Low-income Working Families Research Articles

Prevalence and Patterns of Earned Income: Tax Credit use among Eligible Tax-Filing Families: A Panel Study, 1999-2005

This study expands our understanding of participation in the Earned Income Tax Credit (EITC) program among prime working-age individuals from EITC-eligible families between 1999 and 2005. It identifies gaps in program use over time such that outreach efforts might better target low-income working families to increase EITC take-up rates. Relying on National Longitudinal Survey data, findings indicate that more than one third (37.8%) of the population sample was EITC-eligible at least 1 year (3,034 of 8,033 individuals). Less than 20% of EITC-eligible families filed for the credit, and about half of these filed more than 1 year. Robust correlates of EITC use included lower income; larger families; separated, divorced, or widowed persons; and women versus their respective counterparts. Strategies to increase the EITC take-up rates are discussed.

Health Insurance Tax Credits and Health Insurance Coverage of Low-Income Single Mothers

The Omnibus Budget Reconciliation Act of 1990 introduced a refundable tax credit for low-income working families who purchased health insurance coverage for their children. This health insurance tax credit (HITC) existed during tax years 1991, 1992, and 1993, and was then rescinded. We use Current Population Survey data and a difference-in-differences approach to estimate the HITC’s effect on private health insurance coverage of low-earning single mothers. The findings suggest that during 1991–1993, the health insurance coverage of single mothers was about 6 percentage points higher than it would have been in the absence of the HITC. JEL Classification Codes: H2, H51, I18, J32

Food Security, Hunger, and Food Stamp Participation Among Low-Income Working Families in Rhode Island

ABSTRACT In 2004, almost 12% of all U.S. households, and about one in three low-income households (36.8%) were food insecure.1 While the Food Stamp Program (FSP) is intended to provide a safety net for low-income households to purchase food, recent data indicate it reaches only about 55% of those eligible.2 The purpose of this study was to examine one specific group of underserved, the working poor, in order to assess the reasons why income-eligible households do or do not participate in the FSP. Participants were selected based on their in-come-between 100 and 130% of the federal poverty level (FPL), and FSP participation (divided proportionately) from a larger pool of working families receiving state subsidized child care assistance in Rhode Island. Individuals from 418 low-income households were surveyed regarding household demographics, participation in food assistance programs (Food Stamps, Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), National School Lunch (NSL), and School Breakfast), food security and hunger, and child well-being. Results indicate that more than half (56%) of the low-income working families were food insecure over the past year and close to 20% of households had members who experienced hunger. Further, households participating in the FSP were more disadvantaged than those not participating. Households receiving FSP benefits had lower incomes, higher rates of food insecurity, and more reported difficulties with their children, despite greater use of other food assistance programs. Finally, participation in all of the nutritional assistance programs was low relative to estimated eligibility. The findings highlight the difficulties of working families, who despite employment, and in many cases, nutritional assistance, were still experiencing hunger and food insecurity in unacceptably high percentages.

The demand for dependent health insurance: How important is the cost of family coverage?

From the mid-1980s to the mid-1990s, the proportion of non-elderly Americans with employment-based health insurance declined. Roughly 80% of this decline was due to the loss of coverage by dependent family members. During this period, workers became increasingly responsible for the costs of family coverage, while expanded Medicaid coverage provided low-income working families with an alternative to employment-based insurance. We examine the role of out-of-pocket premiums and expanded Medicaid eligibility in households’ demand for employment-based family coverage. Cross-sectional results reveal that demand is affected by both factors. We find that between 1987 and 1996, the increase in out-of-pocket premium costs accounted for nearly half of the decline in dependent coverage while expanded Medicaid eligibility represented 14% of the decline.

