REPORT TO THE COMMITTEE ON UNITED STATES SENATE ” .-l Corn parison Of The Sim plified And Traditional Methods Of Determining Eligibility For Aid To Families With Dependent Children B-764o31(3J Social and Rehabilitation Service Department of Health, Education, and Welfare BY THE COMPTROLLER GENERAL OF THE UNITED STATES COMPTROLLER GENERAL OF THE UNITED STATES WASHINGTON. D.C. 20!!48 B- 164031(3) Y-. Dear Mr. Chairman: This is our report on the comparison of the simplified and traditional methods of determining eligibility for the I^ federally assisted program of aid to families with dependent children. The Department of Health, Education, and Welfare :.- is responsible for administering the program. Our review was ,made pursuant to your request of March 3, 1971. Sincerely yours, Comptroller General of the United States The Honorable Russell B. Long Chairman, Committee on Finance .? .I , United States Senate _I _-- 50TH ANNIVERSARY 1921- 1971 COMPTROLLERGENERAL'S COMPARISONOF THE SIMPLIFIED AND REPORTTO THECOJMITTEE TRADITIONAL METHODSOF DETERMINING ONFINANCE ELIGIBILITY FOR AID TO FAMILIES WITH UNITEDSTATESSENATE DEPENDENTCHILDREN Social and Rehabilitation Service Department of Health, Education, and Welfare B-164031(3) DIGEST ------ WHYTHEREVIEWMASMADE In January 1969 the Department of Health, Education, and Welfare (HEW) permitted the States to accept persons as eligible for public assis- tance on the basis of information furnished by the applicants without verifying their statements. This is known as the simplified method for determining the eligibility of persons for public assistance. Under the traditional method, decisions are made as to applicants' eli- gibility only after information furnished by them is independently ver- ified by welfare agency workers. Under the program for aid to families with dependent children (AFDC), States have the option to use either method. As of January 1971 a sim- plified method was be'l'ng.used statewide in 22 States. The Chairman of the Senate Committee on Finance asked the General Ac- counting Office (GAO) to compare the AFDC caseload data from welfare centers using the simplified method with data from centers still using the traditional method. I -. GAO's work was done in three metropolitan areas--New York City, Kansas City, and Los Angeles County--and may not represent the situation na- tionally. During February 1971 AFDC expenditures of $105 million (Federal, State, and local) were made in these areas. These expenditures represented about 22 percent of the nationwide AFDC expenditures for that month. Therefore operations in these three areas do have a significant impact on the total program. HEW has not been given an opportunity to examine and comment on this re- port. Most of the matters in the rebort, however, were discussed with local welfare officials. FINDINGSANDCOUCLUSIONS Conformitg to HEWcriteria Does the simpZified method in use conform to HEW'scriteria? Tear Sheet There was not much difference between the extent of verification of in- formation at welfare centers using a simplified method and those using the traditional method of determining eligibility. Welfare centers supposedly using the simplified method were using a "modified" version of that method. Generally the modified version did not conform to HEW's criteria because: I I --Personal interviews were carried out routinely to obtain eligibility I information. I I I --Certain eligibility factors were verified routinely. I Without exception, the directors of the centers using the simplified I method stated that the centers should not rely completely on applicants' I I statements as a basis for making eligibility determinations. The direc- I tors emphasized that, although they believed that most applicants were honest, eligibility workers had an obligation to assure themselves that their decisions were based on a reasonable amount of evidence that ap- plicants qualified. At centers supposedly using the traditional method, verification of fat- ; tors having a bearing on applicants' eligibility is not as extensive as I is commonly thought. These centers generally verified certain of the I applicants' statements through home visits but did not follow normal ad- I I ditional investigative techniques before making a final decision. (See I I ppa 11 to 26.) I Increase in caseloads Does the AFDCeaselload ‘in centers using a simpl.ified method increase faster, stower, or at about the same rate, as the easelload iw centers using the traditional method? AFDC caseloads have increased significantly at all centers visited re- gardless of the type of eligibility method used. Caseloads in the centers using a simplified method increased dispropor- I tionately when (1) the centers first switched from the traditional method i and (2) they no longer required the same welfare agency worker to deter- I mine an applicant's eligibility and also provide social services. (See i pp. 27 to 36.) I I I Rejection rates I Do centers using a simplified method reject more, less, or about the same percentage of applications as do centers using the traditional method? Rejection of applications for assistance by centers using a simplified method were at similar or lower rates than those experienced by centers in the same area using the traditional method. 2 Rejection rates tended to be higher where the eligibility workers made comprehensive investigations, including checks with collateral sources, than under a simplified method which relies on applicants' statements. Centers' rejection rates dropped significantly immediately after adopt- ing a simplified method but tended to level off, or even recover, as eligibility workers gained experience. (See pp- 37 to 49.) Case closings Do centers using a simplified method cZose fewer, more, or about the same n-umber of eases as centers using the traditiona method? Data available on case closings--discontinuing payments to aid recipi- I ents--did not indicate any particular trend or wide fluctuations that could be attributed to the different eligibility methods in use at the centers. In all areas visited by GAO, a lower percentage of cases was closed during 1970 than during earlier periods. Welfare officials have informed GAO that cases are usually closed on the basis of a specific request by the recipient or data supplied vol- untarily by informants. They are seldom closed on the basis of data developed during periodic redeterminations of eligibility for assis- tance. (See PP* 50 t0 53.) 1neZigibiZi-Q rates Does a simplified method result in higher, lower, or about the same CneZigibiZity rates among the AFDC recipients as does the use of the traditional method? Where local welfare departments made special reviews of the eligibil- ity of recipients of assistance qualified under a simplified method, they found that a high percentage of these recipients were (1) ineli- gible, (2) could not be located, or (3) refused to cooperate. Where data was available--regardless of the method used to determine eligibility--the ineligibility rates either exceeded the 3-percent tolerance level established by HEWor contained many cases where eli- gibility was questionable. (See pp. 54 to 61.) Any method for determining the eligibility of an applicant for assis- tance should be designed to produce proper and timely decisions. The traditional method did not provide for timely decisions because of the time needed to make home visits and collateral checks to verify factors bearing on an applicant's eligibility, I Tear Sheet I I I The simplified method--as prescribed by HEW--was not wholly acceptable to those who were responsible for implementing it at local levels. Mod- 1 ified simplified methods produced timely results and, for the most part, : caused little inconvenience to the applicant. The use of a modified I simplified method tends to result in a greater number of applications being rejected, when compared with a truly simplified method. I HEW estimates that nearly 25 million persons would be eligible for as- I sistance under its proposed welfare reform program--about double the I number currently receiving public assistance. Under a program of that size, it does not appear practicable to require 1 detailed field investigations of each eligibility factor for each appli- cant and still render prompt decisions. On the other hand, the integ- ; I rity of such a program must be ensured by keeping ineligibility at a I low level. I RECOhB'ENDATIONS ORSUGGESTIONS I I I To help maintain such integrity, the eligibility method should provide I I for I --determining the eligibility of applicants for assistance on the basis of information obtained through face-to-face interviews and verification of certain key eligibility factors; --using, to the maximum extent possible, experienced people and, before assigning new people to do eligibility work, training them in program policies, procedures, and interviewing and investigative techniques; and --prescribing a quality control system designed to alert management when instances of ineligibility and incorrect entitlement rates reach a point where special corrective action is called for. (See p- 64.) 4 Contents Page DIGEST 1 CHAPTER 1 INTRODUCTION 5 Determinations of eligibility 5 Scope of work 7 2 HEW REGULATIONS PERTAINING TO THE SIMPLIFIED METHOD 8 3 METHODSUSED TO DETERMINE @DC ELIGIBILITY IN AREAS VISITED 11 General observations 11 New York City 12 Kansas City area 18 Los Ang,eles County 22 4 INCREASE IN AFDC CASELOADS 27 New York City 29 Kansas City area 32 Los Angeles County 33 Conclusions 34 5 REJECTION OF APPLICATIO1;S FOR ASSISTANCE 37 New York City 38 Kansas City area 43 Los Angeles County 46 Conclusion 49 6 CASE CLOSINGS 50 Closings through redeterminations of eligibility 50 7 SPECIAL ELIGIBILITY REVIEWS AT CENTERSUSING SIMPLIFIED METHODS 54 New York City review results 54 Los Angeles County review results 60 Page CHAPTER 8 GENERAL OBSERVATIONSREGARDING AFDC CASE- LOADS AND THEIR RELATIONSHIP TO ELIGIBIL- ITY METHODS 62 APPENDIX I Letter dated March 3, 1971, from the Chair- man, Senate Committee on Finance, to the Comptroller General 67 ABBREVIATIONS AFDC Aid to Families With Dependent Children GAO General Accounting Office HEW Department of Health, Education, and Welfare SRS Social and Rehabilitation Service COMPTROLLERGENERAL'S COMPARISONOF THE SIMPLIFIED AND REPORTTO THECOMMITTEE TRADITIONAL METHODSOF DETERMINING ONFINANCE ELIGIBILITY FOR AID TO FAMILIES WITH UNITEDSTATESSENATE DEPENDENTCHILDREN Social and Rehabilitation Service Department of Health, Education, and Welfare B-164031(3) DIGEST ------ WHYTHEREVIEWWASMADE In January 1969 the Department of Health, Education, and Welfare (HEW) permitted the States to accept persons as eligible for public assis- tance on the basis of information furnished by the applicants without verifying their statements. This is known as the simplified method for determining the eligibility of persons for public assistance. Under the traditional method, decisions are made as to applicants' eli- gibility only after information furnished by them is independently ver- ified by welfare agency workers. Under the program for aid to families with dependent children (AFDC), States have the option to use either method. As of January 1971 a sim- plified method was bei'ng.used statewide in 22 States. The Chairman of the Senate Committee on Finance asked the General Ac- counting Office (GAO) to compare the AFDC caseload data from welfare centers usina the simelified method with data from centers still using the traditioial method. GAO's work was done in three metropolitan areas--New York City3 Kansas City, and Los Angeles County--and may not represent the situation na- tionally. During February 1971 AFDC expenditures of $105 million (Federal, State, and local) were made in these areas. These expenditures represented about 22 percent of the nationwide AFDC expenditures for that month. Therefore operations in these three areas do have a significant impact on the total program. HEWhas not been given an opportunity to examine and comment on this re- port. Most of the matters in the report, however, were discussed with local welfare officials. FINDINGSAND CONCLUSIONS Conformity to HEWcriteria Does the simplified method in use conform to HEW'scriteria? 1 There was not much difference between the extent of verification of in- formation at welfare centers using a simplified method and those using the traditional method of determining eligibility. Welfare centers supposedly using the simplified method were using a "modified" version of that method. Generally the modified version did not conform to HEW's criteria because: --Personal interviews were carried out routinely to obtain eligibility information. --Certain eligibility factors were verified routinely. Without exception, the directors of the centers using the simplified method stated that the centers should not rely completely on applicants' statements as a basis for making eligibility determinations. The direc- tors emphasized that, although they believed that most applicants were honest, eligibility workers had an obligation to assure themselves that their decisions were based on a reasonable amount of evidence that ap- plicants qualified. At centers supposedly using the traditional method, verification of fac- tors having a bearing on applicants' eligibility is not as extensive as is commonly thought. These centers generally verified certain of the applicants' statements through home visits but did not follow normal ad- ditional investigative techniques before making a final decision. (See pp. 11 to 26.) Increase in caseloads Does the AFDC caseload in centers using a simplified method increase faster, slower, or at about the same rate, as the caseload in centers using the traditiona method? AFDC caseloads have increased significantly at all centers visited re- gardless of the type of eligibility method used. Caseloads in the centers using a simplified method increased dispropor- tionately when (1) the centers first switched from the traditional method and (2) they no longer required the same welfare agency worker to deter- mine an applicant's eligibility and also provide social services. (See pp- 27 to 36.) Rejection rates Do centers using a simpZified method reject more, Zess, or about the same percentage of applications as do centers using the traditionaz method? Rejection of applications for assistance by centers using a simplified method were at similar or lower rates than those experienced by centers in the same area using the traditional method. 