Privatization in Practice: Case Studies of Contracting for TANF Case Management. Privatizing TANF Case Management: Why, What, and to Whom?

03/01/2003

Although some TANF services are privatized in all but one state, there is considerable variation in the services selected for privatization and the types of contractors. In most states, only some TANF case management functions are contracted out; only a handful of states and localities use outside organizations for all TANF case management and processing functions, including eligibility determination. Some sites administer only one or two contracts for all of their TANF services, while others issue many, smaller contracts. And while state-level TANF contracts in some states  such as Florida  are awarded mainly to for-profit organizations, New Jersey and other states rely nearly exclusively on nonprofit organizations (GAO 2002).

This chapter offers some explanations for this wide variation by examining the study sites decisions about which services to privatize, the scope and size of the contracts, and to whom contracts are awarded. Section A discusses the factors that played a role in the study sites decisions to privatize. Section B describes the types of TANF case management and related case processing functions that are privatized and some of the issues considered in making these decisions. The size and scope of contracts issued by each site, and the factors behind those decisions, are discussed in Section C. Section D offers a description and comparison of the types of contractors providing services in the study sites.

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