Family coverage expansions: Impact on insurance coverage and health care utilization of parents

With the passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), Medicaid eligibility ceased to be tied to receipt of cash assistance. Since then, states have had a growing number of opportunities to expand health coverage to low-income working families beyond previous AFDC limits. As of 2001, 20 states have raised income eligibility limits for parents to or beyond 100% of the Federal Poverty Level. First, we use the Current Population Survey to study the effect of states’ expansions on the insurance rates of adults and to estimate the crowd-out of private insurance. We find that eligible adults living in a state that expanded coverage are more likely to be insured. We find a take-up rate of 14.8%. Our results suggest that 24% of this increase is due to a reduction in private coverage. Next, we use the Behavioral Risk Factor Surveillance System to examine changes in health care utilization. We find that these expansions increased cancer-screening rates. Of previously uninsured mothers not receiving cancer screening, 29% now receive these screens. Finally, our results indicate the expansions decreased the likelihood that a parent needed to see a doctor but did not because of cost.

Unintended Consequences? Undocumented, Working Poor Families and the Refundable Child Tax Credit

Immigrants toil in sweatshops for torturously long days at sub-minimum wages, which may or may not be paid, with little meaningful recourse. Immigrant workers with and without authorization to work in the United States are disproportionately represented among the lowest earners. The average wage among all low-wage immigrant workers was $14,400 in 2001. Moreover, almost half of immigrant workers earned less than twice the minimum wage. These hard working individuals are living in poverty. The Earned Income Tax Credit (EITC) lifts almost 20 million low-income working individuals out of poverty every year. Unfortunately, the EITC does not apply if a worker, her spouse, or her qualifying child does not have a Social Security number. Consequently, many low-income immigrant working families cannot qualify for the EITC. However, the Child Tax Credit (CTC) under certain circumstances may provide relief. This Article begins with an explanation of the complex operation of the CTC. The operation of the CTC is examined by focusing the analysis on the different tax consequences for working poor families in which each member has a Social Security number (documented) and those in which at least one member does not have a Social Security number (undocumented). Next, the Article demonstrates how the CTC fails to ensure that undocumented, working poor families do not pay any taxes. Finally, the Article proposes a legislative reform for this onerous problem and encourages Congress to provide relief for all hard-working poor families.

Economic and Labor Market Trends

SUMMARY A number of economic and labor market trends in the United States over the past 30 years affect the well-being of workers and their families. This article describes key changes taking place and the implications for social and economic policies designed to help low-income working families and their children, particularly those families that include immigrants. Important conclusions that emerge include the following: * Diversity. The workforce, like the population, is more diverse than in past decades, as more workers and their families are of mixed ethnicities and more workers have families that include both immigrant and non-immigrant members. * Demand for Low-Skilled Labor. Although demand for high-skilled workers continues to increase, two-thirds of all jobs in the U.S. labor market do not require high skills or education, and the demand for low-skilled workers also is expected to continue over the next decade. * Skills Gap. Those with strong technical skills and college educations receive higher wages; and those with fewer skills and education are relegated to the secondary labor market where wages and job security are low and few employee benefits are offered. * Working Poor. Over 2 million persons are in poverty even though at least one person in their family works full time, year round. The authors conclude that policies to help low-wage workers with families need to focus on more work supplementation strategies, improved access to supports, more targeted education and training services, and proposals extending some form of legal status to undocumented workers. Without a commitment to such policies, working poverty is likely to continue, and children in immigrant families, in particular, are likely to stay poor, even with working parents. ********** A number of economic and labor market trends in the United States over the past 30 years have altered the characteristics of the workforce and have had an impact on the well-being of workers and their families. Low-income workers in particular have been affected by some of the macro-economic trends, such as the shift in the industrial base of the nation from one centered on manufacturing to one focused more on services and, especially since the 1990s, to one defined by technology and communication. Because of economic restructuring, the gap between wages paid to those with high levels of education and skills and those with low levels of education and skills has widened. Meanwhile, the United States has experienced a shift in the ethnicity and national origins of its population, and therefore its workforce, as well as a continuing shift in family structure. The past two decades have seen a high and sustained inflow of immigrants and an increase in the proportion of the population with limited English proficiency. A significant share of the immigrant population possesses educational deficiencies and limited work skills, which means they generally enter the low-wage segment of the labor market. At the same time, the trend toward more single-parent households, at least in the non-immigrant population, continues to redefine family issues for low-wage workers, their employers, and public policy. This article describes key changes taking place in the economy and in the workforce that affect low-income families. (1) The implications of these broad and intermingled trends are discussed, along with social and economic policies designed to help low-income working families, particularly those that include immigrants. Trends in the Economy and Employment Despite the slow-down and recession in 2001 and 2002, the U.S. economy is extremely strong. The long period of economic growth in the 1990s--with strong job growth, high productivity, and low inflation--brought unemployment to historically low levels. More people, even those with relatively limited labor market experience, worked in the 1990s, and poverty rates showed a slight decline even for single mothers and their children. …