2 Rejection rates tended to be higher where the eli'gibility workers made comprehensive investigations, including checks with collateral sources, than under a simplified method which relies on applicants' statements. Centers' rejection rates dropped significantly immediately after adopt- ing a simplified method but tended to level off, or even recover, as eligibility workers gained experience. be pp- 37 to 49.) Case ctosings Do centers using a simplified method cZose fewer, more, or about the same nwnber of cases as centers using the traditional method? Data available on case closings--discontinuing payments to aid recipi- ents--did not indicate any particular trend or wide fluctuations that could be attributed to the different eligibility methods in use at the centers. In all areas visited by GAO, a lower percentage of cases was closed during 1970 than during earlier periods. Welfare officials have informed GAO that cases are usually closed on the basis of a specific request by the recipient or data supplied vol- untarily by informants. They are seldom closed on the basis of data developed during periodic redeterminations of eligibility for assis- tance. (See pp. 50 to 53.) IneZiqibiZity rates Does a simplified method result in higher, lower, or about the same ineZigibiZity rates amongthe AFDCrecipients as does the use of the traditionuZ method? Where local welfare departments madesspecial reviews of the eligibil- ity of recipients of assistance qualified under a simplified method, they found that a high percentage of these recipients were (1) ineli- gible, (2) could not be located, or (3) refused to cooperate. Where data was available--regardless of the method used to determine eligibility--the ineligibility rates either exceeded the 3-percent tolerance level established by HEWor contained many cases where eli- gibility was questionable. (See pp. 54 to 61.) Any method for determining the eligibility of an applicant for assis- tance should be designed to produce proper and timely decisions. The traditional method did not provide for timely decisions because of the time needed to make home visits and collateral checks to verify factors bearing on an applicant's eligibility. The simplified method--as prescribed by HEW--was not wholly acceptable to those who were responsible for implementing it at local levels. Mod- ified simplified methods produced timely results and, for the most part, caused little inconvenience to the applicant. The use of a modified simplified method tends to result in a greater number of applications being rejected, when compared with a truly simplified method. HEW estimates that nearly 25 million persons would be eligible for as- sistance under its proposed welfare reform program--about double the number currently receiving public assistance. Under a program of that size, it does not appear practicable to require detailed field investigations of each eligibility factor for each appli- cant and still render prompt decisions. On the other hand, the integ- rity of such a program must be ensured by keeping ineligibility at a low level. RECOWflDATIOflSOR SUGGESTIONS To help maintain such integrity, the eligibility method should provide for --determining the eligibility of applicants for assistance on the basis of information obtained through face-to-face interviews and verification of certain key eligibility factors; --using, to the maximum extent possible, experienced people and, before assigning new people to do eligibility work, training them in program policies, procedures, and interviewing and investigative techniques; and --prescribing a quality control system designed to alert management when instances of ineligibility and incorrect entitlement rates reach a point where special corrective action is called for. (See pa 64,) CHAPTER1 INTRODUCTION DETERMINATIONS OF ELIGIBILITY Determining an applicant's eligibility for public as- sistance is of fundamental importance in achieving effective operation of public assistance programs, Two different methods of determining eligibility--generally called the traditional method and the simplified method--are used today. Traditional method The traditional method of determining the eligibility of an applicant for public assistance has been used by pub- lic welfare agencies for many years. Under this method, welfare agency employees interview each applicant for public assistance and complete an application form for the appli- cant (intake interview). Decisions regarding eligibility and the amount of assistance are not made until after a caseworker visits the applicant's home to verify the infor- mation obtained at the intake interview. In many cases collateral sources of information--s,uch as school attendance records, interviews with landlords and employers, and inquiries of the Social Security Administra- tion--are sought to verify factors relating to an appli- cant's eligibility and the extent of his entitlement. A decision on his eligibility and on the extent of his entitle- ment is made only after a thorough investigation, For an applicant determined to be eligible for public assistance, a redetermination of his eligibility is made on a recurring basis (usually every 6 to 12 months) following the same procedures. Simplified method Criticism of the traditional method of determining eli- gibility has been that it is too expensive and time-consum- ing and that it is humiliating to the person involved. Therefore HEW developed a simplified method for determining 5 eligibility designed to initiate payments to eligible ap- plicants more promptly, to reduce administrative costs, and to make more time available for social workers to render services to recipients of public assistance. The HEW simplified method of determining eligibility of applicants for public assistance provides for the deter- minations to be based, to the maximum extent possible, on information furnished by the applicant without interviewing the applicant for the purpose of verifying information and without verifying information through collateral sources. For applicants determined to be eligible, redeterminations of need are made on a recurring basis (usually 6 to 12 months) following the same procedures. On May 28, 1970, the Secretary of HEW mandated the use of the simplified method beginning July 1, 1970, for the public assistance programs covering the aged, the blind, and the disabled (adult programs). This method was to be in effect, nationwide, not later than July 1, 1971, for these programs. States still have the option, however, to use either the traditional or the simplified method for the aid to families with dependent children program. HEW records show that, as of January 1971, a simplified method was being used on a statewide basis in 37 States for their adult pro- grams and in 22 States for their AFDC programs. Primary difference between the two methods The primary difference between the traditional method and the HEW-prescribed simplified method is the means used to substantiate eligibility information. Under the tradi- tional method emphasis is placed on the verification of ap- plicants' statements through home visits and checks with collateral sources. The simplified method, on the other hand, provides for reliance on the applicants' statements with verification of these statements only when there appear to be reasons for doubting the applicant's truthfulness. Currently much attention is being focused on the sim- plified method of determining eligibility because (1) HEW is considering mandating its use in the AFDC program and (2) HEW has proposed to use such a method in the Family As- sistance Program. 6 SCOPE OF WORK Our review concerned only the AFDC program. In New York City and Los Angeles County, we compared AFDC caseload data from welfare centers using the simplified method with similar data from welfare centers using the traditional method. In the Kansas City area, we compared AFDC caseload data from the Jackson County, Missouri, welfare center (Kansas City, Missouri), which used the traditional method, with similar data from the Wyandotte County, Kansas, welfare center (Kansas City, Kansas), which used the simplified method. City and county welfare officials in all locations stated that the centers selected for comparison were com- parable in regard to general demographic data, such as eco- nomic, educational, and ethnic characteristics, Informa- tion was gathered also through interviews with welfare agency staff and observations of activities relating to el- igibility methods at the centers. Our fieldwork was carried out in only three major met- ropolitan areas and therefore may not be representative of the national situation; During February 1971 AFDC expendi- tures of $105 million (Federal, State, and local) were made in these three areas. These expenditures represented about 22 percent of the nationwide AFDC expenditures for that month and therefore operations in these areas do have a sig- nificant impact on the total AFDC program. 1 1970 census tract data was not available for the geographi- cal areas covered by the welfare centers. At our request local welfare officials selected centers using the tradi- tional method that they believed to be comparable to the centers using the simplified method so that comparisons could be made. 7 CHAPTER2 HEW REGULATIONS PERTAINING TO THE SIMPLIFIED METHOD Within HEW, the Social and Rehabilitation Service (SRS) has been delegated responsibility for Federal administration of the various public assistance programs. SRS Program Reg- ulation 10-3, issued on January 24, 1969, provided guidance to State public assistance agencies in establishing and ad- ministering a simplified method for determining eligibility under all public assistance programs authorized by the So- cial Security Act. The SRS regulation states: "The simplified method means an organized method by which the agency accepts the statements of the applicant for, or recipient of assistance, about facts that are within his knowledge and competence *** as a basis for decisions regarding his eligi- bility and extent of entitlement." The Assistance Payments Administration of SRS issued supplementary instructions to State welfare agencies on March 28, 1969, explaining more fully the simplified method. These instructions state that the simplified method could not be effective in a State that required either a manda- tory interview or a routine verification of information in all or a substantial number of cases. These instructions emphasize that the States still have the task of simplifying their eligibility regulations so that the application form can be designed to permit ap- plicants to clearly answer questions or furnish information relating to their eligibility. The instructions note that a test of achieving such simplification would be whether personal interviews were necessary to determine initial or continuing eligibility. Under the SRS instructions the States are required to use the information provided by the applicant and recorded on the simplified application form in determining his eligi- bility and extent of his entitlement. If questions arise concerning the information on the form, the applicant is to be given the opportunity to furnish additional or clarifying information. If the applicant is unable to provide such information, the State agency is required to obtain permis- sion from the applicant to seek the information from other sources. The States were instructed to establish criteria for unusual cases; that is, instances of inconsistencies or gaps in the information presented by an applicant which could not be resolved by him and which, to a prudent person, suggested the need for further explanation or verification. The instructions specify that there must be a particular reason for seeking additional information; that is, a spe- cific factor of eligibility for a specific case must be in question and not a factor applicable to all cases. States were required to use the SRS Program Regulation 10-3 and the supplemental instructions in establishing the simplified method in their welfare centers. The simplified methods in use in the areas we visited were developed on the basis of SRS regulations and instructions issued early in 1969. In a report to the'senate Finance Committee on our ob- servations on KEW's test of the simplified method for deter- mining eligibility of persons for the adult public assis- tance programs (B-164031(3), August 5, 1970),we stated that one of the main problems that States had in testing the simplified method was in determining the extent to which they were to verify information of the applicants if inconsistencies appeared in information provided on the ap- plications. We concluded in that report that HEW needed to develop more specific guidelines as to when, and the manner in which, inconsistent statements made by applicants should be verified by information obtained from collateral sources. In a letter dated December 4, 1970, to the Comptroller Gen- eral in which HEW commented upon that report, HEW agreed to issue additional guidance to the States. On February 9, 1971, the Assistance Payments Adminis- tration of SRS issued another supplementary instruction further defining the simplified method by specifying in- stances when information, in addition to that furnished by the applicant, should be secured. Basically, however, this definition of the simplified method is the same as that enunciated in Program Regulation 10-3 issued in January 1969. 9 (See p. 8.) This new instruction also reiterates that man- datory interviews or routine verifications of information in either all or a substantial number of cases are not com- patible with the simplified method. The instruction stresses that interviews are permissible for the purpose of interpreting the program or assisting individuals, upon re- West 3 to complete the application form as distinguished from investigatory interviews aimed at gathering eligibility information or documentary proof of applicants' statements. 