| Welfare program
case management is usually organized in one of two ways. Under traditional
case management, welfare recipients interact with two separate workers:
one who deals with welfare eligibility and payment issues, often called
income maintenance, and one who deals with employment and training issues.
Under integrated case management, welfare recipients work with
only one staff member who handles both the income maintenance and employment
and training aspects of their case. Although both strategies have certain
advantages — for example, the traditional structure allows staff
members to specialize in one particular role, and the integrated structure
allows staff members to quickly emphasize the importance of employment
and eliminates failures in communication between staff members —
little information exists on the effects of the two approaches.
This report presents the results of a random assignment study designed
to evaluate the two case management approaches, and thus it addresses
some longstanding issues in the management of welfare programs. The study
was conducted in Columbus (Franklin County), Ohio, as part of the National
Evaluation of Welfare-to-Work Strategies (NEWWS Evaluation), a large-scale
evaluation of 11 welfare-to-work programs in seven sites across the nation.
The evaluation is being conducted by the Manpower Demonstration Research
Corporation (MDRC), under contract to the U.S. Department of Health and
Human Services, with support from the U.S. Department of Education.[1]
For the study, Columbus operated two separate welfare-to-work programs:
one that used integrated case management, referred to in this report as
the integrated program, and one that used traditional case
management, referred to as the traditional program. Apart from
the case management difference, the welfare-to-work programs were the
same: They required welfare recipients to participate in activities to
build their skills and eventually move into the labor market; provided
child care and other services to support this participation; and penalized
those who did not follow program rules by reducing their cash grant. Participants
in the programs were also subject to the same public assistance eligibility
and payment system.
This report provides information on how the integrated and traditional
programs were implemented, how they affected participation in employment-related
activities, and the costs of providing employment-related services in
the two programs. It also discusses program effects, measured three
years after sample members’ entry into the study, on employment,
earnings, and welfare receipt. (The final report in the NEWWS Evaluation
will present program effects measured five years after study entry.)
To facilitate this assessment, from 1992 to 1994 over 7,000 single-parent
welfare applicants and recipients, who were determined to be mandatory
for the Columbus welfare-to-work program, were randomly assigned for
the evaluation. The study’s rigorous research design allows researchers
to determine the effects of each program as well as the relative effects
of the programs, thus providing two types of information.
First, the report describes and evaluates the effects of two mandatory
welfare-to-work programs relative to the effects of no special welfare-to-work
program. In contrast to many previously studied programs that emphasized
skills-building, which engaged most participants in basic education classes,
the Columbus programs engaged many people in basic education but also
engaged many others in post-secondary education, primarily at two-year
colleges.
Second, this report compares the effectiveness of a welfare-to-work program
that used integrated case management with the effectiveness of one that
used traditional case management. Because other program features were
the same, these comparisons indicate the relative effectiveness of the
two case management approaches.[2]
Columbus’s integrated and traditional programs were
operated under the Family Support Act (FSA) of 1988. The FSA required
states to provide education, employment, and support services to Aid to
Families with Dependent Children (AFDC) recipients, who were, in turn,
required to participate in the Job Opportunities and Basic Skills Training
(JOBS) program created by the act to equip them for work. In 1996, the
Personal Responsibility and Work Opportunity Reconciliation Act replaced
AFDC with a block grant program, Temporary Assistance for Needy Families
(TANF). The law limits most families to five years of federal assistance,
offers states financial incentives to run mandatory, work-focused welfare-to-work
programs, and requires states to meet relatively high work participation
rates or face reductions in their block grant. The 1996 law’s overarching
goal is similar to the FSA’s: to foster the economic self-sufficiency
of welfare recipients through increased employment and decreased welfare
receipt. Columbus began operating its TANF program in October 1997, after
the follow-up period covered in this report.[3]
I.The Findings in
Brief
Key findings from this report include the following:
- Integrated case managers provided more personalized attention than
traditional case managers and more closely monitored participation in
program activities. More integrated staff than traditional staff
said that they tried to learn in depth about the recipients they worked
with and provided positive reinforcement to them. Integrated staff received
more timely attendance information from service providers and more quickly
contacted participants about attendance problems.
-
The integrated program engaged more people in welfare-to-work
activities than the traditional program. A higher proportion of
recipients in the integrated program attended a JOBS orientation
and participated in JOBS activities. This probably reflects integrated
staff members’ better participation monitoring and follow-up. Also,
recipients in the integrated program may have taken the threat of cash
grant reductions for noncompliance more seriously than recipients in
the traditional program because integrated case managers could reduce
grants themselves rather than relying on an income maintenance worker
to do so.