Insecure Families and Low-Paying Labour Markets: Comments on the British Experience

There has been a raft of policy changes in the UK that are intended to help low-income families engage with the labour market. Drawing in part upon the findings of a small-scale qualitative study of the experiences of low-income working families, this article infers that the secular trend to working parenthood may, as matters stand, be experienced rather differently by secure middle-class families than by poor families. It may be that the former will benefit from policies to improve access to formal childcare, career breaks and time off when needed. The latter are more likely to remain dependent on informal childcare from other family members or friends and receive minimal concessions granted by reluctant employers. While benefits such as working families tax credit will help to secure the material needs of low-income working families, low-paid employment will remain no less precarious and it is possible that the insecurity experienced by low-income working families will increase.

Business versus Families: Whose Side is New Labour on?

In its proposals for achieving a better ‘work–life balance’ for Britain's working families, the New Labour government is also seeking to balance the interests of business against the needs of families. This article argues that the economic policy ‘trilemma’ resulting from economic globalisation is mirrored in a parallel family policy trilemma, with particular consequences for the poorest families. Drawing upon this argument and, partly, upon illustrative evidence from a small-scale qualitative study of low-income working families, it is suggested that promoting family friendly employment alongside a policy of welfare-to-work cannot reasonably be achieved without significant additional regulation of low-paying employers.

Working parenthood and parental obligation

This article reports upon aspects of a small-scale qualitative study of lowincome working families. The study was conducted in the context of recent policy changes in Britain that are intended to promote labour force participation by low-income parents, especially mothers. It is argued that while popular opinion is generally supportive of mothers taking paid employment, some deep-rooted ambivalence remains. Mothers in lowincome families can experience the life-course transition involved as difficult in terms of the practical obstacles, the moral dilemmas and the ideological pressures. Without additional measures to support them in relation to their parental obligations, low-paid women are being pressed, at best, to exchange familial dependency for economic exploitation.

Tax Implications of Welfare Reform: The Minnesota Experience

Partly in response to welfare reform, an increasing number of states have enacted refundable tax credits to assist low-income working families. These state credits are layered on top of the federal tax system, state welfare programs, and direct state subsidies for child care. Minnesota's experience shows how state earned income credits might be redesigned to better meet their goals. It also illustrates how difficult it is to integrate a refundable state child care credit with the non-refundable federal credit, pretax accounts, and direct subsidies for child care.

Wyoming chapter wins big SCHIP victory for state children

Wyoming AAP members used familiar tactics — but on a slightly different scale — to win their long battle for children9s health insurance. The main tactic? Just personal contact, said Robert Prentice, M.D., FAAP, chapter president and a general pediatrician in private practice at Cheyenne9s Children9s Clinic. formal committees. No Kiwanis or Lions Club. were talking with the legislators directly. As to scale, the Wyoming AAP chapter has only 42 members to cover the state9s nearly 98,000 square miles. When it comes to advocacy efforts, Dr. Prentice observed, We don9t have committees; we have people. As Gov. Jim Geringer in March signed H.B. 100 into law, Wyoming became the 49th state to approve funds for Title XXI, the State Children9s Health Insurance Program (SCHIP). It provides about $40 billion in federal matching funds over 10 years to states that offer health care to uninsured children of low-income working families.

