THE EXPANSION OF WIC ELIGIBILITY AND ENROLLMENT. Time to Re-Think Policies and Practices

Transcription

1 THE EXPANSION OF WIC ELIGIBILITY AND ENROLLMENT Time to Re-Think Policies and Practices 2016 (Updating a 2009 report) Douglas J. Besharov Douglas M. Call Douglas J. Besharov is the Norman and Florence Brody professor at the University of Maryland School of Public Policy, where Douglas M. Call is a senior research analyst. Douglas J. Besharov 2016

2 Contents Acknowledgments ii I. Summary and Recommendations 1 Expanded eligibility and enrollment 3 Definitional liberalization 11 Poor targeting and horizontal inequity 13 Explanations 16 Future budget pressures 20 Recommendations 23 II. The WIC Program 30 Program categories and benefits 33 Eligibility 33 Funding 26 Future budget pressures 42 III. Expanding Eligibility 51 USDA s expanded estimates of eligibility 51 More unserved families 63 Higher recipient incomes and more horizontal inequity 68 IV. Explanations and Assessments 80 Subfamily income vs. shared-income family household income Current income vs. income that more accurately reflects the family s status. Certification periods vs. income changes (especially during pregnancy) Expanded adjunctive eligibility vs. income caps Nutritional risk assumed Appendix 1 Annotated Bibliography on WIC Eligibility 127 Appendix 2 Notes to Table 12 Estimating WIC Eligibility 147 Appendix 3 Effects of Applying 2016 State Medicaid Income Eligibility Caps to Number of Infants in 2012/

3 Acknowledgments We would like to take this opportunity to thank those who assisted in the preparation of this report, an update of one we prepared in 2009 for the American Enterprise Institute. 1 In the original report, Justus Myers, Anne Shi, and Mithun Mansinghani of the American Enterprise Institute helped conduct the basic research for the original report. Richard Bavier provided invaluable assistance by analyzing various aspects of WIC recipiency as reported in the Current Population Survey (CPS) and the Survey of Income and Program Participation (SIPP). For this report, Bekzod Akramov provided assistance in updating the CPS numbers. The 2009 paper went through a series of drafts that many people read (and re-read), providing patient and helpful comments. Special thanks (in alphabetical order) go to: Richard Bavier; Nancy Burstein, Abt Associates; Barbara Devaney, Mathematica Policy Research; Donald Dempsey, U.S. Office of Management and Budget; Kathleen FitzGerald, Congressional Budget Office; Elizabeth Frazao, Economic Research Service, U.S. Department of Agriculture; Peter Germanis, Administration for Children and Families, Department of Health and Human Services; Fred Glantz, Kokopelli Associates; Ron Haskins, the Brookings Institution; Jay Hirschman, Food and Nutrition Service, U.S. Department of Agriculture; Zoë Neuberger, Center on Budget and Policy Priorities; Victor Oliveira, Economic Research Service, U.S. Department of Agriculture; David Smallwood, Economic Research Service, U.S. Department of Agriculture; Karen Thiel, Patton Boggs; and Laurie True, California WIC Association. This 2016 update has also gone through a series of drafts and we are grateful to the many people who provided formal comments. Thanks (in alphabetical order) go to: Randy Aussenberg, Congressional Research Service; Anne DeCesaro, Staff Director, U.S. House of Representatives Subcommittee on Human Resources; Robert Doar, American Enterprise Institute; Linda Gianarelli, Urban Institute; and Jason Turner, Secretary s Innovation Group. We are especially grateful to the team at the U.S. Department of Agriculture s Food and Nutrition Service who provided us with many helpful comments and assistance throughout this process: Melissa Abelev, Danielle Berman, Jay Hirschman, Grant Lovellette, Richard Lucas, Lisa Southworth, Debra Whitford, and Sarah Widor. In addition, we received advice and suggestions on sections of the paper from many other analysts in the field. This report is being published under the auspices of R Street, and we are grateful for its financial support, editorial assistance, and dissemination efforts. Additional support for this update was provided by the University of Maryland Welfare 1. Douglas J. Besharov and Douglas M. Call, The Expansion of WIC Eligibility and Enrollment: Good Intentions, Uncontrolled Local Discretion, and Compliant Federal Officials (Washington, DC: American Enterprise Institute, March 2009), ii

4 Reform Academy and its donors. Funding from Mead Johnson Nutrition was provided prior to the compilation of this final report to update certain federal data. The findings and conclusions contained in this report are solely those of the authors, and should not necessarily be attributed to any of its funders. Indeed, this report confirms our earlier findings and the continuation of program trends we identified in it. Of course, the authors are responsible for any remaining factual errors and misinterpretations. Readers will note that some of the statistics reported below are from the period and before. This is because they are based on research that has not been replicated. We only use these older data when other evidence indicates that the conditions or trends remain unchanged, although magnitudes may have. iii

5 I. Summary and Recommendations The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is supposed to provide a package of supplemental foods, nutrition education, and health care referrals at no cost 2 to low-income mothers and young children who are at nutritional risk. Its monthly food packages contain such basics as milk (or cheese), adult cereal, fruit juice, eggs, and peanut butter (or an equivalent legume product), worth on average about $45 per person/per month for women and children. Infants who are not fully breastfed 3 also receive iron-fortified formula which brings the value of their package to about $ per month. 4 The nutritional counseling is normally about one fifteen-minute session every three months. 5 (Unless otherwise indicated, all dollar amounts in this paper are in 2014 dollars.) In 2014, WIC was an $8 billion program (about $6.2 billion in federal funding and about $1.8 billion through rebates from infant formula manufacturers) 6 that served about 8.2 million people (including 2.0 million infants, 4.3 million children ages one through four, and 2.0 million pregnant and postpartum mothers). Both program enrollment and program expenditures have declined since their historic peaks in 2009 of 9.2 million participants and $9.2 billion in expenditures. Officially, income eligibility for WIC is based on the combined income of related or nonrelated individuals who are living together as one economic unit at or below 185 percent of the federal poverty line. Many means-tested programs in the United States (such as child care vouchers, Medicaid, housing choice vouchers, and Temporary Assistance for Needy Families [TANF]) count only the income of those in the family, that is, individuals related by blood, marriage, or adoption living in the same residence. WIC is one of a few means-tested programs (including the Supplemental Nutrition Assistance Program [SNAP], school meals, and Low- 2. Victor Oliveira, The Food Assistance Landscape: FY 2014 Annual Report (Alexandria, VA: USDA, March 2015), 2, 3. Nancy Burstein, Kelly L. Patlan, Susan Bartlett, Patty Connor, and Bryan Johnson, WIC Participant and Program Characteristics: Food Package Report (Alexandria, VA: U.S. Department of Agriculture, November 2014), 9, 4. Ibid.; Tracy Vericker, Chen Zhen, and Shawn Karns, Fiscal Year 2010: WIC Food Cost Report (Alexandria, VA: U.S. Department of Agriculture, August 2013); files/wicfoodcost2010_0.pdf. 5. Douglas J. Besharov and Peter Germanis, Rethinking WIC: An Evaluation of the Women, Infants, and Children Program (Washington, DC: The AEI Press, 2001), 1415; Carol Olander, Nutrition Education and the Role of Dosage, 3, Dosage.pdf, which states: Control group participants received the usual 10 minutes of dietary counseling during bimonthly clinic visits to pick up WIC vouchers. See also U.S. General Accounting Office, Nutrition Education: USDA Provides Multiple Services through Multiple Programs, but Stronger Linkages among Efforts are Needed (Washington, DC: GAO, April 2004), 29, which states: The average WIC recipient received approximately less than 20 minutes of nutrition education twice every six months. 6. Because of rounding, the total exceeds the sum of the subtotals. 1

6 Income Home Energy Assistance Program [LIHEAP]) that include the income of unrelated cohabiters who share resources in the definition of the income unit. Therefore, in this paper, we adopt the term income-sharing household to include the unrelated household members sharing resources. Of course, many WIC income units consist of only family members. So, throughout this paper, we refer to both families and income-sharing households, depending on the context. In practice, it is often difficult to be that precise. Many of our estimates of WIC receipt and eligibility in this paper are derived from large national surveys (the Current Population Survey [CPS] and the Survey of Income Program Participation [SIPP]) that do not ask if members of a household share food and resources. Because the income unit household may include household members who do not share their resources, we use family income even though that may underestimate the amount of shared household income. (As much as possible, we try to indicate the difference.) Eligibility is also conferred through the receipt of Medicaid, the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps), or cash assistance under the Temporary Assistance for Needy Families (TANF) program. 7 For the period of July 1, 2014 to June 30, 2015 (hereinafter, 2014/2015 ), percent of poverty was $36,612 for an income-sharing family household of three, and $51,634 for an income-sharing family household of five. 9 This relatively high threshold is presumably meant to be mitigated by the additional requirement that applicants also be found to be at nutritional risk. Over the years, however, the criteria for determining nutritional risk have been watered down and now just about all WIC applicants are deemed at risk. Given WIC s purpose, benefit package, and putative eligibility rules, one would assume that its benefits would be targeted to the most needful Americans. But, as this report documents, various formal and informal changes have liberalized these criteria so that, according to the Census Bureau s Current Population Survey (CPS), in 2014 about 24 percent of WIC recipients lived in families with annual incomes above WIC s putative income cap of 185 percent of poverty, and about 8 percent in families with annual incomes at or above 300 percent of poverty. 10 In 2014, about 49 percent of all American infants were on WIC and about 39 percent 7. As explained below, receipt of TANF nonassistance does not confer adjunctive eligibility. 8. Although the Department of Health and Human Services issues the poverty guidelines in either late January or early February for immediate application, individual programs are allowed to choose a later effective date. In the case of the WIC program, the new poverty guidelines take effect at the beginning of July and remain in effect until the end of June of the next year. See U.S. Department of Health and Human Services, WIC Nutrition Education Frequently Asked Questions Related to the Poverty Guidelines and Poverty, 9. U.S. Department of Agriculture, WIC Income Eligibility Guidelines, , /sites/default/files/wic/fy _wic_iegs_web.pdf. 10. To account for non-response to questions about WIC receipt in the CPS, the Census Bureau will impute WIC receipt based on characteristics indicating that a non-responder is likely to be receiving WIC. For this paper, because of concerns about the Census Bureau s imputation strategy, we do not include data for families with imputed WIC receipt. If we had, the income distribution of WIC recipients is that in 2014 about 26 percent of WIC 2

7 of postpartum and breastfeeding mothers received WIC benefits. 11 A word about the data in the report. To the extent possible, we use the most current available administrative and survey data. For WIC administrative data, that ranges from between 2013 and For the survey data, our estimates of the income distribution of WIC recipients comes from the 2015 CPS. Our eligibility estimates, however, are, in part, derived from the Urban Institute s eligibility report, the latest of which uses the 2014 CPS. (The estimates from the CPS should be considered approximate because of limitations with the survey generally. In addition, as Richard Lucas, deputy administrator for policy support at the Food and Nutrition Service of the USDA, notes [CPS] samples are drawn to represent the national population and are not stratified to ensure representativeness of the WIC population. ) 12 Expanded eligibility and enrollment The dramatic increases in eligibility and, thence, enrollment are documented in USDA estimates of the number of WIC eligibles. As recently as its estimates for 2003, the USDA had estimated eligibility at about 33 percent of the relevant demographic categories, including 40 percent of infants, 31 percent of children one to four, and 34 percent of pregnant and postpartum women (see table 7). Until 2006, the USDA estimated eligibility for WIC by identifying the number of individuals in the relevant demographic groups in families (not income-sharing households) with incomes below 185 percent of poverty and making very small adjustments to account for adjunctive eligibility and individuals who were income eligible for only part of the year. Starting in the late 1990s, however, observers noted that the number of mothers and infants actually on WIC was higher than the USDA s eligibility counts. For example, in 2003, about 93 percent of the eligible population was participating in WIC, including about 132 percent of eligible infants and about 135 percent of eligible postpartum and breastfeeding women (see table 9). recipients lived in families with annual incomes above WIC s putative income cap of 185 percent of poverty and about 11 percent in families with annual incomes over 300 percent of poverty. 11 Authors calculations, U.S. Census Bureau, Current Population Survey. 12. Richard Lucas, U.S. Department of Agriculture, Food and Nutrition Service, message to authors, April 6,

8 Some took these over-100 percent coverage rates as an indication that the program was enrolling many ineligible children and mothers. Others took issue with the estimates themselves, arguing that the USDA s methodology underestimated the number of eligibles, thereby overestimating coverage rates. In response, the USDA commissioned various studies that, based as they were on past formal and informal expansions of eligibility criteria (such as adjunctive eligibility, the use of monthly income instead of annual income, and certification periods), concluded that the USDA s approach underestimated the number of eligibles. 13 In 2006, the USDA adopted most of the changes recommended by these groups, leading to much higher estimates of the number eligible. (The USDA called this a correction, which seems to be an understatement because of the extent of the changes. In any event, estimates of the number of WIC-eligible persons increased substantially.) Compared to the estimates using the original USDA methodology, the revised estimates were much higher: 54 percent of the relevant demographic categories were considered eligible (compared to 33 percent previously), including 63 percent of infants (compared to 40 percent previously), 53 percent of children one to four (compared to 31 percent previously), and 49 percent of pregnant and postpartum women (compared to 34 percent previously) (see table 7). In 2013, the most recent year with available estimates, the USDA estimates are about the same: 55 percent of the relevant demographic categories, including 61 percent of infants, 56 percent of children one to four, and 47 percent of pregnant and postpartum women (see table 7). Our estimates are even higher. First, we believe that WIC agencies only count the income of subfamilies and not the income of all members of the household sharing food, as required by statute. 14 Second, we estimate that more families and income-sharing households are categorically eligible for WIC because of the growth in other government programs. For 2013, we estimate that between 71 and 81 percent of all American infants would have been WIC eligible, with similar increases for WIC s other demographic categories. This percentage may continue to increase as states continue to raise Medicaid income eligibility caps, which automatically increases the number of adjunctively eligible families and income-sharing households. (For example, we estimate that if the 2016 state Medicaid income eligibility caps are applied to the 2013 infant population, then the number of adjunctively eligible infants in 2013 would have been about 55 percent higher.) (See table 12 and figure 1.) One can see the impact of the informal and formal expansions of eligibility on WIC s rising enrollment between 1980 and 2014, measured as a percent of all people in each of the WIC-eligible demographic categories: In 1980, about 9 percent of all people in eligible demographic categories received WIC benefits, including about 15 percent of infants, about 8 percent of all children ages one to four, about 9 percent of all pregnant women, and about 8 percent of all postpartum or 13. Michele Ver Ploeg and David M. Betson, eds., Estimating Eligibility and Participation for the WIC Program: Phase I Report (Washington, DC: National Academies Press, 2001). 14. For definitions of household and subfamily, see Box 2. 4

9 breastfeeding women. In 1992, about 22 percent of all people in eligible demographic categories received WIC benefits, including about 42 percent of all infants, about 16 percent of all children ages one to four, about 23 percent of all pregnant women, and about 21 percent of all postpartum or breastfeeding women. And, in 2014, about 32 percent of all people in eligible demographic categories received WIC benefits, including about 49 percent of infants, 15 about 27 percent of all children ages one to four, about 27 percent of all pregnant women, and about 39 percent of all postpartum or breastfeeding women (see table 6). However, despite this long-term increase in enrollment, more recently WIC enrollment has declined. Between 2009 and 2014, WIC enrollment declined from about 9.2 million to about 8.2 million. This decline appears, at least in part, to be the result of the declining number of births over this same period of time, resulting in a smaller population of possible eligibles for WIC. Compared to 2009, in the years , the number of infants in each year, on average, was about 166,000 lower, and the number of children ages 1-4 in each year was, on average, about 1 million lower. Some analysts argue that the decline in the birth rate does not explain the decline in WIC enrollment because the percent of all US infants and children receiving WIC has been declining during this period as well. The percent of all US infants receiving WIC declined from about 53.7 percent to about 49.1 percent while the percent of all children receiving WIC declined from about 27.5 percent to about 27 percent. (See Table 7.) The more appropriate measure, however, is the coverage rate, that is, the percent of eligibles enrolled in WIC. Between 2009 and 2013, the overall coverage rate for all WIC demographic groups declined imperceptibly (from 60.9 percent to 60.2 percent). Moreover, the total number of eligibles during this same time period declined by about 900,000 (from about 15.1 million to about 14.2 million), roughly the same number as the decline in total enrollment. Some think that some of the decline may also have been caused by how some states and localities responded to reductions in appropriations between 2011 and 2014 (a reduction of about 15. See Joyce A. Martin, Brady E. Hamilton, Paul D. Sutton, Stephanie J. Ventura, Fay Menacker, and Sharon Kirmeyer, Births: Final Data for 2004, National Vital Statistics 55, no.1 (September 29, 2006), Brady E. Hamilton, Joyce A. Martin, and Stephanie J. Ventura, Births: Preliminary Data from 2006, National Vital Statistics 56, no.7 (December 5, 2007), sr56_07.pdf; Joyce A. Martin, Brady E. Hamilton, Michelle J. K. Osterman, Sally C. Curtain, and T. J. Matthews, Births: Final Data for 2013, National Vital Statistics Reports 64, no. 1 (January 2015), nvsr/nvsr64/nvsr64_01.pdf; and Brady E. Hamilton, Joyce A. Martin, Michelle J. K. Osterman, and Sally C. Curtain, Births: Preliminary Data for 2014, National Vital Statistics Reports, 64, no. 6 (June 2015), 5

10 $1.1 billion). According to Richard Lucas, deputy administrator for policy support at FNS, some states closed WIC sites, which may have dampened applications for the program: Many State agencies reported closing WIC clinic sites and/or reducing their hours of operations, especially weekend and evening hours, in preparation for possible budget cuts to their nutrition service and administration grant funds as a result of Federal sequestration. These actions reduce program access, resulting in lower participation rates. The total number of WIC local agencies has decreased by 3.2 percent since Also, after the Federal government shutdown in October 2014, participation dropped more than 5 percent during the first quarter of the year, resulting in lower average monthly participation during FY

11 Sources: Authors calculations based on data from the following sources: For the numbers of WIC participants: U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015). For eligibility estimates: David Betson, Michael Martinez-Schiferl, Linda Giannarelli, and Sheila Zedlewski National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, : Final Report (Washington, DC: Urban Institute, December 2011), Michael Martinez-Schiferl, Sheila Zedlewski, and Linda Giannarelli, Paul Johnson, Linda Giannarelli, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach: 2010 Final Report (Washington, DC: Urban Institute, January 2013), WICEligibles2010Vol1.pdf; Erika Huber, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2011: Final Report (Alexandria, VA: U.S. Department of Agriculture, March 2014); Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2012: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2015); and Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2016). These high rates of eligibility and enrollment are partly explained by the fact that families 7

12 and income-sharing households with young children have lower incomes than the general population and are an increasing portion of the population. But enrollment is also rising when measured as a percentage of the families with annual incomes below 185 percent of poverty. The percentage of all American infants in the program is especially striking. (See figure 2). In 1977, WIC enrollment equaled only about 11 percent of all demographically eligible people in families with annual incomes below 185 percent of poverty. The number of infants on WIC represented only about 17 percent of the infants in families with annual incomes below 185 percent of poverty. In 1992, WIC enrollment equaled about 51 percent of all demographically eligible people in families with annual incomes below 185 percent of poverty. The number of WIC infants represented about 96 percent of infants in families with annual incomes below 185 percent of poverty. In 2012, WIC enrollment equaled about 77 percent of all demographically eligible people in families with annual incomes below 185 percent of poverty. There were 17 percent more WIC infants than infants in families with annual incomes below 185 percent of poverty. In fact, according to the Census Bureau s CPS, in 2014 about 8 percent of WIC infants lived in families with annual incomes above 300 percent of poverty (for a family of three, about $59,370) Authors calculations based on U.S. Census Bureau, DataFerrett, Current Population Survey, Annual Social and Economic (ASEC) Supplement, March

13 Sources: Authors calculations based on data from the following sources: For the numbers of WIC participants: U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015). For the estimates of the number of infants under 185 percent of poverty for : University of Maryland, Poverty Analysis and Tabulation Tool (College Park, MD: Welfare Reform Academy, 2007); David Betson, Michael Martinez-Schiferl, Linda Giannarelli, and Sheila Zedlewski, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, : Final Report (Washington, DC: Urban Institute, December 2011), WICEligibles Vol1.pdf; Michael Martinez-Schiferl, Sheila Zedlewski, and Linda Giannarelli, Paul Johnson, Linda Giannarelli, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2010: Final Report (Washington, DC: Urban Institute, January 2013), WICEligibles2010Vol1.pdf; Erika Huber, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2011: Final Report (Alexandria, VA: U.S. Department of Agriculture, March 2014); Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2012: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2015); and Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report (Alexandria, VA, U.S. 9

14 Department of Agriculture, January 2016). 10

15 Definitional liberalization This paper is part of a multi-part study by the authors and their colleagues that explores how income eligibility is determined in selected federal means-tested programs and its effects on behavior. The first paper in this series on Head Start 17 found that the malleability of current definitions of income makes it easy for staff to expand program eligibility with little political scrutiny or public debate by informally adopting more liberal interpretations of existing rules. A more recent paper on marriage penalties found that the increased size and coverage of meanstested social welfare benefits can, for cohabiting couples especially, lead to marriage bonuses of as much as 12 percent of their combined earnings or to marriage penalties of as much as or more than about 34 percent of their combined earnings, depending on the relationship between cohabiters whether or not they have children in common and whether or not they are sharing expenses and their combined and relative earnings. 18 This paper explains the growth in WIC s eligibility and enrollment as also the products of liberalized, more informal interpretations of eligibility rules by WIC staff and officials at all levels of government as well as formal Congressional action (extending the length of WIC certification periods for children) and inaction (failing to cap income eligibility for WIC recipients who are adjunctively eligible). It also identifies the factors behind this liberalization and makes recommendations about what to do about them. (In the WIC program, there is the added vagueness of the nutritional risk requirement, which has been interpreted away, as discussed below.) The major definitional elements that were loosened in WIC are similar in other meanstested programs: Subfamily income vs. shared household income. To determine income eligibility, WIC agencies are supposed to count the income of the entire household if it is shared as one economic unit. Many agencies do not do so, however, and instead count the income of only the nuclear family, leaving out other sources of household income for example, from grandparents, siblings, and boyfriends. 19 The failure to count all of the household s income could, by itself, expand eligibility over the base of those with annual incomes 17. Douglas J. Besharov and Jeffrey S. Morrow, Nonpoor Children in Head Start, Journal of Policy Analysis and Management 26, no. 3 (2007): , /nonpoor_children_in_head_start.pdf. 18. Douglas J. Besharov and Neil Gilbert, Marriage Penalties in the Modern Social Welfare State: Are Expanded Social Welfare Benefits and Changing Family Norms Leading to More Cohabitation (Rather than Marriage)? (Washington, DC: R Street, September 2015). 19. U.S. Government Accountability Office, WIC Program: Improved Oversight of Income Eligibility Determination Needed (Washington, DC: U.S. Government Accountability Office, February 2013),

16 below 185 percent of poverty by about 20 percent. 20 Current income vs. income that more accurately reflects the family s status. Because incomes can rise and fall throughout the year, WIC agencies are allowed to choose among annual, monthly, or weekly income. USDA regulations allow (but do not mandate) states to require that agencies select the period that more accurately reflects the family s status. 21 (The one exception, and it is substantial, is lower current income caused by unemployment.) 22 Most WIC agencies, however, simply seem to use the lowest income, whatever that is, in order to maximize eligibility. This failure to use the most appropriate income period could, by itself, expand eligibility over the base of those with annual incomes below 185 percent of poverty by about 20 percent. 23 Certification periods vs. income changes (especially during pregnancy). Once found income-eligible, successful applicants do not have their income eligibility recertified for six months or more (up to one year for infants and children) even if incomes rise during the certification period that would make them otherwise ineligible. WIC s current sixand twelve-month certification periods could, by themselves, expand eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 30 percent. 24 (Legislation currently pending in the Senate proposes that WIC certification periods for children be extended to two years.) 25 Expanded adjunctive eligibility vs. income caps. Eligibility for WIC is also established adjunctively (in some other programs called categorically ), that is, it is automatically granted to members of families and income-sharing households who are receiving This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations, Code of Federal Regulations, title 7, sec (d)(2)(i), (2015): 376, /wic/wicregulations-7cfr246.pdf. 22. Ibid., which states: However, persons from families with adult members who are unemployed shall be eligible based on income during the period of unemployment if the loss of income causes the current rate of income to be less than the State or local agency s income guidelines for Program eligibility. 23. This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix Improving Child Nutrition Integrity and Access Act of 2016, Senate, 114 th Congress, 2 nd session, Although the statute uses the word receiving, WIC regulations do not require applicants to actually be receiving assistance as long as they have been certified eligible to receive assistance under the programs. U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. The certification is made by the Medicaid, SNAP or TANF programs, not WIC. Zoë Neuberger, Center on Budget and Policy Priorities, 12

