Welfare Reform
Outcomes for TANF Recipients with Impairments Gao ID: GAO-02-884 July 8, 2002The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 created the Temporary Assistance for Needy Families (TANF) block grants to states, which emphasizes work and responsibility over dependence on government benefits. GAO found that impairments are common among TANF recipients and their children, with 44 percent of TANF recipients reporting that they or their children had impairments, compared with 15 percent of the non-TANF population. Moreover, recipients with impairments were more likely to be white and over age 35 than those without impairments. GAO found that people with impairments who left TANF were less likely to be employed than leavers without impairments, but many leavers with impairments received Supplemental Security Income, a federal program providing cash assistance to low-income individuals who are aged, blind, or disabled.
GAO-02-884, Welfare Reform: Outcomes for TANF Recipients with Impairments
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United States General Accounting Office:
GAO:
Report to Congressional Requesters:
July 2002:
Welfare Reform:
Outcomes for TANF Recipients with Impairments:
GAO-02-884:
Contents:
Letter:
Appendix:
Related GAO Products:
Abbreviations:
HHS: Department of Health and Human Services:
PRWORA: Personal Responsibility and Work Opportunity Reconciliation Act
of 1996:
SIPP: Survey of Income and Program Participation:
SSI: Supplemental Security Income:
TANF: Temporary Assistance for Needy Families:
[End of section]
United States General Accounting Office:
Washington, DC 20548:
July 8, 2002:
The Honorable Benjamin L. Cardin:
Ranking Minority Member:
Subcommittee on Human Resources:
Committee on Ways and Means:
House of Representatives:
The Honorable Pete Stark:
House of Representatives:
With the enactment of the Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 (PRWORA), the Congress made sweeping changes
to federal welfare policy for needy families. PRWORA created the
Temporary Assistance for Needy Families (TANF) block grant to states,
which emphasizes work and responsibility over dependence on government
benefits. The Department of Health and Human Services (HHS) oversees
the TANF block grant program, which provides grants to states totaling
up to $16.5 billion each year through September 2002 and requires
states to maintain a historical level of state spending on welfare-
related programs.
To provide you with information on how people with impairments are
faring in the new welfare environment, you asked us to determine: (1)
the extent to which recipients with impairments exit TANF, compared with
recipients without impairments; and (2) the extent to which people with
impairments are employed after leaving TANF, compared with people
without impairments. To address both questions, we analyzed self-
reported data from the Census Bureau‘s Survey of Income and Program
Participation (SIPP), a nationally representative survey. We used a
cross-section of responses given between July 1997 and July 1999 and
relied on a definition of impairments developed by Census. This broad
definition includes both severe and non-severe physical and mental
impairments. (See appendix I for the complete definition of
impairments.) Our analyses included both descriptive statistics and
multivariate analyses. We also reviewed findings of other studies to
supplement the SIPP data. We conducted our work from March to June 2002
in accordance with generally accepted government auditing standards.
On June 28, 2002, we briefed your offices on the results of our
analyses. This report formally conveys the information provided during
that briefing. Our key findings are summarized below.
We found that impairments are relatively common among TANF recipients
and their children, with 44 percent of TANF recipients either reporting
that they or their children had impairments, compared with 15 percent of
the non-TANF population. Moreover, recipients with impairments were
more likely to be white and over age 35 than those without impairments.
Controlling for these and other demographic characteristics, we found
that recipients with impairments were half as likely to exit TANF as
recipients without impairments. Although impairments affect exits, other
factors, such as family support, personal motivation, and local economic
conditions, may also affect whether recipients exit TANF.
Regarding the outcomes for people with impairments who left TANF, we
found that leavers with impairments were less likely to be employed than
leavers without impairments, but many leavers with impairments (40
percent) received Supplemental Security Income (SSI), a federal program
providing cash assistance to low-income individuals who are aged, blind,
or disabled. Controlling for demographic characteristics and receipt of
SSI, we found that leavers with impairments were one-third as likely to
be employed as leavers without impairments. Regarding other potential
sources of income, leavers with impairments were more likely than
leavers without impairments to report having no income from personal
earnings, household earnings, or SSI, but they also were more likely to
receive Food Stamps and Medicaid. Among leavers who had earnings, the
amount of the earnings was similar for leavers with and without
impairments.