10 CHAPTER 3 METHODSUSED TO DETERMINE AF'DC ELIGIBILITY IN AREAS VISITED The methods used to determine eligibility for AFDC in the areas visited by us--New York City, Kansas City area, and Los Angeles County-- differ from the HEW-prescribed sim- plified method described in chapter 2 and from the tradi- tional method described on page 5. We believe that the dif- ferences in the methods used to make eligibility determina- tions have had a bearing on the trends in the AFDC data, which are discussed in later chapters of this report. GENERALOBSERVATIONS Generally welfare centers which were supposedly using the HEW simplified method were, in fact, using a modified version of that method. We found that applicants for public assistance routinely were being interviewed to secure infor- mation regarding their eligibility and that certain eligi- bility information routinely was being verified. Centers which were supposedly using the traditional method generally verified certain of the applicants" state- ments through home visits but did not follow normal addi- tional investigative techniques before making a final eligi- bility decision. There appears to have been a decreasing emphasis placed on the use of collateral sources of informa- tion because --the unprecedented increase in AFDC caseloads made it impossible to follow normal investigative procedures and --SRS regulations require eligibility decisions to be made within 30 days of submission of applications for assistance. Under both the traditional and the various simplified methods of determining eligibility, the information fur- nished by the applicant was relied upon to a large extent. For example, we noted that eligibility workers at centers using the traditional method were verifying information furnished by the applicants concerning such eligibility factors as cash in the bank or amount of earnings only if the applicants stated that they had bank accounts or were working. Similarly, eligibility workers at centers using a sim- plified method pursue with applicants questions about p=- erty 2 earnings, or other resources, only if the applicants state that they have them. Usually no further inquiry is made regarding any eligibility factor which is answered in the negative by the applicant--such as no earnings, no sav- ings, no property. Thus the verification is dictated--un- der either method--to a great extent by the information willingly furnished by an applicant. The details of the eligibility methods used in the areas visited by us are described below. NEW YORK CITY Simplified method In April 1967 the East End and Clinton welfare centers in New York City began a pilot program using a simplified method for determini?g eligibility under the various public assistance programs. The pilot program ended in February 1969, but the two centers continued to use this method. Under the simplified methods in use, both centers re- quire applicants to apply in person for assistance unless they are homebound; in such cases a welfare center worker visits the home and assists the applicant in filling out the application. Thus in every case a face-to-face inter- view between an applicant and a welfare center worker is 1The pilot program to test the simplified method was funded, in large part, by an HEM demonstration project gra& under title XI, section 1115 of the Social Security Act. The total Federal contribution of special project funds was about $175,300. 12 required to develop information regarding the applicant's eligibility for assistance before an eligibility decision is made. Neither cefter makes home visits to verify any eligibility factors. According to officials at the two centers, eligibility decisions in about 90 percent of the cases are made on the day of application. Also, the directors of both welfare centers have advised us that, in their opinion, eligibility workers must be experienced, trained employees if they are to develop complete information during interviews with ap- plicants to enable proper eligibility decisions to be made. Although both centers routinely interview all appli- cants to establish their eligibility, the eligibility work- ers at the two centers differed in the degree to which they relied upon the applicants' statements. From April 1967 until March 1969, eligibility workers at the East End center used a model simplified method; that is, they relied comnletelv on the applicants1 statements and did not verify any items affecting the applicants' eli- gibility. The director of the East End center advised us that--since this was a pilot program--he wanted the center to apply a truly simplified method as intended by the New York City Department of Social Services. After the test period, however, the director assigned his more experienced caseworkers as eligibility workers to routinely interview applicants and encouraged these eligi- bility workers to verify applicants' eligibility factors, such as rent payments, income, and number of children, in any case in which there was any doubt as to the validity of the information furnished by an applicant. Over a period of time, the verification of such items has become almost routine. Thus since March 1969 the East End center has been using a modified simplified method. 1An exception exists if the applicant is a narcotic addict or an alcoholic, has a previous record of fraud, or has had a welfare case closed previously because he had not re- ported,all income or resources. In such cases, investiga- tions of eligibility factors are made. 13 The Clinton welfare center, on the other hand, operated a modified simplified method from the beginning of the pilot program. The director of the center told us that he felt that it was necessary to verify certain key items affecting every applicant's eligibility for assistance and extent of his entitlement. Therefore from the inception of the modi- fied simplified method, the center's eligibility workers have verified applicants' statements regarding their rent payments and income earned for those applicants who stated that they were employed. Rent verification consisted of (1) examining a rent receipt furnished by the applicant or (2) securing confirmation from the landlord. Income verifi- cation consisted of (1) examining pay slips furnished by the applicant or (2) securing confirmation from the employer. Contacts with landlords and employers were usually by tele- phone. A third center was created in February 1969, from part of the territory and caseloads previously served by the East Rnd center. This center --Franklin--operated a simplified method from its inception in much the same manner as the Clinton center; that is, certain eligibility factors were routinely verified. In March 1970 the New York City Department of Social Services began to separate the eligibility and service func- tions of the 44 welfare centers in the city. Under this separated approach, a staff of social workers handles the service needs of the recipients (such as housing, child care, medical) and a staff of administrative workers handles money payment needs (eligibility and extent of entitlement). The three centers--Clinton, East tid, and Franklin--us- ing the modified simplified method for determining appli- cants’ eligibility for assistance were the first centers to separate the eligibility and service functions. 1 Thus in March 1970 these centers began using eligibility workers to make eligibility decisions. These workers were not 1As of May 1971 six centers had separated the eligibility and service functions. A city official advised us that a separation of these functions at other centers was being delayed pending negotiations with the social workers' union. 14 experienced caseworkers but were, for the most part, high school graduates who were either newly hired or newly trained. As noted earlier, under the simplified method at the Clinton and Franklin centers--prior to separation of the eligibility and service functions--all applicants' state- ments regarding their rent and income were verified. At the East End center, these eligibility factors were veri- fied only when there was a question regarding the informa- tion provided by an applicant. According to the directors of the three centers, the inexperience of the new eligibil- ity workers delayed effective implementation of the centers1 particular verification policies for several months. As .. the new workers at each center gained experience, however, they were able to more effectively evaluate information pro- vided by the applicants and to follow established center policies. By March 1971 when we visited the three centers in New York City, workers in all the centers were routinely interviewing applicants and routinely verifying certain eligibility factors. ' On the basis of information gathered by us, we con- clude that the simplified method in use at the three wel- fare centers in New York City does not meet the HEW crite- ria but is a modification of those criteria in that --applicants for assistance are interviewed in all cases to secure eligibility information and --certain eligibility factors are routinely verified. HEW criteria state that a simplified system cannot be effec- tive if it requires either of the above-mentioned factors. The directors of each of the three New York City welfare centers told us that they did not believe that the integrity of their welfare operations could be maintained if they did not operate under a modification of the HEW criteria. They stated that, under the modified simplified method, there was better assurance that only eligible applicants would be provided assistance and that it would be in the proper amount. 15 Traditional method We also visited certain welfare centers in New York City that were using the traditional method of determining an applicant's eligibility for assistance. Under this method an applicant must apply in person at the center. Exceptions are made for homebound cases. The applicant is interviewed by a center worker (intake interviewer) who re- cords the applicant's family and economic history. If, on the basis of the information obtained and recorded during this interview, the center worker believes the applicant to be eligible for assistance, he is considered presumptively eligible and the case is referred to a caseworker for field investigation. The interview, however, can result in a de- cision of ineligibility, in which case the application is not processed any further. Caseworkers usually make an appointment and visit the applicant's home within a week after the case has been re- ferred by the intake interviewer. While in the home the caseworkers review pertinent available documents, such as birth certificates, bankbooks, or insurance policies, to substantiate information provided by the applicant at the time of application. The center directors and caseworkers whom we inter- viewed stated that the home visit was not a very effective means of determining eligibility but that it was vital for providing social services. They stated also that arranging appointments for home visits with applicants permitted the applicants to ensure that their living situations conformed to what was reported at the intake interviews. Further, the caseworkers said that they generally do not seek collat- eral sources of information to substantiate factors affect- ing an applicant's eligibility or the extent of his entitle- ment. For example, inquiries are usually not made of (1) the landlord or neighbors as to whether the applicant is known to be working or as to the whereabouts of a reported absent father, (2) school off icials as to whether a child over 18 is regularly attending school, or (3) the last known employers as to reasons for applicants' leaving em- ployment and possible availability of unemployment compensa- tion. 16 Directors, eligibility workers, social workers, and various management officials of the New York City Depart- ment of Social Services advised us that--with the exception of a visit to an applicant's residence--the verification of eligibility factors under the traditional method was not as extensive as was commonly thought. Those interviewed at- tributed the lessening of eligibility verification to in- sufficient time to carry out such work which was, in turn, attributed to the increased AFDC caseloads which the centers were handling. Certain of these officials stated that the general attitude of many caseworkers had changed in recent years with more emphasis being placed on providing services to recipients than on making detailed eligibility investi- gations. 17 KANSAS CITY AREA Simplified method (Wyandotte County, Kansas) On March 23, 1970, Wyandotte County began using a type of simplified method for determining an applicant's eligi- bility for assistance under the AF'DC program. Separation of eligibility and service functions (see p, 14) began in June 1970 and was completed by October 1970. In this county there is only one welfare office that processes applications for AFDC assistance. Our observations and discussions with State and county welfare officials indicated that the county had been using a type of simplified method for more than a year prior to its formal adoption in March 1970. In the summer of 1968 caseworkers became unable to in- vestigate each applicant under the traditional method and began using a type of simplified method. According to the caseworkers whom we interviewed, they could not use the traditional method because of --the increasing caseload for each worker and --HEW's requirement that eligibility decisions be made within 30 days of submission of applications for as- sistance. We were advised that the sharp increase in the AFDC caseload began occurring in the summer of 1968 primarily be- cause of strong community pressure on the welfare center from community action groups which urged low-income persons to apply for public assistance and urged recipients to ap- ply for special clothing and furniture grants.1 According to county welfare officials, these groups also pressured for quick eligibility decisions. Caseworkers advised us that, because of the increased work load, it was necessary to forego their normal eligibility investigations. 1A Jackson County welfare official informed us that pres- sures from community groups did not begin to affect the caseloads until 1969. 