17 Medicaid, SNAP, TANF cash assistance (if they can provide documentation of receipt of assistance ). 27 When this provision was added to the law, income eligibility for these programs was set below 185 percent of poverty. Hence, the original purpose of adjunctive eligibility was simply to facilitate the enrollment process, not to expand eligibility. However, recent legislative changes to Medicaid and SCHIP authorized states to raise income limits for those programs to higher than 185 percent of poverty (and, in many states, higher than 300 percent of poverty), making adjunctive eligibility a potential source of substantially enlarged WIC eligibility. Under current Medicaid eligibility rules, adjunctive eligibility could, by itself, expand eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 40 percent. And, barring legislative change, there is no limit to how much WIC eligibility can expand via further increases in Medicaid and SCHIP income eligibility. Nutritional risk assumed. In addition to being income-eligible or adjunctively eligible, WIC applicants are supposed to be at nutritional risk. It appears, however, that this proviso has little practical impact on eligibility determinations. In a widely noted practice, WIC agencies find almost all applicants to be at nutritional risk. 28 This broad application of the definition of actual nutritional risk could, by itself, expand eligibility by as much as 25 percent. 29 The USDA s original methodology for estimating WIC eligibility was surely too constricted, and some of the changes made were long overdue. But overall, its revised methodology sharply documents the definitional liberalizations that have occurred. Poor targeting and horizontal inequity Why should we care about WIC s expansion beyond its putative income limit? Certainly, 185 percent of poverty is not a magic line. Those just above the line are not significantly better off than those just below it. For one, the failure to respect the spirit of this statutory benchmark has message to authors, June 29, Presumably, the difference is de minimus, and most researchers estimate adjunctive eligibility on the basis of being enrolled in or being participants in the Medicaid, SNAP, or TANF programs. See Michele Ver Ploeg and David M. Betson, eds., Estimating Eligibility and Participation for the WIC Program: Final Report (Washington, DC: National Academies Press, 2003), 50; Marianne Bitler and Janet Currie, Medicaid at Birth, WIC Take-Up, and Children s Outcomes (discussion paper, Institute for Research on Poverty, University of Wisconsin-Madison, Madison, WI, August 2004), 2, Child Nutrition Act of 1966, as amended through Public Law , U.S. Code 42, chapt. 13A, 1786, 17(d)(3)(E), The receipt of TANF nonassistance does not confer adjunctive eligibility, as described below. 28. U.S. Department of Agriculture, Food and Nutrition Service, WIC Policy Memorandum 98-9, Revision 8: 401 Failure to Meet Dietary Guideline for Americans (Alexandria, VA: USDA, March 2005). 29. This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix 2. 13

18 worsened WIC s already poor targeting. It also reflects a more endemic problem facing the American welfare state. WIC is not simply (some would say not primarily) a supplemental food program that provides the equivalent of income support in the way of foodstuffs: its nutritional counseling services are widely cited as a major reason for the program. Even at 185 percent of poverty, WIC is already generously targeted for a supplemental food and nutritional counseling program: $36,612 for an income-sharing household of three and $51,634 for an income-sharing household of five. 30 Presumably, WIC s higher income threshold was meant to be moderated by the requirement that applicants also be at nutritional risk, a restriction that turns out to be all but meaningless as applied by local grantees. Because of automatic adjunctive eligibility, in eight states already, WIC eligibility for infants (and in six states for children) reaches up to income-sharing family households with annual incomes above 300 percent of poverty (about $59,370 for an income-sharing household of three, and $83,730 for an income-sharing household of five), compared to other states without Medicaid expansions where the income cap remains at only 185 percent of poverty. In addition, state Medicaid income eligibility caps have been rising as a result of the Affordable Care Act. We estimate that if the 2016 state Medicaid income eligibility caps were to be applied to the 2013 estimates of the number of infants who were adjunctively eligibility through Medicaid (the latest year for which data are available), the number would increase by 55 percent from about 442,000 to about 655, According to the CPS in 2014, only about 48 percent of WIC recipients had annual family incomes at or below poverty, about 20 percent had annual incomes between 100 and 149 percent of poverty, only about 9 percent had annual incomes between 150 and 185 percent of poverty, and about 24 percent had annual incomes above 185 percent of poverty about 13 percent had annual incomes between 200 and 300 percent of poverty and about 8 percent had annual incomes over 30. Throughout this paper, we use as the income unit family income (that is, the income of a group of two people or more [one of whom is the householder] related by birth, marriage, or adoption and residing together ), but, as we point out in relevant places, WIC eligibility is keyed to the income of income-sharing households (that is, a household maintained by a householder who is in a family, and includes any unrelated people [unrelated subfamily members and/or secondary individuals] who may be residing there ), which, at the median, is about 2 percent higher. See U.S. Census Bureau, Current Population Survey (CPS) Definitions and Explanations, cps/about/cpsdef.html. Authors calculations from Carmen DeNavas-Watt and Bernadette D. Proctor, Income and Poverty in the United States: 2013 (Washington, DC: U.S. Census Bureau, September 2014), /content/dam/census/library/publications/2014/demo/p pdf; and U.S. Census Bureau, Historical Income Tables Families: Table F-6. Regions Families (All Races) by Median and Mean Income: 1953 to 2013, Authors calculations from Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2016); and U.S. Census Bureau, Annual Estimates of the Resident Population by Single Year of Age and Sex for the United States, States, and Puerto Rico Commonwealth: April 1, 2010 to July 1, 2014, /bkmk/table/1.0/en/pep/2014/pepsyasex. 14

19 300 percent of poverty. 32 The way in which eligibility has been liberalized is deeply unfair to those families and income-sharing households whose incomes are just above 185 percent of poverty. The three main factors that have raised eligibility do not simply increase the level of WIC s income cap they leapfrog eligibility to families and income-sharing households with significantly higher incomes. Two examples illustrate how large can be this horizontal inequity: When determining income eligibility, WIC agencies typically count the income of the subfamily (the immediate nuclear family) instead of including the income of other family members or cohabiters. Using the CPS, in 2014, when the entire income of the family was counted, 46 percent of WIC recipients in related subfamilies lived in families with incomes at or above 185 percent of poverty, 21 percent had annual incomes between 200 percent and 299 percent of poverty, and 20 percent had annual incomes at or above 300 percent of poverty. 33 Because only current income is counted, WIC ignores the higher, long-term (and truer) income of some families. For example, in instances of unemployment, WIC regulations mandate that state and local WIC agencies count current income. In instances of temporary illness or when a mother takes time off to have a baby, USDA regulations give state and local WIC agencies discretion in determining whether they will count current income or income that best fits the family s situation, which most often results in the selection of current income. In the 1990s, an additional 47 to 74 percent of pregnant women became eligible for this reason (between about 350,000 and 460,000 women). 34 According to Gordon, Lewis, and Radbill, these newly eligible women were more educated, were more likely to live with the father, were more likely to be white, and had fewer children than those who were income eligible during pregnancy. 35 Similarly, Alison Jacknowitz and Laura Tiehan used the Early Childhood Longitudinal Study, Birth Cohort (ECLS-B) to analyze the differences between mothers who enrolled in WIC in the prenatal period compared to those who enrolled in the postnatal period. They found that women who delayed enrolling had higher education levels, higher household income, and were more likely to be employed before they gave birth Authors calculations from U.S. Census Bureau, Current Population Survey. 33. Authors calculations from U.S. Census Bureau, Current Population Survey. 34. Anne Gordon, Kimball Lewis, and Larry Radbill, Income Variability Among Families with Pregnant Women, Infants, or Young Children (Princeton, NJ: Mathematica Policy Research, Inc., January 1997); and Aaron S. Yelowitz, Income Variability and WIC Eligibility: Evidence from the SIPP (working paper, National Bureau of Economic Research, 2002). 35. Gordon, Lewis, and Radbill, Income Variability Among Families with Pregnant Women, Infants, or Young Children, xv. 36 Alison Jacknowitz and Laura Tiehan, Transitions Into and Out of the WIC Program: A Cause for 15

20 The foregoing also ignores the long-standing unfairness that results from ignoring various forms of cash and noncash assistance (but counting other forms of income) in determining income. 37 This includes, for example, cash assistance such as the Earned Income Tax Credit (an average of about $3,000 per household with children), 38 noncash assistance such as SNAP (an average of more than $3,000 per household), 39 and housing assistance (an average of about $7,675 per household). 40 Most of these programs have almost universal coverage, so that the unfairness is somewhat limited. Housing assistance, however, reaches less than one-third of those eligible, 41 so that its beneficiaries are much better off than some families and income-sharing households denied WIC because their incomes are slightly above 185 percent of poverty. More fundamentally, this kind of hidden and distorting expansion of eligibility whether in WIC or any other means-tested programs undercuts sound program planning. The addition of so many somewhat better-off families and income-sharing households makes WIC less able to focus on the deep-seated nutritional and social needs of the most disadvantaged families and income-sharing households. Instead of enriching the services WIC can deliver to those below the income threshold, the funds that have been added to the program were used to expand coverage to Concern? Social Science Review 83, no. 2 (2009): According to the WIC regulations: Income for the purposes of this part means gross cash income before deductions for income taxes, employees social security taxes, insurance premiums, bonds, etc. Income includes the following (A) Monetary compensation for services, including wages, salary, commissions, or fees; (B) Net income from farm and nonfarm self-employment; (C) Social Security benefits; (D) Dividends or interest on savings or bonds, income from estates or trusts, or net rental income; (E) Public assistance or welfare payments; (F) Unemployment compensation; (G) Government civilian employee or military retirement or pensions or veterans payments; (H) Private pensions or annuities; (I) Alimony or child support payments; (J) Regular contributions from persons not living in the household; (K) Net royalties; and (L) Other cash income. Other cash income includes, but is not limited to, cash amounts received or withdrawn from any source including savings, investments, trust accounts and other resources which are readily available to the family. States may exclude the following income: in-kind housing and other benefits, loans, military housing, school meals payments, LIHEAP, federal student financial assistance (including Pell Grants), childcare vouchers. U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. 38. Center on Budget and Policy Priorities, Policy Basics: The Earned Income Tax Credit (Washington, DC: Center on Budget and Policy Priorities, January 2015), Center on Budget and Policy Priorities, SNAP Helps Struggling Families Put Food on the Table (Washington, DC: Center on Budget and Policy Priorities, January 2015), Center on Budget and Policy Priorities, Fact Sheet: the Housing Choice Voucher Program (Washington, DC: Center on Budget and Policy Priorities, 2015), G. Thomas Kingsley, Federal Housing Assistance and Welfare Reform: Unchartered Territory, New Federalism: Issues and Options for States series (Washington, DC: Urban Institute, December 1997), 16

21 higher income families and income-sharing households. Explanations The income-related elements of WIC eligibility are roughly the same as those in many other means-tested programs. But, without a formal change in eligibility rules, not all meanstested programs have experienced such large increases in eligibility and enrollment. Several factors seem to account for WIC s expansion: (1) WIC is a popular but little understood program largely insulated from political control. It is popular because it is widely believed to work. After all, it is widely, if inaccurately, claimed that every dollar of WIC spending saves $3 (or more) in medical and other costs. 42 Never mind that, whatever the original validity of the claim, it is certainly less true now that WIC has expanded to serve so many less needy families and income-sharing households. WIC s popularity makes it difficult for politicians of either party to criticize or control. Why else did the Bush Administration not try to rein in the program? And why did it, instead, preside over the 2006 recodification of the methods for estimating the program s eligibility that, in 2003, increased the total number of WIC eligibles by about 62 percent or about 5.1 million additional mothers, infants or children and in 2013, the most recent year available, by about 58 percent roughly 5.3 million additional mothers, infants, and children? 43 It is, however, one thing to fear a backlash for cutting a popular program like WIC; it is quite another to shy away from placing reasonable controls on eligibility criteria, especially after the program has grown to cover about half of all American infants at the cost of denying enhanced services such as more extensive nutritional and anti-obesity counseling for the neediest families and income-sharing households. (The only other possible explanation for the Bush Administration s failure to limit the growth in WIC eligibility is that senior staff did not understand what was happening.) (2) WIC has a devoted staff eager to serve as many people as possible. Most WIC staff are strong believers in the program and, hence, are understandably eager to provide benefits to as many families as possible. Prevailing practice seems to reflect the belief that enrollment in WIC should be facilitated because the program is beneficial even for families and income-sharing households whose incomes are substantially higher than the formal eligibility criteria For an analysis of these claims, see Douglas J. Besharov and Peter Germanis, Is WIC as Good as They Say? The Public Interest 134 (Winter 1999): See Table 7, WIC Eligibles as a Percent of the Total Population in that Category. 44. This problem is not limited to WIC. A recent USDA Office of the Inspector General report for SNAP found a number of cases in which state agencies did not verify the reported income of SNAP recipients and assumed recipients income did not change over the course of a certification period, which allowed SNAP recipients to remain eligible for the program. U.S. Department of Agriculture, Office of Inspector General, FNS Quality Control Process for SNAP Error Rate (Alexandria, VA: U.S. Department of Agriculture, September 2015), /oig/webdocs/ pdf. 17

22 When the findings in this paper concerning the incomes of WIC families and incomesharing households are presented to WIC supporters, the reaction is often not to deny that they are accurate, but to argue that they do not pose a problem. In fact, one of the authors has been scolded many times by WIC staff when he argued for targeting of benefits. Some staff even argue that all Americans could benefit from the program. (They probably have in mind WIC s counseling, not its food package, including free baby formula.) Hence, WIC staffers should not be expected to enforce eligibility rules they deem overly restrictive. Their natural inclination is to sign up families until funding runs out. (3) At least in the past, expansions were fueled by the easy availability of funds to support expansions, usually at little or no cost to the local program or the Congress. Many other meanstested programs also have deeply committed staffs and are politically popular, of course. Why did WIC expand when some others did not? The concurrence of program expansions with rising infant formula rebates strongly suggests that the rebates fed the process. The infant formula rebate program has provided billions of dollars to WIC with little legislative oversight. In 1990, the first year, the rebates provided WIC with about $808 million in additional funds, enough to pay benefits for about 880,000 additional recipients. By 1998, the rebates had grown to about $1.9 billion, enough for more than an additional 1.9 million recipients. In 2014, the rebates totaled about $1.8 billion, enough to pay benefits to about 2.0 million recipients, roughly one-quarter of the program s entire caseload and total spending. 45 Coming to the program outside the normal appropriations process, these billions of dollars in rebates have been automatically applied under WIC s eligibility and funding rules without serious consideration of whether the additional funds should be used to expand program benefits or services, rather than simply adding more recipients. The applicable rules require that the rebate reimbursements be used as appropriated funds, which means that they can only be used to expand program coverage, not to expand counseling services or to save state funds. 46 Moreover, because of the restriction on how much may be spent in administrative costs per recipient, the additional money that states have from the rebate reimbursements may only be used to expand participation, generally to those with higher incomes (and lower nutritional risk), rather than to improve services. There are legitimate reasons for placing limits on the things on which a program as large and diverse as WIC can spend money. But forcing states to add more and more families and income-sharing households to the program when the program needs to provide greater benefits to the neediest families and income-sharing households is not one of 45. Steven Carlson, Robert Greenstein, and Zoë Neuberger, WIC s Competitive Bidding Process for Infant Formula is Highly Cost-Effective (Washington, DC: Center on Budget and Policy Priorities, June 2015), The percentages of appropriated funds that are allocated to states that may be used for the WIC food packages and the national average per participant grants (AGP) for administrative costs are limited by law and regulation, so that additional funds must go to additional recipients. Child Nutrition Act of (h)(1)(B) and Special Supplemental Nutrition Program for Women, Infants, and Children, Code of Federal Regulations 7, sec

23 them. Put simply, the increased funding available through rebates enabled federal, state, and local WIC officials (as well as program operators) to make substantially more mothers and children eligible for program benefits painlessly, that is, without needing to find additional funds to cover them. Hence, as more funds became available, it was predictable that they would enroll as many families and income-sharing households as possible, even if it meant relaxing income-eligibility standards. 47 (4) Minimal state or local interest in controlling costs in the absence of a tough audit process or through federal/state cost sharing. This is not a unique phenomenon, of course. Separating the functions of determining eligibility from paying program costs, common to many federal, state, and local programs, almost always creates a moral hazard, that is, decision makers have no incentive to cut costs unless they face effective eligibility monitoring or a rigorously enforced budget limit. SNAP, for example, has the same separation between decider and payer. It seeks to deal with this problem through its Quality Control (QC) system, under which state agencies (with federal oversight) continuously sample food stamp recipients to check for errors in eligibility and benefits. The federal government publishes annual error rates for eligibility and benefits, and sanctions states with error rates above a previously defined tolerance level. 48 The sanctions can be substantial. 49 A recent report from the USDA Office of the Inspector General, however, has found a number of problems with the implementation of the SNAP QC system. 50 The federal school meals programs also have a regular audit process. Local school districts (with state and federal oversight) sample families with children receiving free or reduced school lunch or breakfast where the families have incomes that are considered error-prone or within a defined amount of the eligibility threshold. 51 In the school year (the latest 47. See, for example, Besharov and Germanis, Rethinking WIC, 22, which states: Moreover, as program funding has increased, according to some local WIC staff, even income testing seems to have become less rigorous, with many participants having incomes over eligibility limits. 48. U.S. House of Representatives, Committee on Ways and Means, 2004 Green Book: Background Material and Data on the Programs Within the Jurisdiction of the Committee on Ways and Means (Washington, DC: GPO, March 2004). 49. They are calculated by multiplying the state s food stamp expenditures by 10 percent of the amount by which the State s combined error rate exceeds 6 percent. Ibid., U.S. Department of Agriculture, Office of Inspector General, FNS Quality Control Process for SNAP Error Rate. 51. Richard B. Russell National School Lunch Act, as amended through Public Law , 113 th Cong., 1st sess. (February 7, 2014), sec. 9(D), 19

24 year for which data are available), the error rate for the National School Lunch program was about 15.6 percent, and the error rate for the National School Breakfast program was about 25.2 percent. 52 As with SNAP, recipients of federal school meals programs who are found to have received benefits in error during the audit process may have their benefits reduced or eliminated. In 2010, Congress authorized USDA to fine or disqualify state or local agencies that do not attempt to correct high error rates. 53 (The regulations have not yet been finalized.) 54 No similar frequent audit process exists for WIC. Instead, every ten years, the USDA conducts a WIC income verification study that measures WIC error rates. It applies, however, the eligibility rules of the state or local WIC agencies many of which reflect the liberalizations described in this paper. 55 In 1988, the estimated error rate for WIC was 5.7 percent; in 1998, it was 4.5 percent, 56 and in 2008, 3 percent. 57 (It does not appear that those who were found to be receiving benefits in error had their benefits terminated or reduced.) Future budget pressures Between 2000 and 2009, the number of WIC recipients increased from 7.2 million to 9.2 million. The rate of growth in WIC enrollment exceeded that of the population as a whole: WIC recipients as a percent of the total eligible population increased from 28.6 percent to 33.2 percent. 52. U.S. Department of Agriculture, Office of Inspector General, FNS: National School Lunch and School Breakfast Programs (Alexandria, VA: USDA, 2015), Quinn Moore, Judith Cannon, Dallas Dotter, Esa Eslami, John Hall, Joanne Lee, Alicia Leonard, Nora Paxton, Michael Ponza, Emily Weaver, Eric Zeidman, Mustafa Karakus, and Roline Milfort, Program Error in the National School Lunch Program and School Breakfast Program: Findings from the Second Access, Participation, Eligibility and Certification Study (APEC II), Volume 1: Findings (Alexandria, VA: U.S. Department of Agriculture, May 2015), USDA has responded to the high error rates by encouraging states and localities to take advantage of the Community Eligibility Provision (CEP). Under the CEP, in schools where at least 40 percent of children are eligible for free or reduced school lunch, all children are determined to be eligible for free school lunches. According to the USDA, in the school year, more than half of all eligible schools took advantage of CEP. Moore et al., Program Error in the National School Lunch Program and School Breakfast Program. 54. U.S. Department of Agriculture, Child Nutrition Program Integrity, Federal Register 81, no. 60 (March 29, 2016), See Robert G. St. Pierre and Michael J. Puma, Controlling Federal Expenditures in the National School Lunch Program: The Relationship Between Changes in Household Eligibility and Federal Policy, Journal of Policy Analysis and Management 11, no. 1 (Winter 1992): Nancy Cole, David Hoaglin, and John Kirlin, National Survey of WIC Participants: Final Report (Washington, DC: USDA, October 2001), U.S. Department of Agriculture, Food and Nutrition Service, National Survey of WIC Participants II: Report Summary (Alexandria, VA: U.S. Department of Agriculture, April 2012), /default/files/nswp-ii_summary.pdf. 20

25 In addition, during this period, WIC appropriations, expenditures, and food costs all increased as did the value of the income rebates. These trends all reversed after 2009, but remained at levels higher than in 2000 (adjusted for inflation and population growth). For example, in 2014, the total number of WIC recipients declined to 8.2 million and to 31.8 percent of the total population, although both figures are still higher than their 2000 levels. The trends for most of the subcategories of WIC recipients reflect the broader trend, except for pregnant women where the number of pregnant women receiving WIC as a percent of the total pregnant population has now dropped below its 2000 level. 58 As mentioned above, however, in 2006, the USDA changed its methodology for estimating the number of WIC eligibles, which has led to a roughly twenty percentage point increase in the percent of the population that is estimated to be eligible for WIC compared to the previously used methodology. In addition, under this expanded methodology, there has been a steady increase in the percent of the total population that is estimated to be eligible to receive WIC, rising from 48.1 percent in 2000 to 54.7 percent in The rise has been especially steep among children ages one to four, increasing from 46.6 percent in 2000 to 55.9 percent in These estimates of eligibility indicate that there is great potential for rapid growth in the WIC caseload. The increase in the estimates of eligibility since 2000 are driven by three major factors: Increasing rates of adjunctive eligibility as a result of rising enrollments in Medicaid and SNAP, in part because of outreach, in part because of a weak economy, and, more recently, because of increased reimbursement rates of up to 100 percent for SCHIP programs through Receiving Medicaid or SNAP makes an income-sharing family household adjunctively eligible for WIC. In fact, during the enrollment process for both programs, families and income-sharing households are often encouraged to enroll in WIC. For Medicaid, the ACA increased the federal government s share of costs for the State Children s Health Insurance Program (SCHIP) by 23 percentage points, meaning that the federal government will now pay between 88 and 100 percent of the costs for SCHIP. 59 As states are allowed to operate their SCHIP program as an expansion of their Medicaid programs, many states have increased Medicaid income eligibility caps for infants to more than 200 percent of poverty, eleven states have Medicaid income eligibility caps above 250 percent, and eight have Medicaid income eligibility caps above 300 percent (see table 15). Between 2002 and 2014, according to the Congressional Budget Office, the estimated number of children receiving Medicaid increased from about 23 million to about message to authors, June 4, Robin Rudowitz, Samantha Artiga, and Rachel Arguello, Children s Health Coverage: Medicaid, CHIP, and the ACA (Washington, DC: Kaiser Family Foundation, March 2014), 21