-
Sanctioning rates in the programs were similar and
very high. The rate of “initiating” a sanction, however, was
higher in the traditional program. Over a third of sample members
in each program had their cash grant reduced because of noncompliance
with program rules. More recipients in the traditional program, however,
had a sanction initiated (the case manager decided that a sanction should
be imposed), which means that fewer of those for whom a sanction was
initiated in the traditional program actually had their grant reduced.
This probably reflects the fact that traditional case managers had to
rely on another staff member to impose sanctions, and, because the case
managers did not deal with the eligibility aspects of cases, that they
probably initiated sanctions for some people who were no longer receiving
cash assistance or were no longer mandatory for JOBS.
- The integrated program had somewhat higher two-year costs for employment-related
services than the traditional program. This difference reflects
higher expenditures for vocational training and case management. A future
benefit-cost analysis will include estimates of the cost of income maintenance
services and thus will provide the bottom line on the relative costs
of the programs.
- The
Columbus programs increased earnings. Over three years, the integrated
and traditional programs boosted average earnings by about $1,000, or
10 percent, relative to the control group average.
-
Both programs reduced welfare receipt and payments,
but the effects of the integrated program were somewhat larger.
Over the three-year follow-up period, the integrated program reduced
time on cash assistance by about 2 1/2 months and reduced three-year
welfare expenditures by 15 percent. The traditional program, in comparison,
reduced welfare receipt by about 1 2/3 months and reduced expenditures
by 11 percent. Integrated case managers more quickly closed cash assistance
cases and were better able to detect individuals who should not be receiving
welfare than traditional case managers.
- Neither program increased sample members’ average combined
income from earnings, cash assistance, and Food Stamps. Earnings
gains did not exceed public assistance decreases (both programs decreased
Food Stamp payments).
- For sample members who did not have a high school diploma or GED
when they entered the study, the integrated program produced larger
earnings gains and welfare reductions than the traditional program.
It is unclear why the integrated program produced larger effects
for this subgroup. It may be that the closer monitoring and higher level
of personalized attention and encouragement of the integrated approach
especially benefited these more disadvantaged recipients.
Overall, the results show that Columbus ran two moderately effective
welfare-to-work programs. Both engaged many welfare recipients in education
and training, and, over three years, increased their earnings and decreased
their welfare receipt. Additional follow-up, to be presented in the evaluation’s
final report, will show whether these effects continue in the fourth and
fifth years following study entry.
The results also provide evidence that an integrated case management
approach can yield additional effects beyond those of a traditional approach
— namely, higher participation rates and somewhat larger welfare
reductions. It is important to note that Columbus had sufficient program
services and an uncommon degree of administrative and clerical support.
Integrated case managers found balancing employment services with income
maintenance to be demanding even with these supports; without them, they
may have found the work to be overwhelming.
The remainder of the summary presents the findings in more detail. Following
a brief discussion of the history of the two case management approaches
and the operation of the approaches in Columbus, the summary provides
some detail about the evaluation. Then it discusses the programs’
services, messages, and costs, and their effects on an array of outcomes,
including employment, welfare, and income. The summary concludes with
a discussion of the findings.
II. Historical Context of
Integrated and Traditional Case Management
The idea of administering income maintenance together with employment
services and other social services is not new.[4] After the Social Security Amendments of 1962, which
increased federal compensation to state welfare agencies for administrative
costs related to social services, most states adopted what was called
a casework model. Welfare departments hired caseworkers to review applications
for welfare and to attempt to “rehabilitate” recipients so that
they would become self-supporting. Supporters of the casework model believed
that it would allow welfare staff to show concern for recipients during
the course of income maintenance discussions and respond to problems,
and make it easier for recipients to request services.
Some people, however, criticized the casework model. In many states,
staff members hired to perform casework were not professionally trained
and did not know what to look for or how to confront recipients about
the problems they observed. Few “hard” services, such as job
training, placement assistance, or substance abuse treatment, were provided.
Professional social workers argued that “the money function disables
or overwhelms the social services.”[5]
Conservative lawmakers in Congress feared that liberal caseworkers authorized
benefits to which individuals were not entitled. Welfare rights and civil
rights groups objected to the assumption that welfare recipients needed
rehabilitation and attacked the home visits as an invasion of privacy.
Responding to these criticisms, in 1967 the U.S. Department of Health,
Education, and Welfare (HEW) issued a directive that urged states to reorganize
the administration of their welfare programs by creating separate line
agencies to determine welfare eligibility and provide social services.