18 From the summer of 1968 until March 1970, eligibility decisions were made in many cases on the basis of informa- tion provided by an applicant during the intake interview and obtained during the visit to the applicant's home. In some cases decisions were made on the basis of the intake interview and an examination of certain documents furnished by the applicant without an additional verification of the information. Thus before the county formally began using a simplified method, it had already begun to shift away from the traditional method. When the simplified method was formally adopted on March 23, 1970, the method of determining eligibility of an applicant was changed further. The current policies of the county are discussed below. An application for assistance can now be made by mail. Applicants need not apply in person at the welfare center for assistance, although--according to the chief of the in- take section--about 90 percent of all applicants do so. At the center group interviews of new applicants are held to explain the welfare department policies and to instruct the applicants concerning the proper way to complete an applica- tion form. After an applicant completes an application form, it is forwarded to an eligibility worker for review and a decision as to the applicant's eligibility and the extent of his en- titlement. According to local welfare officials, these workers are not experienced caseworkers but area for the most part, newly hired college graduates who have had brief exposure to the welfare department's operation.1 No face-to-face interviews are routinely made to ob- tain information needed to make an eligibility decision, Eligibility workers have told us that, for three of every four applications, they find it necessary to contact the applicants-- either by telephone or by their return to the 1 According to State officials, of the 121 caseworkers in Wyandotte County, 73, or 60 percent, were hired in the last 2 years. 19 center --to obtain clarification of eligibility information shown on the application or to develop eligibility informa- tion which was not shown on the application. They have stated that, because of the complicated State regulations concerning,welfare, the application form is necessarily com- plicated and that many applicants are not able to complete it correctly. The eligibility workers have advised us that they (1) routinely verify an applicant's reported income by re- quiring the applicant to produce pay slips or by contacting his employer or other sources from which he receives income-- such as the State unemployment office--and (2) verify other factors affecting the applicant's eligibility whenever they have any doubts concerning the information furnished by the applicant. The Wyandotte County welfare center uses a separate staff to handle the eligibility and service functions. The director of the center advised us that, because of the im- portance of making correct decisions concerning applicants' eligibility and extent of their entitlement, the center em- ployed college graduates as eligibility workers. He stated that, in his opinion, these workers could exercise better judgment than clerical staff in reviewing applications for assistance and in computing recipients' budgetary needs. The center's staff told us that they generally felt that the type of simplified eligibility method in use was not much different from the method in use from mid-1968 to March 1970. They also stated that the information obtained under the traditional method by interviewing the applicant at home was just as easily obtained by talking to the ap- plicant on the telephone or in an interview at the welfare center. On the basis of the data gathered by us, we believe that Wyandotte County has been using a type of simplified method since mid-1968. When the county formally adopted the simplified method in March 1970, the eligibility workers found it necessary to routinely contact most of the appli- cants to obtain eligibility data and to routinely verify stated income. Wyandotte County's method of determining an 20 applicant's eligibility for assistance therefore does not strictly conform to HEW's prescribed simplified method. Traditional method (Jackson County, Missouri) Jackson County has always used the traditional method for determining an applicant's eligibility for assistance under the AFDC program. The county has one welfare office where all applications are processed. Cur discussions with the county welfare director and other county officials in- dicate that considerable emphasis is placed on making com- plete investigations of factors affecting an applicant's eligibility before his application is approved or rejected. According to the county director, Missouri law requires com- plete investigations prior to making an eligibility deci- sion.1 Thus the county's welfare office caseworkers, in addition to conducting eligibility interviews, must obtain evidence --including responses from collateral sources con- tacted--on all relevant eligibility factors before making a decision. HEW regulations' require that eligibility decisions con- cerning assistance under the AFDC program be made within 30 days from the time of application. The Jackson County investigations, however, have resulted in eligibility deci- sions'not being made within the prescribed time. For ex- ample, in calendar year 1970 the average time taken by the county to approve an AFDC application was 46 days and the average time taken to reject an &DC application was 40 days. County welfare officials advised us that there were no delays in making home visits to interview the applicants but that the primary cause of the delays was the time needed to verify eligibility information with collateral sources-- such as present or former employers, schools., insurance 1 Section 208.070 of the Missouri Social Security Law states: "Whenever the County office receives an applica- tion for benefits an investigation and record shall be promptly made of the circumstances of the applicant by the County office in order to ascertain the facts supporting the application." 21 companies, and the county assessor's office. They empha- sized that checks with collateral sources were vital to verify information upon which eligibility decisions were based. They have pointed out, however, that collateral checks are made only if applicants indicate that they have resources and that no checks are made if negative responses are given. Therefore, even under the traditional method, the extent of the investigation depends to some degree upon the information which an applicant willingly provides. County officials also noted that, in their opinion, most information obtained during a visit to an applicant's home could just as easily be obtained by interviewing the appli- cant at the welfare center. In January 1971 HEW conducted a hearing regarding Mis- souri's compliance with Federal welfare laws. In a report dated May 3, 1971, to the Administrator of SRS, the hearing examiner proposed that the State be found out of compliance with the Federal laws because--among other compliance is- sues-- the State was not furnishing public assistance with reasonable promptness to all persons eligible under the AFDC program, that is, within the prescribed 30 days for that program. The State took the position during the hearing that the 30-day rule was arbitrary and unreasonable in the light of existing Missouri law requiring complete investigations. The Administrator, SRS, has 60 days to decide whether to find the State out of compliance and withhold applicable Federal funds.l If found out of compliance, the decision may be appealed in the U.S. Court of Appeals for the Eighth Circuit. LOS ANGELES COUNTY Simplified method In October 1969 the Pomona and Inglewood welfare ten.. ters in Los Angeles County adopted a simplified method for determining an applicant's eligibility for assistance. The two centers had separated their eligibility and service functions in July 1969 but did not complete a 1On July 2, 1971, the Administrator found Missouri out of compliance because the State was not furnishing assistance with reasonable promptness. 22 changeover to the use of eligibility workers (clerical staff) to carry out functions relating to determination of eligibility and extent of entitlement until the summer of 1970. At the time of our fieldwork in April 1971, 18 other centers in the county were still using the traditional method. Under the type of simplified method adopted, applicants usually fill out an application form at the centers and eli- gibility workers routinely interview the applicants to clar- ify information recorded on the form and to develop other information needed to make an eligibility decision. Welfare officials at both centers have told us that the routine in- terviews are considered essential if they are to make reli- able eligibility decisions. County welfare officials have pointed out to us that the HEW-prescribed simplified method cannot really be effective until the complex State and county welfare eligibility rules are also simplified. Although primary reliance is placed on the information furnished by an applicant on the application form and in the interview, we have.found that eligibility workers at both centers (1) routinely verify an applicant's reported earned income and (2) often verify the place of residence or the primary factor causing a need for emergency aid in cases where such aid is being requested. Verification of earned income usually consists of examining pay slips provided by the applicant or contacting the applicant's employer. Ver- ification of an applicant's place of residence or other factors necessitating emergency aid usually consists of re- quiring the applicant to provide appropriate documents, such as a driver's license, an eviction notice, or a utility shutoff notice. In cases where AFDC assistance is provided to an ap- plicant who is earning some income, both centers require that he file a monthly earnings report with the welfare cen- ter. The directors of the two centers have advised us that, under the type of simplified method followed, their eligi- bility workers have been able to approve or reject about 90 percent of the applications for assistance on the day 23 the applications were submitted despite the sharp increase in applications under the AFDC program. Cur review showed that Los Angeles County used a type of simplified method which deviated from the method pre- scribed by HEW. County welfare officials felt that, to en- sure effective operation of their AFDC program, it was es- sential to routinely interview applicants and to routinely verify certain eligibility factors. Traditional method Eighteen welfare centers in Los Angeles County use the traditional method for determining an applicant's eligibil- ity for assistance. The separation of the eligibility and service functions has facilitated the determinations. An applicant applying for assistance at a center using the traditional method for determining eligibility is pro- vided an eligibility packet containing the necessary appli- cation forms. The applicant completes the forms and is then interviewed by an eligibility worker--usually on the day of application. During this intake interview the eligibility worker asks the applicant probing questions about his family and financial situation and why assistance is needed. The eligibility worker can reject an application on the basis of this interview if it is apparent that the applicant"s family would not be eligible for assistance. If the eligibility worker believes that the applicant's family might be eligible after reviewing the application forms and interviewing the applicant, he arranges to visit the applicant's home within 24 hours. During this home visit the worker asks the applicant to produce docume,ntation to support statements made at the intake interview (such as birth certificates and pay slips). After the visit the el- igibility worker can declare the applicant presumptively eligible and provide him with assistance. If the eligibil- ity worker believes that there is still a need to make col- lateral checks regarding such factors as ownership of prop- erty, savings accounts, or receipt of unemployment compen- sation, the case is referred to a separate property unit for investigation. Thus welfare officials have stated that, even under the traditional method, basic reliance is placed 24 on the applicant for eligibility information and that usually no independent verification is routinely undertaken in the case of applicants who state that they have no income or other resources. The caseworkers whom we interviewed pointed out that, although they believed visits to an applicant*s home to be beneficial, eligibility determinations could be just as ef- fective if the applicants brought all the necessary documen- tation to the welfare center. The workers emphasized, how- ever, that they found home visits to be an effective way for quickly assessing the service needs of the applicants and their children. According to officials at two traditional centers which we visited, eligibility decisions were made in most cases within 48 hours after the home visit, As noted above, eli- gibility workers can refer an application to the property unit for investigation if they have some reason to question the applicant's statements after the intake interview and the home visit. Generally, though, primary emphasis is placed on the applicant's word and documentation to support eligibility factors rather than on independent checks with collateral sources. The increase in welfare applications during the last 6 months of 1970--particularly under the AFDC program--cur- tailed the ability of eligibility workers at the traditional centers to use their normal investigation techniques, At one of the traditional centers which we visited, officials stated that, from June through December 1970, home visits were curtailed because of the tremendous increase in the application caseload. They stated also that, to make prompt eligibility decisions during this period, the eligibility workers often relied entirely on the applicants# statements and on documentation which the applicants furnished during the intake interviews. Also eligibility workers at the other traditional center which we visited stated that, dur- ing this period, they frequently were not able to adequately carry out their eligibility work9 including home visits, In effect, the two centers curtailed normal procedures under the traditional method during this period. 25 In December 1970 the Los Angeles County Department of Public Social Services-- in recognition of the problems caused by the increased caseloads-- issued a memorandum to the centers restating the policy requiring that visits to an applicant's home be made before financial assistance is provided to the applicant. Eligibility workers have told us that they have been able to make timely home visits since January 1971. As in New York City, the Los Angeles County eligibility workers had to curtail their normal investigative efforts when the caseload was increasing rapidly. Also, as in both Jackson County and New York City, the traditional method as followed by the two centers in Los Angeles County places primary reliance on the willingness of the applicant to fur- nish eligibility information rather than on independent in- vestigations through collateral sources. 