26 million, an increase of about 57 percent. 60 As more states increase Medicaid income eligibility caps, the number of children on Medicaid will continue to rise, thereby increasing eligibility for WIC. Similarly, between 2002 and 2014, the number of individuals on SNAP increased from 19.1 million to 46.5 million, an increase of about 143 percent. 61 Although SNAP s income threshold is a federally-mandated 130 percent of poverty, families with incomes above the income threshold may still be eligible for WIC if they are also receiving TANF nonassistance (defined below). If families receiving TANF nonassistance that meets TANF purposes three or four (to prevent and reduce the incidence of out-of-wedlock pregnancies or to encourage the formation and maintenance of two-parent families), 62 the eligibility threshold for being adjunctively eligible for WIC is 200 percent of poverty. However, if they are receiving TANF nonassistance that meets TANF purposes one or two (provide assistance to needy families so that children can be cared for in their own homes and reduce the dependency of needy parents by promoting job preparation, work and marriage), the eligibility threshold depends on the state s definition of needy families which, in some states, can be above 185 percent of poverty. Greater income volatility among low-income families than in the past. WIC agencies tend to use current income rather than annual income in their eligibility decisions. Because eligibility certification periods span periods after incomes rise (or fall, of course), the result is longer spells of WIC recipiency and, hence, higher enrollment rates. A weak economy. The financial crisis and subsequent recession of have left many economic problems in their wake. One of the most worrisome has been a weak labor market with high levels of joblessness and declining wages that shows little indication of more than modest improvement for some time to come. Although the unemployment rate has finally fallen from its high of 10 percent in October 2009 to about 5.0 percent as of May 2016, only 68.9 percent of working age Americans are actually employed (compared to its high of 74.1 percent in 2000). 63 About 25.7 percent of the 60. John Holohan and Bowen Garrett, Rising Unemployment and Medicaid (Washington, DC: Urban Institute, October 2001), and Congressional Budget Office, Fact Sheet for CBO s April 2014 Baseline: Medicaid, /cbofiles/attachments/ medicaid.pdf. 61. U.S. Department of Agriculture, Food and Nutrition Service, Food Stamp Program Monthly Data, U.S. Department of Agriculture, Food and Nutrition Service, Food Stamp and Food Distribution Program, Code of Federal Regulations, title 7, sec (j)(2)(I), see also U.S. Government Accountability Office, States Use of Options and Waivers to Improve Program Administration and Promote Access (Washington, DC: GAO, 2002). 63. Organisation for Economic Co-operation and Development, OECD Stats Database, 22

27 unemployed had been without a job for six months (down from a high of 45 percent in September 2011, the highest since World War II) compared to 11.4 percent in The 2014 median hourly wage was $17.09, actually lower than 2001 s $ Recommendations This paper documents how the liberalization of WIC eligibility rules has led to substantial increases in eligibility and enrollment. We believe that WIC would be most effective if its resources were targeted on those families and income-sharing households most in need of its services, including spending less on those better off financially and spending more on those in greater need. That would be the best way to make it more successful in meeting its prime goals. 66 This analysis, however, should be important even for those who do want to see WIC enrollments increased. Even those who want expansions in WIC eligibility and recipiency should be troubled by the haphazard and unequal expansions this report documents. Because eligibility depends on varying state and local policies concerning the income unit, the income period, and the income limits for Medicaid and SCHIP, the current program is plagued with substantial horizontal and vertical inequity in who receives benefits. Some will read this report about the factors contributing to WIC s expansions and conclude that, without imposing onerous administrative burdens, there is no good way to control the discretion of what sociologists call street level bureaucrats. This is unnecessarily pessimistic. In our 2009 report, we made recommendations for the USDA to instruct state and local agencies on income measurement and to provide guidance for eligibility determination. In 2013, the USDA issued a policy memorandum that provided clarification to states on the definition of the economic unit and current income. We think this is a positive step and continue to encourage the USDA to make the following steps: 1. USDA regulations should mandate careful attention to eligibility determinations. In too many key provisions, WIC regulations are permissive rather than mandatory. The almost casual attitude that the WIC regulations take to these issues seems to encourage the lax processes Bureau of Labor Statistics, Table A-12. Unemployed Persons by Duration of Unemployment, U.S. Department of Labor, Bureau of Labor Statistics, May 2001 National Occupational Employment and Wage Estimates: All Occupations, and U.S. Department of Labor, Bureau of Labor Statistics, May 2014 National Occupational Employment and Wage Estimates United States, See Besharov and Germanis, Rethinking WIC. 23

28 documented in this report. A certain amount of state- and local-level flexibility is necessary and valuable, of course. But current regulations do not require states to mandate that local agencies adopt income-verification procedures to make sure that initial determinations of eligibility are accurate. 67 The regulations also allow for state and local agencies to choose between current income (defined by the state) or income... [that] more accurately reflects the family s status 68 which allows frontline workers to consistently choose monthly income over annual income. And they do not require states to terminate the benefits of individuals whose incomes rise sharply during the certification period. 69 In its 2013 policy memorandum, the USDA encouraged states to adopt the USDA s definition of current income (income in the past thirty days) and provided advice on deciding when annual income is more appropriate than current income. This is a positive step and, as mentioned below, many of the state WIC manuals that we reviewed use the USDA s definition. We are unable to gauge the degree to which the policy memorandum has been implemented nor its impact. This information may be in the USDA s management evaluations of state and local WIC agencies, but we have been unable to obtain access to them. 2. USDA regulations should use a term like family and income-sharing household and not just family to describe the income unit for WIC, and WIC agencies should use the income of the family and income-sharing household not just the subfamily of parent and child to determine income eligibility. Although WIC regulations label the income unit as the family, they actually encompass a broader unit: households that share income and resources, defined as a group of related or nonrelated individuals who are living together as one economic unit. 70 In practice, many state and WIC agencies only collect income information for just the family or subfamily. The 2013 USDA policy memorandum attempted to clarify that although the regulations use the term family, the applicable WIC income unit is the economic unit. This remains needlessly confusing. There may be other possible terms to use, but we recommend the 67. U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations, which state: The State or local agency may require verification of information it determines necessary to confirm income eligibility for Program benefits. (Emphasis added.) 68. Ibid. 69. The portion of the regulations that deal with changes in income makes no mention of any requirement for participants to report any changes in income, stating only: The local agency must reassess a participant s income eligibility during the current certification period if the local agency receives information indicating that the participant s household income has changed. However, such assessments are not required in cases where sufficient time does not exist to effect the change. Sufficient time means 90 days or less before the expiration of the certification period. See Ibid. 70. Ibid. There is apparently no definition of the relevant economic unit in the two statutes that form the basis of WIC s legal framework: the Child Nutrition Act of 1966 and the Richard B. Russell National School Lunch Act (NSLA). The Food and Nutrition Act of 2008, however, defines a household to include a group of individuals who live together and customarily purchase food and prepare meals together for home consumption. Food and Nutrition Act of 2008, sec. 3(m)(1), pdf. 24

29 use of the term income-sharing family household as we feel it best captures the nuances of the definition. The most recent evidence of compliance with the definition in the regulations is from 2012, and, as mentioned above, we are unable to gauge compliance with the 2013 memorandum because we were not able to access the WIC management evaluations. Evidence from the CPS, however, suggests that this continues to be a problem in the program. In 2014, about 89 percent of individuals in related subfamilies (meaning that they are in a family that is related to the primary householder) who were receiving WIC had annual subfamily incomes below 100 percent of poverty, about 7 percent had annual incomes between percent of poverty, about 3 percent had annual incomes between percent of poverty, and only about 1 percent had annual incomes above 185 percent of poverty. When counting the income of the entire family (not even including other members of the household as required by WIC regulations), however, only about 27 percent of these individuals in related subfamilies had annual incomes below 100 percent of poverty, about 20 percent had incomes between percent of poverty, about 7 percent had annual incomes between percent of poverty, and about 46 percent had annual incomes above 185 percent of poverty. About 21 percent had incomes between percent of poverty and about 19 percent had incomes at or above 300 percent of poverty. 71 Some analysts to whom we spoke suggested that the administrative costs for fixing the problem would likely exceed the cost-savings. We think that this is an open question and, in any event, raises substantial questions about program integrity and the targeting of WIC. 3. Adjunctive eligibility through Medicaid (directly or through SCHIP) and SNAP should be capped. In the past, opponents of this idea have noted that capping adjunctive eligibility at 185 percent of poverty, 200 percent, or even 250 percent of poverty, would not remove many families and income-sharing households from WIC because other liberalizations in the definition of income have taken the operational income cap for WIC above those levels. Recent expansions of Medicaid eligibility, however, appear to have increased the percent of WIC recipients with incomes above 185 percent of poverty from about 14.8 percent of all WIC recipients to about 23.9 percent. Failure to place some cap on adjunctive eligibility is an implicit ratification of these past liberalizations of eligibility. And, as expansions of Medicaid eligibility continue, it could well expand WIC eligibility even further and with even less relevance to the program s mission. 4. WIC s now meaningless test of nutritional risk should be dropped from eligibility determinations or perhaps used as a means for directing program resources. Almost all applicants are now deemed to be at nutritional risk. As both the National Research Council (NRC) and Institute of Medicine (IOM) have recommended, this now meaningless requirement should be dropped. All it does is paint a misleading picture of WIC s purpose. At the same time, consideration should be given to using some determination of risk or need as the basis for 71. Authors calculations from U.S. Census Bureau, Current Population Survey. 25

30 targeting enhanced WIC services to those low-income families and income-sharing households that need more than WIC s standard benefits. 5. State and local WIC agencies should have a more direct financial stake in the proper governance of their programs, including the eligibility determinations. The absence of an audit process within WIC undoubtedly encourages loosened eligibility determinations, but given that all program funds come from the federal government (or the infant formula rebates), a substantial liberalization of eligibility determinations was predictable. State and local WIC officials have little reason to be cost conscious as long as program funds seem available. As in the case of many other federal, means-tested programs, states should be required to pay a portion of WIC s program costs so that they would have a stake in enforcing eligibility rules. (Properly structured, this would make it possible to give states the flexibility to shift how they spend funds to spend less on expanding enrollment and more on enhancing services for current recipients, such as putting healthier products in the food package and spending more time in counseling.) * * * This review of WIC s eligibility and enrollment practices illustrates how, when meanstested programs are not restrained by legal, financial, or political forces, they can expand beyond their putative income-eligibility limits. Sometimes, such expansions do nothing but add recipients to the program. Too often, though, as in the case of WIC, the addition of less needy recipients diverts the program from its essential purpose, undermines sound program planning, creates significant horizontal inequities, and, at least in a small way, puts pressure on other, less politically popular programs. All means-tested programs would benefit from a similar examination. Hence, the larger lesson from this paper s analysis is that policymakers, administrators, and the public need a better understanding of the nature and application of income-eligibility rules across the panoply of means-tested programs. Details matter. As we have seen, identifiable variations in how and when to measure income can shift eligibility for large numbers of families. 26

31 Table 1 WIC Eligibility at a Glance Element Formal or original rule Implementation Categories of eligible persons Pregnant women up to entire pregnancy. Infants up to age 1. Children ages 1 to 4. Breastfeeding women up to 1 year. Postpartum women up to six months after end of pregnancy. Income eligibility Maximum income level Income unit Between 100 and 185 percent of poverty, at state option. All states have set maximum eligibility at 185 percent of the federal poverty guidelines, unless the applicant is adjunctively eligible. Households of related or nonrelated individuals who are living together as one economic unit. Unborn children are counted household members for setting income threshold. The expansion of Medicaid eligibility has inadvertently raised income limits in a number of states. Often, only members of the subfamily and their income are counted. Income period Income during the past twelve months or current income, whichever more accurately reflects the family s status. However, persons from families with adult members who are unemployed shall be eligible based on income during the period of unemployment if the loss of income causes the current rate of income to be less than the income guidelines. Usually, the lowest income is chosen, without regard to whether it more accurately reflects the family s status. Included income Excluded income Earnings disregards Asset tests Gross cash income before deductions for income taxes, employees social security taxes, insurance premiums, bonds, etc. Excluded income includes noncash benefits (such as SNAP and housing benefits), military housing allowances, low-income energy assistance, and Title IV student financial aid. Reimbursements for work expenses, such as travel or meals. None None Income verification can be lax. Adjunctive eligibility (sometimes called categorical or automatic eligibility) Applicants are automatically eligible if they receive Medicaid, SNAP, or TANF cash assistance (or are certified as eligible by the program). (Medicaid enrollment also confers adjunctive eligibility on other eligible members of the household.) At state agency option, this includes those eligible to 27

32 participate in other state-administered programs, so long as eligibility for them is based on income at or below 185 percent of poverty. Nutritional risk Priorities for services Recertification periods Basic rules The applicant must still be at nutritional risk. Applicants must be at nutritional risk, as determined by a WIC clinic or health professional. Priorities in the following order: (1) Pregnant or breastfeeding women and infants with evident medical problems that demonstrate the need for supplemental foods. (2) Infants whose mothers had medical problems during pregnancy that demonstrated the need for supplemental foods or whose mothers were program participants. (3) Children with medical problems that demonstrate the need for supplemental foods. (4) Infants or pregnant or breastfeeding women at nutritional risk because of an inadequate dietary pattern. (5) Children at nutritional risk because of an inadequate dietary pattern. (6) Postpartum women with any nutritional risk. (7) Individuals certified for WIC solely due to homeless or migrant status and current WIC participants who could have medical or dietary problems without WIC. Pregnant women are certified for the duration of their pregnancies, and up to the last day of the month in which the infant becomes six weeks old or the pregnancy ends. Postpartum women are certified up to the last day of the sixth month after the baby is born or the pregnancy ends (postpartum). Breastfeeding women are certified approximately every six months. (The state agency may permit local agencies to certify a breastfeeding woman up to the last day of the month in which her infant turns one year old, or until the woman ceases breastfeeding, whichever occurs first.) Infants are certified approximately every six months. (The state agency may permit its local agencies to certify an infant under six months of age up to the last day of the month in which the infant turns one year old, provided the quality and accessibility of health care services are not diminished.) Children are certified approximately every six months 28 Few applicants fail to qualify under at least one category of nutritional risk. Seldom necessary due to funding increases in the 1990s.

33 State options Verification requirements Time limits for receiving benefits Other ending with the last day of the month in which a child reaches age five. (The state agency may permit local agencies to certify a child for up to one year.) As noted above, state agencies may authorize local agencies to increase certification periods to as long as six months for infants and breastfeeding mothers and up to one-year for children. They may also authorize local agencies to use shorter certification periods than noted above, on a case-bycase basis, as long as guidance is provided to local agencies. Longer or shorter periods of up to thirty days may be granted when there are scheduling difficulties. State and local agencies may require recipients to report changes in their income during the certification period. State agencies must require proof of identity, residency, pregnancy, and adjunctive eligibility or of family/shared household income. None while eligible because of pregnancy, postpregnancy status, or child s age. Applicants must reside in the state in which they are applying (except for Indian State agencies). Applicants must be physically present at certification. Thirty states have opted to certify children for one year. States usually require proof of income through pay stubs, employer statements, or W-2 forms. (Documentation is needed for pregnancy unless visually apparent.) 29

34 II. The WIC Program The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) started as a two-year pilot program in 1972, and was made permanent in Administered by the Food and Nutrition Service (FNS) of the U.S. Department of Agriculture (USDA), in 2014, WIC was an $8.0 billion program (including $1.8 billion in infant formula rebates), serving about 8.2 million infants, children ages one through four, and pregnant and postpartum mothers. (Unless otherwise indicated, all dollar amounts in this paper are in 2014 dollars.) According to the USDA, The program was established during a time of growing public concern about malnutrition among low-income mothers and children. WIC is based on the premise that early intervention programs during critical times of growth and development can help prevent future medical and developmental problems. 72 Although observers disagree about how well WIC meets its important goals, 73 WIC is nevertheless a key component of the federal government s efforts to provide nutritional assistance to low-income mothers and children. Except in the few states that supplement administrative costs, all costs of the WIC program are borne by the federal government (and, through the rebate system, infant formula manufacturers). Although WIC is a USDA program, most of its grantees are state health departments. These state agencies, in turn, fund WIC services through local health-related agencies such as health departments, hospitals, public health clinics, and community health centers. (As we will see, this separation of the functions of determining eligibility from paying program costs creates a moral hazard, that is, local decision makers have no incentive to cut costs unless they face effective eligibility monitoring or a rigorously enforced budget limit.) Program categories and benefits. WIC serves seven groups of low-income women and children (see box 1). As the USDA explains, except possibly for those young infants who are only fed formula, WIC was never intended to be a primary source of food, nor of general food assistance. 74 That role is assigned to SNAP and other cash and noncash assistance programs. Instead, WIC seeks to safeguard the health of low-income women, infants, and children up to age 5 who are at nutritional risk 75 by providing a package of supplemental foods, nutrition 72. Victor Oliveira, Elizabeth Racine, Jennifer Olmsted, and Linda M. Ghelfi, The WIC Program: Background, Trends, and Issues (Washington, DC: USDA, September 2002), 1, /media/327957/fanrr27_1_.pdf. 73. See Besharov and Germanis, Rethinking WIC. 74. U.S. Department of Agriculture, Food and Nutrition Service, Special Supplemental Nutrition Program for Women, Infants and Children (WIC): Revisions in the WIC Food Packages, Code of Federal Regulations, title 7, sec. 246(II) (2015): 68996, U.S. Department of Health and Human Services, About WIC, /about-wic. 30

35 education, and health care referrals at no cost. 76 WIC s monthly food packages contain such basics as milk (or cheese), adult cereal, fruit juice, eggs, and peanut butter (or an equivalent legume product), worth on average about $45 for women and children. Infants who are not fully breastfed 77 also receive iron-fortified formula which brings the value of their package to about $124 per month (see box 1). Include the benefit for infants mothers, and the monthly value of the WIC package is about $175 for mothers with one child. 78 Using 2010 data (the latest available), the average annual cost per child was about $682 with a total cost of about $3.3 billion, the average cost per infant was about $912 with a total cost of about $2.0 billion, and the average cost per woman was about $830 with a total cost of about $1.8 billion. 79 In 2006, the USDA proposed changes in the various WIC food packages to reflect advances in nutrition science and the shifting dietary needs of low-income children and mothers. 80 Approved in late 2007 as an interim rule, the changes were designed to reduce obesity and increase intake of nutrients such as iron, fiber, and vitamin E by adding fruits, vegetables, and whole grains. 81 According to the USDA, The revisions align the WIC food packages with the 2005 Dietary Guidelines for Americans and infant feeding practice guidelines of the American Academy of Pediatrics... with certain cost containment and administrative modifications found necessary by the Department to ensure cost neutrality. 82 The final rule codifying these changes was published in March Oliveira, The Food Assistance Landscape. 77. Burstein et al., WIC Participant and Program Characteristics. 78. Ibid.; Vericker, Zhen, and Karns, Fiscal Year Authors calculations based on Vericker, Zhen, and Karns, Fiscal Year 2010; and U.S. Department of Agriculture, Food and Nutrition Services, WIC Program Participation and Costs, default/files//pd/ wisummary.pdf. 80. U.S. Department of Agriculture, Food and Nutrition Service, Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Revisions in the WIC Food Packages; Proposed Rule, Federal Register 71, no. 151 (August 7, 2006): , Ibid. 82. U.S. Department of Agriculture, Food and Nutrition Service, Special Supplemental Nutrition Program for Women, Infants and Children (WIC): Revisions in the WIC Food PackagesInterim Rule, U.S. Department of Agriculture, Food and Nutrition Service, Special Supplemental Nutrition Program for Women, Infants and Children (WIC): Revisions in the WIC Food Packages; Final Rule, Federal Register 79, no. 42 (March 4, 2014): , default/files/ _wic-food-packages -Final-Rule.pdf. 31

36 Box 1 WIC FOOD PACKAGES Monthly Contents and Values 2014 Pregnant women and partially breastfeeding women (up to the infant s first birthday) receive milk, adult cereal, fruit juice, eggs, peanut butter (or an equivalent legume product), whole wheat bread, and a $10 cash voucher for fruits and vegetables, worth on average about $ Non-breastfeeding postpartum women (up to six months after the end of the pregnancy) receive milk (in lesser quantities than breastfeeding women), adult cereal, fruit juice (in lesser quantities than breastfeeding women), eggs, and a $10 cash voucher for fruits and vegetables, worth on average about $ Fully breastfeeding women (up to the infant s first birthday) receive milk, cheese, eggs, cereal, juice, peanut butter (or an equivalent legume product), tuna, and a $10 cash voucher for fruits and vegetables, worth on average about $ Infants ages zero to five months receive iron-fortified formula. Infants ages six to twelve months receive ironfortified formula, infant cereal, baby food fruit and vegetables, and, for breastfeeding infants only, baby food meat. All infant packages are worth on average about $ (at a cost of about $53.39 after the rebate). Children ages one to four receive milk, adult cereal, fruit juice, eggs, peanut butter (or an equivalent legume product), whole wheat bread, and a $6 cash voucher for fruits and vegetables, worth on average about $ Children or women with special dietary needs (that is, those who cannot consume food in the other packages for medically documented reasons) are supposed to receive tailored food packages, so that their contents and value vary from person to person, but generally include special forms of formula, cereal, and juice Children or women with special dietary needs (that is, those who cannot consume food in the other packages for medically documented reasons) are supposed to receive tailored food packages, so that their contents and value vary from person to person, but generally include special forms of formula, cereal, and juice. Notes: Nancy Burstein, Kelly L. Patlan, Susan Bartlett, Patty Connor, and Bryan Johnson, WIC Participant and Program Characteristics: Food Package Report (Alexandria, VA: U.S. Department of Agriculture, November 2014), Tracy Vericker, Chen Zhen, and Shawn Karns, Fiscal Year 2010: WIC Food Cost Report (Alexandria, VA: U.S. Department of Agriculture, August 2013); Changes in these packages were adopted as an interim rule in December 2007 and become mandatory in The final rule was published in March Special Supplemental Nutrition Program for Women, Infants and Children (WIC): Revisions in the WIC Food Packages; Final Rule, Federal Register 79, no. 42 (March 4, 2014): , Besides the fact that WIC provides a prescribed food package, its counseling services are what many think set it apart from SNAP, which is essentially a voucher (now in the form of a debit card) with which to obtain food. (In fact, most analysts consider SNAP to be a form of 32

37 income support.) 84 WIC agencies, in contrast, are required to offer at least two nutritional education sessions on nutrition and health to all WIC participants during each certification period 85 although they are normally no more than fifteen minutes long and only once every three months. 86 (For WIC recipients, these sessions are voluntary; the food package is not conditional on attendance.) At these sessions, staff provides advice to parents on how to manage their own nutritional risks and those of their children, as well as encouraging breastfeeding. 87 As Abt Associates researchers describe: Although WIC participants are not required to attend nutrition education, local WIC agencies often schedule nutrition counseling to coincide with food instrument issuance to encourage WIC clients to attend. 88 Nutritional education sessions may take place face-to-face in individual or group settings or electronically (for example, through or online quizzes). (Local WIC agencies may not count videos, pamphlets, posters, or public service announcements as contact. ) 89 Eligibility. The main basis of eligibility for WIC is income at or below 185 percent of the federal poverty guidelines. 90 For simplicity, and in accord with common practice, this paper 84. See, for example, James C. Ohls and Harold Beebout, The Food Stamp Program: Design Tradeoffs, Policy, and Impacts (Washington DC: The Urban Institute Press, 1993). 85. U.S. Department of Agriculture, Food and Nutrition Service, Nutrition Education and Promotion: The Role of FNS in Helping Low-Income Families Make Healthier Eating and Lifestyle Choices: A Report to Congress (Alexandria, VA: U.S. Department of Agriculture, March 2010), /NutritionEdRTC.pdf. 86. The only reliable information we can find on this topic dates back over a decade, but we have no reason to think that information has changed. Besharov and Germanis, Rethinking WIC, 1415; and Olander, Nutrition Education and the Role of Dosage, 3, which states: Control group participants received the usual 10 minutes of dietary counseling during bimonthly clinic visits to pick up WIC vouchers. See also U.S. General Accounting Office, Nutrition Education. 87. Besharov and Germanis, Rethinking WIC, Bonnie Randall, Kim Sprague, David B. Connell, and Jenny Golay, WIC Nutrition Education Demonstration Study: Prenatal Intervention (Alexandria, VA: USDA, March 2001), viiviii, 12, U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Nutrition Education Guidance (Alexandria, VA: U.S. Department of Agriculture, January 2006), wicworks/learning_center/ntredguidance.pdf; see also U.S. Department of Agriculture, Food and Nutrition Service, WIC Nutrition Education Frequently Asked Questions. 90. The WIC statute requires the Secretary of Agriculture to establish income eligibility standards for the states to apply for those at nutritional risk in families with an income that is less than the maximum income limit prescribed under section 9(b) of the Richard B. Russell National School Lunch Act for free and reduced price meals. Child Nutrition Act of In turn, the National School Lunch Act provides that, for any given year, they shall be 185 percent of the applicable family size income levels contained in the nonfarm income poverty 33