The 1967 Work Incentive (WIN) program directed some AFDC recipients to
participate in employment-related activities and provided funding for
these activities. The WIN program was jointly administered by HEW and
the U.S. Department of Labor, which fostered the separation of income
maintenance and employment services. This administrative structure was
replicated at the state and local levels in most states, resulting in
a system in which welfare staff generally referred recipients outside
the income maintenance office to employment security agencies for WIN
assessment and services.
By the 1970s, the separation of social and employment services from income
maintenance left most welfare offices focused on determining eligibility,
authorizing welfare grants, and distributing welfare checks. Many agencies
that once recruited college graduates to do casework downgraded the income
maintenance role to a clerical level. A goal of minimizing AFDC payment
errors replaced the previous decade’s goal of “rehabilitating”
welfare recipients.
The FSA of 1988, which created the JOBS program, made state welfare agencies
directly accountable for enrolling welfare recipients in education and
work-related services. As under WIN, most states continued to separate
income maintenance and employment-related services, although a 1992 survey
found that 17 states operated programs in which JOBS case managers performed
an integrated income maintenance and JOBS role. (As this report was being
prepared, information was not yet available on how many states have combined
income maintenance and employment services under the 1996 federal welfare
reform law.)
Both case management approaches can be argued to have certain advantages
and disadvantages. The separation of income maintenance from employment
and training tasks allows each staff member to specialize in a particular
role. It can also allow the employment services case managers to develop
a distinct and often more prestigious professional identity. Common criticisms
of this model are that a lack of coordination between income maintenance
and employment and training services may prevent the quick enrollment
of welfare recipients in work activities or may hinder the imposition
of penalties on individuals who do not comply with work participation
requirements.
By combining the roles of income maintenance and employment and training
in one position, the integrated approach eliminates communication breakdowns
between different staff members. Integration also allows staff to quickly
emphasize the importance of employment. Two prominent welfare scholars
suggested that integration may change the “eligibility-compliance
culture” of the average welfare office to a “self-sufficiency
culture” — that is, one that structures “interactions and
expectations around work and preparation for work, with most of the attention
of clients and workers devoted to moving off welfare rather than to validating
the credential for staying on it.”[6]
A common criticism of integrated case management, however, is that the
two functions may overwhelm staff members, and, because they must deal
with welfare payments each month, this may lead them to pay less attention
to employment and training.
III. Integrated
and Traditional Case Management in Columbus
Table 1 summarizes the primary duties of line staff
in the integrated and traditional programs in Columbus. In the traditional
program, income maintenance (IM) workers determined eligibility for and
authorized public assistance benefits provided by the welfare department,
including cash assistance, Food Stamps, and Medicaid. They also made changes
in benefit amounts as family composition changed or as recipients found
work, and they imposed financial sanctions at the request of JOBS case
managers. JOBS case managers conducted JOBS orientation sessions, assessed
recipients’ skills and support service needs, assigned them to JOBS
activities, monitored their attendance and progress, and initiated sanctions
for those who did not comply with program requirements. In the integrated
program, integrated case managers performed all these duties.
Evaluation designers had planned that integrated case managers would
carry relatively small caseloads so they could work closely with each
case. Various factors caused integrated caseloads to be somewhat larger
than intended. As Table 1 shows, caseloads averaged about 260 for both
IM workers and JOBS case managers and 140 for integrated case managers
(rather than 100 as Evaluation designers originally planned). In other
words, on average, every two staff members in the traditional program
worked with about 260 recipients, and every two staff members in the integrated
program worked with about 280 recipients. Therefore, the evaluation in
Columbus is comparing the effectiveness of integrated and traditional
case management approaches with similar recipient-to-staff ratios. Any
differences that exist between the programs’ outcomes can be attributed
to the case management approach.
IV. The Evaluation in Columbus
A. Research Design
During the period studied, Columbus required all welfare recipients whose
youngest child was at least 3 years old and who did not meet federal exemption
criteria to participate in the JOBS welfare-to-work program. (Exemption
reasons included working 30 hours or more per week, being ill or incapacitated
or caring for an ill or incapacitated household member, being of advanced
age, being in at least the second trimester of pregnancy, or living in
a remote area that made program activities inaccessible.) For the evaluation,
between September 1992 and July 1994, 7,242 JOBS-mandatory, single-parent
welfare applicants and recipients were assigned, at random, to one of
three groups:
-
the integrated group, whose members were required
to participate in the integrated JOBS program or face a reduction in
their cash grant (a financial sanction);
- the traditional group, whose members were required to participate
in the traditional JOBS program or face a financial sanction; or
- the control group, whose members were neither required nor
eligible to participate in any special welfare-to-work program. (Control
group members received income maintenance services. They could seek
out employment-related services available in the community and, if they
did, could receive child care assistance from the welfare department.)