26 CHAPTER 4 INCREASE IN AF'DC CASELOADS AF'DC caseloads increased significantly in recent years in the areas where we made our review as well as in the in- dividual welfare centers visited. Such increases followed a nationwide trend in the AFDC program. The increases ex- perienced nationwide and in the areas included in our re- view are shown below. Percentage increase Number of AFDC cases in December from 1967 1968 l-969 1970 1967 Nationwide 1,297,OOO 1,522,OOO 1,876,OOO 2,552,OOO 97 New York City 133,164 172,968 190,871 220,488 66 Los Angeles county 64,189 75,988 90,346 125,269 95 Jackson County 3,305 3,881 4,901 7,223 119 Wyandotte County 1,436 1,892 2,476 3,750 161 County and city welfare officials in the areas we visited attributed the increase in the AFDC caseloads to three primary factors. --Liberalization of eligibility requirements through changes in welfare policies and court decisions, such as the 1967 amendment to the Social Security Act which requires States to disregard the first $30 and an additional one third of a working welfare re- cipient's monthly income when computing the extent of his entitlement and the Supreme Court decision prohibiting a durational residency requirement. --Activities of community action groups in increasing the awareness of potential recipients of benefits available under the program. --General downturn in economic conditions which resulted in increased unemployment and fewer job opportunities. The city and county welfare officials have stated that, although it is undoubtedly easier for applicants to obtain 27 assistance under a truly simplified method, compared with the traditional method, generally they did not believe that the adoption of the modified simplified methods had resulted in providing assistance to more ineligible persons than would have been provided under the traditional method. They have stated also that, under the simplified method, more persons may have been encouraged to apply for assis- tance. To evaluate the effect of the simplified methods on the size of the caseloads, in the areas where we made our review, we compared the quarterly changes in caseload of welfare centers using the simplified methods with the changes in caseload of welfare centers using the traditional method. For the New York City and the Kansas City areas, we used January 1966 as the base period; for Los Angeles County we used July 1967 as the base period because not all of the centers used for comparison were in existence before that date. The results of our comparisons are discussed below. NEWYORK CITY As shown in the following graph, the two centers which began using simplified methods (Clinton and East End) had greater percents of increases in their AFDC caseloads for about a year after the adoption in April 1967 of the modi- fied simplified methods than the two centers (Harlem and Fort Greene) that used the traditional method. Also, for most of that year, there was a slightly greater percent of increase in the caseload of the two simplified centers than in the caseload of all other centers in New York City. As shown by the graph, the percent of increase in the caseloads during the period April 1967 through June 1968 over the base period (January 1966) was as follows: 28 PERCENT OF INCREASE IN AFDC CASELOADS NEW YORK CITY PERCENT PERCENTS BASED ON CASELOAD AS OF JANUARY 1, 1966 22.5 ALL TRADITIONAL CENTERS SIMPLIFIED CENTERS z 12.5 \ /\ .,. . . 0 . . L TWO TRADITIONAL CENTERS 2.5 TWO SIMPLIFIED CENTERS THREE SIMPLIFIED CENTERS I I I I I I I I I#+ I I 0 I I I c I I IAl I I \/I I I I I I 3/66 6/66 9/66 12/66 3/67 6/67 9/67 12/67 3/68 6/68 9/68 12/68 3/69 6/69 9/69 12/69 3/70 6/70 9/70 12/70 QUARTER ENDING Percent of increase in caseloads TWO TWO All Quarter simplified traditional traditional ending centers centers centers June 1967 11.2 6.1 9.6 Sept. " 13.7 9.0 10.7 Dec. " 9.6 7.5 9.9 Mar. 1968 9.6 6.6 8.2 June " 9.8 8.1 10.8 Although the caseload of all centers increased, the adoption by the two centers of simplified methods may have accounted for some of the difference in the intensity of the percent of increase. In the quarter (April to June 1970) in which the sim- plified centers separated their eligibility and service functions, the percent of increase in the centers? case- loads was greater than for the two traditional centers. The percent of increase in the caseloads of the simplified and traditional centers during the period October 1969 to December 1570 over the caseload during the base period fol- lows. Percent of increase in caseloads Three simplified TWO All Quarter centers traditional traditional ending (note a> centers centers Dec. 1969 2.1 1.4 3.2 Mar. 1970 4.2 2.6 5.7 June 11 8.1 3.8 8.5 Sept. II 7.7 4.5 11.6 Dec. It 5.6 4.6 9.5 aIn February 1969 a third simplified center (Franklin) was created from territory and caseloads previously served by the East End center. The separation of the functions may have accounted for some differences in the intensity in the rate of increase in the caseloads, as did the situation when the simplified 30 methods were adopted. As the eligibility workers gained experience and began to apply the simplified eligibility methods more effectively, the percent of increase in the simplified centers' caseloads dropped back to a level com- mensurate with that for the two traditional centers. A city welfare official advised us that, during the period June to December 1970, the increases in the case- loads were particularly great because of poor economic con- ditions. He stated that the increases were greatest in those centers serving areas where the potential for unem- ployment and the resultant need for public assistance was high. The poorer areas --which had already experienced the precipitous rise in the number of persons receiving assis- tance--included the areas served by the simplified centers where high unemployment had already been experienced. 31 KANSAS CITY AREA The AFDC caseloads in Wyandotte County and Jackson County have been steadily increasing in recent years (see 27 > Our analysis of available caseload data shows, kwev&, that the percent of increase in the caseload of the Wyandotte County center, which uses a simplified method of determining an applicant's eligibility for assistance, has been markedly greater than the percent of increase in the caseload of the Jackson County center, which uses the tradi- tional method. The differences are depicted on the follow- ing graph. The largest differences in the caseloads of the two counties began to show up in the summer of 1968 when the Wyandotte County center began using a simplified method and became greater in the quarters immediately after the formal adoption of the method in March 1970. The differences be- came even greater when the center began to separate the eligibility and service functions in June 1970. The percent of increase in the caseloads of the two counties over the caseloads during the base period is as follows: Percent of increase in caseloads Quarter Wyandotte County Jackson County ending (simplified method) (traditional method) June 1968 6.1 4.1 Sept. 1968 10.5 3.9 Dec. 1968 16.3 6.9 Mar. 1969 11.2 3.4 June 1969 14.2 3.0 Sept. 1969 17.8 11.3 Dec. 1969 12.7 13.7 Mar. 1970 22.0 15.9 June. 1970 26.6 14.6 Sept. 1970 46.4 20.4 Dec. 1970 27.0 20.2 As shown by the above table, the rate of increase in the Jackson County center's caseload was much lower than the rate of increase in the Wyandotte County center's caseload. The lesser rate of increase can be attributed mainly to two factors: (1) the Jackson County center generally made a 32 PERCENT OF INCREASE IN AFDC CASELOADS 27.0 KANSAS CITY AREA PERCENT PERCENTS BASED ON CASELOAD AS OF JANUARY 1, 1966 22.5 20.0 17.5 15.0 WYANDOTTECO~NTKKAN. I\ w (SimpliNad method adopted w 12.5 infonnaflly in ammer of 1968 wd fomrally in Mach 1970) 10.0 (Treditionol Method) - 2.5 I I I I I I I I 1 I I I I I I I 1 3/66 6/66 9/66 12/t% 3/67 6/67 9/67 12/67 3160 6/68 q/b0 12/H 3/69 b/69 9/69 12169 3/70 61’70 9/70 12/7C QUARTER ENDING complete investigation of an applicant's entitlement to as- sistance and (2) Missouri's eligibility requirements are more restrictive than those of Kansas, LOS ANGELES COUNTY Our comparison of the percent of increase in the case- loads of two simplified and two traditional centers in Los Angeles County showed that there was no significant differ- ence in the rates of increase for centers using a simplified method and centers using the traditional method. The Pomona and Inglewood centers began using a simplified method for determining an applicant's eligibility in October 1969 and, as shown by the graph on the next page, the percent of in- crease in their caseloads was slightly greater in four of the five quarters-- October 1969 through December 1970--than (1) the percent of increase in the caseloads of the El Monte and Exposition Parkcenters which used the traditional method, and (2) the percent of increase for all centers in the county. The percent of increase in the caseloads during January 1969 through December 1970 over the base period (July 1967) is as follows: Percent of increase in caseloads Quarter zt70 simpli- Two tradi- All county ending Lied centers tional centers centers Mar. 1969 3.8 4.5 June 1969 3.0 4.1 Sept. 1969 12.4 7.9 Dec. 1969 12.2 9.6 8.9 Mar. 1970 8.5 11.6 11.9 June 1970 21.3 17.7 13.8 Sept. 1970 24.7 22.1 20.9 Dec. 1970 21.1 16.1 15.3 CONCLUSIONS It seems evident that the adoption of the simplified method and the separation of eligibility and service func- tions have had an impact in the form of increased caseloads in the welfare centers included in our review. The effect of the impact was diminished, however, as time permitted the eligibility workers to become experienced in carrying 34 PERCENT OF INCREASE IN AFDC CASELOADS LOS ANGELES COUNTY PERCENT PERCENTS BASED ON CASELOAD AS OF JULY 1, 1967 TWO SIMPLIFIED C . 0 0 . l . TWO TRADITIONAL CENTERS .’ w WI 12.5 ALL COUNTY CENTERS 2.5 ; QUARTER ENDING out the eligibility functions, and the centers modified their systems for determining eligibility to provide better as- surance that proper eligibility decisions were made. Our overall conclusions are discussed in chapter 8. 36 CHAPTER 5 REJECTION OF APPLICATIONS FOR ASSISTANCE As part of our evaluation of the relative effects of determining an applicant's eligibility for assistance under the traditional method and under the simplified methods, we examined whether the centers using simplified methods were rejecting a higher, lesser9 or about the same percentage of applications as centers using the traditional method, On the basis of our examination, we concluded that: --The rates of rejection of applications resulting from the use of the modified simplified methods, under which center workers interviewed applicants and ver- ified certain eligibility factors, did not differ significantly (although they were lower) from the rates of rejection that resulted from the use of the traditional method. --The use by one center of a truly simplified method, under which reliance was placed entirely on the ap- plicants' statements, resulted in a significant drop in the rate of rejection of applications in relation to the rate of rejection of centers using modified simplified methods. --The centers' separation of'their eligibility and ser- vice functions resulted in reductions in the rates of rejection of applications. Because of dissimilarities in eligibility requirements of the States, there is no average rejection rate against which to measure the correctness of eligibility decisions. Rejection rates for the areas visited by us therefore should not be compared in terms of percentage differences. What can be compared is the trend in rejection rates when certain events --which have an impact on all welfare centers and which are not affected by dissimilarities in eligibility re- quirements--occur, such as the introduction of a simplified method and the separation of eligibility and service func- tions. The data we obtained concerning the rejection rates in the areas is discussed below. 37 NEWYORK CITY Two dates are important when analyzing rejection rates in New York City, namely, April 1967 (the adoption by two centers of a simplified method) and March 1970 (the separa- tion at the two centers of eligibility and service func- tions). As shown by the graph on the following page, a sig- nificant drop in the rate of rejection of applications for assistance occurred upon the centers' adoption of a simpli- fied method and an even greater drop occurred upon the sep- aration of the eligibility and service functions. Adoption of simplified methods Immediately following the adoption by the Clinton and East End welfare centers of simplified methods, the rate of rejection of applications of about 30 percent experienced in the preceding year dropped to about 15 percent and did not return to the 30-percent level until 2 years later. During this 2-year period, the rejection rate of all centers in the city also dropped-- from about 27 to 21 percent--but not as drastically as that of the simplified centers. Local welfare officials attributed the drop in the citywide rejec- tion rate to pressure caused by community groups and riots. The two traditional centers used for comparative purposes-- Fort Greene (which includes part of Bedford-Stuyvesant) and Harlem--also experienced a large drop in the rejection rate. Officials at these centers advised us that the eligibility workers had been unable to make their normal eligibility in- vestigations during this period. They advised us also that a drop in the two centers' rate of rejection of applications had been expected upon adopting the simplified method but that they had also ex- pected that the rates would return to the previous levels much sooner than they had. Cur analysis of the recovery of the rates of rejection of the two centers using the simpli- fied method (Clinton and East End) indicates that the type of simplified method used affects the rates of rejection differently. As noted on page 14, Clinton center eligibility workers routinely interviewed applicants and routinely verified cer- tain eligibility factors under its simplified method. In 38 RATE OF REJECTION OF PERCENT AFDC APPLICATIONS FOR ASSISTANCE 50 NEW YORK CITY 45 - 1 40 \ TWO TRADITIONAL CENTERS ALL TRADITIONA iL CENTERS 35 / \ •--~#~--\ 30 25 2 - --.. 