38 refers to income in relation to the poverty line or poverty, rather than, in this context, the more technically correct poverty guidelines, federal poverty level, or FPL. 91 Officially, income eligibility for WIC is based on the combined income of related or nonrelated individuals who are living together as one economic unit at or below 185 percent of the federal poverty line. Many means-tested programs in the United States (such as child care vouchers, Medicaid, housing choice vouchers, and Temporary Assistance for Needy Families [TANF]) count only the income of those in the family, that is, individuals related by blood, marriage, or adoption living in the same residence. WIC is one of a few means-tested programs (including the Supplemental Nutrition Assistance Program [SNAP], school meals, and Low- Income Home Energy Assistance Program [LIHEAP]) that include the income of unrelated cohabiters who share resources in the definition of the income unit. Therefore, in this paper, we adopt the term income-sharing household to include the unrelated household members sharing resources. Of course, many WIC income units consist of only family members. So, throughout this paper, we refer to both families and income-sharing households, depending on the context. In practice, it is often difficult to be that precise. Many of our estimates of WIC receipt and eligibility in this paper are derived from large national surveys (the Current Population Survey [CPS] and the Survey of Income Program Participation [SIPP]) that do not ask if members of a household share food and resources. Because the income unit household may include household members who do not share their resources, we use family income even though that may underestimate the amount of shared household income. (As much as possible, we try to indicate the difference.) States are permitted to set lower income limit standards for eligibility (as low as 100 percent of poverty), 92 but because of funding availability, all states have set maximum eligibility at 185 percent of poverty. 93 For the period of July 1, 2014 to June 30, 2015 (hereinafter, guidelines prescribed by the Office of Management and Budget, as adjusted annually in accordance with subparagraph (B). Richard B. Russell National School Lunch Act. See also U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. 91. The federal poverty guidelines, issued each year by the Department of Health and Human Services, are a simplified version of the federal poverty thresholds and are used primarily for administrative purposes (such as determining eligibility for certain programs), whereas the thresholds are used for statistical purposes (such as calculating a poverty rate). The guidelines are based solely on family size (which is calculated as a weighted average of the corresponding family size in the thresholds, rounded to multiples of $10), while the thresholds are based on both total family size and the number of children under 18 in the family. In addition, the guidelines have different sets of figures for Alaska and Hawaii (which the thresholds do not) and do not distinguish between elderly and nonelderly individuals (which the thresholds do for family units of one or two persons). Finally, the guidelines for a given year are issued in February of that same year (but are based on the thresholds of the previous year), while the thresholds for a given year are issued in August of the next year. U.S. Department of Health and Human Services, Frequently Asked Questions. 92. U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. 93. Victor Oliveira, Mark Prell, David Smallwood, and Elizabeth Frazao, WIC and the Retail Price of 34

39 2014/2015 ), 94 it was $36,612 for an income-sharing household of three, and $51,634 for an income-sharing household of five. 95 (The guidelines for Alaska and Hawaii are higher.) Table 2 presents the income maximums for WIC eligibility based on the income-sharing household size in the 48 contiguous states. Table 2 WIC Income-Eligibility Guidelines Contiguous United States 2014/2015 Persons in family or Persons in income-sharing household For each additional individual add 185% of poverty guidelines $21,590 $29,101 $36,612 $44,123 $51,634 $59,145 $66,656 $74,167 $7,511 Source: U.S. Department of Agriculture, WIC Income Eligibility Guidelines, , In 2014 dollars. Note: The poverty guidelines for Hawaii and Alaska (each have its own) are higher than those for the contiguous United States. Because WIC uses the poverty guidelines (as do most means-tested programs) rather than the poverty thresholds, for large households, program eligibility reaches far above the official poverty line. The Census Bureau caps the federal poverty thresholds at the level for a family of Infant Formula, Food Assistance and Research Report 39 (Washington, DC: USDA, May 2004), 7, Although the Department of Health and Human Services issues the poverty guidelines in either late January or early February for immediate application, individual programs are allowed to choose a later effective date. In the case of the WIC program, the new poverty guidelines take effect at the beginning of July and remain in effect until the end of June of the next year. Although the income guidelines have been updated for July 2015, because we are reporting on enrollment data from 2014, we opt to use the 2014 income guidelines. See U.S. Department of Health and Human Services, Frequently Asked Questions Related to the Poverty Guidelines and Poverty. 95. U.S. Department of Agriculture, Food and Nutrition Service, WIC Income Eligibility Guidelines

40 nine or more (with only one child under 18), which, in 2014, was $52, The poverty guidelines, however, are not similarly capped. Under the 2014/15 guidelines, each additional person in the income-sharing household beyond eight added another $7,511 to the income eligibility guidelines. 97 For the purpose of determining eligibility, countable income is defined as gross money income from all sources (before taxes). 98 Some forms of income are not counted, however, primarily noncash benefits (such as SNAP and housing benefits), military housing allowances, low-income energy assistance, and Title IV student financial aid. 99 In addition, some states, such as California and Wisconsin, specifically instruct local agencies to exclude payments as reimbursement for job-related expenses, e.g. travel, 100 but presumably such payments would be excluded even in the absence of a specific mandate. There are no asset limits for receiving WIC benefits. Moreover, there are no time limits, as such, for receiving WIC benefits, but they are implicitly imposed because eligibility is based on the mother s pregnancy or breastfeeding status and the age of the child. Eligibility for WIC can also be established adjunctively, that is, individuals are automatically eligible if they are receiving Medicaid, SNAP, TANF cash assistance, or certain other state-administered, means-tested programs (as long as these state programs have income eligibility caps at or below 185 percent of poverty). 101 As described below, adjunctive (or categorical ) eligibility for the federal programs can result in income eligibility substantially above WIC s general income cutoff of 185 percent of poverty. Whether income-eligible or adjunctively eligible, however, applicants must also be at nutritional risk, a somewhat nebulous term that, as we will see, excludes very few low-income mothers or children from the program. Funding. Unlike many other programs for low-income Americans (such as SNAP and 96. U.S. Census Bureau, Poverty Thresholds for 2014 by Size of Family and Number of Related Children, U.S. Department of Agriculture, Food and Nutrition Service, WIC Income Eligibility Guidelines U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. 99. Ibid California Department of Health Services, California WIC Program Manual (Sacramento, CA: California Department of Health Services, November 2009), 3, /Documents/WPM/WIC-WPM pdf U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. 36

41 Medicaid), WIC is not an entitlement to either individual recipients or states. Instead, it is funded by annual congressional appropriations. 102 Appropriations. In 2014, Congress appropriated about $6.9 billion for WIC. About $4.9 billion was for food and about $2.0 billion was for Nutrition Service and Administrative costs (NSA). 103 Approximately two-thirds of nutrition services and administrative (NSA) costs are for nutrition education, breastfeeding promotion and support, and linkages to health and other client services (such as immunization; drug, alcohol and tobacco education; referrals to family and child health social programs). The remaining third is used for traditional management functions. 104 The NSA amount is derived from a formula based on the state s prior year s grant, its inflation-adjusted administrative cost per participant, 105 and its proportion of the aggregate national number of income-eligible persons. Some states supplement their NSA expenditures with their own funds. 106 In 2014, the latest year for which data are available, five states spent about $15.3 million on NSA. 107 The amount of state support varies. Massachusetts, for example, provided over 29 percent of total NSA costs (about $10 million), while Louisiana provided less than 0.3 percent (only about $100,000). 108 Table 3 shows how much WIC spending and enrollment has grown since the program s inception, and the large impact of the infant formula rebate program on both. At about $1.8 billion in 2014, reimbursements from manufacturer s rebates were about 22 percent of total WIC spending. Enrollment exceeds eight million people, and spending (including the reimbursements from the rebates which allow WIC agencies to increase enrollment) is more than $8 billion a year. (Table 3 also shows the difference between the amount granted to the states by the federal government and the amount actually spent by the states. The remainder, usually between $100 and $300 million a year, goes back to the federal government for funding the next year s WIC program.) 102. United States Department of Agriculture, Food and Nutrition Service, WIC at a Glance, U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Participation and Costs." 104. U.S. Department of Agriculture, Special Supplemental Nutrition Program for Women, Infants and Children (WIC), The initial figure was established in 1987 on the basis of the average nationwide cost per participant. See Besharov and Germanis, Rethinking WIC, U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations U.S. General Accounting Office, Food Assistance: Financial Information on WIC Nutrition Services and Administrative Costs (Washington, DC: GAO, March 2000), 8, U.S. Department of Agriculture, WIC Combined Federal and State NSA Outlays and In-kind Report: Fiscal Year 2014 (unpublished tables). 37

42 However, despite this long-term increase in enrollment, more recently WIC enrollment has declined. Between 2009 and 2014, WIC enrollment declined from about 9.2 million to about 8.2 million. This decline appears, at least in part, to be the result of the declining number of births over this same period of time, resulting in a smaller population of possible eligibles for WIC. Compared to 2009, in the years , the number of infants in each year, on average, was about 166,000 lower, and the number of children ages 1-4 in each year was, on average, about 1 million lower. Some analysts argue that the decline in the birth rate does not explain the decline in WIC enrollment because the percent of all US infants and children receiving WIC has been declining during this period as well. The percent of all US infants receiving WIC declined from about 53.7 percent to about 49.1 percent while the percent of all children receiving WIC declined from about 27.5 percent to about 27 percent. (See Table 7.) The more appropriate measure, however, is the coverage rate, that is, the percent of eligibles enrolled in WIC. Between 2009 and 2013, the overall coverage rate for all WIC demographic groups declined imperceptibly (from 60.9 percent to 60.2 percent). Moreover, the total number of eligibles during this same time period declined by about 900,000 (from about 15.1 million to about 14.2 million), roughly the same number as the decline in total enrollment. Some think that some of the decline may also have been caused by how some states and localities responded to reductions in appropriations between 2011 and 2014 (a reduction of about $1.1 billion). According to Richard Lucas, deputy administrator for policy support at FNS, some states closed WIC sites, which may have dampened applications for the program: Many State agencies reported closing WIC clinic sites and/or reducing their hours of operations, especially weekend and evening hours, in preparation for possible budget cuts to their nutrition service and administration grant funds as a result of Federal sequestration. These actions reduce program access, resulting in lower participation rates. The total number of WIC local agencies has decreased by 3.2 percent since Also, after the Federal government shutdown in October 2014, participation dropped more than 5 percent during the first quarter of the year, resulting in lower average monthly participation during FY

43 Table 3 WIC Spending and Participation (in millions of 2014 dollars) Year Grants to states Total state and local expenditures Food NSA a Total Food NSA a Total b Infant formula rebate amounts Total expenditures plus rebates Average monthly participation (millions) c Sources: For the grants to states, , see U.S. Department of Agriculture, Food and Nutrition Service, Funding and Program Data (various years), For WIC program participation and costs, , see U.S. Department of Agriculture, Food and Nutrition Service, WIC Program and Participation Costs, and for infant formula rebate amount, Edward Harper, U.S. Department of Agriculture, Food and Nutrition Service, message to Douglas Call, April 22, 2008; and Steven Carlson, Robert Greenstein, and Zoë Neuberger, WIC s Competitive Bidding Process for Infant Formula is

44 Highly Cost-Effective (Washington, DC: Center on Budget and Policy Priorities, June 2015), Notes: a U.S. Department of Agriculture, Food and Nutrition Service, WIC Program and Participation Costs, Nutrition Services and Administrative costs. Nutrition Services includes nutrition education, preventative and coordination services (such as health care), and promotion of breastfeeding and immunization. b This total does not include funds for program evaluation, Farmers Market Nutrition Program (FY 1989 onward), special projects and infrastructure. c Participation data are annual averages (6 months in FY 1974; 12 months all subsequent years; are FY, are CY. 40

45 Infant formula rebates. Since 1990, congressional appropriations have been supplemented by rebates from infant formula manufacturers. The rebates are obtained from manufacturers that competitively bid for contracts with state agencies to be the sole providers of WIC-provided formula. The manufacturers usually sell the formula to the states for as little as 2 percent to 15 percent of the wholesale price. 109 Because the federal government essentially reimburses the states for the formula s full wholesale price, the state thus gains additional funds to support the program. The rebate system is essentially a fee charged for having the advantage of being the WIC infant formula provider in a state. Analysts disagree about the actual cost of the rebate paid (the firms apparently believe they obtain a benefit from being the provider) and the degree to which the firms versus middle-class purchasers of formula pay the fee (essentially a cross subsidy). 110 Whatever the answer to both questions, as the percent of American infants covered rises, the financial viability of the rebate system declines. Either way, the rebate reimbursements were a major source of funds for the program s expansion in the early 1990s (see table 3). 111 According to Jay Hirschman of the FNS, prior to the infusion of infant formula rebates into the WIC program, many local agencies had waiting lists, and some could not certify older children (e.g., ages 3 and 4 years) due to lack of funding. 112 In 2014, rebates from infant formula manufacturers amounted to about $1.8 billion, 113 almost 22 percent of total WIC expenditures. Steve Carlson, Robert Greenstein, and Zoe Neuberger of the Center on Budget Policy and Priorities estimate that without the rebates, WIC would have been able to serve nearly 2 million fewer participants a cut of roughly onefourth. 114 After an increase of about 100 percent in the value of total rebates between 1990 and 1997 (from about $900 million to $1.8 billion), total rebates have remained between $1.8 billion and $2.2 billion since 1997 (see table 3) Victor Oliveira, Elizabeth Frazao, and David Smallwood, Trends in Infant Formula Contracts: Implications for the WIC Program (Alexandria, VA: U.S. Department of Agriculture, December 2013), See, for example, U.S. Government Accountability Office, Information on WIC Sole-Source Rebates and Infant Formula Prices (Washington, DC: GAO, May 1998), and Oliveira et al., WIC and the Retail Price of Infant Formula See Besharov and Germanis, Rethinking WIC U.S. Department of Agriculture, Food and Nutrition Service, Office of Analysis, Nutrition, and Evaluation, message to authors, June 3, Carlson, Greenstein, and Neuberger, WIC s Competitive Bidding Process for Infant Formula is Highly Cost-Effective Ibid. 41

46 Since December 2008, forty-six state WIC agencies have awarded new contracts to formula manufacturers. A 2013 USDA report found that, under the new contracts, forty-four of the forty-six WIC agencies are receiving higher rebates than under the previous contracts: On average, real rebates increased by about 44 cents (or 14 percent) per 26 reconstituted fluid ounces of formula between the previous and current contracts. 115 During this same period, the percent rebate off the wholesale price of infant formula increased from an average of 85 percent of the wholesale price to 92 percent of the wholesale price. The average wholesale price also increased during this period by an average of about 21 cents per 26 reconstituted fluid ounces, but the increase was easily offset by the much higher rebates. This is a reversal of a trend in the earlier part of the 2000s when the rebates had been declining. Between 2002 and 2005, for example, the average per-can cost for those states that negotiated new contracts with manufacturers rose more than fourfold. 116 Nationwide, the average amount states pay per can rose 40 percent between 2002 and The USDA s Economic Research Service (ERS) reports that there are three likely reasons for this trend reversal: (1) a decline in the birth rate between 2008 and 2013, which reduced the demand for infant formula; (2) an increase in the number of WIC mothers who breastfeed, which has further reduced the demand for formula; and (3) a market correction in the costs of the previous contracts for more expensive formula (supplemented with two fatty acids found in breast milk) that had been introduced by formula manufacturers in 2002 and Another possibility is that because the amount of formula was reduced in the recent changes to the WIC food package, formula manufacturers expected an increase in the amount of sales of full-price formula. Future budget pressures Between 2000 and 2009, the number of WIC recipients increased from 7.2 million to 9.2 million. The growth rate of WIC enrollment exceeded that of the population as a whole: WIC recipients as a percent of the total eligible population increased from 28.6 percent to 33.2 percent. During this period, WIC appropriations, expenditures, and food costs all increased as did the value of the income rebates. These trends all reversed after 2009, but as with the number of recipients, they all remained at levels higher than in For example, in 2014, the total number of WIC recipients declined to 8.2 million and to 31.8 percent of the total population, 115. Oliveira, Frazao, and Smallwood, Trends in Infant Formula Contracts: Implications for the WIC Program U.S. Government Accountability Office, Food Assistance: FNS Could Take Additional Steps to Contain WIC Infant Formula Costs (Washington, DC: GAO, March 2006), 17, /d06380.pdf Victor Oliveira and David E. Davis, Recent Trends and Economic Issues in the WIC Infant Formula Rebate Program (Washington, DC: USDA, August 2006), iii, /err22_002.pdf. 42

47 although both figures are still higher than their 2000 levels. The trends for most of the subcategories of WIC recipients reflect the broader trend, except for pregnant women, where the number of pregnant women receiving WIC as a percent of the total pregnant population has now dropped below its 2000 level. As mentioned above, however, in 2006, the USDA changed its methodology for estimating the number of WIC eligibles, which has led to a roughly twenty-percentage point increase in the percent of the population that is estimated to be eligible for WIC compared to the previously used methodology. In addition, under this expanded methodology, there has been a steady increase in the percent of the total population that is estimated to be eligible to receive WIC, rising from 48.1 percent in 2000 to 54.7 percent in 2013 (see table 7). The rise has been especially steep among children ages one to four, increasing from 46.6 percent in 2000 to 55.9 percent in These estimates of eligibility indicate that there is great potential for rapid growth in the WIC caseload. The increase in the estimates of eligibility since 2000 are driven by three major factors: Increasing rates of adjunctive eligibility as a result of rising enrollments in Medicaid and SNAP, in part because of outreach, in part because of a weak economy, and more recently, because of increased reimbursement rates of up to 100 percent for SCHIP programs through Receiving Medicaid or SNAP makes an income-sharing family household adjunctively eligible for WIC. In fact, during the enrollment process for both programs, families and income-sharing households are often encouraged to enroll in WIC. For Medicaid, the ACA increased the federal government s share of costs for the State Children s Health Insurance Program (SCHIP) by 23 percentage points, meaning that the federal government will now pay between 88 and 100 percent of the costs for SCHIP. 118 As states are allowed to operate their SCHIP program as an expansion of their Medicaid programs, many states have increased Medicaid income eligibility caps for infants to more than 200 percent of poverty, eleven states have Medicaid income eligibility caps above 250 percent, and eight have Medicaid income eligibility caps above 300 percent (see table 15). According to the Congressional Budget Office, between 2002 and 2014, the estimated number of children receiving Medicaid increased from about 23 million to about 36 million, an increase of about 57 percent. 119 As more states raise Medicaid income eligibility caps, the number of children on Medicaid will continue to rise, thereby increasing eligibility for WIC Rudowitz, Artiga, and Arguello, Children s Health Coverage: Medicaid, CHIP, and the ACA Holohan and Garrett, Rising Unemployment and Medicaid; and Congressional Budget Office, Fact Sheet for CBO s April 2014 Baseline: Medicaid. 43

48 Similarly, between 2002 and 2014, the number of individuals on SNAP increased from 19.1 million to 46.5 million, an increase of about 143 percent. 120 Although SNAP s income threshold is a federally-mandated 130 percent of poverty, families with incomes above the income threshold may still be eligible for WIC if they are also receiving TANF nonassistance (defined below). If families receiving TANF nonassistance that meets TANF purposes three or four (to prevent and reduce the incidence of out-of-wedlock pregnancies or to encourage the formation and maintenance of two-parent families), 121 the eligibility threshold for being adjunctively eligible for WIC is 200 percent of poverty. However, if families are receiving TANF nonassistance that meets TANF purposes one or two (provide assistance to needy families so that children can be cared for in their own homes and reduce the dependency of needy parents by promoting job preparation, work, and marriage), the eligibility threshold depends on the state s definition of needy families which, in some states, can be above 185 percent of poverty. Greater income volatility among low-income families than in the past. WIC agencies tend to use current income rather than annual income in their eligibility decisions. Because eligibility certification periods span periods after incomes rise, the result is longer spells of WIC recipiency and, hence, higher enrollment rates. A weak economy. The Financial Crisis and subsequent recession of have left many economic problems in their wake. One of the most worrisome has been a weak labor market with high levels of joblessness and declining wages that shows little indication of more than modest improvement for some time to come. Although the unemployment rate has finally fallen from its high of 10 percent in October 2009 to about 5.0 percent as of May 2016, only 68.9 percent of working age Americans are actually employed (compared to its high of 74.1 percent in 2000). 122 About 25.7 percent of the unemployed had been without a job for six months (down from a high of 45 percent in September 2011, the highest since World War II) compared to 11.4 percent in The 2014 median hourly wage was $17.09, actually lower than 2001 s $ Recipients. Of the approximately 8.2 million people served by WIC in 2014, about U.S. Department of Agriculture, Food and Nutrition Service, Food Stamp Program Monthly Data U.S. Department of Agriculture, Food and Nutrition Service, Food Stamp and Food Distribution Program ; see also U.S. Government Accountability Office, States Use of Options and Waivers to Improve Program Administration and Promote Access Organisation for Economic Co-operation and Development, OECD Stats Database Bureau of Labor Statistics, Table A-12. Unemployed Persons by Duration of Unemployment U.S. Department of Labor, Bureau of Labor Statistics, May 2001 National Occupational Employment and Wage Estimates: All Occupations ; and U.S. Department of Labor, Bureau of Labor Statistics, May 2014 National Occupational Employment and Wage Estimates United States. 44

49 million or about 52 percent were children; about 2 million or about 24 percent were infants, and about 2 million or about 24 percent were women. For the women, about 10 percent of the total WIC enrollment were pregnant women, about 7 percent were breastfeeding women, and about 7 percent were postpartum women. 125 (See tables 4 and 5.) 125. U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015). 45