We provided a draft of this report to officials at HHS for their
technical comments and incorporated their comments where appropriate.
As agreed with your offices, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 7 days
after its issue date. At that time, we will send copies to the
Secretary of HHS, relevant congressional committees, and other
interested parties. We will also make copies available to others upon
request. In addition, the report will be available at no charge on the
GAO Web site at [hyperlink, http://www.gao.gov].
A list of Related GAO Products is included at the end of this report.
If you have any questions concerning this report, please contact me on
202-512-7215 or Gale Harris, Assistant Director, on 202-512-7235.
Heather McCallum, Tiffany Boiman, Wendy Ahmed, and Grant Mallie also
made key contributions to this report.
Signed by:
Cynthia M. Fagnoni:
Managing Director:
Education, Workforce, and Income Security Issues:
[End of letter]
Appendix: Outcomes for TANF Recipients with Impairments:
Briefing for Staff of Representative Cardin and Representative Stark:
June 28, 2002:
Key Questions:
* To what extent do recipients with impairments exit the Temporary
Assistance for Needy Families (TANF) program, compared with recipients
without impairments?
* To what extent are people with impairments employed after leaving
TANF, compared with people without impairments?
Scope and Methodology:
* To address our key questions, we analyzed self-reported data from the
Census Bureau‘s Survey of Income and Program Participation (SIPP), a
nationally representative survey. We used a cross-section of responses
given between July 1997 and July 1999.
* We relied on a definition of impairments developed by Census. This
broad definition includes both severe and nonsevere physical and mental
impairments. See appendix I for definition of impairments.
* We conducted statistical analyses of the SIPP data, including
logistic regression analyses. See appendix I for more information on
our methodology.
* We reviewed findings of other studies to supplement the SIPP data.
See appendix II for related studies.
Major Findings:
* Controlling for certain demographic factors, recipients with
impairments are half as likely to exit TANF as recipients without
impairments.
* Controlling for certain factors, people with impairments are less
likely than people without impairments to be employed after leaving
TANF; many receive Supplemental Security Income (SSI).
Background – TANF Block Grant:
Temporary Assistance for Needy Families (TANF):
* The Congress created the TANF block grant in 1996 for states to
provide cash assistance and other supports to low-income families with
children.
* Under TANF, most recipients are limited to 60 months of federal
assistance, although up to 20 percent of a state‘s caseload may receive
extensions.
* Many TANF recipients are required to work, with some exemptions
allowed.
* No federal rules explicitly address identifying or serving people
with impairments through TANF.
* TANF caseloads have declined by more than 50 percent since 1996.
Background – TANF Recipients:
* TANF recipients are diverse.
* In earlier work [Footnote 1], we found that:
- Many TANF recipients have characteristics that may make it difficult
for them to find and keep jobs;
- Many recipients with impairments may not be receiving assistance to
help them move toward employment;
- Recipients with impairments are sometimes exempted from work
requirements but not from time limits.
* These findings, combined with caseload decline, contribute to
concerns about outcomes for TANF recipients with impairments.
Background – The Relationship between SSI and TANF:
* SSI is designed to provide cash assistance to low-income individuals
with long-term impairments that prevent them from obtaining or
retaining employment.
* SSI differs from TANF in that applicants are subject to federally
established eligibility requirements and benefit levels and a
disability determination process that is similar nationwide.
* Some TANF recipients have impairments severe enough to qualify them
for SSI. Although individuals may not receive SSI and TANF at the same
time, some collect TANF while they are awaiting determination of their
eligibility for SSI.
Definition of Impairments:
* We relied on a definition of impairments developed by the U.S. Census
Bureau. This broad definition includes both severe and nonsevere
physical and mental impairments, such as:
- Had difficulty performing one or more functional activities,
including seeing, hearing, speaking, lifting, and carrying, using
stairs, and walking;
- Had one or more specific conditions, including a learning disability,
mental retardation or another developmental disability, Alzheimer‘s
disease, or some other type of mental or emotional condition;
- Used a wheelchair, a cane, crutches, or a walker.