20 SIMPLIFIED CENTERS \ / 15 10 TWO SIMPLIFIED CENTERS THREE SIMPLIFIED CENTERS 5 - A A 1 I I 3/66 6/66 9/66 12/66 3/67 6/67 9/67 12/67 3/68 6/68 9/68 12/68 3/69 6/69 9/69 12/69 3/70 6/70 9/70 12/70 QUARTER ENDING contrast, as noted on page 13, East End center eligibility workers, under a model simplified method, relied completely on applicants' statements from April 1967 until March 1969, at which time they began making routine verifications of certain eligibility factors. The graph on the following page shows (1) that the East End center experienced a greater drop in its rejection rate than did the Clinton center and (2) that East End centerIs rejection rate remained at a very low level until March 1969 when eligibility workers began making routine verifications. Separation of functions During the quarter April to June 1970, the simplified centers again experienced a drastic drop in their rates of rejection of applications, (See graph on p* 39.) This drop--greater than any previously experienced--was due to the centers' separation of their eligibility and service functions. Upon the separation of these functions, newly hired or newly trained eligibility workers were responsible for mak- ing eligibility decisions. According to the local welfare officials, the new workers initially were not effectively interviewing applicants and were not detecting discrepancies in the applications that, to an experienced caseworker, would have raised questions concerning the applicants' eli- gibility for assistance. The eligibility workers whom we interviewed indicated that they had not been given sufficient training in effec- tive interviewing techniques or had not been adequately trained regarding the detailed welfare policies. Generally the workers were given 2 weeks of formal training before they began making eligibility decisions, Thus according to both the welfare officials and the eligibility workers, ad- equate eligibility decisions were not made until the workers gained experience on the job. An official of the New York City Department of Social Services has informed us that the department has strength- ened its prejob training of new eligibility workers in those centers that were scheduled to separate their eligibility and service functions in an effort to prevent a drop in the 40 Ir rate of rejection of applications that has been experienced by the other centers. Three additional centers were sched- uled to adopt a simplified method and to separate their el- igibility and service functions in March 1971. Thus at the time of our fieldwork, data was not available to indicate whether the strengthened training had been effective. 42 KANSAS CITY AREA As shown by the graph on the next page, a comparison of the rates of rejection of applications for assistance by the Jackson County center and by the Wyandotte County center showed that,during the past 5 years, the Jackson County cen- ter experienced a much higher rejection rate than the Wyandotte County center regardless of the eligibility meth- ods in use. It appears that there were two primary reasons for the Jackson County center having a higher rate of rejection of applications than the Wyandotte County center, First, in computing the needs of an AFDC family in Kansas where the family had some earnings, the State allows more of the earn- ings to be exempted than does Missouri. For example, in computing the needs of a family in Kansas, exemptions are made for the actual amount of social security and income tax withheld, actual cost of transportation to and from work (up to 9 cents a mile in Wyandotte County),and other work- related expenses. In uissouri, however, a fixed-dollar ex- emption is allowed; the amount exempted is dependent upon the applicant's gross income. These fixed exemptions are generally less than the actual work expenses and taxes in- curred by the applicant. Thus families with similar incomes are more likely to receive assistance in Kansas than in Mis- souri, Secondly, as discussed earlier on pages 21 and 22,the Jackson County center conducted an extensive eligibility in- vestigation of an applicant before making an eligibility de- cision, As noted also, an SRS hearing examiner has recom- mended that Missouri be held out of compliance with Federal law because of the length of time being taken to make eligi- bility decisions. The extra time taken by Jackson County to process applications would have a tendency to result in a higher rejection rate compared with that of'wyandotte County because of the possibility that (1) evidence gathered during the detailed investigations would show that the applicants did not meet all of the State's eligibility requirements and (2) family and economic changes would occur subsequent to the date of application and before the detailed investiga- tions were completed --such as applicants! securing employ- ment or the return of an absent parent. 43 RATE OF REJECTION OF PERCENT 61.4 AFDC APPLICATIONS FOR ASSISTANCE KANSAS CITY AREA 60 : lb\ 4 -\ \ t --- \ - JACKSON COUNTY, MO. 1 I (Traditional Method) 40 \ \ I / \\ I’ 30 k,VYANDOTTE COUNTY, KAN. 25 \ (Simplified method adopted informally in e-er of 1968 and formally in March 1970) 3/66 6/66 9/66 12/66 3/67 6/67 9/67 12/67 3/68 6/68 9/68 12/68 3/69 6/69 9/69 12/69 3/70 6/70 9/7Q 12/70, QUARTER ENDING Simplification of procedures As discussed on pages 18 and 19, the Wyandotte County center, in effect, began using a simplied method in the sum- mer of 1968 because pressure from community groups forced the county to suspend normal eligibility checks. Because of the pressures, eligibility decisions were sometimes made on the basis of interviews at the center and examination of documents furnished by the applicant at the center. Thus at the time of the center's formal adoption of its simplified method in March 1970, no significant change occurred in its method of determining eligibility, The rejection rate data for the Wyandotte County center (see graph on p. 44) shows that a significant drop--about 10 percent-- occurred during the June to December 1968 period and that the rate in later periods was at a similarly low level. Separation of functions The director of the Wyandotte County center advised us that he considered the method of determining the eligibility of an applicant to be extremely important in maintaining the integrity of the welfare program. He stated that, at the time of the separation of the eligibility and service func- tions (between June and October 19701, he assigned college graduates, when possible, to perform the eligibility func- tions. He expressed the opinion that the quality of such a staff permitted better judgments to be made and probably re- sulted in keeping the rejection rate from dropping signifi- cantly. A comparison of the effect of the adoption of simplified methods for determining eligibility and of the separation of the eligibility and service functions by the New York City centers and the Wyandotte County center showed that the New York City centers experienced much sharper drops in their rates of rejection of applications after the adoption of the simplified method (see pp. 38 to 40) and after the separation of the functions (see p. 40) than were experienced by the Wyandotte County center. 45 Two factors may have contributed to the differences in the drop in the rejection rates. First, the New York City centers separated their eligibility and services functions on a specific day, In contrast, the Wyandotte County center took about 5 months to complete the separation of its func- tions and thus permitted the eligibility workers to gradu- ally become familiar with its functions. Secondly, the New York City centers used clerical workers--usually newly hired or newly trained high school graduates--to perform the eli- gibility functions. In contrast, the Wyandotte County cen- ter used co_llege graduates to perform those functions, A comparison of the rejection rates for Jackson and Wyandotte Counties showed that other sharp changes occurred in the rates at times other than those discussed above. The most obvious changes were during the quarters ended Septem- ber 1966 through March 1967 in Wyandotte County and in 1969 and 1970 in Jackson County. We found that these sharp changes were caused by administrative decisions unrelated to the methods used for determining eligibility, On August 1, 1966,Kansas increased the AFDC basic needs allowance; this automatically made more persons eligible for assistance. According to the director of the Jackson County welfare center, the overall increase in applications during 1969 and 1970 created an administrative logjam for the center's eli- gibility workers. He said that periodically the staff in- tensified their efforts to clear out the backlog which re- sulted in the rejection rate peaks and valleys during that period. LOS ANGELES COUNTY All Los Angeles County welfare centers began to sepa- rate their eligibility and service functions during the last half of 1969; the separations were completed during different periods of time. Two of the centers, Pomona and Inglewood, began using simplified methods in October 1969. As shown by the graph on the next page, the two cen- ters' rate of rejection of applications increased in the quarters ended June and September 1969, According to the 46 RATE OF REJECTION OF AFDC APPLICATIONS PERCENT FOR ASSISTANCE 60 LOS ANGELES COUNTY 50 - TWO SIMPLIFIED CENTERS (Simplified Method adopted in October 1969) 45 TWO TRADITIONAL CENTERS 40 P --I 35 30 1 25 ALL COUNTY CENTERS 20 15 4 / 0 I I I I I I I I I I I I I I I I I I 3/66 6/66 9/66 12/66 3/67 6/67 9/67 12/67 3/6a 6/68 9/68 12/68 3/69 6/69 9/69 12/69 3/70 6/70 9,‘70 12/70 QUARTER ENDING directors of the centers, these increases resulted from ad- ministrative action taken to clear up all pending applica- tions before adopting the simplified methods and separating the eligibility and service functions. Most of the pending applications were under investiga- tion by the property units which were responsible for making collateral checks on eligibility factors, such as appli- cants' ownership of savings accounts and property and re- ceipt of unemployment compensation. The directors stated that they had assigned their most experienced workers to as- sist in evaluating the results of the detailed investiga- tions by the property units to expedite eligibility deci- sions. According to the directors, the assignment of the experienced workers and the information obtained by the property units resulted not only in a reduction of the back- log of pending applications but also in a more thorough re- view of the applications and a temporary increase in the re- jection rate. Since the adoption of the simplified method in October 1969, the trend in the rejection rate for the two simplified centers --although slightly higher--has not been signif- icantly different from all centers in the county or from the two traditional centers used for comparison. Perhaps this can be attributed to the similarities between the manner in which the two methods were actually being carried out. As discussed on pages 22 and 23 the simplified centers were US- ing a modified version of simplification (routinely inter- viewing and verifying certain eligibility factors) and the traditional centers were placing considerable reliance on the applicants' statements rather than independently verify- ing eligibility factors through collateral sources. The county's centers-- including the two simplified cen- ters --experienced a relatively sharp drop in the rate of ap- plications rejected in the quarters ended December 1969 and March 1970, the period in which most of the centers sepa- rated their eligibility and service functions and the new eligibility workers were gaining experience in carrying out the eligibility functions. Welfare officials of the two simplified centers advised us that the lower rejection rates represented, to some extent, a return to the rejection rate levels existing before clearing out the backlog of pending applications. 48 The drop in the rejection rates during the July to De- cember 1970 period of the two traditional centers used for comparison purposes probably occurred because of the in- crease in the number of applications that curtailed the ability of eligibility workers to use their normal investi- gation techniques. (See p. 25.) CONCLUSION The findings of our review indicate that the rejection rate is higher when eligibility workers perform comprehen- sive eligibility investigations, including checks with col- lateral sources, as was noted in Jackson County and in the Pomona and Inglewood centers in Los Angeles County just prior to separation of eligibility and service functions and the adoption of the simplified method. Also our findings indicate that the rejection rates drop when changeover to separation or simplification occurs but tend to level off, or even recover, as eligibility workers gain experience, Our overall conclusions are discussed in chapter 8. 49 CHAPTER 6 CASE CLOSINGS Once an AFDC applicant is determined to be eligible for assistance, the case generally remains open and payments are continued until (1) the recipient requests that the case be closed or (2) information becomes available to the welfare center that the recipient is no longer eligible for assis- tance, The available data we examined pertaining to the number of AFDC cases closed in New York City, the Kansas City area, and Los Angeles County did not indicate any particular trend or wide fluctuations in the number of cases closed that could be attributed to the different methods for determining eligibility. For example, during 1969 an average of 1.7 cases per hundred each month were closed by the New York City centers using a simplified method, compared with an average of 2 cases by all New York City centers, Conversely, during this same period, an average of 4.2 cases per hundred each month were closed by the Los Angeles centers using the tra- ditional method compared with an average of 5.4 cases by the centers using the simplified method. In the Kansas City area during 1969, both Jackson County and Wyandotte County were using the traditional method. For all areas visited by us, the percentage of cases closed dur- ing 1970 was lower than in the 2 preceding years. CLOSINGS THROUGH REDETERMINATIONS OF ELIGIBILITY Once an applicant is determined to be eligible for as- sistance under a public assistance program, HEW regulations require that his eligibility be periodically redetermined. For the AFDC program, HEW has prescribed that such redeter- minations be made at least every 6 months. The manner in which these determinations are made by the centers visited by us arc described below. 