Developing an outcome-based performance system starts with identifying the goals of the program. What is the purpose of a program? What are its desired outcomes? How will we know if the program is working? This is not necessarily an easy task for a program with as many purposes and as much flexibility in the possible uses of funds as TANF - it may be difficult to reach consensus on the outcomes that we care about enough to single out for performance measures, particularly if the associated consequences are substantial.
As discussed above, under TANF, states have a great deal of flexibility in selecting how to distribute their funds among the four Congressionally-specified purposes. While all states have invested substantially in promoting work and self-sufficiency, beyond this common core, they have made different choices in the goals they promote: some have invested in programs to support the formation and maintenance of two-parent families, some have focused on preventing teen pregnancies, and others have expanded their supports for all working poor families, whether or not they have previously received cash assistance. Moreover, even within the general area of promoting work, states have made different decisions about how best to achieve this goal. For example, some states have adopted "work-first" programs which encourage recipients to accept any job they can get in order to acquire work experience, while others have encouraged recipients to be more selective and to participate in training to qualify for a job that offers some promotion potential, or that provides health insurance or other benefits. Which of these approaches will be determined to have the best outcomes depends at least in part on the specific measure that is selected.
The question of whether this degree of variation in goals is appropriate and desirable or whether state flexibility in this area should be restricted is a topic for TANF reauthorization discussions. There are any number of potential approaches, including:
- Adopt mandatory measures of performance to reflect all goals which Congress considers of high priority. Particularly if penalties were associated with these measures, this approach would reduce state flexibility in the use of TANF and MOE funds.
- Allow states to select from a list of performance measures, reflecting a range of goals, the ones under which they wish to compete for bonuses. This is the approach adopted by HHS in implementing the High Performance Bonuses. This approach gives states an incentive to improve their performance in areas where they may not have focused as much attention, but does not penalize those states which are not interested in competing under these measures.
- Adopt only outcome-based performance measures related to those goals around which there are both general agreement and comparable data. Currently, this would probably limit outcome measurement to work-related measures.