Because people were assigned to one of the three groups through a random
process, any differences that emerge over time between the groups’
outcomes — for example, in average earnings or average welfare payments
— can reliably be attributed to the programs.
The three-way design allows researchers to make two types of rigorous
comparisons. First, estimates of the net effects of each program
can be made by comparing outcomes of the integrated group with outcomes
of the control group, and by comparing outcomes of the traditional group
with outcomes of the control group. (The integrated and traditional groups
are also referred to as program groups in this report.) Second, estimates
of the differential effects of the programs can be made by comparing
outcomes of the integrated group with outcomes of the traditional group;
because the income maintenance and employment services in the two programs
were the same, the differential effects represent the relative effectiveness
of the two case management approaches. All these differences in outcomes
are referred to as program effects or impacts.
The fact that random assignment occurred at the welfare office when people
were referred to JOBS affects how the report’s results should be
interpreted. First, the impacts reflect the effects not only of JOBS services
and mandates, but also of the referral to JOBS and any related follow-up,
such as sanctioning for people who did not attend an orientation session.
Second, outcomes for sample members who did not attend a JOBS orientation,
and thus did not receive any program services, are averaged together with
those of orientation attendees; this may dilute the estimate of the effects
of the welfare-to-work program services and mandates.
B. Characteristics of Sample Members
Information on various characteristics of sample members was collected
at random assignment. Most sample members were women, and roughly half
were white and half were African-American. Typical sample members had
limited experience in the labor market: Fewer than half reported that
they had ever worked full time for six months or longer for one employer,
and fewer than a third reported that they had worked for pay in the year
before random assignment. Nearly three-fifths had received a high school
diploma or GED certificate.
C. Environment in Columbus
Between 1992 and 1997, the period covered in this report,
Columbus was a growing metropolitan area with a population of close to
1 million. The labor market was robust, with a low unemployment rate that
decreased throughout the period (to 2.7 percent in 1997), and substantial
employment growth. Over the follow-up period, the county welfare caseload
decreased by almost a third.
V. Program
Services and Messages
This report presents findings on the implementation of the integrated
and traditional programs, based primarily on interviews and surveys of
line staff and supervisors and observations of program activities. Information
on recipients’ participation in employment-related activities was
obtained from reviews of program case files and a survey of sample members
administered two years after random assignment. Following are highlights
of the implementation and participation findings.
- The Columbus programs had plentiful resources, good facilities,
and extensive administrative support.
Welfare administrators in Columbus placed a high priority on the JOBS
program; they considered it the centerpiece of an agency-wide mission
to make welfare temporary and employment-focused. Unavailability of program
services was rarely, if ever, a problem. The JOBS center, physically separate
from the welfare office, housed the employment and training staff for
the integrated and traditional programs. The center also provided spacious
classrooms for basic education and job search classes; offices for state
employment services staff, and county alcohol, substance abuse, and mental
health workers; and a child care facility for children between ages 2
1/2 and 5.
The programs provided line staff with an unusual level of administrative
support. Columbus had a child care unit that connected parents with child
care providers and a resource unit that collected JOBS activity attendance
information and provided it to case managers. Columbus used an automated
case record information system that contained information on individuals’
past public assistance benefits, JOBS activity assignments, and sanctions
for noncompliance. The system guided staff through the welfare eligibility
determination process and the JOBS assessment.
- Despite larger-than-intended
caseloads, integrated case managers, aided by various program supports,
successfully performed both their income maintenance and employment
and training duties.
For integrated workers whose caseloads are too large, their income
maintenance role may overshadow their employment and training role,
particularly if management emphasizes income maintenance. Although caseloads
in Columbus were larger than planned, and perhaps larger than ideal,
integrated staff spent much of their time focused on employment and
training issues.
As noted above, program administrators in Columbus emphasized the importance
of employment and training, and staff received substantial administrative
support. In addition, before starting work integrated case managers
received four weeks of training on income maintenance procedures and
the automated case management system and one week of training on JOBS
procedures (traditional JOBS case managers also received JOBS training).
Additional training (for all staff) was provided over time, as part
of an agency-wide effort to improve staff performance.
- Integrated case managers provided more personalized attention than
traditional case managers and more closely monitored participation in
program activities.