50 Traditional method Each of the welfare centers we visited that use the traditional method for determining the eligibility of appli- cants for assistance followed the same procedures in making eligibility redeterminations as in making initial eligibility determinations. Caseworkers usually interview the recipi- ents in their homes and make their usual investigations in an effort to ascertain that recipients' economic and family situations qualify them for continued assistance, The re- determinations are usually completed more quickly than the initial determinations since some of the previously verified eligibility factors are relied upon at the time of redeter- mination (for example, age of children and establishment of paternity). Simplified method The centers visited by us that were using simplified methods did not follow the same procedures in redetermining eligibility that were used in making initial eligibility de- terminations, The cefiters initiate a redetermination of el- igibility by mailing a form to the recipient to be completed and returned to the center. The content of the forms used in making redetermina- tions of eligibility differed markedly between those used by the New York City centers and those used by the centers in the Kansas City area and Los Angeles County, which ,used a form similar to the one originally completed by the recip- ient. The New York City centers used a single sheet "decla- ration" form on which recipients could certify that they were still in need, or not in need, of public assistance, or note changes which might have an effect on the extent of their entitlement to assistance. A copy of this declaration form is reproduced on the next page. Upon receipt of the completed forms, the welfare cen- ters' eligibility workers review the forms to ascertain whether the information reported affects the recipients' el- igibility and extent of entitlement, Eligibility workers only contact recipients to clarify information noted on the form. Center directors in Wyandotte County and Los Angeles County advised us that s,uch contacts--usually by telephone-- are needed in many of the redetermination cases. 51 Form W-1OC (face) THE CITY OF NEW YORK l/24/69 DEPARTMENT OF SOCIAL SERVICES Date DECLARATION - CONTINUED NEED FOR PUBLIC ASSISTANCE OR CARE It is necessary at this time for us to secure information from you about your current situation. Therefore, we want to know if there have been any changes which would affect your need for public assistance. Complete this form. Sign and date the certification. Mail in the enclosed envelope. No. postage stamp is required. It is important that you complete and return this form promptly to prevent any lapse in your public assistance grant. Please check the box which applies to your situation. I CERTIFY THAT I AM STILL IN NEED OF PUBLIC ASSISTANCE n THERE ARE NO CHANGES m HAVE ANY OF THE FOLLOWING CHANGES OCCURRED’ a. Has anyone left or been added to the members of your family ? If so, please list the changes, the date the changes occurred and the relationship to you of the person(s) involved: b. Has there been any change in your financial situation ? (such as bank accounts, Unemployment Dis- ability Benefits, Soc~ol Security, Workmen’s Compensation, property, etc.) c. Has there been any change in your regular Income from employment, relatives, or other sources? d. Other changes? u I AM NO BECAUSE: LONGER IN NEED OF PUBLIC ASSISTANCE AND YOU MAY DISCONTINUE SENDING ME FURTHER AID (For additional space sse reverse side) (I) (We) certify that all of the informotlon contaIned in this Declaration is true and correct to the best of our knowledge and belief. We understand that we will furnish any additional information which may be required and that we will report imma diotely any changes in circumstances Including changes in flnoncial resources, to the public welfare official to thorn this statement is submitted. We have not assIgned any of our assets or property to anyone in order to qualify for public ossist- once. (I) (We) know that anyone who obtains, or attempts to obtoin, public assistance or care based on false statement, or deliber- ore co~~reaiment, is sublecr to prosecution and punishment in accordance with the penalties fixed by law. WiTNESS SIGNATURE(S) OF CLIENT(S) DATE Ilecessq only if signature of client ts b? markj 1. S8gncture 2. Address 52 The Wyandotte and Los Angeles County centers accumu- lated no statistical data showing the nature of decisions made on the basis of redetermination forms. The center di- rectors or supervisors, however, stated that most of the recipients reported some change in their family or economic condition but that few recipients were actually removed from the welfare rolls on the basis of these changes. Tl=Y stated also--as did welfare officials in New York City--that, once recipients were on the rolls, they were usually removed on the basis of (1) the specific request of the recipient or (2) data voluntarily supplied by informants. At the three New York City centers using simplified methods, we were able to obtain statistics on the experience with the use of the declaration form. The data, however, is for all categories of public assistance (aged, blind, dis- abled, AFDC, and general assistance) and is not limited to the AFDC program. A summary of the data for the period April through December 1970, follows, Number of cases Percent Total declaration forms due during the April- December 1970 period 23,391 100.00 Declaration forms received 22,372 95.64 Declaration forms not received 1,019 4.36 Total declaration forms received 22.,372 100.00 No changes reported 21,368 95.51 Changes reported (note a) 894 3.99 Closed--termination of assistance requested 110 .50 Declaration forms not received &olJ 100.00 Recertified as eligible (note b> 266 26.10 Suspended--assistance discontinued (note C) 753 73.90 - - - - Percent of cases closed or suspended (110 + 753 + 23,391) 3.69 aInformation was not available as to the number of cases, if any, which were closed because of a reported change. b Cases in which follow-up contacts by eligibility workers found recipients to be eligible or cases in which recipients came to the welfare office once their assistance payments were stopped and eligibility was reestablished. 'Cases in which additional information could not be obtained to determine eligibility and payments were discontinued. 53 CHAPTER 7 SPECIAL ELIGIBILITY REVIEWS AT CENTERSUSING SIMPLIFIED METHODS Since 1964 HEW has required States to maintain a system of quality control over the decisions made by local welfare workers regarding eligibility and extent of entitlement of recipients for public assistance. Past reviews by HEW and GAO have shown that the system, as it was generally imple- mented by the States, did not provide Federal and State pro- gram managers with information needed to assure them that proper eligibility determinations were being made. In October 1970 HEW prescribed a revised quality con- trol system designed to ensure the integrity of the public assistance program by alerting responsible program officials to the need for instituting corrective measures whenever es- tablished ineligibility tolerances (3 percent) or incorrect payment tolerances (5 percent ignoring first $5) were ex- ceeded. The revised system has been modified to recognize the increasing use of the simplified method of determining eligibility. At the time of our visit to welfare centers in New York City, the Kansas City area, and Los Angeles County, data had not been compiled on the results of the States' experience with the new quality control system for the quarters ended December 1970 or March 1971. New York City and Los Angeles County had made, however, special--although dissimilar-- eligibility reviews concerning implementation of the simpli- fied method. No such reviews were made by Wyandotte County. NEW YORK CITY REVIEW RESULTS The New York City Department of Social Services re- viewed a sample of all cases approved by the three centers using the simplified method during the period April 1, 1970, through August 31, 1970. The test consisted of a random sample of 20 percent of approvals of eligibility whether they were based on initial applications for assistance or re- determinations, The sample consisted of 895 family cases, including AFDC cases, AF'DC-unemployed parent cases, Home 54 Relief cases (non-Federal participating), and other family- type cases, The results of the New York City review of these cases, as shown in the following table, showed that 13.2 percent of the cases were ineligible or questionable as to eligibility. Special Review of Family Cases Under the Simplif d M th d April l%$&&,'l9~0 AFDC- Unemployed other family Total AFDC p=WIlt Home Relief (note a) Number --------- Percent Number Percent Number Percent Number Percent Number Percent Verified as eligible -??? ----86.8 469 92.5 32 84.2 -133-.---.- 75.1 143 82.7 Determined to be ineligible (note b) 14 1.6 7 1.4 2 5.3 3 1.7 2 1.2 Classified as: Unwilling to participate 29 Unable to locate recipient. 59 Unable to complete for other reasons (death, left state, in state in- stitution) - 16 Ineligible or questionable as to eligibility -118 ----13.2 38 7.5 6 -----15.8 44 24.9 30 17.3 Total cases reviewed 695 100.0 507 100.0 36 100.0 177 100.0 173 100.0 =- ~=~=~=~= - %ses in which a family payment is primary and a nonfamily member is included; for example, an AFDC case which in- cludes a payment for an aged, blind, or disabled person. bA case which was ineligible for one category--such es AFDC--but eligible for another category--such as Home Re- lief--was not considered ineligible. Nb data could be obtained on such cases. The city's review classified a case as ineligible only if the case was found to be ineligible for & types of fi- nancial assistance available under New York State law. For example, if a reviewer found that parental deprivation did not exist in an AFDC case but that the family had limited income and would qualify for assistance under the non- Federal-sharing Home Relief program, the case was not clas- sified as ineligible, It was not possible for us to ascertain how many of the federally supported cases (AFDC, AFDC-unemployed parent, and other family) may have been classified as eligible on the basis that, under the State- and City-financed Home Relief program, they were in need. In our report on a special re- view of the AFDC program in New York City in 1969, however, we stated that, of the 543 cases examined for eligibility during that review, 58 cases (10.7 percent) were considered 55 by us to be ineligible for AFDC.l Of these 58 cases, we considered 26 cases (4.8 percent of all cases reviewed) to be eligible for the Home Relief program. Thus the number of cases classified by the city in its special test as eli- gible for AFDC most likely contains some cases which are not eligible for Federal financial assistance. In discussing the results of the testing of the simpli- fied method of determining eligibility with officials of the New York City Department of Social Services, they informed us that assistance payments were discontinued in 11.6 per- cent of the cases classified as: unwilling to participate (3.2 percent), unable to locate (6.6 percent), or unable to complete for other reasons (1.8 percent). According to these officials, about half of the cases in which the recipient refused to participate in the special review were not receiving assistance when the city's inves- tigator attempted to interview the recipient but had been receiving assistance when the sample case was selected. In the other half of the cases, the recipients refused to co- operate even though they were still receiving assistance. Examples of cases classified as unwilling to participate, as furnished to us by the Department, follow. "Case was reviewed as a 6/70 recert [recertifica- tion], the case was closed at the client's re- quest prior to the review on 7/16/70 for reasons of full employment, the validator contacted the former client at her place of employment on 10/18/70, Mrs. refused to participate in a interview either at her home, during her lunch hour or at the V&R [validation and review] of- fice."' 1Report to the Committee on Ways and Means, House of Represen- tatives, entitled "Monitoring of Special Review of Aid to Families With Dependent Children in New York City conducted by the Department of Health, Education, and Welfare and the New York State Department of Social Services," (B-164031(3), dated October 17, 1969). 56 "Case was reviewed as a 6/70 accept [new case ac- ceptance]. Validator attempted to visit Mr. on 8/20 and g/3/70, he was not at home, notes were left both times which Mr. did not respond to. A regis- tered letter was sent on g/16/70, no reply re- ceived. The center was notified and the case was closed g/30/70, at the address of record for rea- sons of employment." "Case was reviewed as a 5/70 recert. [recertifica- tion], The client was visited on g/24/70 she was not at home, a note was left, another visit was made on g/27/70 again a note was left. The client phoned on g/30/70 and made an appointment for an office interview, this appointment was not kept. On 10/8/70 a third visit was made no contact was made, the case was closed on 11/25/70." "Case reviewed as a 4/70 accept [new case accep- tance]. V&R [validation and review] worker vis- ited address of'record and was informed by cli- ent's sister that client now resided at Flushing Avenue, worker visited this address no one was home a note was left, client never re- sponded, a letter was sent on 6/8/70 it was not returned. Case was closed on g/17/70, -kdr*." Concerning the cases in which the recipients of assis- tance could not be located, officials of the New York City Department of Social Services advised us that they follow a standard procedure in attempting to find recipients. A re- cipient is first sent a letter requesting to vis-it the home. If no reply is received, a city investigator visits the re- cipient's home, and if unable to interview the recipient, leaves a note requesting the recipient to contact the in- vestigator. If the recipient still does not respond, a sec- ond letter is mailed advising the recipient that his assis- tance payments are to be suspended, Examples of cases in which the investigators were unable to locate the recipi- ents, as provided to us by the department, follow. 57 "Case was reviewed as a 4/70 accept [new case ac- ceptance]. An appointment letter sent by the validator to the address of record was returned marked 'Addressee Unknown.' A new address was se- cured from the center the validator visited on 5/14/70 and discovered that the entire building was vacant, the checks of 5/16, 6/l and 6/16/70, were returned to the center and cancelled. The case was closed 6/17/70, whereabouts unkn~wn.