TANF and Medicaid: Review

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TANF was enacted in 1996 and set 4 goals for the states using the program:

  1. “provide assistance to needy families so that children may be cared for in their own homes or the homes of relatives;
  2. end the dependence of needy parents on government benefits by promoting job preparation, work, and marriage;
  3. prevent and reduce the incidence of out of wedlock pregnancies and establish annual numerical goals for preventing and reducing the incidence of these pregnancies; and
  4. encourage the formation and maintenance of two-parent families.”

To work on these tasks state governments receive money from a federal block grant. To be eligible for the TANF funding the state must also spend a certain amount of its own money on the project. It is called the “maintenance of effort” requirement. This amount is affected by the state’s financial condition. Across the country, local budget contributions amount to roughly 40% of the overall expenses. The states failing to meet the spending goals are severely penalized. The federal law also sets the lifetime limit of 60 months for each participant of the program. Once the person has been receiving welfare for that period, they no longer count as eligible for further support. Since the system aims to integrate people into the workforce, any states meeting the requirements for job participation among the beneficiaries get caseload reduction credit which reduces the minimum number of participants required for continued funding.

The states must demonstrate that at least 50% of the participants are working, and 90% of the two-parent families enrolled in the program are employed. Theoretically, the states who do not meet these requirements risk losing their funding. That rarely happens since the penalties can be avoided by taking corrective actions. Other than that, the system is extremely flexible and allows each state to create independent welfare programs. For example, California has created a program named California Work Opportunities and Responsibility to Kids. It is a part of the overall TANF plan but uses a separate set of participation requirements. The beneficiary must be either pregnant or responsible for a child under 19, be a permanent resident, the US citizen or legal immigrant, receive low income, and be either unemployed, underemployed or face unemployment. Illinois has chosen to cover some education expenses as a part of the TANF support. The state still encourages labor participation but allows the beneficiaries to attend community colleges. Washington, on the other hand, focuses on the Work First approach of the act. The beneficiaries are required to participate in the 12-week long job search before considering other options like professional training.

Every state has some differences in their TANF implementation since the program allows the local governments a lot of freedom in determining the approach and achieving the overall goals. Since the emergence of the project in 1996, the amount of money spent on TANF has been decreasing. In 2013, 32$ billion overall was spent on the TNAF program. The government reports claim that this is the lowest amount in the project’s history. Cash assistance, childcare, work and employment support, and program administration and maintenance amounted to the 67.6% of the expenditures. Each year, a larger part of the funding is spent on healthcare, nutrition, education, and housing. Only 36% of the money was used for recurring cash assistance in 2012. The decrease is explained by the decreasing number of the beneficiaries which means less money is spent on inflation-adjusted payments. It also represents a shift in priorities in the welfare system. AFDC provided most of the support in the form of recurring cash payments.

The TNAF seeks to integrate the participants into the workforce and increase the number of full families. That is achieved by providing less direct payments and supporting the beneficiaries by providing other forms of aid. Since the changes to legislation in 1996, the welfare caseload has rapidly decreased and remained stable until 2008. That is explained by stricter participation requirements excluding many families previously supported by the AFDC program. The economic crisis has caused the load to start rising again, but after an insignificant increase, the number of beneficiaries started to decline again and reached the pre-crisis levels by 2013. Since the states are encouraged to decrease the overall caseload, the tendency is unlikely to change.

2. Medicaid is the federal program aimed to provide the healthcare to the socially vulnerable citizens. The program targets low-income population. However to enroll one must also be a member of a certain category. These categories include children under certain age, pregnant women, disabled people, and low-income seniors. Medicaid is a means-tested program which means that eligibility of the individual is primarily determined by their own inability to cover the healthcare expenses. The exact list of eligibility requirement is defined separately by each state. The participation in the Medicaid program is optional, but all states have participated since 1982. One of the most recent changes to the system was implemented in the Patient Protection and Affordable Care Act passed in 2010. This legislation has expanded the population eligible for the Medicaid assistance to include people with income of up to 133% of the poverty line and adult without dependent children. The Act has also increased the federal funding for the program. States do not have to adopt the Act, but refusal to do so prevents them from receiving additional funding. The act was supported by most states, but some refuse to expand the coverage, arguing that it would overstrain the budget.

The implementation of the Medicaid systems varies widely on the state by state basis. Most states have their own variations of Medicaid. For example, California utilizes Medi-Cal program which includes expanded coverage for people with income of up to 138% of the poverty line and beneficiaries of other state welfare programs including CalWORKs and refugee assistance. In Tennessee, the TennCare Standard Spend Down program was initiated to help a limited number of adults with low income and high medical expenses. Other aspects of Medicaid implementation also may vary. For example, some state governments contact the health providers directly while others subcontract insurance companies to help manage the program. In 2012, the overall Medicaid expenses amounted to 431.9$ billion. 42% of that sum was provided by state governments and 52% by the federal government. 44% of the total amount of money was spent on care for the disabled people who constitute the 17% of the total number of people utilizing Medicaid. On average, 17,225$ is spent on a single disabled person per year. The aged participants amounted to 21% of the expenses and children to another 20%. The per capita expenditure for aged beneficiaries is second highest at $15,688 a year. It is worth noting that 49% of the Medicaid beneficiaries are children. The remaining 16% were spent on adult beneficiaries without disabilities. The Medicaid expenditure has been rising since the inception of the system in 1965 and is projected to rise further in the coming years.

After the PPACA was adopted by most states, the amount of people eligible for care is rising. States are coping with the increased load by adopting various strategies. Texas, Florida, Kansas, Georgia, Louisiana, Alabama, and Mississippi have the largest populations of people who will become eligible for Medicaid support. These states simply refused to expand coverage. On the other hand, states like California and Tennessee preferred to strain their budgets by offering expanded coverage. Across all states, the increased load on the healthcare facilities means increased need for the medical professionals able to handle the primary healthcare needs. That had led to Nursing Boards advocating the expansion of privileges for the nurse practitioners (NPs). Currently, most states allow NPs to provide primary healthcare services in tandem with physicians who are required to track and supervise all of the diagnosis and prescriptions provided by the nurse. However, the increased workload leads to more and more states authorizing certified NPs to be able to work independently. The education programs for medical professionals are also being expanded to answer the growing caseload. Overall, the states either aim to decrease the number of new applicants for their Medicaid programs and avoid increasing expenses, or accept the new regulations and try to cope by increasing the funding and hiring more medical professionals.

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1. BusinessEssay. "TANF and Medicaid: Review." January 14, 2022. https://business-essay.com/tanf-and-medicaid-review/.


BusinessEssay. "TANF and Medicaid: Review." January 14, 2022. https://business-essay.com/tanf-and-medicaid-review/.