More integrated case managers than traditional JOBS case managers said
that they tried to learn in depth about the recipients they worked with
and provided positive reinforcement to them. Program participants corroborated
this difference: More recipients in the integrated program than the traditional
program said that their case manager knew a lot about them and their family
and believed that program staff would help them resolve problems affecting
their participation in activities. Integrated staff also more quickly
received attendance information from service providers and contacted participants
about attendance problems.
-
The integrated and traditional programs emphasized
skills-building prior to entry into the labor market rather than immediate
employment.
This emphasis was based on the belief that an initial investment in the
skills levels of welfare recipients would allow them to eventually obtain
higher-paying and more secure jobs. The programs did not have a specific
prescribed activity sequence, but staff strongly encouraged people who
did not have a high school diploma or GED certificate to attend basic
education classes and earn a diploma or GED, and they encouraged many
of those who already had a such a credential to attend vocational training
classes or post-secondary education or to participate in work experience
before actively seeking a job. Staff referred only the most employable
recipients to job search services — typically those who had a high
school diploma or GED, some work experience, and no serious problems,
such as substance abuse, that might interfere with working.
- The programs substantially increased participation in employment-related
activities.
Many welfare recipients take part in employment-related activities without
the intervention of a welfare-to-work program. For a program to make a
difference, it must engage more people than would have volunteered for
activities available in the community. For recipients who did not have
a high school diploma or GED at random assignment, survey responses show
that the programs produced large increases in participation in basic education.
For sample members with one of these credentials, the programs substantially
increased participation in post-secondary education (most commonly, courses
at a two-year college), job search activities, and unpaid work experience.
The increases in post-secondary education are large compared with increases
found for other programs.
-
The integrated case management approach engaged more
people in the welfare-to-work program than the traditional approach.
As shown in Figure 1, reviews of program case files
indicated that a larger proportion of sample members in the integrated
program than in the traditional program attended a JOBS orientation, the
gateway to program activities. (The asterisks indicate that the difference
between the programs’ participation levels is statistically significant,
that is, not due to chance.) In addition, more integrated group members
participated in post-orientation activities, including job search, education,
training, life skills workshops, and unpaid work experience.
These differences probably reflect integrated case managers’ closer
monitoring of participation and quicker follow-up regarding attendance
problems. Integrated group members may also have taken the threat of financial
sanction for program noncompliance more seriously than traditional group
members because integrated case managers could impose sanctions themselves.
The orientation attendance rate may also have been higher because integrated
case managers called people in to orientation more quickly than did traditional
case managers.
- Sanctioning rates in the programs were similar and very high. The
rate of “initiating” a sanction, however, was higher in the
traditional program than in the integrated program.
Staff in both programs believed that those who receive welfare have an
obligation to take part in welfare-to-work activities. They strongly emphasized
the program participation mandate and freely used financial sanctions
(grant reductions) as a response to recipients’ noncompliance with
program requirements. As Figure 1 shows, more than a third of those in
each program were sanctioned at some point during the follow-up period.
(In Columbus, a sanction reduced an average grant by about one-fifth.)
Before a sanction could be imposed, the recipient’s case manager
had to decide that a financial penalty was in order; in this report, the
decision to sanction is referred to as “initiating” a sanction.
In both the integrated and traditional programs, some people for whom
a sanction was initiated demonstrated good cause for not participating
and were not sanctioned. However, more recipients in the traditional group
than in the integrated group had a sanction initiated, which means that
a smaller proportion of those for whom a sanction was initiated were actually
sanctioned in the traditional program than in the integrated program.
This difference probably occurred because traditional JOBS case managers
could not impose sanctions themselves. In addition, since they did not
deal with the income maintenance aspects of cases, they probably initiated
a sanction for some people who had not attended a program activity either
because they were no longer receiving cash assistance or were no longer
mandatory for the JOBS program (and thus could not or should not be sanctioned).
VI. Program Costs
The cost of the employment-related services in the integrated and traditional
programs was determined using various sources, including state and county
fiscal reports, support service payment records, case file participation
records, and sample members’ survey responses. As in the other cost
analyses in the NEWWS Evaluation, the cost estimates in this report consist
of all costs associated with providing employment services and related
support services to sample members. They do not include, for either the
integrated or traditional program, the costs of authorizing and processing
welfare payments (that is, they do not reflect the cost of the IM workers
in the traditional program or the cost of the eligibility tasks of the
integrated case managers). The five-year benefit-cost analysis, to be
presented in the evaluation’s final report, will estimate the costs
of both employment-related and eligibility services, and thus will provide
the bottom line on the differential costs of integrated and traditional
case management in Columbus. Key findings on the programs’ two-year
employment-related costs are presented below.