~~ "Case reviewed as a 5/70 accept [new case accep- tance]. A visit was attempted on g/30/70. The client was not at home, a collateral [check] was made with the super of the address of record, he stated the client had moved and left no forwarding address, that he only came by to pick up his check. The center was notified and the case was closed l/18/70 whereabouts unknown, there were no checks returned," "Case reviewed as a 5/70 accept [new case accep- tance]. V&R [validation and review investigator] visited on 8/13 and g/14/70 no contact made. A collateral contact with the primary tenant re- vealed that client had never resided at address of record, but just picked up his checks there, The 6/l/70, check was returned and cancelled. The center was notified on 12/7/70 that the cli- ent could not be located, the case was closed on 12/16/70." "Case was reviewed as a 5/70 accept [new case ac- ceptance]. Letters sent client on 9/2 - g/25/70, returned 'Addressee Unknown.' Home visits at- tempted on 9/30 and 11/2/70, a contact with the center on 11/6/70 showed that the address was cor- rect. The super and tenants of the building never heard of the client. Case was closed 11/10/70**, there were no checks returned." We discussed with New York City Department of Social Service officials their reasons for not classifying a case as ineligible when the recipient was receiving assistance but (1) refused to cooperate or (2) could not be located. 58 The officials stated that the recipients might have been found to be eligible if they had cooperated or if they had been located, They conceded that the reverse might be true and agreed that eligibility was at least questionable. New York City did not have comparable eligibility data for centers using the traditional method, The special re- view of AFDC eligibility in New York City during 1969 by HEW and New York State and monitored by GAO, however, showed the AFDC ineligibility rate at that time to be 10.7 per- cent.1 That review of eligibility for 543 cases included 508 cases from centers using the traditional method and 35 cases from two centers using the simplified method. Direct comparisons between the rates of ineligibility found in the 1969 review and the spec9al review by the city in 1970 are not susceptible to meaningful comparison because of the differences in time and methodology. Nevertheless, results from both reviews show that New York City's AFDC caseload contains many ineligible and/or questionable cases. 1See footnote on p. 56. 59 LOS ANGELES COUNTY RFVIEW RESULTS The Los Angeles County Department of Public Social Service reviewed a sample of AFDC cases determined to be eligible for assistance under the simplified method. The sample, covering determinations made from October through December 1970, was selected from all AFDC cases on the rolls at the two welfare centers using the simplified method. The sample drawn was based upon random-sampling techniques. The review of AFDC cases consisted of (1) a review of the case record, (2) an interview with the recipient, and (3) verification of data with collateral sources, as con- sidered necessary. The results of the county's review ap- pear below. Number of cases Percent Verified as eligible Determined to be totally ineligible 8 4.0 Determined to be partially inelibible (some member of family included in grant was ineligible) -ui ' 8.9 Totally or partially ineligible _26 12.9 Total cases reviewed In contrast to the review in New York City, Los Angeles (1) classified an AFDC case as ineligible even if the fam- ily qualified for assistance under some other public assis- tance program and (2) made an eligibility decision for all cases--including those who refused to cooperate or could not be located--on the basis of information in the case record and data obtained from collateral sources. The county also made a special review of AFDC cases determined to be eligible for assistance under the tradi- tional method during October 1970. According to local wel- fare officials, this review of cases was not undertaken 60 specifically for comparative purposes, but the results could be used to indicate differences in ineligibility at centers using the simplified and the traditional methods. In this special review, reliance was placed completely on eligibility data in the case records; recipients were not interviewed and collateral checks were not made. Officials involved in the review told us that, if these additional steps had been taken, the percentage of ineligible cases probably would have been higher. The results of this spe- cial review are shown below, Number of cases Percent Verified as eligible 352 91.9 Determined to be totally ineligible Determined to be partially ineligible (some member of family included in grant was ineligible) 27 7.1 Totally or partially ineligible 8.1 Total cases reviewed Considering that the ineligibility findings in the re- view of cases under the traditional method may have been higher than 8.1 percent if full field investigations had been done, the difference between the percentage of ineli- gible cases approved under the traditional method and under the simplified method would have been narrowed. Under both methods, however, the percentages of ineligible cases ex- ceed HEW's 3-percent tolerance level. 61 CHAPTER 8 GENERAL OBSERVATIONSREGARDING AFDC CASELOADS AND THEIR RELATIONSHIP TO ELIGIBILITY METHODS Welfare centers in New York City, the Kansas City area, and Los Angeles County that were supposedly using a simpli- fied method for determining applicants'eligibility for as- sistance were, in fact, using a modified version of the HEW- prescribed simplified method. We found that generally these centers were routinely interviewing applicants to obtain eligibility data and were routinely verifying certain eligi- bility factors. Without exception, the directors of the centers using simplified methods stated that the centers should not rely completely on applicants' statements as a basis for making eligibility determinations. They have emphasized that, al- though they believed that most applicants are honest, eligi- bility workers have an obligation to assure themselves that their decisions are based on a reasonable amount of evidence that applicants qualify for assistance. Further, in our visits to centers using the traditional method, we found that verification of factors having a bear- ing on applicants' eligibility was not as extensive'as was commonly thought, In essence, there was not a great deal of difference between the verifications being made under the simplified methods and the traditional method in use at the centers. A summary of our findings for the areas visited, as presented in detail in the preceding chapters, follows. --AFDC caseloads increased significantly at all centers regardless of the type of eligibility method being used. However, caseloads in the centers using sim- plified methods experienced disproportionate in- creases when (11 they first switched over from the traditional method and (2) the centers first sepa- rated the eligibility and service functions. --Rates of rejection of applications for assistance (1) by centers using the simplified method in 62 Los Angeles County were similar to those experienced by centers using the traditional method: and (2) by centers using simplified methods in New York City and in Kansas City area were lower than those experienced by centers using the traditional method in those areas. The rates of rejection tend to be higher where the eligibility workers made comprehensive eligibility in- vestigations, including checks with collateral sources, than under a simplified method which relies on appli- cants ' statements. Also centers' rates of rejection dropped significantly immediately after adopting a simplified method or separating eligibility and ser- vice functions but tended to level off, or even re- cover, as eligibility workers gained experience, --Data available on closing of cases did not indicate any particular trend or wide fluctuations that could be attributed to the different eligibility methods in use at the centers. The percentage of cases closed during 1970 in all areas visited by us was lower than during earlier periods. Welfare offi- cials advised us that, once recipients began receiv- ing assistance, cases were seldom closed on the basis of data developed at the time of the periodic rede- terminations of their eligibility for assistance but were usually closed on the basis of (1) the specific request of a recipient or e(2) data voluntarily sup- plied by informants. --Where local welfare departments made special reviews of the eligibility of recipients of assistance that had been provided under the simplified methods, in- eligibility rates were found to be high. Sufficient data on ineligibility under the traditional method was not available to us to make meaningful compari- sons with the simplified method, Nevertheless, the ineligibility rates in the centers where data was available, regardless of the method followed in de- termining eligibility, either exceeded the 3-percent tolerance level established by HEW as the point be- yond which special corrective measures are called for or contained many cases where eligibility was questionable. 63 Any method for determining the eligibility of an appli- cant for assistance should be designed to produce proper and timely decisions. Ideally this should be done with lit- tle inconvenience to the applicants. The traditional method does not provide for achieving such a goal because of the time needed to make home visits and collateral checks to verify various factors having a bearing on an applicant's eligibility. The simplified method-- as prescribed by HEW--was not wholly acceptable to those who were responsible for imple- menting it at local levels. Therefore modified simplified methods were adopted which produced timely results and, for the most part, caused little inconvenience to the applicant. The use of a modified simplified method tends to result in a greater number of applications being rejected when com- pared with the use of a truly simplified method. HEW estimates that nearly 25 million persons would be eligible for assistance under its proposed welfare reform program-- about double the number currently receiving public assistance, Under a program of that size, it would not ap- pear practicable to require detailed field investigations of each eligibility factor for each applicant and still ren- der prompt decisions. On the other hand, the integrity of such a program must be ensured by keeping ineligibility at a low level. To help achieve this objective, we believe that the eligibility method in a welfare program should provide for --determining the eligibility of applicants for assis- tance on the basis of information obtained through face-to-face interviews with applicants and verifi- cation of certain key eligibility factors; --using, to the maximum extent possible, experienced personnel and having newly hired personnel trained in program policies, procedures, and interviewing and investigative techniques before assigning them to do eligibility work; and --prescribing a quality control system designed to alert management when instances of ineligibility and incor- rect entitlement rates reach a point at which special corrective action is called for. 64 APPENDIX 65 .- __.. -. APPENDIX I A!stAHAM RImeoFF. CONN. PI”L 1. FINNIN. *RIZ. FRED R. HARRIS. OKLA. CLWFORD P. “INSEN. WYO. HARRY C. WRD. ,I?.. Y*. ROBERT P. GRIFFIN. MIC”. GAYLORD NELSON. WIS. TOM "AIL. CHIEF COUNSEL COMMITTEE ON FINANCE WASHINGTON, D.C. 20510 March 3, 1971 B-164031 (3) The Honorable Elmer B. Staats Comptroller General of the United States Washington, D. C. 20548 Dear Mr. Staats: In the Senate Finance Committee’s forthcoming deliberations on the Administration’s proposed welfare reform legislation - - known as the Family Assistance Plan -- it would be beneficial if we could obtain information concerning the effect, if any, which the simplified method of determining eligibility has had on the current Aid to Families with Dependent Children caseloads and whether the recently revised quality control system of the Department of Health, Education, and Welfare is adequately monitoring the eligibility aspects ‘of the several public assistance programs. The Committee staff has discussed the above matters with representatives of your staff at HEW on several occasions. On the basis of these discussions, the Committee requests the Government Accounting Office to: 1. Analyze AFDC caseload data of selected welfare centers using the simplified method and compare with centers still using the traditional method of deter- mining eligibility. 2. Evaluate the effectiveness of the revised quality control system in monitoring the eligibility aspects of the several public assistance programs. APPENDIX I The Honorable Elmer B. Staats -2- March 3, 1971 With respect to the comparative analysis work for the AFDC program (item number l), the Committee staff has ad- vised me that GAO will do work at two or three locations and will furnish a report on its findings to the Comrnittee by the end of May, The Committee understands that GAO plans to start a review during this month of the effectiveness of HEW’s quality control system; this work is to be performed in the States of California, Colorado, Maryland, Michigan, New York, Ohio, and Texas, which account for nearly half of all Federal welfare funds. Since the fieldwork on this review is not planned to be completed until August and a report not issued until some months after that, we have agreed that, to accomplish item number 2 above, periodic informal briefings concerning the prog- ress of this review and the receipt of raw data compiled by you in connection with your review would be very beneficial. In this connection, we are seeking ways in which any shortcomings in the existing quality control system -- particularly as it relates to the simplified method of determining eligibility -- can be over- come in any welfare reform program approved by the Congress. I want to express the Committee’s appreciation for the valuable assistance provided by your Office during our consid- eration of H. R. 16311 during the last session and assure you that this information will be of great help in our further consideration of the proposed reforms. With every good wish, I am Chairman U.S GAO, Wash.. D.C. 68
Comparison of the Simplified and Traditional Methods of Determining Eligibility for Aid to Families With Dependent Children
Published by the Government Accountability Office on 1971-07-14.
Below is a raw (and likely hideous) rendition of the original report. (PDF)