* We included in our analysis only people who reported meeting this
definition of impairments in both July 1997 and July 1999.
* See appendix I for the complete definition of impairments.
Impairments and TANF Exits:
* Impairments are relatively common among TANF recipients and their
children.
* Recipients with impairments were more likely to be over age 35 and
white than those without impairments.
* Controlling for certain demographic characteristics, recipients with
impairments were half as likely to exit TANF as recipients without
impairments.
* Other factors may also affect whether recipients exit TANF.
Figure: Impairments Are Relatively Common among TANF Recipients and
Their Children:
[See PDF for image]
This figure contains two pie-charts that depict the following data:
TANF recipients:
Neither adult nor child has impairments: 56%;
Only adult has impairments: 29%;
Both adult and child have impairments: 8%;
Only child has impairments: 7%.
Non-TANF population:
Neither adult nor child has impairments: 85%;
Only adult has impairments: 11%;
Both adult and child have impairments: 1%;
Only child has impairments: 3%.
[End of figure]
Overall, 44 percent of TANF recipients had impairments or were caring
for a child with impairments, compared with 15 percent of the non-TANF
population.
Figure: Recipients with Impairments Were More Likely to Be Over Age 35
and White than Those without Impairments:
[See PDF for image]
This figure is a vertical bar graph depicting the following data:
Percentage of recipients with characteristics:
Age 36-62[A]:
All recipients: 39%;
With impairments: 67%;
Without impairments: 23%.
Married:
All recipients: 25%;
With impairments: 22%;
Without impairments: 26%.
White[A]:
All recipients: 33%;
With impairments: 43%;
Without impairments: 28%.
High school diploma or less:
All recipients: 72%;
With impairments: 77%;
Without impairments: 69%.
[A] Differences between recipients with and without impairments are
statistically significant.
[End of figure]
Controlling for Certain Demographics, Recipients with Impairments Less
Likely to Exit TANF:
* Overall, most recipients (74 percent) exited TANF during our observed
time period (July 1997 to July 1999).
* Using a statistical model to control for basic demographic factors
and state-level differences, we found that recipients with impairments
were half as likely to exit TANF during the time period as recipients
without impairments.
* The statistical model controlled for the following variables:
- Gender;
- Race;
- Age;
- Marital status;
- Education, and;
- State. [Footnote 2]
Other Factors May Also Affect Whether Recipients Exit TANF:
* Other factors that may affect TANF exits include:
- Severity, type or number of impairments;
- personal motivation;
- family support;
- local economies, and;
- local TANF policies.
* Two people with identical impairments may have different outcomes due
to some of these factors.
See: U.S. General Accounting Office, Social Security Disability
Insurance: Multiple Factors Affect Beneficiaries' Ability to Return to
Work, GAO/HEHS-98-39 (Washington, D.C.: Jan. 12, 1998).
Outcomes for Leavers with Impairments Compared with Leavers without
Impairments:
* Controlling for certain factors, leavers with impairments were less
likely to be employed; many received SSI.
* For those with earnings after exiting TANF, earnings were similar for
those with and without impairments.
* Leavers with impairments were more likely to report having no
personal or household earnings, or SSI.
* Leavers with impairments were more likely to receive Food Stamps and
Medicaid.
* One in four leavers with or without impairments returned to TANF.
Figure: Leavers with Impairments Less Likely to Be Employed, but Many
Receive SSI:
[See PDF for image]
This figure contains two pie-chart that depict the following data:
Leavers with impairments:
Not employed (no SSI): 27%;
Employed (no SSI): 33%;
Receiving SSI (not employed)[A]: 34%;
Both employed and receiving SSI[A]: 6%.
Leavers without impairments:
Not employed (no SSI): 20%;
Employed (no SSI): 80%.
Notes:
(1) For comparison, among the non-TANF populations, 52 percent of
people with impairments are employed, while 93 percent of people
without impairments are employed.