50 Fiscal year Table 4 WIC Participation by Recipient Category Average Monthly Participation CY Women Infants Children Total Number Percent Number Percent Number Percent Number Percent 442, , , , , , , , , ,097 1,040,887 1,154,320 1,252,709 1,404,240 1,524,576 1,589,327 1,675,121 1,708,688 1,744,294 1,737,284 1,760,350 1,788,958 1,818,691 1,874,606 1,944,911 1,975,405 2,043,836 2,110,415 2,162,583 2,179,145 2,121,309 2,097,446 2,086,543 2,023,051 1,969, % 21.0% 21.7% 21.6% 21.4% 21.2% 21.5% 22.0% 22.9% 23.1% 22.9% 22.8% 22.8% 23.1% 23.0% 22.9% 23.0% 23.1% 23.6% 23.9% 24.4% 24.3% 24.2% 24.4% 24.4% 24.6% 25.2% 25.2% 24.5% 23.7% 23.3% 23.4% 23.5% 23.7% 23.9% 539, , , , , , ,642 1,030,237 1,131,385 1,299,690 1,444,443 1,602,121 1,696,693 1,757,864 1,796,083 1,816,872 1,834,936 1,868,648 1,893,036 1,891,698 1,899,835 1,925,665 1,931,632 1,959,486 2,028,188 2,053,280 2,093,967 2,185,451 2,228,058 2,216,652 2,150,451 2,096,344 2,059,436 2,015,432 1,961, % 28.2% 28.4% 28.4% 27.2% 27.9% 28.9% 29.9% 30.6% 30.4% 31.7% 31.7% 30.8% 29.0% 27.1% 26.1% 25.2% 25.3% 25.7% 26.1% 26.3% 26.2% 25.7% 25.5% 25.5% 25.6% 25.8% 26.1% 25.3% 24.1% 23.6% 23.4% 23.2% 23.6% 23.8% 1,049,256 1,047,782 1,140,987 1,341,762 1,575,325 1,625,838 1,654,628 1,651,786 1,717,037 1,985,077 2,065,124 2,295,770 2,555,337 2,909,770 3,298,240 3,541,696 3,769,028 3,807,929 3,741,169 3,629,042 3,551,309 3,648,665 3,763,862 3,850,275 3,991,965 4,001,781 3,987,749 4,080,125 4,428,489 4,789,736 4,837,433 4,756,436 4,716,344 4,508,241 4,296, % 50.7% 49.9% 50.0% 51.4% 50.9% 49.6% 48.0% 46.5% 46.5% 45.4% 45.4% 46.4% 47.9% 49.8% 51.0% 51.8% 51.6% 50.7% 50.0% 49.2% 49.6% 50.1% 50.1% 50.1% 49.8% 49.1% 48.7% 50.2% 52.1% 53.1% 53.1% 53.2% 52.7% 52.2% 2,031,185 2,065,274 2,286,676 2,681,869 3,066,339 3,195,311 3,336,255 3,440,694 3,693,487 4,270,865 4,550,454 5,052,210 5,504,738 6,071,873 6,618,898 6,947,895 7,279,085 7,385,265 7,378,499 7,258,024 7,211,494 7,363,287 7,514,184 7,684,367 7,965,064 8,030,466 8,125,552 8,375,991 8,819,130 9,185,532 9,109,192 8,950,226 8,862,323 8,546,724 8,227, % 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Source: U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015). 46

51 Table 5 WIC Spending by Recipient Category 2005 and 2010 (in millions of 2014 dollars) Fiscal year Women Infants Children All 2005 (old food package) Amount Percent Amount Percent Amount Percent Amount Percent $1, % $1, % $3, % $5, % 2010 (new food package) $1, % $1, % $3, % $7, % Sources: Authors calculation based on U.S. Department of Agriculture, Food and Nutrition Service, WIC Food Package Costs and Rebates: Fiscal Year 2005 (Alexandria, VA: U.S. Department of Agriculture, September 2007), and Tracy Vericker, Chen Zhen, and Shawn Karns, Fiscal Year 2010: WIC Food Cost Report (Alexandria, VA: U.S. Department of Agriculture, August 2013); Notes: The spending figures for each category consist of both food costs and nutrition services and administrative (NSA) costs. The aggregated amount of food costs are derived from the food cost per person in each category. The NSA costs by category are derived by distributing the total NSA cost across all categories using the same proportion as food costs by category. Table 6 shows the historic growth in the proportion of Americans receiving WIC benefits. When WIC was established, the program served a mere 6.4 percent of American infants, but now about half of all infants receive WIC benefits, 126 as do more than a quarter of all children ages one to four, and about a third of pregnant or postpartum women Martin et al., Births: Final Data for 2004 ; Hamilton, Martin, and Ventura, Births: Preliminary Data from 2006 ; Martin et al., Births: Final Data for 2013 ; Hamilton et al., Births: Preliminary Data for 2014 ; and U.S. House of Representatives, Committee on Ways and Means, 1998 Green Book (Washington, DC: U.S. Government Printing Office, 1998), 1002, table

52 Table 6 WIC Recipients as Percent of the Relevant US Population Year Categories of eligible women Infants Children (ages 14) All categories of eligible women 9.0% 8.7% 9.7% 11.6% 13.1% 13.3% 14.1% 14.7% 16.0% 18.2% 18.7% 20.9% 22.9% 26.1% 28.6% 30.0% 31.7% 31.9% 31.8% 31.3% 30.5% 30.9% 31.4% 31.7% 32.4% 32.6% 32.7% 33.3% 34.6% 35.6% 35.7% 35.4% 35.3% 34.4% 33.0% Pregnant women 8.6% 9.3% 9.8% 11.4% 13.7% 13.5% 14.5% 15.1% 16.1% 18.2% 19.3% 21.0% 23.1% 26.2% 27.1% 27.7% 28.7% 29.2% 29.0% 28.3% 27.6% 27.2% 27.3% 27.5% 28.2% 28.2% 28.1% 28.1% 29.1% 30.5% 30.8% 30.2% 29.8% 28.5% 26.9% Postpartum/ Breastfeeding women 7.9% 8.5% 8.9% 10.3% 12.4% 12.4% 13.2% 13.9% 14.7% 16.7% 17.7% 19.4% 21.4% 24.4% 30.5% 32.8% 35.4% 35.2% 34.9% 34.6% 33.7% 35.0% 35.9% 36.2% 36.8% 37.2% 37.4% 38.7% 40.3% 40.8% 40.6% 40.7% 40.8% 40.3% 39.2% 14.9% 16.1% 17.6% 20.9% 22.7% 23.7% 25.7% 27.0% 28.9% 32.2% 34.7% 39.0% 41.7% 43.9% 45.4% 46.6% 47.2% 48.1% 48.0% 47.8% 46.8% 47.8% 48.0% 47.9% 49.3% 49.6% 49.1% 50.6% 52.5% 53.7% 53.8% 53.0% 52.1% 51.3% 49.2% 8.1% 7.7% 8.2% 9.5% 11.0% 11.3% 11.4% 11.4% 11.8% 13.5% 13.9% 14.9% 16.3% 18.2% 20.6% 22.3% 24.0% 24.6% 24.5% 23.8% 23.0% 23.3% 23.7% 23.9% 24.4% 24.1% 24.1% 24.2% 25.9% 27.5% 28.0% 29.1% 29.1% 28.0% 27.0% All categories of eligible persons 9.4% 9.3% 10.1% 11.8% 13.3% 13.8% 14.3% 14.7% 15.6% 17.6% 18.5% 20.2% 21.8% 24.0% 26.2% 27.7% 29.3% 29.9% 29.8% 29.3% 28.6% 28.9% 29.2% 29.4% 30.1% 30.0% 30.0% 30.5% 31.9% 33.2% 33.4% 34.1% 34.0% 33.0% 31.8% Sources: Authors calculations based on data from the following sources: For the numbers of WIC participants, U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015). For the numbers of infants, see Joyce A. Martin, Brady E. Hamilton, Paul D. Sutton, Stephanie J. Ventura, Fay Menacker, and Sharon Kirmeyer, Births: Final Data for 2004 National Vital Statistics 55, no.1 (September 29, 48

53 2006), and Brady E. Hamilton, Joyce A. Martin, and Stephanie J. Ventura, Births: Preliminary Data from 2006 National Vital Statistics 56, no.7 (December 5, 2007), sr56_07.pdf; Joyce A. Martin, Brady E. Hamilton, Michelle J. K. Osterman, Sally C. Curtain, and T. J. Matthews, Births: Final Data for 2013, National Vital Statistics Reports 64, no. 1 (January 2015), and Brady E. Hamilton, Joyce A. Martin, Michelle J. K. Osterman, and Sally C. Curtain, Births: Preliminary Data for 2014, National Vital Statistics Reports, 64, no. 6 (June 2015), For the numbers of children ages 14, see U.S. Census Bureau, Statistical Abstract of the United States: 1999 (Washington, DC: U.S. Census Bureau, 2000): 15, table 14, U.S. Census Bureau, Statistical Abstract of the United States: 2012 (Suitland, MD: U.S. Census Bureau, 2012), and U.S. Census Bureau, Annual Estimates of the Resident Population by Single Year of Age and Sex for the United States: April 1, 2010 to July 1, 2014, For population estimates of infants and children in territories, U.S. Census Bureau, Statistical Abstract of the United States (Suitland, MD: U.S. Census Bureau, ); and U.S. Census Bureau, Annual Estimates of the Resident Population by Single Year of Age and Sex for the United States, States, and Puerto Rico Commonwealth: April 1, 2010 to July 1, 2014, Children estimates from were derived from the number of infants in those years because detailed population figures were not available. For breastfeeding rates, Ross Products Division of Abbott Laboratories, Breastfeeding Trends 2003, appendix 1, Centers for Disease Control and Prevention, Breastfeeding Report Cards (Atlanta, GA: Centers for Disease Control and Prevention, ), and Centers for Disease Control and Prevention, Nutrition, Physical Activity and Obesity: Data, Trends and Maps, Notes: Breastfeeding rates are for any breastfeeding as opposed to exclusive breastfeeding. Consistent with common practice, the number of women in each category (pregnant, postpartum, and breastfeeding) is based on the number of infants. We assume that the number of pregnant women is 75 percent of the number of infants; the number of postpartum women (including breastfeeding women within six months after giving birth) is 50 percent of the number of infants; and the number of breastfeeding women beyond six months after giving birth is 50 percent of the number of infants multiplied by the breastfeeding rate at six months. The latest available year of breastfeeding data is 2012, so we assume the same rate for years In 2003, about 48 percent of US infants on WIC consumed about 54 percent of all formula sold in the United States. 127 The usual explanation given is that WIC infants consume more formula and then continue the use of formula longer (probably because it is free). Priorities. Because WIC was once much less well-funded, federal law assigns priorities for WIC benefits based on the category under which the applicant falls. 128 At the time of this 127. Oliveira et al., WIC and the Retail Price of Infant Formula U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. Ranked in order from highest to lowest, enrollment priorities are as follows: 1. Pregnant or breastfeeding women and infants with evident medical problems that demonstrate the need for supplemental foods; 49

54 writing, however, most WIC agencies seldom need to resort to such priority setting or waiting lists, as there is at least for now usually sufficient funding to serve all eligible applicants. 129 The USDA explains: Although WIC is a discretionary program, it is important to note that the funding has been sufficient to provide benefits to eligible persons seeking services. There have not been waiting lists to participate in WIC in recent years. 130 The next section describes the degree to which WIC eligibility has been expanded in recent years. Subsequent sections describe the elements of this expansion in eligibility and its implications for programming. 2. Infants whose mothers had medical problems during pregnancy that demonstrated the need for supplemental foods or whose mothers were program participants; 3. Children with medical problems that demonstrate the need for supplemental foods; 4. Infants or pregnant or breastfeeding women at nutritional risk because of an inadequate dietary pattern; 5. Children at nutritional risk because of an inadequate dietary pattern; 6. Postpartum women with any nutritional risk; and 7. Individuals certified for WIC solely due homeless or migrant status and current WIC participants who could have medical or dietary problems without WIC Oliveira and Davis, Recent Trends and Economic Issues in the WIC Infant Formula Rebate Program, 4. See also Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 19, which states: The last year a state had to implement a priority waiting list was States that experienced shortages of funds to serve all eligible applicants in 2002 obtained supplemental funding from the federal government U.S. Department of Agriculture, Food and Nutrition Service, Office of Analysis, Nutrition, and Evaluation, WIC Program Coverage: How Many Eligible Individuals Participated in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): 1994 to 2003? (Alexandria, VA: USDA, February 2006), 3, 50

55 III. Expanding Eligibility As we saw, in 2014, about 49 percent of all American infants and 39 percent of all postpartum women received WIC benefits. Although low-income families tend to have more children than the general population, 131 these figures are much higher than one would expect given WIC s putative eligibility framework. This section uses the 2006 changes in how the USDA estimates eligibility to illuminate the avenues through which eligibility and hence enrollment have expanded. USDA s expanded estimates of eligibility. For years, the USDA estimated the number of WIC eligibles by simply calculating the number of demographically eligible persons in families with annual incomes below 185 percent of poverty plus those who were on Medicaid. Starting in the late 1990s, however, observers noted that the number of infants on WIC exceeded this simple count of eligibles. For example, under the USDA s then-operative method of estimating eligibility (for simplicity, the USDA s original methodology ), the National Research Council s Committee on National Statistics (NRC), using the CPS, concluded that in 1998 about 91 percent of the estimated number of eligible people were participating, including 127 percent of the estimated number of eligible postpartum and breastfeeding mothers, and 128 percent of the estimated number of eligible infants. 132 (Table 9 updates these calculations with more recent CPS data.) Some took these 100 percent-plus coverage rates as an indication that the program was enrolling many ineligible children and mothers. Besharov and Germanis, for example, reported that as program funding has increased, according to some local WIC staff, even income testing seems to have become less rigorous, with many participants having incomes over eligibility limits. 133 Others took issue with the estimates themselves, arguing that the USDA s methodology underestimated the number of eligibles, thereby overestimating coverage rates. For example, Marianne Bitler, Janet Currie, and John Karl Scholz estimated much lower participation rates when several factors are taken into account, including monthly versus annual income for 131. See, for example, Lawrence B. Finer and Stanley K. Henshaw, Disparities in Rates of Unintended Pregnancy in the United States, 1994 and 2001, Perspectives on Sexual and Reproductive Health 38, no. 2 (2006): 93, table 1, Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 22. Note that this is a percentage of the estimated eligible population. It is possible that not all eligible people are participating and that more ineligibles exist than the 127 percent and 128 percent participation rate suggest Besharov and Germanis, Rethinking WIC, But see Nancy R. Burstein, Mary Kay Fox, Jordan B. Hiller, Robert Kornfield, Ken Lam, Cristofer Price, and David T. Rodda, WIC General Analysis Project: Profile of WIC Children (Cambridge, MA: Abt Associates, March 2000), which states: The authors determined that many of the income-ineligible households in their sample were in fact on Medicaid, and therefore adjunctively eligible. 51

56 eligibility determinations, the existence of adjunctive eligibility, and the length of certification periods. 134 Based on SIPP data, they estimated an overall 1998 WIC participation rate of 48 percent, not the USDA s estimate of 91 percent. They also estimated lower 1998 coverage rates for several categories of WIC recipients: 73 percent for infants (rather than 128 percent under the USDA s original methodology), 38 percent for children one to four years old (rather than 74 percent under the USDA s original methodology), and 67 percent for pregnant and postpartum women (rather than 97 percent under the USDA s original methodology). 135 (Table 9 updates these calculations with more recent CPS data.) A 2005 GAO study of program access in means-tested programs also showed lower coverage rates than USDA estimates. The GAO estimated that, in 2001, the coverage rate for infants was between 79 and 91 percent (rather than 117 percent under the USDA s original methodology) and for children was between 41 and 45 percent (rather than 78 percent under the USDA s original methodology). 136 Such findings led the USDA to commission the National Research Council s Committee on National Statistics to review the methodology for estimating eligibility and to develop a revised methodology. The committee found that the original methodology failed to fully reflect current eligibility rules and regulations. 137 The committee concluded: USDA estimates of the number of participants have come under critical scrutiny, in part because the number of infants and postpartum women who actually enrolled in the program has exceeded the number projected to be eligible by as much as 20 to 30 percent 134. Marianne P. Bitler, Janet Currie, and John Karl Scholz, WIC Eligibility and Participation, Journal of Human Resources 38, no. 4 (September 2003): 1162, table Ibid., 1160, table 6; Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, For 2001 WIC coverage rates, see U.S. Government Accountability Office, Means-Tested Program: Information on Program Access Can Be an Important Management Tool (Washington, DC: GAO, March 2005), 21-22, To estimate coverage rates for WIC, the GAO used estimates from the Urban Institute s Transfer Income Model, version 3 (TRIM3), which draws data from the CPS and simulates the process that a caseworker would undergo to determine eligibility by reviewing individual or household characteristics such as household composition, income, disability, and other factors as appropriate for the programs, including both monthly income rates and adjunctive eligibility status for WIC (54). The GAO did not attempt to estimate coverage rates for women because the CPS does not provide information on whether a woman is pregnant or postpartum. For 2001 WIC coverage rates based on the original methodology, authors calculation based on U.S. Department of Agriculture, Special Supplemental Nutrition Program for Women, Infants and Children (WIC) ; and Edward Herzog, U.S. Department of Agriculture, Food and Nutrition Service, message to authors, June 14, U.S. Department of Agriculture, Food and Nutrition Service, Office of Analysis, Nutrition, and Evaluation, WIC Program Coverage: How Many Eligible Individuals Participated in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): 1994 to 2003? citing Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report. 52

57 in recent years. These high coverage rates have led some members of Congress to conclude that some participants are truly ineligible, and that funding could be reduced somewhat and still meet the needs of truly eligible people who would participate under full funding (see U.S. House of Representatives, 1998). In contrast, some advocates and state WIC agencies believe that the estimates of the number of eligible persons are too low and that there are additional people who are eligible and would choose to participate, given their eligibility. With these concerns in mind, USDA asked the Committee on National Statistics of the National Research Council to convene a panel of experts to review the methods used to estimate the national number of people eligible and likely to participate in the WIC program. The panel is charged with reviewing data and methods for estimating categorical eligibility, income eligibility, adjunctive eligibility from participation in other public assistance programs, and nutritional risk among the income eligible population, as well as for estimating the participation if the program is fully funded. The panel was also asked to consider alternative methods and data for making these estimates. 138 As part of its report, the NRC proposed an alternate methodology to estimate WIC eligibility, which the USDA largely adopted in 2006 (see table 12). 139 Using the USDA s original approach to estimating eligibility, WIC eligibility in 2003 was about 40 percent of infants, 31 percent of children one to four, and 34 percent of pregnant and postpartum women. Using the USDA s expanded methodology, for the same year, WIC eligibility rose to about 63 percent of infants, 53 percent of children one to four, and 49 percent of pregnant and postpartum women. (In 2013, the most recent year with available estimates, using the expanded USDA methodology, WIC eligibility was about 61 percent of infants, about 56 percent of children one to four, and about 47 percent of pregnant and postpartum women.) As explained below, our estimates for 2013 are even higher about 71 to 81 percent of all infants. The USDA s expanded approach is summarized below. (All of the adjustment factors given below are for 2013, the latest year for which data are available.) CPS miscounts. The expanded methodology corrected for miscounts in the CPS of the number of infants and children, as recommended by the NRC the original methodology did not. In 2003, the CPS underestimated the number of infants, requiring a 6.2 percent increase, and overestimated the number of children, requiring a 1.7 percent decrease. In other years, the correction could be for either underestimates or overestimates Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 139. U.S. Department of Agriculture, Food and Nutrition Service, Office of Analysis, Nutrition, and Evaluation, WIC Program Coverage: How Many Eligible Individuals Participated in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): 1994 to 2003? 140. Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 53

58 Adjunctive eligibility. The expanded methodology increased the estimated number of eligibles by counting as adjunctively eligible those families and income-sharing households participating in either Medicaid, SNAP, or TANF cash assistance. (The original methodology counted only some of those on Medicaid, and did not estimate the impact of SNAP or TANF.) 141 Adjunctive eligibility could, by itself, expand eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 40 percent. 142 Monthly income. The expanded methodology increased the estimated number of eligibles by using monthly income instead of annual income, in conjunction with certification periods (using SIPP data). (The expanded methodology does not estimate these effects separately. The original methodology used annual income and did not factor in certification periods.) 143 Using monthly income could, by itself, expand eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 20 percent. 144 Certification periods. The expanded methodology increased the estimated number of eligibles by taking into account certification periods, which keep recipients eligible for six or twelve months regardless of income changes. (The original methodology made no 4246; and Edward Herzog, U.S. Department of Agriculture, Food and Nutrition Service, message to authors, June 14, For infants, the USDA s adjustment factor for adjunctive eligibility is based on the difference between number of infants in the CPS in families with annual incomes below 185 percent of poverty (1,656,495) and the additional infants above 185 percent of poverty participating in Medicaid, SNAP, and TANF (465,105); for children, the numbers were 6,975,161 and 1,992,824, respectively. For infants and all categories of women, the new adjustment factor is about 1.28 (times the number of infants in the CPS with annual incomes below 185 percent of poverty); for children, the new adjustment factor is about 1.30 (times the number of children in the CPS with annual incomes below 185 percent of poverty). Our adjustment factor estimates differ slightly from those of the Urban Institute because we include infants and children in the territories This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix For infants, the USDA s adjustment factor for monthly income is based on the difference between the number of infants in the CPS in families with annual incomes below 185 percent of poverty plus those who are adjunctively eligible (2,127,753) and the additional eligible infants based on monthly income estimates derived from the SIPP (333,304); for children, the numbers were 8,967,985 and 176,267, respectively. For infants and for all categories of women, the new adjustment factor is about 1.20 (times the number of infants with annual incomes below 185 percent of poverty); for children, the new adjustment factor is about 1.03 (times the number of children in the CPS with annual incomes below 185 percent of poverty). Our adjustment factor estimates differ slightly from those of the Urban Institute because we include infants and children in the territories This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix 2. 54

59 adjustment for certification periods.) The adjustment factor of this correction is combined with the adjustment factor for monthly income (see above). WIC s six- and twelve-month certification periods could, by themselves, expand eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 30 percent. 145 Employed while pregnant. Overall, the expanded methodology increased the estimated number of eligibles by using monthly income. This change accounts for the income declines associated with leaving work or reducing the hours worked while pregnant. This adjustment slightly lowers eligibility estimates by taking into account that pregnancies are only nine months long and that many mothers are not eligible for that entire period. (Because the original methodology was based on annual income, it assumed that pregnant women were income-eligible during their entire nine-month pregnancy.) 146 Multiple births and infant deaths. The expanded methodology decreased the estimated number of eligibles by taking into account multiple births and infant deaths in counting pregnant, breastfeeding, and postpartum women. (The original methodology simply assumed that there was one pregnant woman for every infant born.) 147 Breastfeeding rates. The expanded methodology increased the estimated number of eligibles by using more current (and higher) estimates of the proportion of new mothers who breastfeed and who can be WIC-eligible for an entire year. (The original methodology used lower breastfeeding rates that were derived from the 1988 National Maternal Infant Health Survey.) 148 Nutritional risk. The expanded methodology increased the estimated number of eligibles by assuming that 97 percent of all income-eligible infants, 99 percent of all incomeeligible children, and 94 percent of all income-eligible women are at nutritional risk. (The 145. This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix For pregnant women, the USDA s adjustment factor for the length of the pregnancy is based on the number of fully eligible infants (2,416,450) and the number of women who were not income-eligible for all nine months of their pregnancy. Because pregnant women are pregnant for only three-quarters of the year (nine months) and often are not income-eligible for a portion of that time, the number of infants is multiplied by 0.52 to estimate the number of pregnant women. The new adjustment factor for pregnant women is about 0.52 (times the number of fully eligible infants, the number of eligible infants after adjusting for the number in the CPS below 185 percent of poverty; adjunctive eligibility; monthly instead of annual income; income eligibles in the U.S. territories; and nutritional risk factors) For pregnant women, the USDA s adjustment factor for multiple births and infant deaths is based on the number of fully eligible infants (2,416,450) and multiple births less infant deaths (4,936). The new adjustment factor for pregnant women is about 0.51 (times the number of eligible infants) For breastfeeding women, the USDA s adjustment factor for breastfeeding rates is based on the number of fully eligible infants (2,416,450) and the number of non-breastfeeding women (1,390,715). The new adjustment factor for breastfeeding women is about 0.35 (times the number of eligible infants). 55

60 original methodology assumed that only 95 percent of infants, 75 percent of children, 91 percent of pregnant women, 89 percent of breastfeeding women, and 93 percent of postpartum women were at nutritional risk.) The continuing failure to screen for nutritional risk, however, may have expanded eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 25 percent. As described in the following pages, taken together, these modifications substantially increased the estimated number of WIC eligibles and significantly decreased estimated program coverage rates. Across all categories of WIC eligible persons, the percent of the relevant US population estimated to be eligible for WIC in 2003 rose from about 33 percent to about 54 percent. The proportion of eligible infants rose from about 40 percent to about 63 percent; for children, it increased from about 31 percent to about 53 percent; and for pregnant and postpartum women, it increased from about 34 percent to about 49 percent. 149 In 2013 (the latest year for which eligibility estimates are available), these numbers were essentially the same. (The difference between the estimates under the original and expanded methodology would be even greater had we not adopted the original methodology for the correction for CPS miscounts embedded in the expanded methodology.) (See table 7.) 149. In a earlier estimate based on similar but not identical adjustments, Bitler, Currie, and Scholz estimate that, in 1998, approximately 58 percent of infants, 54 percent of pregnant and postpartum women, and 57 percent of children (ages one to five) were eligible for WIC in a given month. Bitler, Currie, and Scholz, WIC Eligibility and Participation,