States find new ways of approaching chronic problems: SCHIP innovators offer special needs 'ounce of prevention'

Developing an insurance model for America9s sickest uninsured children — those with serious or chronic physical and behavioral problems — requires shattering certain myths. It9s the old ounce of prevention adage, said Adrian Sandler, M.D., FAAP, of Asheville, N.C. To provide quality health care to children with special health care needs is affordable. The costs of neglecting these children9s care can be immense. But there are misconceptions about who these children are and how expensive they are. Dr. Sandler and AAP members in North Carolina and Connecticut are developing innovative programs for children with special health care needs under Title XXI, the State Children9s Health Insurance Program (SCHIP). Authorized a little over a year ago, SCHIP in the next 10 years could provide approximately $40 billion in federal matching funds to states that offer health care to uninsured children in low-income working families.

Low-income working families at risk: uninsured and underserved.

Ongoing market trends are increasing the risks that working families will be uninsured or suffer lapses in health insurance coverage, with consequent threats to access to health care. Despite strong economic growth, employer-provided health insurance coverage has continued to erode throughout the past decade. Although a record number of women and men are working, slow wage growth for lower-wage workers, a shift in work toward industries less likely to provide and pay for health benefits for families, and a shift toward temporary and parttime jobs have combined to undermine employment as a base for health insurance coverage for working families. 1'2 As a result, the nation has seen a steady increase in the number and proportion of working-age Americans without insurance throughout the 1990s: from March 1989 to March 1997, the number of uninsured increased from 33 to 42 million, a jump from 15.2% to 17.6% of the under-65 population. 3 Recent projections suggest that the number of uninsured will reach 47 million in 8 years, with one American in five uninsured. 4 The rise in the number of uninsured comes at a time when access to health care is likely to be ever more difficult to obtain for those who cannot pay. In a search to contain health costs, public and private purchasers of health insurance have turned to managed-care plans with an endorsement of intense efforts to negotiate deep discounts and reduce payments for care for the insured. Enrollment of insured beneficiaries in managed-care plans has proceeded so rapidly that 8 in 10 workers employed by medium and large employers were enrolled in some form of managed care by 1997, compared with 56% in 1992 and 29% in

Health insurance for low-income working families. Effect on the provision of immunizations to preschool-age children.

The out-of-pocket cost for immunizations is a cause for referral to public health department clinics and is associated with delayed immunization. In 1991, New York State started Child Health Plus (CHPlus), an insurance program that covers ambulatory care and immunization services for children of families earning less than 222% of the poverty level. To determine the effect of CHPlus on the provision of immunizations. A before-and-after design was used to compare the year immediately before enrollment in CHPlus with the first year after enrollment in CHPlus. A mixed-model analysis of variance was used to control for the effects of age. All area primary care practices (n = 164) and public health department clinics (n = 6). Children (n = 1730) younger than 6 years who were enrolled in CHPlus. Number of immunization visits; types of providers (public health department clinics or primary care providers [pediatricians and family physicians]); and series-complete immunization coverage, including the diphtheria toxoid, tetanus toxoid, and pertussis vaccine, the oral poliovirus vaccine, and the measles, mumps, and rubella vaccine. The average age of the children was 37.7 months, 85% were white, 50% had been uninsured for immunizations before enrollment in CHPlus, and 16% previously received Medicaid. For infants, CHPlus decreased immunization visits to public health department clinics by 37% (from 0.14 to 0.09 visits per child, P = .009), increased immunization visits to primary care providers' offices by 15% (from 2.3 to 2.7 visits per child, P = .001), and increased immunization coverage by 7% (from 76% to 83%, P = .03). For children aged 1 to 5 years, CHPlus decreased visits to public health department clinics by 67% (from 0.06 to 0.02 visits per child, P < .001), increased visits to primary care providers' offices by 27% (from 0.46 to 0.59 visits per child, P < .001), and increased immunization coverage by 5% (from 83% to 88%, P < .001). The effects were greatest among previously uninsured children and among those with a gap in insurance coverage that was longer than 6 months. Insurance coverage for low-income working families resulted in a shift in the provision of immunizations from the health department to primary care providers and in increased immunization coverage.