(2) ’Employed“ and ’Receiving SSI“ include people who reported being
employed or receiving SSI, respectively, in any month after leaving
TANF and before the end of July 1999. ’Not employed“ and ’no SSI“
include people who reported not being employed or not receiving SSI,
respectively, the entire time after leaving TANF and before the end of
July 1999.
[A] About 309,000 leavers received SSI, which accounts for 40 percent
of leavers with impairments, or 14 percent of all leavers.
[End of figure]
Controlling for Certain Demographics, Leavers with Impairments Less
Likely to Be Employed:
* Using a statistical model to control for basic demographic factors,
state-level differences, and receipt of SSI, we found that leavers with
impairments were one-third as likely to be employed as leavers without
impairments between July 1997 and July 1999.
* The statistical model controlled for the following variables:
- Gender;
- Race;
- Age;
- Marital status;
- Education;
- State, [Footnote 3] and;
- SSI.
Earnings of Leavers with Impairments after Exiting TANF:
* Personal earnings:
0 Leavers with personal earnings reported an average of about $1,000
per month. This figure was the same for leavers with and without
impairments. [Footnote 4] (Earnings could come from employment or other
sources);
- No significant change in personal earnings for either group in first
6 months after exiting TANF.
* Earnings of others in the household (household earnings):
- About 35 percent of leavers with impairments reported having
household earnings, the same as for leavers without impairments;
- Leavers with household earnings reported an average of about $2,000
per month in addition to any personal earnings. This figure was the
same for leavers with and without impairments;
- No significant changes in household earnings for either group in
first 6 months after exiting TANF.
Leavers with Impairments More Likely to Report Having No Personal or
Household Earnings, or SSI:
In their first month after leaving TANF, 36 percent of leavers with
impairments reported having no personal or household earnings, or SSI,
compared with 23 percent of leavers without impairments.
Figure:
[See PDF for image]
This figure is a stacked vertical bar graph depicting the following
data:
Leavers with impairments[A]:
Reported at least one of these sources of income: 64%;
Reported none of these sources of income: 36%.
Leavers without impairments[A]:
Reported at least one of these sources of income: 77%;
Reported none of these sources of income: 23%.
[A] Differences between recipients with and without impairments are
statistically significant.
[End of figure]
Figure: Leavers with Impairments Were More Likely to Receive Food Stamps and
Medicaid:
[See PDF for image]
This figure is a vertical bar graph depicting the following data:
Received food stamps[A]:
Leavers with impairments: 77%;
Leavers without impairments: 62%.
Received Medicaid[A]:
Leavers with impairments: 89%;
Leavers without impairments: 71%.
[A] Differences between recipients with and without impairments are
statistically significant.
[End of figure]
Recipient Outcomes Could Differ Depending on Type of Exit:
* Recipients exit TANF for a variety of reasons, including increased
income, time limits, sanctions for noncompliance with program
requirements, and voluntary exits. Some of these types of exits may be
more associated with negative outcomes than others. [Footnote 5]
* SIPP data do not include information on how people exit TANF.
* At least one study (MDRC Urban Change) found that recipients with
more health problems were more likely to be sanctioned for
noncompliance than their healthier counterparts. Similarly, over 50
percent of leavers with health problems had their benefits terminated
due to noncompliance, compared with 39 percent of leavers without
health problems. See appendix II for related studies.
One in Four Leavers Returned to TANF:
* Overall, about one in four recipients who left TANF between July 1997
and July 1999 returned to TANF before the end of that period.
* There were no significant differences between people with impairments
and those without impairments on this measure.
Figure:
[See PDF for image]
This figure is a pie-chart depicting the following data:
Returned to TANF: 26%;
Did not return to TANF: 74%.
[End of figure]
[End of presentation]
Appendix I: Methodology:
* To investigate the differences between impaired and nonimpaired TANF
recipients and leavers, we used data collected in the Census Bureau‘s
Survey of Income and Program Participation (SIPP).
- We used respondents that were in the sample in both wave 5 and wave
11, from July 1997 to July 1999, and analyzed their responses during
this time period.
- The survey is of a probability sample of households nationwide, and we
have used appropriate techniques to weight the data to make population
estimates for 1999 as well as to take into account the complex sampling
design when estimating variances.