61 Table 7 WIC Eligibles as Percent of the Total Population in that Category Original and Expanded USDA Estimates Year All Infants Children Number of categorically eligible persons 25,968,526 25,809,078 25,298,829 26,190,926 26,682,921 26,844,573 27,084,020 27,679,254 28,046,026 28,260,367 27,705,103 26,385,863 26,065,401 25,951,094 4,160,938 4,211,080 3,649,594 4,087,474 4,177,343 4,214,023 4,239,478 4,401,759 4,445,497 4,330,068 4,156,050 4,012,975 3,941,665 3,895,561 15,412,940 15,671,031 15,908,645 16,108,622 16,384,297 16,590,511 16,571,067 16,832,662 17,126,864 17,386,289 17,307,217 16,372,915 16,220,865 16,119, Original USDA method Total number of persons eligible for WIC 7,937,600 8,264,430 8,088,628 8,487,364 8,693,748 8,757,912 8,852,986 9,157,827 9,234,447 10,067,313 9,721,149 9,534,254 9,310,552 8,982,229 1,557,543 1,638,587 1,439,335 1,592,451 1,697,663 1,680,547 1,659,386 1,788,947 1,712,100 1,832,931 1,757,351 1,773,436 1,704,218 1,612,407 4,474,249 4,620,870 4,888,124 4,946,394 4,918,828 5,021,051 5,163,177 5,179,927 5,427,423 5,991,612 5,813,507 5,590,845 5,521,055 5,391, Ratio of WIC eligibles to the categorically eligible population 30.6% 32.0% 32.0% 32.4% 32.6% 32.6% 32.7% 33.1% 32.9% 35.6% 35.1% 36.1% 35.8% 34.6% 37.4% 38.9% 39.4% 39.0% 40.6% 39.9% 39.1% 40.6% 38.5% 42.3% 42.3% 44.2% 43.2% 41.4% 28.2% 29.7% 29.8% 30.5% 30.0% 30.5% 31.1% 30.8% 31.8% 34.2% 33.5% 34.2% 34.1% 33.3% Expanded USDA method Total number of persons eligible for WIC 12,482,201 13,035,180 12,990,331 13,654,070 13,906,743 14,065,636 14,289,806 14,079,339 14,171,379 15,075,257 14,550,116 14,277,454 14,053,362 14,188,552 2,417,133 2,494,306 2,203,108 2,501,169 2,578,635 2,596,448 2,702,049 2,651,367 2,633,819 2,674,000 2,535,074 2,516,309 2,420,597 2,387,223 7,400,765 7,783,758 8,339,280 8,385,979 8,472,345 8,593,698 8,622,879 8,540,981 8,657,117 9,469,000 9,224,455 8,888,005 8,823,888 9,052,810 Ratio of WIC eligibles to the categorically eligible population 48.1% 50.5% 51.3% 52.1% 52.1% 52.4% 52.8% 50.9% 50.5% 53.3% 52.5% 54.1% 53.9% 54.7% 58.1% 59.2% 60.4% 61.2% 61.7% 61.6% 63.7% 60.2% 59.2% 61.8% 61.0% 62.7% 61.4% 61.3% 46.6% 50.1% 50.9% 51.8% 51.6% 52.2% 51.9% 50.8% 50.8% 54.1% 53.1% 54.3% 54.5% 55.9%

62 58 All categorically eligible women ,918,934 6,049,216 5,253,591 5,908,444 6,101,009 6,171,437 6,221,434 6,466,184 6,543,772 6,421,491 6,182,124 6,007,424 5,940,089 5,870,610 1,905,808 2,004,973 1,761,168 1,948,520 2,077,257 2,056,314 2,030,422 2,188,953 2,094,923 2,242,771 2,150,292 2,169,973 2,085,279 1,978, % 33.1% 33.5% 33.0% 34.0% 33.3% 32.6% 33.9% 32.0% 34.9% 34.8% 36.1% 35.3% 33.7% 2,664,303 2,757,116 2,447,943 2,766,922 2,855,763 2,875,490 2,964,878 2,886,991 2,880,443 2,932,257 2,790,587 2,873,140 2,808,877 2,748, % 45.6% 46.6% 46.8% 46.8% 46.6% 47.7% 44.6% 44.0% 45.7% 45.1% 47.8% 47.3% 46.8% Pregnant women ,120,704 3,158,310 2,737,196 3,065,606 3,133,007 3,160,517 3,179,609 3,301,319 3,334,123 3,247,551 3,117,038 3,009,731 2,956,249 2,921,671 1,107,909 1,165,557 1,023,826 1,132,739 1,207,579 1,195,404 1,180,352 1,272,511 1,217,848 1,303,797 1,250,036 1,261,477 1,212,242 1,152, % 36.9% 37.4% 36.9% 38.5% 37.8% 37.1% 38.5% 36.5% 40.1% 40.1% 41.9% 41.0% 39.4% 1,244,265 1,283,991 1,134,091 1,287,524 1,326,735 1,335,900 1,390,233 1,364,156 1,355,127 1,376,000 1,304,322 1,294,668 1,245,423 1,228, % 40.7% 41.4% 42.0% 42.3% 42.3% 43.7% 41.3% 40.6% 42.4% 41.8% 43.0% 42.1% 42.0% Postpartum women ,335,661 1,383,340 1,209,840 1,359,085 1,441,183 1,449,624 1,473,219 1,514,205 1,551,478 1,526,349 1,471,242 1,408,554 1,407,174 1,390, , , , , , , , , , , , , , , % 42.3% 42.5% 41.8% 42.0% 41.4% 40.2% 42.2% 39.4% 42.8% 42.6% 44.9% 43.2% 41.4% 753, , , , , , , , , , , , , , % 55.4% 55.5% 58.9% 57.6% 56.1% 59.3% 58.7% 57.1% 58.3% 55.8% 54.5% 51.4% 49.9% Breastfeeding women ,462,570 1,507,567 1,306,555 1,483,753 1,526,819 1,561,296 1,568,607 1,650,660 1,658, , , , , , , , , , % 16.9% 17.1% 16.7% 17.3% 16.7% 16.4% 16.8% 16.1% 666, , , , , , , , , % 46.9% 49.1% 45.8% 45.8% 46.5% 44.6% 38.4% 38.5%

63 ,647,591 1,593,845 1,589,138 1,576,666 1,558, , , , , , % 17.1% 17.3% 16.8% 16.1% Sources: Authors calculations based on data from the following sources: 667, , , , , % 41.7% 51.1% 53.3% 53.0% For the numbers of WIC participants, U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015). For the numbers of infants, see Joyce A. Martin, Brady E. Hamilton, Paul D. Sutton, Stephanie J. Ventura, Fay Menacker, and Sharon Kirmeyer, Births: Final Data for 2004 National Vital Statistics 55, no.1 (September 29, 2006), and Brady E. Hamilton, Joyce A. Martin, and Stephanie J. Ventura, Births: Preliminary Data from 2006 National Vital Statistics 56, no.7 (December 5, 2007), sr56_07.pdf; Joyce A. Martin, Brady E. Hamilton, Michelle J. K. Osterman, Sally C. Curtain, and T. J. Matthews, Births: Final Data for 2013, National Vital Statistics Reports 64, no. 1 (January 2015), and Brady E. Hamilton, Joyce A. Martin, Michelle J. K. Osterman, and Sally C. Curtain, Births: Preliminary Data for 2014, National Vital Statistics Reports, 64, no. 6 (June 2015), For the numbers of children ages 14, see U.S. Census Bureau, Statistical Abstract of the United States: 1999 (Washington, DC: U.S. Census Bureau, 2000): 15, table 14, U.S. Census Bureau, Statistical Abstract of the United States: 2012 (Suitland, MD: U.S. Census Bureau, 2012), and U.S. Census Bureau, Annual Estimates of the Resident Population by Single Year of Age and Sex for the United States: April 1, 2010 to July 1, 2014, For population estimates of infants and children in territories, U.S. Census Bureau, Statistical Abstract of the United States (Suitland, MD: U.S. Census Bureau, ); and U.S. Census Bureau, Annual Estimates of the Resident Population by Single Year of Age and Sex for the United States, States, and Puerto Rico Commonwealth: April 1, 2010 to July 1, 2014, Children estimates from were derived from the number of infants in those years because detailed population figures were not available. For breastfeeding rates, Ross Products Division of Abbott Laboratories, Breastfeeding Trends 2003, appendix 1, Centers for Disease Control and Prevention, Breastfeeding Report Cards (Atlanta, GA: Centers for Disease Control and Prevention, ), and Centers for Disease Control and Prevention, Nutrition, Physical Activity and Obesity: Data, Trends and Maps, Notes: Consistent with common practice, the number of women in each category (pregnant, postpartum, and breastfeeding women) is based on the number of infants. We assume that the number of pregnant women is 75 percent of the number of infants, because the duration of pregnancy is usually nine months (75 percent of 12 months). We assume that the number of postpartum women (including breastfeeding women within six months after giving birth) is 50 percent of the number of infants, as the certification period (six months) for them is half of that for infants. Further, we assume that the number of breastfeeding women beyond six months after giving birth is 50 percent of the number of infants breastfeeding at six months, because categorically eligible breastfeeding women are required to breastfeed their children at six months and their certification period (six months) is half of that for infants. The total number of persons eligible under the original methodology is derived by multiplying the USDA s adjusted count of the number of persons under 185 percent of poverty (as proposed by the NRC) by the percent adjustments of the original methodology described in Michele Ver Ploeg and David M. Betson, eds., Estimating Eligibility and Participation for the WIC Program: Final Report (Washington, DC: National Academies Press, 2003). For the number of infants and children who are eligible in the territories from , we apply the same share of 59

64 infants and children with income under 185 percent of poverty in the years (similar to the method used by USDA). The above describes the increased estimated number of eligibles caused by the USDA s expanded methodology. This increase was not the product of an increase in poverty. As table 8 shows, shifting from the USDA s original methodology to its expanded one substantially raises the proportion eligible with annual incomes above 185 percent of poverty. For example, the proportion of eligible infants rises about 42 percent, going from about 97 percent to about 138 percent of those with annual incomes below 185 percent of poverty. For children ages one to four, it rises more than 61 percent, going from 77 percent to 124 percent of those with annual incomes below 185 percent of poverty. 60

65 All Infants Table 8 WIC Eligibles as a Percent of Those with Annual Family Incomes below 185% of Poverty Original vs. Expanded USDA Methodology Infants and Children (ages 14) Year Children Number of persons below 185% of poverty 7,474,689 7,743,095 7,879,345 8,103,754 8,168,617 8,275,402 8,426,379 8,573,744 8,805,332 9,647,124 9,335,001 9,060,442 8,895,778 8,631,656 1,613,987 1,695,909 1,493,310 1,645,928 1,750,672 1,732,681 1,718,315 1,841,291 1,761,090 1,884,556 1,808,297 1,820,871 1,749,458 1,656,495 5,860,702 6,047,187 6,386,035 6,457,826 6,417,945 6,542,721 6,708,065 6,732,454 7,044,242 Original USDA method Total number of persons eligible for WIC 6,031,792 6,259,457 6,327,460 6,538,844 6,616,491 6,701,598 6,822,563 6,968,874 7,139,523 7,824,542 7,570,857 7,364,281 7,225,273 7,003,978 1,557,543 1,638,587 1,439,335 1,592,451 1,697,663 1,680,547 1,659,386 1,788,947 1,712,100 1,832,931 1,757,351 1,773,436 1,704,218 1,612,407 4,474,249 4,620,870 4,888,124 4,946,394 4,918,828 5,021,051 5,163,177 5,179,927 5,427, Ratio of WIC eligibles to those below 185% of poverty 80.7% 80.8% 80.3% 80.7% 81.0% 81.0% 81.0% 81.3% 81.1% 81.1% 81.1% 81.3% 81.2% 81.1% 96.5% 96.6% 96.4% 96.8% 97.0% 97.0% 96.6% 97.2% 97.2% 97.3% 97.2% 97.4% 97.4% 97.3% 76.3% 76.4% 76.5% 76.6% 76.6% 76.7% 77.0% 76.9% 77.0% Expanded USDA method Total number of persons eligible for WIC 9,817,898 10,278,064 10,542,388 10,887,148 11,050,980 11,190,146 11,324,928 11,192,348 11,290,936 12,143,000 11,759,529 11,404,314 11,244,485 11,440,033 2,417,133 2,494,306 2,203,108 2,501,169 2,578,635 2,596,448 2,702,049 2,651,367 2,633,819 2,674,000 2,535,074 2,516,309 2,420,597 2,387,223 7,400,765 7,783,758 8,339,280 8,385,979 8,472,345 8,593,698 8,622,879 8,540,981 8,657,117 Ratio of WIC eligibles to those below 185% of poverty 131.3% 132.7% 133.8% 134.3% 135.3% 135.2% 134.4% 130.5% 128.2% 125.9% 126.0% 125.9% 126.4% 132.5% 149.8% 147.1% 147.5% 152.0% 147.3% 149.9% 157.2% 144.0% 149.6% 141.9% 140.2% 138.2% 138.4% 144.1% 126.3% 128.7% 130.6% 129.9% 132.0% 131.3% 128.5% 126.9% 122.9%

66 Table 8 WIC Eligibles as a Percent of Those with Annual Family Incomes below 185% of Poverty Original vs. Expanded USDA Methodology Infants and Children (ages 14) ,762,568 7,526,704 7,239,571 7,146,320 6,975,161 5,991,612 5,813,507 5,590,845 5,521,055 5,391, % 77.2% 77.2% 77.3% 77.3% 9,469,000 9,224,455 8,888,005 8,823,888 9,052, % 122.6% 122.8% 123.5% 129.8% Sources: David Betson, Michael Martinez-Schiferl, Linda Giannarelli, and Sheila Zedlewski, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, : Final Report (Washington, DC: Urban Institute, December 2011), Michael Martinez-Schiferl, Sheila Zedlewski, and Linda Giannarelli, Paul Johnson, Linda Giannarelli, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2010 Final Report (Washington, DC: Urban Institute, January 2013), Erika Huber, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2011: Final Report (Alexandria, VA: U.S. Department of Agriculture, March 2014); Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2012: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2015); and Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2016). Notes: The total number of persons under 185 percent of poverty is the USDA s adjusted count to correct for the miscounts in the CPS (as proposed by the NRC). The total number of persons eligible under the original methodology is derived by multiplying the adjusted count of the persons under 185 percent of poverty by the percent adjustments of the original methodology described in Michele Ver Ploeg and David M. Betson, eds., Estimating Eligibility and Participation for the WIC Program: Final Report (Washington, DC: National Academies Press, 2003). 62

67 More unserved families. The large increase in estimated eligibility under the USDA s expanded approach has sharply lowered calculated coverage rates, that is, the percent of estimated WIC eligibles actually enrolled in the program. Table 9 shows that, using the USDA s original methodology, participation of infants and postpartum women greatly exceeded estimated eligibility in recent years, with coverage rates as high as 121 percent for infants and 139 percent for postpartum/breastfeeding women, and overall WIC participation approaching full coverage of all eligible persons. That is, in some categories, many more were participating than estimated to be eligible to participate. The USDA s expanded methodology substantially lowers WIC s estimated coverage rates. For example, the 2013 coverage estimate for infants (the last year with available data) falls from about 125 percent to about 84 percent. The coverage rates for all women fall from about 102 percent to about 74 percent and overall from about 95 percent to about 60 percent. This, of course, changes the previous conclusion that WIC is fully funded (and in some categories, drastically overfunded) to a view that WIC participation (and funding) still needs to be substantially increased. Actually, even these are probably a slight overstatement of coverage rates, because they assume that everyone on WIC is eligible. In this regard, the WIC Income Verification Study, conducted in 1988 found that 5.7 percent of WIC recipients should not have been eligible because their income was too high. 150 Ten years later, the National Survey of WIC Participants (NSWP), conducted in 1998, estimated ineligibility at 4.5 percent. 151 In 2008, the NSWP II estimated ineligibility at 3.0 percent. 152 The lower coverage or participation rates for children should perhaps be explained. A significant drop-off in WIC participation occurs among families and income-sharing households with older children. Theoretically, a mother who starts in a WIC program when she is pregnant should continue to receive WIC for herself or her child until her youngest child reaches age five (assuming continued income eligibility and nutritional risk). Participation drops off rapidly after the first year, however. In 2014, for example, about 2.1 million infants participated in the program but only about 1.8 million one-year-olds did. With each successive year of age, children s participation fell resulting in only about 705,000 four-year-olds participating in the 150. U.S. General Accounting Office, Efforts to Control Fraud and Abuse in the WIC Program Can Be Strengthened (Washington, DC: GAO, August 1999) 23; U.S. Department of Agriculture, Annual Report for Fiscal Year 2003: Report on Performance and Accountability (Washington, DC: U.S. Department of Agriculture, January 2004): 286, /usdarpt/par2003/pdf/par09.pdf U.S. Department of Agriculture, Annual Report for Fiscal Year 2003: Report on Performance and Accountability U.S. Department of Agriculture, Food and Nutrition Service, National Survey of WIC Participants II: Report Summary. 63

68 program. 153 Although part of the drop-off may be a result of the difference in eligibility criteria for infants and children, as well as the fact that family incomes tend to be higher as children grow older, the primary factor is probably the lesser value of the total food package once the mother is no longer eligible to receive benefits for herself. For example, in 2014, the value of a food package for a breastfeeding mother and her infant was worth about $177 per month, compared to just $40 for only one child. 154 After a while, many mothers may simply decide that the small amount of food is not worth the time or trouble of continued participation. (In a survey of WIC recipients, the supplemental food that WIC provides, and not nutritional counseling, was listed as the most attractive program attribute among mothers in the prenatal and postpartum components.) 155 Another factor could be the shorter certification periods for children that, until 2010, were limited to six months. The Healthy Hunger-Free Kids Act (HHFKA), passed in December of 2010, gives states the option to extend certification periods for children to one year. As of this writing, thirty states have opted to do so. (See Table 13.) 153. Betsy Thorn, Chrystine Tadler, Nicole Huret, Elaine Ayo, Carole Tripp, Michele Mendelson, Kelly L. Patlan, Gabriel Schwartz, and Vinh Tran, WIC Participant and Program Characteristics 2014: Final Report (Alexandria, VA: USDA, November 2015), Authors calculations from Vericker, Zhen, and Karns, Fiscal Year Mary Kay Fox, Nancy Burstein, Jenny Golay, and Cristofer Price, The WIC Nutrition Education Assessment Study: Executive Summary (Cambridge, MA: Abt Associates, 1999), ix, which states This was the only program characteristic that was consistently included in the top three positive aspects of the WIC Program. 64

69 All Infants Year and category Children Total enrolled 7,211,494 7,363,287 7,514,184 7,684,367 7,965,064 8,030,466 8,125,552 8,375,991 8,819,130 9,185,532 9,109,192 8,950,226 8,862,323 8,546,724 1,899,835 1,925,665 1,931,632 1,959,486 2,028,188 2,053,280 2,093,967 2,185,451 2,228,058 2,216,652 2,150,451 2,096,344 2,059,436 2,015,432 3,551,309 3,648,665 3,763,862 3,850,275 3,991,965 4,001,781 3,987,749 4,080,125 4,428,489 4,789,736 4,837,433 4,756,436 4,716,344 Table 9 WIC Coverage Rates Original vs. Expanded USDA Methodology Original USDA method Total eligible 7,937,600 8,264,430 8,088,628 8,487,364 8,693,748 8,757,912 8,852,986 9,157,827 9,234,447 10,067,313 9,721,149 9,534,254 9,310,552 8,982,229 1,557,543 1,638,587 1,439,335 1,592,451 1,697,663 1,680,547 1,659,386 1,788,947 1,712,100 1,832,931 1,757,351 1,773,436 1,704,218 1,612,407 4,474,249 4,620,870 4,888,124 4,946,394 4,918,828 5,021,051 5,163,177 5,179,927 5,427,423 5,991,612 5,813,507 5,590,845 5,521, Coverage rate (enrollees as a % of estimated eligibles) 90.9% 89.1% 92.9% 90.5% 91.6% 91.7% 91.8% 91.5% 95.5% 91.2% 93.7% 93.9% 95.2% 95.2% 122.0% 117.5% 134.2% 123.0% 119.5% 122.2% 126.2% 122.2% 130.1% 120.9% 122.4% 118.2% 120.8% 125.0% 79.4% 79.0% 77.0% 77.8% 81.2% 79.7% 77.2% 78.8% 81.6% 79.9% 83.2% 85.1% 85.4% Expanded USDA method Total eligible 12,482,201 13,035,180 12,990,331 13,654,070 13,906,743 14,065,636 14,289,806 14,079,339 14,171,379 15,075,257 14,550,116 14,277,454 14,053,362 14,188,552 2,417,133 2,494,306 2,203,108 2,501,169 2,578,635 2,596,448 2,702,049 2,651,367 2,633,819 2,674,000 2,535,074 2,516,309 2,420,597 2,387,223 7,400,765 7,783,758 8,339,280 8,385,979 8,472,345 8,593,698 8,622,879 8,540,981 8,657,117 9,469,000 9,224,455 8,888,005 8,823,888 Coverage rate (enrollees as a % of estimated eligibles) 57.8% 56.5% 57.8% 56.3% 57.3% 57.1% 56.9% 59.5% 62.2% 60.9% 62.6% 62.7% 63.1% 60.2% 78.6% 77.2% 87.7% 78.3% 78.7% 79.1% 77.5% 82.4% 84.6% 82.9% 84.8% 83.3% 85.1% 84.4% 48.0% 46.9% 45.1% 45.9% 47.1% 46.6% 46.2% 47.8% 51.2% 50.6% 52.4% 53.5% 53.4%

70 ,508,241 5,391, % 9,052, % All women ,760,350 1,788,958 1,818,691 1,874,606 1,944,911 1,975,405 2,043,836 2,110,415 2,162,583 2,179,145 2,121,309 2,097,446 2,086,543 2,023,051 1,905,808 2,004,973 1,761,168 1,948,520 2,077,257 2,056,314 2,030,422 2,188,953 2,094,923 2,242,771 2,150,292 2,169,973 2,085,279 1,978, % 89.2% 103.3% 96.2% 93.6% 96.1% 100.7% 96.4% 103.2% 97.2% 98.7% 96.7% 100.1% 102.3% 2,664,303 2,757,116 2,447,943 2,766,922 2,855,763 2,875,490 2,964,878 2,886,991 2,880,443 2,932,257 2,790,587 2,873,140 2,808,877 2,748, % 64.9% 74.3% 67.8% 68.1% 68.7% 68.9% 73.1% 75.1% 74.3% 76.0% 73.0% 74.3% 73.6% Pregnant women , , , , , , , , , , , , , ,822 1,107,909 1,165,557 1,023,826 1,132,739 1,207,579 1,195,404 1,180,352 1,272,511 1,217,848 1,303,797 1,250,036 1,261,477 1,212,242 1,152, % 70.5% 80.5% 74.6% 72.0% 73.1% 76.1% 71.5% 76.1% 72.4% 73.9% 71.0% 72.8% 72.9% 1,244,265 1,283,991 1,134,091 1,287,524 1,326,735 1,335,900 1,390,233 1,364,156 1,355,127 1,376,000 1,304,322 1,294,668 1,245,423 1,228, % 64.0% 72.6% 65.6% 65.5% 65.4% 64.6% 66.7% 68.4% 68.6% 70.8% 69.2% 70.9% 68.4% Postpartum women , , , , , , , , , , , , , , , , , , , , , , , , , , , , % 94.7% 108.9% 100.7% 98.3% 99.4% 104.1% 100.7% 106.8% 99.0% 100.8% 98.8% 100.7% 102.5% 753, , , , , , , , , , , , , , % 72.3% 83.2% 71.5% 71.7% 73.3% 70.5% 72.3% 73.6% 72.8% 76.9% 81.5% 84.6% 84.9% Breastfeeding women , , , , , , , , , , % 162.3% 194.8% 184.8% 181.9% 666, , , , , % 58.4% 67.9% 67.3% 68.7%

