of welfare receipt (and, therefore, Medicaid coverage) over the entire five-year period were substantial, ranging from 1.6 months (Detroit) to 5.6 months (Portland). Although program group members were more likely than their control group counterparts to receive Transitional Medicaid, this did not make up for the loss in Medicaid benefits due to their shorter stay on welfare. As shown in Table 13.7, average Medicaid losses over the five-year period ranged from $309 (Detroit) to $2,598 (Portland).

The costs of administering transfer programs were calculated as the cost per benefit paid. As a result, the NEWWS programs also decreased transfer program administration costs.(23) These changes, shown in Table 13.7, yielded decreases of between about $150 (Atlanta HCD and Detroit) and about $1,250 in Portland.(24)