* We used the questions and responses to the survey to look at several
differences between impaired and nonimpaired TANF recipients,
nonrecipients, and leavers.
- We focused first on overall differences between impaired leavers and
nonimpaired leavers.
- Following these simple analyses, we developed multivariate models
that included demographic characteristics and state as well as
disability status.
Multivariate models (logistic regression):
* First, we looked at the difference in the likelihood of leaving TANF
for impaired and nonimpaired recipients using the following model:
Exit TANF = Disability + Age + Gender + Married + Race + Education +
State.
* Next, for those reporting leaving TANF, we looked at the difference
in the likelihood of being employed for impaired and nonimpaired
recipients, using the following model:
Employed After Leaving TANF = Disability + Age + Gender + Married +
Race + Education + State + SSI.
Definitions:
TANF recipient: Respondents who reported receiving TANF in any month
during the period (July 1997 – July 1999).
TANF leaver: Respondents who reported receiving TANF in some month
during the period, and subsequently not receiving TANF at some point for
at least 2 consecutive months.
Non–TANF population: Respondents who did not receive TANF benefits in
any month during the time period.
Employed (leavers): Respondents who reported employment in any month
after leaving TANF during the time period.
Age: Categorized as 18-34 and 35-62 and defined as the respondents
reported age in wave 5, July 1997.
Education: Categorized as either having at least a high school diploma
or not. For models of TANF exits, education is defined as the reported
level of education in wave 5, July 1997; for models predicting
employment among leavers, education is defined as the reported level of
education in the month the respondent reported leaving TANF.
Marital status: Categorized as either married or not. For models of TANF
exits, marital status is defined as reported status in wave 5; for
models predicting employment among leavers, marital status is defined
as reported status in the month the respondent reported leaving TANF.
Received Food Stamps/Medicaid (leavers): Respondents who reported
receiving Food Stamps/Medicaid in any month after leaving TANF during
the time period.
Impaired: Categorized as impaired or not. Respondents are defined as
’impaired“ or ’disabled“ if they report being impaired in both wave 5
and wave 11 of SIPP and are defined as ’not impaired“ if they report
being not impaired in both wave 5 and wave 11 of SIPP. To be identified
as having a disability or impairment in SIPP, individuals must meet
specific disability criteria developed by the U.S. Census Bureau.
Although the Census Bureau has developed further criteria for
distinguishing between persons with severe and nonsevere disabilities,
we did not make this distinction. Our use of the term ’impairments“
includes both people with severe and nonsevere disabilities. That is,
they must meet any of the following criteria:
* Had difficulty performing one or more functional activities, including
seeing, hearing, speaking, lifting, and carrying, using stairs, and
walking;
* Had difficulty with one or more activities of daily living, such as
getting around inside the home, getting in or out of a bed or chair,
bathing, dressing, and eating;
* Had difficulty with one or more instrumental activities of daily
living, including going outside the home, keeping track of money or
bills, preparing meals, doing light housework, and using the telephone;
* Had one or more specific conditions, including a learning disability,
mental retardation or another developmental disability, Alzheimer‘s
disease, or some other type of mental or emotional condition;
* Had other mental or emotional condition that seriously interfered with
everyday activities, including frequently depressed or anxious, trouble
getting along with others, trouble concentrating, or trouble coping
with day-to-day stress;
* Had a condition that limited the ability to work, including around
the house;
* Had a condition that made it difficult to work at a job or business;
* Received federal funds based on inability to work;
* Used a wheelchair, a cane, crutches, or a walker.
[End of section]
Appendix II: Related Studies:
Acs, Gregory, and Pamela Loprest. ’Do Disabilities Inhibit Exits from
AFDC?“ Washington, D.C.: The Urban Institute, 1994.
Brandon, Peter D., and Dennis P. Hogan. ’The Effects of Children with
Disabilities on Mothers‘ Exit from Welfare.“ Paper presented at the
Joint Center for Poverty Research, Research Conference. Washington,
D.C.: February 2002.
Collier-Bolkus, Winifred. ’The Impact of the Welfare Reform Law on
Families with Disabled Children That Need Child Care.“ Ph.D
diss.,Widener University, 2000.