71 , , , , , , , , , , , , , , , , , , % 205.3% 200.6% 219.0% 206.5% 207.2% 209.3% 223.2% 236.8% Sources: Authors calculations based on data from the following sources: 725, , , , , , , , , % 75.6% 88.0% 91.2% 88.2% 85.2% 71.1% 70.4% 71.9% For the numbers of WIC participants, U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015). For the numbers of infants, see Joyce A. Martin, Brady E. Hamilton, Paul D. Sutton, Stephanie J. Ventura, Fay Menacker, and Sharon Kirmeyer, Births: Final Data for 2004 National Vital Statistics 55, no.1 (September 29, 2006), and Brady E. Hamilton, Joyce A. Martin, and Stephanie J. Ventura, Births: Preliminary Data from 2006 National Vital Statistics 56, no.7 (December 5, 2007), sr56_07.pdf ; Joyce A. Martin, Brady E. Hamilton, Michelle J. K. Osterman, Sally C. Curtain, and T. J. Matthews, Births: Final Data for 2013, National Vital Statistics Reports 64, no. 1 (January 2015), and Brady E. Hamilton, Joyce A. Martin, Michelle J. K. Osterman, and Sally C. Curtain, Births: Preliminary Data for 2014, National Vital Statistics Reports, 64, no. 6 (June 2015), For the numbers of children ages 14, see U.S. Census Bureau, Statistical Abstract of the United States: 1999 (Washington, DC: U.S. Census Bureau, 2000): 15, table 14, U.S. Census Bureau, Statistical Abstract of the United States: 2012 (Suitland, MD: U.S. Census Bureau, 2012), and U.S. Census Bureau, Annual Estimates of the Resident Population by Single Year of Age and Sex for the United States: April 1, 2010 to July 1, 2014, For population estimates of infants and children in territories, U.S. Census Bureau, Statistical Abstract of the United States (Suitland, MD: U.S. Census Bureau, ); and U.S. Census Bureau, Annual Estimates of the Resident Population by Single Year of Age and Sex for the United States, States, and Puerto Rico Commonwealth: April 1, 2010 to July 1, 2014, Children estimates from were derived from the number of infants in those years because detailed population figures were not available. For breastfeeding rates, Ross Products Division of Abbott Laboratories, Breastfeeding Trends 2003, appendix 1, Centers for Disease Control and Prevention, Breastfeeding Report Cards (Atlanta, GA: Centers for Disease Control and Prevention, ), and Centers for Disease Control and Prevention, Nutrition, Physical Activity and Obesity: Data, Trends and Maps, Note: The total number of persons eligible under the original methodology is derived by multiplying the USDA s adjusted count of the number of persons under 185 percent of poverty (as proposed by the NRC) by the percent adjustments of the original methodology described in Michele Ver Ploeg and David M. Betson, eds., Estimating Eligibility and Participation for the WIC Program: Final Report (Washington, DC: National Academies Press, 2003). Higher recipient incomes and more horizontal inequity. The actual income of WIC recipients is the subject of some dispute. According to the USDA s WIC Participant and 67

72 Program Characteristics survey (WPPC), which collects income data from WIC agencies, 156 in 2014, about 67.4 percent of WIC participants had family incomes at or below poverty; about 16.2 percent had annual incomes between 100 and 150 percent of poverty; and only about 5.9 percent had annual incomes between 150 and 185 percent of poverty, with a bare 1.3 percent above 185 percent of poverty (see table 10). 157 (There is no income data for about 8 percent, possibly because they are adjunctively eligible for WIC and no income data are collected from them.) 158 Another USDA survey, the 1998 National Survey of WIC Participants and their Local Agencies, often simply called the National Survey of WIC Participants (NSWP), collected income data from a stratified sample of WIC-certified persons in twenty-five states. 159 It found roughly similar incomes to those in the WPPC: about 62 percent of WIC participants had family incomes at or below poverty, about 22 percent had annual incomes between 100 and 150 percent of poverty, about 7 percent had annual incomes between 150 and 185 percent of poverty, and about 6 percent above 185 percent of poverty (with about 3 percent having no income data). (The 2008 update of the NSWP did not include questions about income distribution.) Both of these USDA surveys, however, seem to understate substantially the incomes of WIC recipients at least as conventionally measured by the Census Bureau s definition of annual family income. Thus, two Census Bureau surveys have regularly found that WIC 156. U.S. Department of Agriculture, Food and Nutrition Service, WIC Participant and Program Characteristics 2004 (Alexandria, VA, March 2006), 7, which states: The methodology used for PC2004 was first developed for the 1992 report. The 1992 report on WIC Participant and Program Characteristics (PC92) was substantially different from earlier reports with regard to collecting data on WIC participation. FNS developed a prototype reporting system that allows acquisition of all participation data through the automated transfer of an agreed-upon set of data elements. State WIC agencies download routinely collected information from their existing automated client and management information systems. State and local WIC staff obtain these data to certify applicant eligibility for WIC benefits, to guide nutrition education, and to issue food instruments. This Minimum Data Set (MDS) was developed by FNS working with the Information Committee of the National WIC Association and the Centers for Disease Control and Prevention (CDC) Thorn, et al., WIC Participant and Program Characteristics 2014: Final Report According to officials at FNS, We note that roughly 8 percent of all WIC participants did not report income at certification in We do not currently have information on the distribution of their income, but we do know that WIC infants without reported income are found in states with Medicaid income limits both above and below 185 percent of the FPL, so it cannot be concluded that these WIC infants are particularly likely to have higher household income limits than other WIC participants. Richard Lucas, U.S. Department of Agriculture, Food and Nutrition Service, message to authors, April 6, Cole, Hoaglin, and Kirlin, National Survey of WIC Participants: Final Report. The survey used hierarchical cluster sampling to obtain a national probability sample of WIC participants. It excluded WIC enrollees who did not pick up their current food instruments, defined by the USDA as a voucher, check, electronic benefits transfer card (EBT), coupon or other document which is used by a participant to obtain supplemental foods. U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. 68

73 families have substantially higher incomes than reported in either of the USDA surveys. According to the Current Population Survey (CPS), in 2014 only about 48 percent of WIC participants had annual family incomes at or below poverty, about 20 percent had annual incomes between 100 and 149 percent of poverty, only about 9 percent had annual incomes between 150 and 185 percent of poverty, and about 24 percent had annual incomes above 185 percent of poverty about 13 percent had annual incomes between 200 and 300 percent of poverty and about 8 percent had annual incomes over 300 percent of poverty. 160 According to the Survey of Income and Program Participation (SIPP), in 2004 only about 46 percent of WIC participants had monthly family incomes at or below poverty, about 21 percent had monthly incomes between 100 and 150 percent of poverty, only 11 percent had monthly incomes between 150 and 185 percent of poverty, and about 22 percent had monthly incomes above 185 percent of poverty most of whom had monthly incomes above 200 percent of poverty. 161 (See table 10.) Some program officials and program advocates 162 challenge the Census Bureau s CPS and SIPP data and claim that the USDA s WIC Participant and Program Characteristics (WPPC) survey is more accurate than either the CPS or the SIPP. For example, officials at FNS state: 160. Authors calculations, U.S. Census Bureau, Current Population Survey. Because there are no questions in the CPS that ask for whom respondents are receiving WIC, the CPS cannot provide estimates for the number of infants or children receiving WIC. Therefore, our analysis using CPS data is limited to overall WIC recipients. For our estimates of infants receiving WIC, we identified families in the CPS who report receiving WIC and who have an infant. We decided not to do a similar estimate for children one-to-four because their WIC take-up rate is much lower than for infants. Other researchers have proposed alternative methods for estimating the number of children one-to-four receiving WIC in the CPS. See Suzanne Macartney, Estimating the Value of WIC Benefits for the Supplemental Poverty Measure (Suitland, MD: U.S. Census Bureau, 2013), /methodology/supplemental/research/wic_paper_july2013.pdf Richard Bavier message to authors, June 24, In an communication with the authors about ten years ago, Robert Greenstein of the Center on Budget and Policy Priorities wrote: I think using the CPS data for this purpose is highly problematic. As you know, the CPS data reflect annual income. As a result, the period the CPS data cover and the period of WIC receipt may match poorly in many circumstances, such as when an unemployed family or income-sharing household receives WIC for a couple of months at the start of the year but then gets a decent paying job and leaves the program. Furthermore, the CPS data have an extremely large undercount [of WIC recipients so that it may not be representative]. For these reasons, the more appropriate data to use are those from the biennial WIC Participant and Program Characteristics survey, conducted for USDA by Abt Associates. A final piece of evidence is USDA s analysis of the participation effects of eliminating Medicaid adjunctive eligibility for WIC participants at or above 250% of poverty. USDA has estimated this would remove 5,000 participants from the WIC program or 0.06% of the caseload. Since Medicaid adjunctive eligibility is basically the only way that someone at that income level can get into WIC, this indicates that the share of WIC participants who are in that income range is pretty minuscule. Robert Greenstein, Center on Budget and Policy Priorities, message to authors, July 2,

74 The Census surveys are large-scale data sources that are valuable for many national estimates. However, their samples are drawn to represent the national population and are not stratified to ensure representativeness of the WIC population. As a result, the estimates of the WIC population are less accurate than those developed based on WIC administrative data or surveys specifically designed to be representative of the WIC population. 163 Others have concluded otherwise, however. Bitler, Currie, and Scholz, for example, conclude that the CPS and the SIPP may be more accurate because incomes frequently fluctuate over the year and people may join the program when their incomes are temporarily low. People may also have opportunities to shield some income from WIC administrators. Moreover, the CPS and SIPP are designed to elicit accurate income information and, if anything, comparisons of consumption and income data suggest that the surveys undercount income. 164 Perhaps more important, they argue, unlike the CPS and SIPP, the USDA data do not include families that are adjunctively eligible and often have higher incomes (as described below). In their words: It is not clear whether the CPS and SIPP or the National Survey of WIC Participants provides more reliable income data. The WIC program has income verification procedures whereby, for example, recipients bring in paycheck stubs to document income. But incomes frequently fluctuate over the year and people may join the program when their incomes are temporarily low. People may also have opportunities to shield some income from WIC administrators. [FN: A WIC clinic visited by one of the authors was explicit about the fact that they used the lowest of monthly income, annual income, or year-to-date income in order to determine eligibility for the program. An alternative reason for administrative data to be lower is that some states did not report income for adjunctively-eligible persons. If adjunctively-eligible persons have incomes higher than do other WIC recipients, omitting them will tend to bias average income downwards in the administrative data. However, even if we focus on ADF recipients who were income eligible for WIC, we find that incomes are 15 percent higher than in the administrative data.] Moreover, the CPS and SIPP are designed to elicit accurate income information and, if anything, comparisons of consumption and income data suggest that the surveys undercount income (see, for example, Meyer and Sullivan, 2002). Hence, we think (though we cannot conclusively demonstrate) that the CPS and particularly the SIPP provide the most accurate available picture of the resources available to families receiving WIC. To conclude this section, it is clear that the CPS FSS and ADF and the SIPP undercount WIC recipients and that the problem is more severe for WIC than it is for other transfers. [FN: The undercount in the CPS appears to be more severe in the Northeast, Mid-Atlantic and Southeast than it is for other regions in the county. Appendix Table A contains regional comparisons across the CPS FSS, CPS ADF, National Survey, 163. Richard Lucas, U.S. Department of Agriculture, Food and Nutrition Service, message to authors, April 6, Bitler, Currie, and Scholz, WIC Eligibility and Participation,

75 and administrative totals. There is less regional variation in the SIPP.] But these comparisons suggest that missing recipients appear to be randomly distributed across categorically-eligible WIC groups, at least in terms of observables. The incomes of WIC recipients are higher in the CPS and SIPP than in the WIC administrative data, but it is plausible that incomes are underreported to WIC administrators. The discrepancies documented in this section serve as a qualification to CPS- and SIPP-based analyses of WIC. 165 After examining all the surveys and weighing the USDA s comments against those of Bitler and her colleagues, supplemented by our own analysis, we think that the CPS and SIPP provide a more accurate picture of the incomes of WIC recipients. In fact, as mentioned in the above quotation, both the CPS and the SIPP are widely believed to understate income, 166 so that the incomes of WIC families are probably even higher. 167 Here is how we reconcile the four surveys: Current vs. annual income. The WPPC data come from WIC agencies and hence reflect their use of current income at the time of application rather than annual income. Similarly, although the NSWP data come from participants, they are asked for income in the month prior to application (again not annual income). The CPS, however, asks for income for the past year (that is, annual income, the standard Census Bureau period for measuring income), which is higher than average monthly income. (For example, between 2009 and 2012, the monthly poverty rate was about 9 to 13 percent higher than the annual poverty rate.) 168 In addition, both the WPPC and the NSWP include the income of pregnant women, which are then on average near their lowest levels (and hence not reflected in either the CPS or the SIPP). This would help explain why the CPS and the SIPP consistently show higher incomes among WIC recipients than the WPPC and the NSWP. Subfamily not income-sharing household income. The WPPC data, coming from WIC 165. Ibid., See Douglas J. Besharov, Jeffery S. Morrow, and Anne Fengyan Shi, Child Care Data in the Survey of Income and Program Participation (SIPP): Inaccuracies and Corrections (College Park, MD: Welfare Reform Academy, 2006), and Mark I. Roemer, Assessing the Quality of the March Current Population Survey and the Survey of Income and Program Participation Income Estimates, (Washington, DC: U.S. Census Bureau, 2000), 47, table 3b, /www/income/publications/assess1.pdf See Besharov, Morrow, and Shi, Child Care Data in the Survey of Income and Program Participation (SIPP): Inaccuracies and Corrections; and Roemer, Assessing the Quality of the March Current Population Survey and the Survey of Income and Program Participation Income Estimates, U.S. Census Bureau, Dynamics of Economic Well-Being: Poverty , 71

76 agencies, reflect their use of subfamily income, which does not count the income of all adults in the household. Although the NSWP seeks to collect information of shared household income, 169 the survey is conducted in local WIC clinics just after the recipient has been certified for WIC. This may yield inaccurate responses as the recipient may simply report the household income as required by the state or local agency (which is more likely to reflect subfamily income as described below) or may be hesitant to report all household income for fear of losing their recently acquired WIC certification. Both the CPS and the SIPP, however, count the income of all family members in the household. (They do not count the income of unrelated adults, such as cohabiters, who share resources). This is a standard Census Bureau economic unit for measuring income, and, for the families with subfamilies in 2006 is more than three times higher than subfamily income alone. 170 This would also help explain why the CPS and the SIPP consistently show higher incomes among WIC recipients than the WPPC and the NSWP. Missed WIC recipients. Both the CPS and the SIPP miss large numbers of WIC recipients, making their findings potentially inaccurate, as Greenstein notes. 171 However, according to Bitler, Currie, and Scholz, the missing recipients appear to be randomly distributed across categorically-eligible WIC groups, at least in terms of observables. 172 The SIPP asks for monthly income over the past four months, so, all things being equal, it should report lower incomes than the CPS. But the SIPP tends to miss disproportionately more young adults, males, minority groups, never-married people, poor people, and people with lower educational attainment. 173 Hence, its income estimates are probably higher than they should be, and this helps to explain why they are not lower than those in 169. According to the NSWP questionnaire for its in-person interviews, an economic unit is a family household in which members (including both related and unrelated persons) share[d] major expenses. The survey counted the past month s income for all members of this economic unit. See Cole, Hoaglin, and Kirlin, National Survey of WIC Participants: Final Report Authors calculations based on U.S. Census Bureau, DataFerrett, Current Population Survey, Annual Social and Economic (ASEC) Supplement, March As mentioned above, the CPS asks two questions related to WIC: At any time during 2014, (was/were) (you/ anyone in this household) on WIC, the Women, Infants, and Children Nutrition Program? and Who received WIC for themselves or on behalf of a child? Because there are no questions asking for whom respondents are receiving WIC, the CPS does not have estimates for the number of infants or children receiving WIC. U.S. Census Bureau, Current Population Survey: 2015 Annual Social and Economic (ASEC) Supplement (Suitland, MD: U.S. Census Bureau, March 2015), Codebook_2015.pdf Bitler, Currie, and Scholz, WIC Eligibility and Participation Robert A. Moffitt and Michele Ver Ploeg, eds., Appendix D: Summaries of National-Level Survey Data Sets Relevant to Welfare Monitoring and Evaluation, in Evaluating Welfare Reform in an Era of Transition (Washington, DC: National Academy Press, 2001),

77 the CPS. Another reason the WPPC and the NSWP report lower income is that they include the income of pregnant enrollees (about 840,000 women in 2013), but, as described below, the incomes of pregnant enrollees are temporarily low. Missing income data. Both the WPPC and the NSWP (especially the former) have a substantial number of families for whom no income was reported. (In the 2014 WPPC, the percent of families with income not reported was about 8.2 percent and with zero income was about 0.9 percent.) 174 The most likely explanation is that these families are adjunctively eligible, so that the WIC program did not need to collect income data. Presumably, many of these families had annual incomes above 185 percent of poverty. Having no income data on so many families probably understates average incomes. (For the CPS and SIPP, those families with no income reported are included in those below 185 percent of poverty.) Relatedly, in the WPPC, some states only report a range of income for WIC recipients who are adjunctively eligible in order to reflect that the income of the recipients changed over the course of the year. Either because of data limitations or for the sake of convenience, for these recipients USDA uses the midpoint of the income range. This likely understates the recipients income and therefore the number of recipients under 185 percent of poverty. Other differences among the surveys are too small to make a difference and are not discussed here Thorn et al., WIC Participant and Program Characteristics 2014: Final Report For example, the WPPC data and NSWP count families whose income is equal to the cutoff line in the lower bound group ( at or below 185 percent of poverty), whereas data from CPS and the SIPP include them in the higher bound groups ( at or above 185 percent of poverty). This difference, however, has a very slight, if any, effect on the distribution, because few eligible persons have family incomes that are exactly at the cutoffs. According to Sandi Nelson of the Urban Institute, among the CPS March data between 1995 and 2006, there are only two years when the CPS contains cases where eligible persons have family incomes that are exactly at the cutoffs (4 cases in 2004 and 5 cases in 2006). In addition, recipients are defined differently in the surveys. In the WPPC, recipients (called participants ) are defined as persons on WIC master lists or persons listed in WIC operating files who are certified to receive WIC benefits in April [of the data year]. A small proportion of those who were certified for WIC did not physically pick up WIC benefits at the WIC office (7 percent in 2002 and 9 percent in 2006). In the CPS, SIPP, and NSWP, the recipients have actually received WIC benefits. 73

78 Year, data source, and income definition 1998 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2000 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2001 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2002 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2003 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2004 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2005 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2006 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2008 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 2010 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) Table 10 Income Distribution of WIC Recipients WIC Participant and Program Characteristics survey (WPPC), National Survey of WIC Participants (NSWP) Current Population Survey (CPS), and Survey of Income and Program Participation (SIPP) 100% (<100%) of poverty 56.8% 62.1% 54.2% 45.0% 55.6% 45.8% 44.2% 53.9% 46.0% 47.5% 57.2% 48.3% 45.8% 48.3% 59.8% 50.2% 60.8% 53.0% 63.8% 56.6% % (100149%) of poverty 18.6% 22.1% 20.8% 22.0% 23.5% 20.1% 23.1% 23.0% 19.3% 22.2% 20.9% 22.3% 19.8% 23.3% 19.5% 21.1% 18.2% 20.4% 1998, % (150184%) of poverty 6.6% 7.4% 8.4% 12.1% 12.0% 8.2% 10.5% 11.2% 7.7% 11.8% 10.9% 11.8% 7.6% 11.3% 7.4% 9.9% 7.4% 9.4% Income distribution % (185199%) of poverty 0.3% 1.8% 0.4% 3.8% 4.3% 0.4% 3.8% 3.4% 0.5% 3.7% 2.9% 3.3% 0.7% 3.8% 0.5% 3.0% 0.5% 3.2% > 200 ( 200%) of poverty 0.4% 3.8% 0.6% 22.1% 16.0% 0.9% 16.6% 14.9% 0.9% 14.1% 19.4% 14.4% 1.2% 11.4% 0.9% 11.1% 0.9% 10.4% Income not reported 17.4% 2.9% 14.2% 16.4% 14.5% 11.0% 9.9% 7.7% < 185% ( 185%) of poverty 82.0% 91.9% 87.1% 76.8% 84.8% 79.9% 79.8% 82.2% 79.6% 81.7% 84.2% 82.2% 77.7% 82.3% 87.2% 84.8% 88.7% 86.0% 90.9% 86.4% 185% (> 185%) of poverty 0.7% 5.6% 12.9% 23.2% 1.0% 20.2% 20.3% 1.3% 20.4% 18.3% 1.4% 17.8% 22.3% 17.7% 1.9% 15.2% 1.4% 14.0% 9.1% 13.6% 74

79 2012 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 66.6% 54.5% 16.7% 21.1% 6.2% 9.6% 0.4% 3.2% 0.9% 11.6% 8.3% 90.4% 85.2% 9.6% 14.8% 2014 WPPC (current/?subfamily) NSWP (current/?subfamily) CPS (annual, family) SIPP (monthly, family) 67.4% 47.5% 16.2% 20.0% 5.9% 8.7% 0.4% 3.3% 0.9% 20.6% 8.2% 90.5% 76.1% 9.5% 23.9% Sources: For the WPPC data, see Susan Bartlett, Ellen Bobronnikov, and Nicole Pacheco, WIC Participant and Program Characteristics 2004 (Alexandria, VA: USDA, March 2006), B-1, Exhibit B3.6, and Susan Bartlett, Ellen Bobronnikov, and Nicole Pacheco, WIC Participant and Program Characteristics 2006 (Alexandria, VA: USDA, December 2007), 38, Exhibit B3.6, Patty Connor, Susan Bartlett, Michele Mendelson, Katherine Condon, and James Sutcliffe;WIC Participant and Program Characteristics 2008 (Alexandria, VA: USDA, January 2010), Patty Connor, Susan Bartlett, Michele Mendelson, Kelly Lawrence, and Katherine Wen, Sutcliffe; WIC Participant and Program Characteristics 2010 (Alexandria, VA: USDA, December 2011), Bryan Johnson, Betsy Thorn, Brittany McGill, Alexandra Suchmanm Michele Mendelson, Kelly Lawrence Patlan, Brian Freeman, Rebecca Gotlieb, and Patty Connor, WIC Participant and Program Characteristics 2012 (Alexandria, VA: USDA, December 2013), and Betsy Thorn, Chrystine Tadler, Nicole Huret, Elaine Ayo, Carole Tripp, Michele Mendelson, Kelly L. Patlan, Gabriel Schwartz, and Vinh Tran, WIC Participant and Program Characteristics 2014: Final Report (Alexandria, VA: USDA, November 2015), For the NSWP, see Nancy Cole, David Hoaglin, and John Kirlin, National Survey of WIC Participants: Final Report (Alexandria, VA: USDA, October 2001), For 1998 CPS data, and Marianne P. Bitler, Janet Currie, and John Karl Scholz, WIC Eligibility and Participation, Journal of Human Resources 38, no.4 (September 2003): For CPS data, authors calculations based on U.S. Census Bureau, DataFerrett, Current Population Survey, Annual Social and Economic (ASEC) Supplement, March, For 1998 SIPP data, and Marianne P. Bitler, Janet Currie, and John Karl Scholz, WIC Eligibility and Participation, Journal of Human Resources 38, no. 4 (September 2003): For 2004 SIPP data, Richard Bavier message to authors, June 24, 2007, based on U.S. Census Bureau, 2004 SIPP Panel data, wave 1, month 4. Notes: For 1999, no data on WIC are available from these surveys. Significant differences exist among the surveys, making them not precisely comparable. Nevertheless, it seems reasonable to draw some conclusions from them, as discussed in the text. Persons who reported zero family income are treated differently among these data sources. In the WPPC data, they are included in the category of income not reported, whereas in the NSWP, CPS, and SIPP, they are included in the category of at or below 100 percent of poverty. Although there was a second round of the National Survey of WIC Participants that was conducted in 2008, the survey did not appear to have asked about family or household income; thus, no income distribution data for WIC participants is available. Perhaps most convincing is a simple calculation that compares the number of infants and children ages 14) from families with annual incomes below 185 percent of poverty with WIC s 75