- The integrated program had somewhat higher two-year costs per program
group member for employment-related services than the traditional program.
The gross cost per program group member during the two-year follow-up
period consists of costs paid by the welfare department and non-welfare
agencies for employment-related services while sample members were enrolled
in the Columbus programs, as well as for employment and support services
after they exited the programs and, in some cases, left welfare. Table
2 shows that this cost was $3,018 in the integrated program and $2,589
in the traditional program.
The programs’ net cost is the gross cost minus what would
have been spent in the absence of a mandatory welfare-to-work program,
as measured by the cost per control group member. Control group members
were not eligible to take part in program activities, but could enroll
on their own in other employment-related activities in the community and,
if they did, were eligible for activity- and employment-related welfare
department support services. Thus, control group costs include expenditures
for all of the nonprogram activities and support services used by control
group members during the follow-up period. Table 2 shows that the two-year
net cost per person was $2,149 for the integrated program and $1,720 for
the traditional program.
The integrated program had somewhat higher employment-related costs for
two main reasons. First, vocational training participants in the integrated
group tended to use more expensive services than participants in the traditional
group (proprietary schools rather than less expensive nonprofit agencies).
Second, integrated employment-related case management costs were somewhat
higher. (This does not indicate that the eligibility-related case management
costs or total case management costs were higher for the integrated program
than for the traditional program.) As noted earlier, caseloads for the
integrated case managers were larger than had been planned. If integrated
case management had been operated with substantially smaller caseloads,
it is very likely that it would have been more expensive.
Similar to the findings for the full sample, the integrated program had
somewhat higher employment-related costs than the traditional program
for both educational attainment subgroups (those who entered the study
with a high school diploma or GED and those who entered the study without
such a credential).
VII. Program Impacts
on Receipt of Education Credentials,
Employment, Welfare, and Income
The programs’ effects on receipt of education credentials were measured
using sample members’ responses to a survey administered two years
after study entry. Effects on employment and welfare were estimated using
automated state unemployment insurance (UI) records and AFDC administrative
records data. Following are highlights of the impact findings.
- For sample members who did not have a high school diploma
or GED at random assignment (nongraduates), the traditional program increased the proportion who received such a credential within two years of entering
the study; the integrated program did not.
About 4 percent of nongraduate control group members reported that they
had received a high school diploma or GED at some point during the two
years following entry into the study. In the traditional group, 13 percent
of nongraduates reported that they received such a credential after entering
the evaluation. In the integrated group, 9 percent of nongraduates reported
receiving a diploma or GED, but the 5 percentage point increase is not
statistically significant. Like most welfare-to-work programs studied,
neither program in Columbus (despite substantial increases in participation
in post-secondary education) increased receipt of a trade certificate,
an associate’s degree, or a bachelor’s degree. Additional sample
members may have received a credential after the two-year point, but these
effects will not be measured in the evaluation.
- The programs raised employment rates and earnings by about the
same amount over the three-year follow-up period. They increased earnings
primarily because program group members worked at better jobs than their
control group counterparts.
Table 3 shows the two programs’ effects on
employment and earnings. The first set of columns shows effects of the
integrated program (integrated-control comparison), and the second set
shows effects of the traditional program (traditional-control comparison).
The last column shows the difference between outcomes of the integrated
and traditional programs (integrated-traditional difference).
During the study period, which was characterized by a very robust labor
market, employment rates were high in Columbus, even without the programs’
intervention: 78.5 percent of control group members were employed at some
point during the three years after entry into the study, and they worked
an average of 5.46 quarters (just over 16 months). As the table indicates,
both programs produced small increases in employment rates and in the
average length of time worked.
Control group members earned an average of $12,027 over the three years
(this average includes zeros for people with no earnings). The integrated
program boosted three-year earnings by an average of $1,181, or 10 percent,
and the traditional program boosted earnings by $1,000, or 8 percent.
(The $181 difference between the two program groups’ average earnings
is not statistically significant.) The Columbus programs increased average
earnings primarily because integrated and traditional group members worked
for more quarters and earned more per quarter of employment than control
group members. This implies that, on average, integrated and traditional
group members who worked held better jobs than control group members who
worked.
Average quarterly earnings are plotted in the upper panel of Figure
2. As is often found for programs that emphasize building skills prior
to finding a job, neither program increased earnings during the first
year of follow-up, but did during the second year. (Impacts are illustrated
by the distance between the lines on the figure.) By the end of the third
year of follow-up, the integrated program’s impacts on earnings had decreased, but remained statistically significant. The
traditional program’s impacts, in contrast, were less consistent
during the third year. These patterns suggest that the integrated program
will continue to increase employment and earnings during the fourth year
of follow-up, but the traditional program may not.
The higher rate of participation in the integrated program did not translate
into larger employment and earnings impacts (although quarterly patterns
suggest that the integrated program may have more positive results than
the traditional program during the fourth year of follow-up). A recently
published analysis of participation in welfare-to-work programs found
that although a minimum level of participation is necessary to produce
employment and earnings impacts, above that threshold there is no linear
relationship between participation levels and impacts.[7]
One should not expect, then, that higher participation rates would necessarily
yield larger increases in employment and earnings.
- Both programs reduced cash assistance receipt and payments. The
integrated program’s reductions were somewhat larger, probably
because integrated staff responded more quickly to changes in sample
members’ employment and welfare eligibility status and had more
knowledge about these changes.
Table 3 shows that control group members received cash assistance for
an average of about 21 1/2 months during the three-year follow-up period.
The integrated program reduced welfare receipt by more than 2 1/2 months,
a decrease of 12 percent relative to the control group average. The traditional
program reduced receipt by about 1 2/3 months, or 8 percent.
Control group members received an average of $7,151 in welfare payments
during the three-year period. Integrated group members received, on average,
15 percent less in welfare payments than the control group, and traditional
group members received 11 percent less. Most of the reduction occurred
because integrated and traditional group members spent less time on welfare
than their control group counterparts (rather than receiving lower grant
amounts).
Average quarterly welfare payments for the research groups are plotted
in the lower panel of Figure 2. The programs reduced payments during each
year of the follow-up period. The effects grew over time and remained
substantial at the end of the three years, which suggests that the reductions
in both programs are very likely to persist during the fourth year of
follow-up.
The integrated program’s somewhat greater success in reducing welfare
receipt and payments, without corresponding larger increases in employment
and earnings, indicates that the integrated case management structure
engendered more effective eligibility case management and facilitated
case closures. Specifically, integrated case managers closed cases more
quickly, on average, than traditional staff. They also closed cases that
would have remained open in the traditional program, probably because
— through closer and more frequent contact — they were better
able to detect individuals who should not be receiving welfare.
-
Neither program increased average combined income from
earnings, cash assistance, and Food Stamps.
One way to measure a program’s effect on sample members’ economic
self-sufficiency is to examine their combined income from earnings, cash
assistance, and Food Stamps. (This income measure does not include estimates
of the Earned Income Credit, a credit against federal income taxes for
low-income taxpayers.) During the three years following random assignment,
control group members received, on average, $25,490 from earnings, cash
assistance, and Food Stamps. Integrated group members received $24,895
over the same period, 2 percent less than the control group average, and
traditional group members received $25,192, 1 percent less. (In addition
to reducing cash assistance payments, both programs reduced Food Stamp
payments over the three-year period: the integrated program by $697 and
the traditional program by $483.) The small decreases in average combined
income are not statistically significant.
- For sample members who did not have a high school diploma or GED
when they entered the study (nongraduates), the integrated program produced
larger earnings gains and welfare reductions than the traditional program.
For graduates, however, the programs had similar effects.
Table 4 presents a summary of the programs’
effects on employment and welfare for the graduate and nongraduate subgroups.
The traditional program increased graduates’ average earnings over
the three-year period by $1,105, or 7 percent; the $633 increase for the
integrated program is not statistically significant. (The $473 difference
between the integrated and traditional groups’ average earnings is
not statistically significant.) Both programs decreased the time that
graduate sample members received welfare benefits and reduced their average
welfare payments. As mentioned earlier, the programs increased graduates’
participation in post-secondary education (as well as in job search and
unpaid work experience). The final report of the evaluation will track
sample members for five years and show whether the participation increases
lead to earnings gains later in the follow-up period.
The lower panel of Table 4 shows that the integrated program boosted
nongraduates’ three-year earnings by $1,730, or 21 percent, compared
with an increase of $734, or 9 percent (not statistically significant),
for the traditional program. The integrated program decreased months of
welfare receipt by 14 percent, compared with 7 percent for the traditional
program, and reduced welfare payments by $1,404, compared with $874.
It is unclear why the integrated program produced larger effects among
nongraduates than the traditional program. Participation patterns for
nongraduates were similar in the two programs, with many attending basic
education classes. It may be that the closer monitoring and more personalized
attention and encouragement that the integrated approach provided to recipients
made more of a difference with a more disadvantaged subgroup.