Danziger, Sandra et. al. ’Barriers to the Employment of Welfare
Recipients.“ (Revised Version) Ann Arbor, MI: University of Michigan,
2000.
Meyers, Marcia K., Anna Lukemeyer and Timothy Smeeding. ’Work, Welfare
and the Burden of Disability: Caring for Special Needs of Children in
Poor Families.“ Syracuse University: Center for Policy Research,
Maxwell School of Citizenship and Public Affairs. 1996.
Polit, Denise F., Andrew S. London, and John M. Martinez. ’The Health
of Poor Urban Women: Findings from the Project on Devolution and Urban
Change.“ New York, NY: Manpower Demonstration Research Corporation.
2001.
[End of section]
Related GAO Products:
Welfare Reform: Tribes Are Using TANF Flexibility To Establish Their
Own Programs. GAO-02-695T. Washington, D.C.: May 10, 2002.
Welfare Reform: Federal Oversight of State and Local Contracting Can Be
Strengthened. GAO-02-661. Washington, D.C.: June 11, 2002.
Welfare Reform: States Are Using TANF Flexibility to Adapt Work
Requirements and Time Limits to Meet State and Local Needs. GAO-02-
501T. Washington, D.C.: March 7, 2002.
Welfare Reform: More Coordinated Federal Efforts Could Help States and
Localities Move TANF Recipients with Impairments Toward Employment. GAO-
02-37. Washington, D.C.: October 31, 2001.
Welfare Reform: Moving Hard-to-Employ Recipients Into the Workforce.
GAO-01-368. Washington, D.C.: March 15, 2001.
Welfare Reform: Work-Site-Based Activities Can Play an Important Role
in TANF Programs. GAO/HEHS-00-122. Washington, D.C.: July 28, 2000.
Welfare Reform: Means-Tested Programs: Determining Financial
Eligibility is Cumbersome and Can Be Simplified. GAO-02-58. Washington,
D.C.: November 2, 2001.
Welfare Reform: Improving State Automated Systems Requires Coordinated
Federal Effort. GAO/HEHS-00-48. Washington, D.C.: April 27, 2000.
Welfare Reform: State Sanction Policies and Number of Families
Affected. GAO/HEHS-00-44. Washington, D.C.: March 31, 2000.
Welfare Reform: Assessing the Effectiveness of Various Welfare-to-Work
Approaches. GAO/HEHS-99-179. Washington, D.C.: September 7, 1999.
Welfare Reform: Information on Former Recipients‘ Status. GAO/HEHS-99-
48. Washington, D.C.: April 28, 1999.
Welfare Reform: States‘ Experiences in Providing Employment Assistance
to TANF Clients. GAO/HEHS-99-22. Washington, D.C.: February 26, 1999.
Welfare Reform: Status of Awards and Selected States‘ Use of Welfare-to-
Work Grants. GAO/HEHS-99-40. Washington, D.C.: February 5, 1999.
[End of section]
Footnotes:
[1] See U.S. General Accounting Office, Welfare Reform: More
Coordinated Federal Effort Could Help States and Localities Move TANF
Recipients With Impairments Toward Employment, GAO-02-37 (Washington
D.C.: Oct. 31, 2001); and Welfare Reform: Moving Hard-to-Employ
Recipients Into the Workforce, GAO-01-368 (Washington D.C.: Mar. 15,
2001).
[2] A variable is included in the model to control for any differences
among states, although the model does not evaluate the specific effects
of different state policies.
[3] A variable is included in the model to control for any differences
among states, although the model does not evaluate the specific effects
of different state policies.
[4] ’Same“ indicates that there were no statistically significant
differences. However, figures are based on small numbers of
respondents. Differences too subtle to measure could exist.
[5] U.S. General Accounting Office, Welfare Reform: State Sanction
Policies and Number of Affected Families, GAO/HEHS-00-44 (Washington,
D.C.: Mar. 31, 2000).
[End of section]
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Jeff Nelligan, managing director, NelliganJ@gao.gov:
(202) 512-4800:
U.S. General Accounting Office:
441 G Street NW, Room 7149:
Washington, D.C. 20548:
