Diversion as a Work-Oriented Welfare Reform Strategy and Its Effect on Access to Medicaid: An Examination of the Experiences of Five Local Communities

This project collected information from all States and the District of Columbia regarding the policies and practices that constitute diversion programs and/or activities under the Temporary Assistance for Needy Families (TANF) program. Diversion programs are defined as efforts to address the immediate needs of families seeking cash assistance in ways that avoid enrolling the families in TANF. More detailed case studies were conducted in five local communities in order to document actual implementation and operation of diversion policies and activities. A major focus of the study was an examination of linkages between Medicaid enrollment and diversion programs/activities. The study also examined whether and how local communities and institutions, particularly traditional safety net providers, might be affected by diversion programs. The project addressed the following issues: (1) how State diversion programs are being conceived, structured and implemented; (2) the effects of these programs/activities on Medicaid enrollment; and (3) how local community institutions are affected, particularly by Medicaid enrollment rates. The researchers found that 31 States had implemented at least one diversion program and six States operated two types of diversion programs. They report that formal diversion efforts represent one of the many approaches States are using to shift to a more work-oriented, transitional cash assistance program. The researchers categorized diversion programs and activities into three types: (1) lump sum payment programs, (2) applicant job search, and (3) exploration of alternative resources. Primarily because the programs and activities are relatively new, little is known about their effects on families and their implications for other programs, such as Medicaid. In examining local policies and practices, the researchers concluded that there is substantial potential for diversion programs to reduce families' access to Medicaid. (See PIC ID 6759)

AGENCY SPONSOR: Office of Planning, Research and Evaluation

FEDERAL CONTACT: Campbell, Nancye
202-401-5760

PIC ID: 6759.1

PERFORMER: George Washington University
Washington, DC

The Struggle to Sustain Employment: The Effectiveness of the Post-Employment Services Demonstration

This report serves an update on the effectiveness of the Postemployment Services Demonstration (PESD) program's promotion of employment and reduction of welfare dependency over a two-year period, using administrative records data on program enrollees. Key findings related to the program have been that: (1) extensive outreach and rapid follow-up enabled case managers to reach most clients and to establish prompt communications; (2) overall levels of employment among sample members were fairly high in all four sites; (3) overall, the program had little effect on increasing earnings, reducing welfare, or promoting the move toward self-sufficiency. In this comprehensive study of the PESD programs and their client population, operational lessons were identified that can serve as a guide for other programs considering the provision of job retention services. Recommendations are that programs should: (1) attempt to tailor services to meet client needs and target clients appropriately for different types of job retention services; (2) simplify service delivery mechanisms to enable program staff to focus more on coordinating services and meeting other client needs; (3) form closer links with employers, so that case managers or other staff could help resolve at least some work-related issues; and (4) assess carefully what services their programs currently offer and make changes to fill current gaps in the system, when considering adding job retention assistance to their current set of services.

AGENCY SPONSOR: Office of Planning, Research and Evaluation

FEDERAL CONTACT: Wolf, Lawrence
202-401-5084

PIC ID: 5974

PERFORMER: Mathematica Policy Research, Inc.
Plainsboro, NJ