November 20, 2007

Welfare Benefits are More than just Cash

Marc Comtois

"Today, state spending on cash assistance through FIP accounts for less than one-half of 1 percent of our entire state budget,” ~ Kate Brewster, RI Poverty Institute.

The qualifier "cash assistance" makes all the difference, though, and ProJo reporter Katherine Gregg picked it up. As Gregg reports, direct cash assistance has dropped from $58 million in 1996 to $7.7 million today, but--lest anyone is left with the incorrect perception that welfare assistance as a whole "is less than one-half of 1% of the state budget"-- Gregg supplies a couple clarifications:

State officials were unable to produce growth numbers for the popular RIte Care program yesterday. But state spending on subsidized childcare jumped from $6.3 million to $39.1 million during this same period.

The net result: while the number of people getting cash dropped dramatically, the combined cost to state taxpayers of FIP and childcare went from $57.3 million to $55.3 million.

Yes, we are spending less cash to welfare recipients via FIP than in the past. (Here's the latest report--PDF). However, much of that cash has been converted into government provided services like subsidized day care and health care for the same population. So while $7 million is indeed 1/2% of a $7 billion state budget, the cash from FIP is only part of the equation. And to try to disassociate the infrastructure costs from the actual benefits provided is a bit disingenuous, too. DHS comprises nearly 40% of the budget--that money goes somewhere.

ADDENDUM: I tried to parse out the cost of RIte Care--which has been deemed a successful program--from the state budget documents but my wonkish abilities may have hit the wall. The best I can do is refer to the "Medical Benefits" portion of the DHS budget. The "Medical Benefits" portion of the 2008 DHS Budget document reads:

The Medical Benefits Program assures quality and access to necessary medical services for approximately 186,000 consumers through the purchase of health care at a reasonable cost, primarily financed by Medicaid. These services are provided to three population groups: families and children, individuals with disabilities, and the elderly. Medicaid is a federal and state matching entitlement program administered by states to provide medical benefits. The federal share of reimbursement, which is based on a state’s per capita personal income, is 52.35 percent for federal fiscal year 2007 and 52.57 percent for federal fiscal year 2008.

The Medical Benefits Program provides health insurance to FIP families, children through age 18 with family incomes not in excess of 250 percent of the federal poverty limit and other low income families. Health care is provided to children with special needs under the Supplemental Security Income Program (SSI) or the Early Periodic Screening Diagnosis and Treatment (EPSDT) program. Acute and long-term care services are provided to adults with disabilities and the elderly. There are four home and community-based waiver programs administered directly by DHS or through the Departments of Elderly Affairs (DEA) and Mental Health, Retardation and Hospitals. A Section 1115 SCHIP waiver provides that families without access to employer- based insurance will have health insurance coverage, or be able to maintain their employer-sponsored insurance benefits, if more cost-effective. HCQFP administers the Early Intervention Program for at- risk children up to age three.

The farthest back I can get is via the 2001 budget (PDF), which contained the numbers for 1998 in which we find that the state contributed $287.9 million (out of $614.6 million) towards all aspects of this program. Yet, I don't know how many people were receiving benefits. In, 2001 there were 125,000 consumers receiving benefits at a total cost to the state of $323.5 million (out of $707 million). The 2008 numbers are 186,000 consumers with benefits costing the state $670.2 million (out of $1.4 billion). That's a doubling of the total budget over the last 8 years, but also an increase of 61,000 people to the program. (Meanwhile, the population has only grown by 1.8% from 2000 to 2006; about 20-25,000 people).

Comments, although monitored, are not necessarily representative of the views Anchor Rising's contributors or approved by them. We reserve the right to delete or modify comments for any reason.

All these programs provide benefits, including the minding services of the employees of the various agencies. Their salaries and overhead must be factored into the benefits. Measuring cash only is, to put it politely, disingenuous.

Posted by: chuckR at November 20, 2007 2:12 PM

Let's not fail to factor in the money spent ADVERTISING food stamps and the 211 phone number.

Posted by: Greg at November 20, 2007 2:16 PM

All federal dollars, folks. Federal dollars.

Posted by: Matt Jerzyk at November 20, 2007 3:16 PM

Hey Matt, do YOU pay Federal taxes because I know I do!

Posted by: Greg at November 20, 2007 3:19 PM

Notwithstanding Greg's point, I believe the various budget docs split out the funding sources (federal or state). For instance, the FIP portion of the FY08 budget submitted by the Governor outlines the total expenditure by funds as this:

General Revenue $22,433,604
Federal Funds $80,239,167
Total Expenditures $102,672,771

Posted by: Marc Comtois at November 20, 2007 3:33 PM

I think it might be more productive to discuss ways of trying to reduce the need for welfare and welfare related payments. Some ideas to do this:
weatherization assistance to reduce the need for long term heating assistance;
making birth control more available and related education so that those who cannot afford children are less likely to have them;
tighten residency requirements for assistance so people are less likely to come here for benefits;
tighten record keeping to avoid abuse;
encourage socail servie agencies and their supporters and advocates to give more emphasis to healthier life syles for their clients - eat better, stop smoking, walk more, have fewer children, avoid substance abuse...;
ensure truly needy people have enough resources to avoid conditions that can lead to suffering, risky behavior, and bad health;
control illegal immigration that drives down wages of those at the bottom of the wage scale and ensure enforcement of workplace safety;
I'm sure others will have good ideas!

Posted by: Barry at November 20, 2007 4:04 PM

You're own party leaders laugh at you and your fellow Marxists. Who do you think pushed the flat tax? Murphy, Caprio and more Dems. Who do you think pushed the Historic and Film credits? Fox, Murphy, Paiva-Weed and Montalbano.
You think they're going to repeal all this for the Baby Mama's, their babysitters and "advocates"?
It's going to be a hard crash for you Marxist Loonies as the GA goes along with 90%++ of "Enron Don's" cuts.
Maybe you should take the Illinois Bar and move back to "progressive" Crook County where you can enjoy Daley, Stroger, an 11% sales tax, highest murder rate in America and a Third World majority.
Don't let the door hit you on the way out!

Posted by: Mike at November 20, 2007 7:57 PM

Barry, your ideas haven't a snowball's chance in hell as long as the likes of Mike who believe taxes are only for the poor and middle classes hold all the cards.

Posted by: rhody at November 21, 2007 11:24 AM