For graduates and nongraduates, as for the full sample, both programs
slightly reduced average combined income from earnings, cash assistance,
and Food Stamps, but the reductions were not statistically significant.
VIII. Discussion
and Implications of the Findings
Overall, this report shows that both welfare-to-work programs in Columbus
were moderately effective. On average, the programs increased sample members’
participation in employment-related activities and their earnings and
reduced their welfare receipt.
It is important to emphasize, however, that, on average, sample members
gained about the same amount in earnings as they lost in public assistance,
resulting in no net increase in income from these sources. Thus, the programs’
main financial effect for participants, as is true for many welfare-to-work
programs, was to replace some welfare dollars with dollars from work.
Furthermore, a substantial proportion of integrated and traditional group
members were still receiving cash assistance benefits at the end of the
three years studied in the report (about one-third of each program group
received benefits in the last quarter of follow-up).
This report also shows that, as operated in Columbus, integrated case
management can yield some additional effects beyond those of a traditional
approach. First, integrated case management generated higher rates of
participation in program activities. As discussed earlier in the summary,
this probably reflects better monitoring and follow-up; and recipients
may have taken the threat of financial sanction more seriously when it
came from a staff member who could impose the sanction herself. A higher
participation rate is consequential for at least two reasons. Engaging
more welfare recipients in a welfare-to-work program helps enforce the
social contract idea that people receiving welfare should, in turn, take
part in employment-focused services. In addition, under the 1996 federal
welfare law, states must meet relatively high work participation rates
or face reductions in their TANF block grant; integrated case management
may help them do so.
Second, through more effective eligibility case management, the integrated
approach generated somewhat larger decreases in time on welfare over the
three-year period, and thus somewhat larger welfare savings. Integrated
staff were able to close cases more quickly than traditional staff, and,
through closer and more frequent contact, were better able to detect individuals
who should not have been receiving welfare. In an environment of time-limited
welfare receipt, reducing months of welfare receipt is an especially important
goal.
Overall, however, the integrated program did not increase earnings more
than the traditional program (and neither program increased combined income
from earnings, cash assistance, and Food Stamps). Thus, whether the Columbus
results suggest that an integrated case management structure is preferable,
compared with a separated, traditional structure, depends on the primary
goals of a program. Specifically, this study shows that integrated case
management may be more effective in increasing participation rates and
decreasing welfare receipt, but offers no evidence that it is more (or
less) effective in increasing participants’ earnings or income.
When interpreting the Columbus results, however, it is important to remember
that the program effects occurred in a specific context. First, and most
important, the case management models were operated as part of a well-funded,
well-run welfare-to-work program. As discussed, staff in Columbus had
extensive administrative support, including a sophisticated case record
information system, a child care referral unit, and a clerical unit that
tracked recipients’ attendance in program activities. Program administrators
placed a high priority on the employment services aspect of the program,
services were plentiful, and staff training was adequate. Integrated case
managers found their job to be demanding with these resources and supports;
without them, they may have found the work to be overwhelming, and the
effects of the integrated program may have been diminished.
Second, the recipient-to-staff ratio in the integrated and traditional
programs was approximately the same. The evaluation results do not indicate
how the program effects would have differed if the integrated case managers
had worked with fewer recipients, as was originally intended. (A previous
MDRC evaluation, however, provided some evidence that smaller caseloads
do not yield larger program effects.)[8]
IX. Future Research
A future NEWWS Evaluation report will track Columbus sample members
for five years. The additional follow-up will show whether the earnings
increases and welfare reductions continue and whether the differences
between the programs’ outcomes remain for the full sample and for
nongraduates. It will also indicate whether the substantial increases
in post-secondary education among graduates lead to additional increases
in earnings. The report will examine the total costs of each program
— eligibility-related costs as well as employment-related costs
— and compare the financial benefits and costs of the two programs,
both for the government and for individuals in the programs. In addition,
the report will compare the results for Columbus with the results for
the other programs in the NEWWS Evaluation.
Notes
[2]
This report draws on an earlier paper prepared
as part of the NEWWS Evaluation: Thomas Brock and Kristen
Harknett, “Welfare-to-Work Case Management: A Comparison
of Two Models” (paper prepared by MDRC as part of the
National Evaluation of Welfare-to-Work Strategies, 1998).
A revised version of this paper was published in Social
Service Review (December 1998): Thomas Brock and Kristen
Harknett, “A Comparison of Two Welfare-to-Work Case
Management Models.”
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