80 total enrollment. As table 11 shows, at least since 2000, the number of infants on WIC has consistently exceeded the number of infants from families with annual incomes at or below 185 percent of poverty by between 15 and 30 percent (see figure 2). Furthermore, the SIPP data suggest that, as WIC has expanded, it has enrolled families with higher incomes. 176 Richard Bavier used SIPP data to examine the distribution of WIC participants by income level in the key period between 1988 and He found that the percentage of WIC participants in families with annual incomes above $25,000 (measured in constant 1996 dollars) rose from 21 percent in 1988 to 29.4 percent in 1996, a 40 percent increase. 177 As Bavier notes, his calculations could be compromised by differences in the reporting of WIC receipt in the two periods, with considerably higher reporting in 1996 than in (It is unknown whether these differences bias the findings.) Nevertheless, his findings are consistent with informal reports from the field (and common sense). Once the program reached those with the lowest incomes, it naturally expanded by enrolling more participants with higher incomes. As mentioned at various points in this paper, the mechanisms that allow so many higher income families into WIC using current income instead of income that more accurately reflects the family s status, 178 and using subfamily income instead of the household s total income make many households WIC-eligible even though they have substantially more financial resources than those excluded because their income falls just a little above 185 percent of poverty. One can see the resultant high levels of horizontal inequity in the income distribution of those currently eligible for WIC: According to tabulations by Bavier, in 2006, using a family household definition of income (rather than a subfamily definition of income) would decrease the number of WIC-eligible infants by about 253,000 (or 14 percent) and decrease the number of WICeligible children ages one through four by about 761,000 (or 11 percent). 179 Because only current income is counted, WIC ignores the long-term (and truer) income of many families and income-sharing households. Consider only those families and 176. But see Robert Greenstein, Center on Budget and Policy Priorities, message to authors, July 2, 2007, which states: It also is instructive that despite some caseload growth from 1998 to 2004, the income composition of the participants is essentially unchanged. The percentage at higher income levels is still very small Richard Bavier message to Peter Germanis, June 22, 1999, describing his special tabulations of persons covered by WIC in the first six months of the 1988 SIPP panel and the first six months of the 1996 panel U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations Richard Bavier, message to authors, November 26, 2007, special tabulation from the 2007 CPS Annual Social and Economic Supplement. 76

81 income-sharing households in which the mother takes time off from work to have a baby. In the 1990s, an additional 47 to 74 percent of pregnant women became eligible for this reason (between about 350,000 and 460,000 women). 180 According to Gordon, Lewis, and Radbill, these newly eligible women were more educated, were more likely to live with the father, were more likely to be white, and had fewer children than those who were income eligible during pregnancy Gordon, Lewis, and Radbill, Income Variability Among Families with Pregnant Women, Infants, or Young Children; and Yelowitz, Income Variability and WIC Eligibility: Evidence from the SIPP Gordon, Lewis, and Radbill, Income Variability Among Families with Pregnant Women, Infants, or Young Children, xv. 77

82 Infants Table 11 WIC Enrollees as a Percentage of the Population in that Category with Annual Family Incomes below 185% of Poverty Infants and Children (ages 14) Children All Year Total below 185% of poverty 1,613,987 1,695,909 1,493,310 1,645,928 1,750,672 1,732,681 1,718,315 1,841,291 1,761,090 1,884,556 1,808,297 1,820,871 1,749,458 1,656,495 5,860,702 6,047,187 6,386,035 6,457,826 6,417,945 6,542,721 6,708,065 6,732,454 7,044,242 7,762,568 7,526,704 7,239,571 7,146,320 6,975,161 7,474,689 7,743,095 7,879,345 8,103,754 8,168,617 8,275,402 8,426,379 8,573,744 8,805,332 9,647,124 9,335,001 9,060, Total WIC enrollment 1,899,835 1,925,665 1,931,632 1,959,486 2,028,188 2,053,280 2,093,967 2,185,451 2,228,058 2,216,652 2,150,451 2,096,344 2,059,436 2,015,432 3,551,309 3,648,665 3,763,862 3,850,275 3,991,965 4,001,781 3,987,749 4,080,125 4,428,489 4,789,736 4,837,433 4,756,436 4,716,344 4,508,241 5,451,144 5,574,330 5,695,493 5,809,761 6,020,153 6,055,061 6,081,716 6,265,576 6,656,547 7,006,387 6,987,884 6,852,780 Ratio of WIC enrollment to population below 185% of poverty 117.7% 113.5% 129.4% 119.1% 115.9% 118.5% 121.9% 118.7% 126.5% 117.6% 118.9% 115.1% 117.7% 121.7% 60.6% 60.3% 58.9% 59.6% 62.2% 61.2% 59.4% 60.6% 62.9% 61.7% 64.3% 65.7% 66.0% 64.6% 72.9% 72.0% 72.3% 71.7% 73.7% 73.2% 72.2% 73.1% 75.6% 72.6% 74.9% 75.6%

83 ,895,778 8,631,656 6,775,780 6,523, % 75.6% Sources: U.S. Department of Agriculture, Food and Nutrition Service, Office of Policy Support, WIC Program Average Monthly Participation by Calendar Year (Alexandria, VA: U.S. Department of Agriculture, 2015); and David Betson, Michael Martinez-Schiferl, Linda Giannarelli, and Sheila Zedlewski, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, : Final Report (Washington, DC: Urban Institute, December 2011), Michael Martinez-Schiferl, Sheila Zedlewski, and Linda Giannarelli, Paul Johnson, Linda Giannarelli, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2010: Final Report (Washington, DC: Urban Institute, January 2013), Erika Huber, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2011: Final Report (Alexandria, VA: U.S. Department of Agriculture, March 2014); Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2012: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2015); and Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2016). Note: The ratio of WIC enrollees to the population below 185 percent of poverty is derived by dividing the total WIC enrollment by the number of people below 185 percent of the poverty for each category. These figures exclude persons with family incomes at exactly 185 percent of the poverty guideline, although they are technically eligible for WIC. This exclusion, however, has very slight, if any, effects on the distribution, because few eligible persons have family incomes that coincide exactly with the cutoffs of 185 percent of the guideline. 79

84 IV. Explanations and Assessments The previous section of this paper documents the extent of WIC s expanding eligibility and the concomitant rise in WIC s enrollment. This section seeks to identify the sources of those expansions and, in doing so, to anticipate possible further expansions. To do so, it uses as a framework the key elements of the USDA s expanded methodology for estimating the number of WIC eligibles. As mentioned above, the USDA did not develop its expanded methodology out of whole cloth. The changes it made were based on a small body of research funded in full or in part by the USDA that attempted to understand the actual eligibility criteria applied by WIC staff at the federal, state, and local levels. As we will see, these practices often reflected the broadest or most liberal application of the WIC statute and regulations and sometimes reflected outright contradictions and even violations of them. Table 12 summarizes the respective impacts of the various changes in the methodology for calculating the number of people eligible for WIC together with our estimates of eligibility in 2013, the most recent year for which we have the relevant data. We use these materials as our initial guide to identify the sources of those expansions and, in doing so, to anticipate possible further expansions. 80

85 2013 USDA (Original) USDA (expanded/ui) Besharov (estimate) b Total population of infants Total infants <185% of poverty Table 12 Estimating WIC Eligibility The Impact of Individual Factors and Estimated Cumulative Impacts 2013 Monthly income plus certification periods Ind. a Adjunctive eligibility Subfamily income Eligible infants in territories Nutritional risk Add l cum. b Ind. a Add l cum. b Ind. a Add l cum. b Ind. a Add l cum. b Ind. a Add l cum. b Total cumulative effect or % 185% of poverty Eligible infants as percent of all infants 3,895,561 1,619,876 1% 4% -5% 41.4% 3,895,561 1,619,876 [16%] a 29% [29%] a % -3% 41.3% 61.3% 3,895,561 1,619, % 30-35% 25-40% 15-20% 15-20% 5-10% 4% 6386% 7181% Source: Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2016). Notes: a In the original USDA method, the adjustment for adjunct eligibility was made for Medicaid only. b The reasons for these estimates are described in Appendix 2. 81

86 Subfamily income vs. shared-income family household income. To determine income eligibility, WIC agencies are supposed to count the income of the entire household if it is shared. Many agencies do not, however, and instead count the income of only the nuclear family, leaving out other sources of household income for example, from grandparents, siblings, and boyfriends. The failure to count all of the household s income could, by itself, expand eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 20 percent. 182 Although WIC regulations call the income unit to be used for measuring incomeeligibility the family, they actually describe a broader unit: households that share income and resources, defined as a group of related or nonrelated individuals who are living together as one economic unit. 183 (As mentioned above, we refer to these groups as families and incomesharing households. ) Those not living together as an economic unit do not have their collective incomes counted in determining eligibility. (Unborn children are counted as family members, as are all children living in the home.) 184 State WIC rules, in turn, make similar reference to shared household income and consumption. For example, the California WIC Program Manual defines the Family Unit as a group of related or nonrelated individuals who live together as one household/economic unit. These individuals share income and consumption of goods or services. 185 Our review of twentythree current state WIC policy and procedure manuals found that most states used the definition in the WIC regulations, but at least three states have less strict definitions. In Texas, for example, the income of all persons, related or unrelated, living together in the same dwelling is required to be counted when determining eligibility, except when members of the household usually purchase or prepare food separately or intend to purchase and prepare food separately after certification. 186 The two other states (Minnesota and Missouri) use definitions that are less strict 182. This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. There is apparently no definition of the relevant economic unit in the two statutes that the form the basis of WIC s legal framework: the Child Nutrition Act of 1966 (CNA) and the Richard B. Russell National School Lunch Act (NSLA). The Food and Nutrition Act of 2008, however, defines a household to include a group of individuals who live together and customarily purchase food and prepare meals together for home consumption. Food and Nutrition Act of U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations California Department of Health Services, WIC Program Manual: Determination of Income Eligibility (Sacramento, CA: California Department of Health Services, February 2014), 2, /wicworks/documents/wpm/wic-wpm pdf Texas Department of State Health Services, Policy and Procedures Manual (Austin, TX: Department of State Health Services, 2015), 82

87 than the WIC regulations. They require that the individuals in the household share economic resources and the consumption of goods and services. 187 Nevertheless, it appears that many WIC eligibility workers do not count all shared household income and instead look at the income of only the nuclear family. They tend to base income-eligibility determinations, for example, on the mother s own income ( subfamily income ) and not that of the entire shared-income family household, which could be much higher because it can include the income of relatives and cohabitors. One method to identify this failure to consider all shared household income is to compare the results of the USDA s National Survey of WIC Participants (NSWP) to the SIPP. (We use the 2001 NSWP and the 1996 and 2001 SIPPs because the most recent NSWP did not include questions about the make-up of the economic unit.) According to the NSWP data, in 1998, 85 percent of the WIC economic units were residing by themselves, only 15 percent were residing in larger households, and 4 percent contained unrelated individuals. 188 Yet, in both the 1996 and 2001 SIPPs, the percentage of WIC mothers ages fifteen to forty-four who lived solely with their immediate family was only about 62 percent in and 66 percent in more than 20 percent lower. And the proportion living with either an unmarried partner or other adult nonrelative(s) was almost five times higher, 17 percent in and 19 percent in The effects of this failure to consider all household income on the income distribution of WIC recipients are described in more detail below Minnesota Department of Health, Certification Procedures, in Minnesota WIC Operations Manual (St. Paul, MN: Minnesota Department of Health, 2015), program/mom/chsctns/ch5/sctn5_2.pdf; and Missouri Department of Health and Senior Services, Income Assessment and Documentation, in WIC Operations Manual (Jefferson City, MO: Missouri Department of Health and Senior Services, 2015), wiclwp/wom/pdf/er pdf Cole, Hoaglin, and Kirlin, National Survey of WIC Participants: Final Report, U.S. Census Bureau, Fertility and Program Participation in the United States: 1996 (P70-82), Detailed Tables, table 3, U.S. Census Bureau, Participation of Mothers in Government Assistance Programs: 2001 (P70102), Detailed Tables, table 3A, U.S. Census Bureau, Fertility and Program Participation in the United States U.S. Census Bureau, Participation of Mothers in Government Assistance Programs:

88 Box 2 Census Bureau Definitions of Income Units A household consists of all the people who occupy a housing unit. The Census Bureau divides households between nonfamily households and family households, according to the status of the householders. A nonfamily household is one in which the householder either lives alone or shares the housing unit with people who are not related to him or her. A family household is a household maintained by a householder who is in a family, and includes any unrelated people (unrelated subfamily members and/or secondary individuals) who may be residing there. A family is a group of two people or more (one of whom is the householder) related by birth, marriage, or adoption and residing together; all such people (including related subfamily members) are considered as members of one family. The term primary family is sometimes used in place of family to distinguish it from a subfamily. A subfamily is a married couple with or without children, or a single parent with one or more nevermarried children under 18 years old. A subfamily does not maintain their own household, but lives in the home of someone else. Subfamilies are either related or unrelated, as described next. A related subfamily is a married couple with or without children, or one parent with one or more own never married children under 18 years old, living in a household and related to, but not including, the person or couple who maintains the household. An unrelated subfamily (formerly called a secondary family) is a married couple with or without children, or a single parent with one or more own never-married children under 18 years old living in a household. Unrelated subfamily members are not related to the householder. An unrelated subfamily may include people such as guests, partners, roommates, or resident employees and their spouses and/or children. Source: U.S. Census Bureau, Current Population Survey (CPS) Definitions and Explanations, Some observers explain this failure to consider all the shared income in the household as the product of worker reluctance to delve into private living arrangements. A 2001 ERS report explains: An area of particular vulnerability in the process of determining income eligibility is obtaining an accurate income for the economic unit. With the exception of small towns, where staff may know the living situations of applicants, WIC staff must typically rely on the documentation the applicant provides on who is living in the home and how much income they receive Dev R. Chaudhari and Vicki Shaffer, Methods To Prevent Fraud and Abuse Among Staff and 84

89 Moreover, as some have noted, WIC staff may simply be eager to provide WIC benefits to as many families and income-sharing households as possible 194 especially at a time when there do not seem to be immediate funding constraints. They may also be unaware of WIC s household income-sharing rule. After all, as mentioned above, USDA publications tend to use the terms of family, economic unit, and household interchangeably. Using the subfamily definition of income makes many better-off families and incomesharing households look more needy than they are and more needy than many who are not in the program. A single mother on her own with an income just above 185 percent of the poverty line would not be eligible for WIC, while a single mother living in a household (with, say, her mother or boyfriend) that has a much higher total income could be eligible as long as her own personal income is below 185 percent of poverty. This is evidenced in the CPS. In 2014, about 89 percent of individuals in related subfamilies (meaning that they are in a family that is related to the primary householder) who were receiving WIC had annual subfamily incomes below 100 percent of poverty, about 7 percent had annual incomes between percent of poverty, about 3 percent had annual incomes between percent of poverty, and only about 1 percent had annual incomes above 185 percent of poverty. However, when counting the income of the entire family (not even including other members of the household as required by WIC regulations), only about 27 percent of these individuals in related subfamilies had annual incomes below 100 percent of poverty, about 20 percent had incomes between percent of poverty, about 7 percent had annual incomes between percent of poverty, and about 46 percent had annual incomes above 185 percent of poverty. About 21 percent had incomes between percent of poverty and about 19 percent had incomes at or above 300 percent of poverty. 195 The USDA does not estimate adjustment factors using alternative definitions of household income units, despite stating it does so in its brief overview of the expanded methodology, 196 and instead uses only the Census Bureau s income definition for a family or primary family ( all persons related by blood, marriage, or adoption ). 197 This is a narrower Participants in the WIC Program: Volume I, Final Report (Washington, DC: USDA, December 2001), 28, Besharov and Germanis, Rethinking WIC, Authors calculations from U.S. Census Bureau, Current Population Survey U.S. Department of Agriculture, Food and Nutrition Service, Office of Analysis, Nutrition, and Evaluation, WIC Program Coverage: How Many Eligible Individuals Participated in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): 1994 to 2003? 197. As recommended by the CNSTAT panel, we define the family as all persons living in the household 85

90 definition of the relevant income unit because it leaves out unrelated members of the household that are probably sharing financial resources and, hence, has the effect of raising the estimate of eligibles. According to the CPS, in 2014, the median subfamily income of the related subfamilies with children that lived with their relatives (about 6 percent of the total number of families with children) was only $19,700, but the median primary family income of such households was about $70, That means that a subfamily in a household with a total income of $70,300 (or more, because this is just the median) could be WIC-eligible, while a mother and a child living alone with a total income of $30,000 would not. (In 2014, the income cutoff was $29,101, or 185 percent of poverty guideline for a two-person family.) 199 Bavier found similar patterns using the 2004 SIPP. 200 In 2001, the NRC explored the impact on eligibility estimates of using the subfamily as the economic unit for determining income and concluded that it made only a very small difference compared to using a family household measure: about a 1 percent increase for infants and a 1.5 percent increase for children. 201 The NRC explained the smallness of this effect as being the product of considering adjunctive eligibility first, because many subfamilies are also eligible for WIC through adjunctive eligibility. Once this is accounted for, according to the NRC, the effect of using subfamilies as the economic unit becomes quite small. 202 Without considering related by birth, marriage, or adoption. (The WIC program does not specifically define the family unit that must be used for income determination.) Johnson et al., National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report, Authors calculations based on U.S. Census Bureau, Current Population Survey, Annual Social and Economic (ASEC) Supplement, March Authors calculation based on U.S. Department of Health and Human Services, The 2014 HHS Poverty Guidelines, Richard Bavier, message to authors, April 7, In the 2004 SIPP, Bavier found that only about 14.9 percent of all related subfamilies with an infant had, themselves, monthly incomes at or above 185 percent of poverty. However, about 53 percent lived with families with monthly incomes at or above 185 percent of poverty, including 32 percent with monthly incomes at or above 300 percent of poverty. Fifty-four percent of all related subfamilies lived in households with monthly incomes at or above 185 percent of poverty, including 33 percent with monthly incomes at or above 300 percent of poverty. For all unrelated subfamilies, only about 2 percent had monthly subfamily incomes at or above 185 percent of poverty, but 46 percent lived in households with monthly incomes at or above 185 percent of poverty, including 22 percent with monthly incomes at or above 300 percent of poverty Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Phase I Report, 202. Ibid., 4546, which states: Giannarelli and Morton (2001) present estimates of the effect of these alternative unit definitions that suggest a much larger impact on the number of income eligible infants and children. However, the baseline they employed did not account for adjunctive eligibility. Our estimates employ a baseline that does account for adjunctive eligibility. The impact of these alternative definitions appears to be much more modest 86

91 the impact of adjunctive eligibility, using a primary family measure compared to a subfamily measure would have increased the estimated number of eligible infants and children by about 13 percent and 7 percent, respectively. 203 But, as suggested above, the NRC did not actually count all household income. It compared eligibility estimates based on subfamily income only to the income of the related persons in the household, what the Census Bureau calls family income (or primary family income). 204 It also did not count the income of unrelated persons with income, which, after all, should be considered for WIC eligibility as long as the income is shared. 205 What happens when the income of nonfamily members in the household is counted? Because of the difficulty of judging from national data sets whether income is being shared, Bitler, Currie, and Scholz decided against calculating the impact of counting the incomes of nonfamily members of the household in their study of WIC as it operated in But their analysis hints at its possible significance: they found that the average and median incomes of WIC recipients are more than 25 percent higher using household versus primary family definitions of income. To estimate the impact of counting the income of nonfamily members of the household, we used the CPS to estimate the annual family and household incomes of WIC recipients. In 2014, about 48 percent of WIC recipients had annual family incomes below poverty, about 21 percent had annual incomes between 100 and 149 percent of poverty, and about 9 percent had annual incomes between 150 and 184 percent of poverty. But an additional about 21 percent had once adjunctive eligibility is accounted for in the estimates Linda Giannarelli and Joyce Morton, Estimating the Number of Infants and Children Who Are Income Eligible for WIC (presentation, Panel to Evaluate the USDA s Methodology for Estimating Eligibility and Participation for the WIC Program, March, 2000) Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Phase I Report, 205. Ibid., 44, which states: The current FNS methodology employs the Census Bureau s family definition to represent the WIC economic unit. A census family is defined as all persons related by blood or marriage who live together. For example, if a mother with an infant and a child lives with her two parents, then the FNS methodology would consider all five persons to constitute an economic unit for determination of WIC eligibility.... The panel explored the use of an alternative definition of the economic unit that includes only parents and children under the age of 18 years. In our example, this alternative definition considers only the mother, her infant, and her child as the economic unit. For a lack of a better term, we denote this definition as the narrow family compared with a broad family definition that would consider the two parents of the mother (grandparents of the children) as part of the economic unit. The panel used Urban Institute data and the TRIM model to examine the sensitivity of the estimated number of income eligible persons to the definition of a WIC economic unit. Two scenarios reflect alternative ways that WIC staff might assess different living arrangements. Under a restrictive scenario, we considered the infants and children to be eligible only if they were eligible under both the narrow and the broad definitions of a family. Under a more generous scenario, we considered them eligible if the family meets income eligibility requirements for at least one of the definitions Richard Bavier, message to authors, April 7,

92 annual incomes above 185 percent of poverty with about 12 percent between 200 and 299 percent of poverty and about 7 percent at or above 300 percent of poverty. When using household incomes instead of family incomes, however, only about 41 percent of WIC recipients had annual incomes below poverty, about 22 percent had annual incomes between 100 and 149 percent of poverty, about 10 percent had annual incomes between 150 and 184 percent of poverty, and about 26 percent had annual incomes above 185 percent of poverty with about 14 percent between 200 and 299 percent of poverty and about 9 percent at or above 300 percent of poverty. The effect of nonfamily members is even more apparent when looking at only the effect of single mothers living with an unmarried partner. Using family income (not counting the income of the unmarried partner), 78 percent of single mothers receiving WIC for themselves and/or their children had annual incomes below 100 percent of poverty, about 10 percent had annual incomes between 100 and 149 percent of poverty, about 8 percent had annual incomes between 150 and 185 percent of poverty, and only about 4 percent had annual incomes above 185 percent of poverty. When using household income (counting the income of the unmarried partner), however, only 23 percent of single mothers receiving WIC for themselves and/or their children had annual incomes below 100 percent of poverty, about 21 percent had annual incomes between 100 and 149 percent of poverty, and about 16 percent had annual incomes between 150 and 184 percent of poverty, but about 40 percent had annual incomes above 185 percent of poverty with about 19 percent between 200 and 299 percent of poverty and about 15 percent at or above 300 percent of poverty. 207 This difference is sometimes defended on the ground that counting the income of the mother s parents might lead her to move out of their home. That is certainly the fear when it comes to welfare payments. But the limited nature of WIC benefits makes that seem implausible. The argument against counting the income of the boyfriend is that it may be temporary in that he may leave. But that would seem to be remediable though an adjustment of benefits. We recommend that the USDA regulations be changed to clarify that the income unit for WIC income eligibility is the family and income-sharing household and not the family. In addition, the USDA should make greater efforts to ensure that state and local agencies count the income of everyone in the family and income-sharing household and not just the income of the subfamily. Current income vs. income that more accurately reflects the family s status. Because incomes can rise and fall throughout the year, WIC agencies are allowed to choose among annual, monthly, or weekly income. The one exception, and it is substantial, is lower 207. Authors calculations from U.S. Census Bureau, Current Population Survey. 88

93 current income caused by unemployment, which must be used as the basis of eligibility. 208 The regulations allow (but do not mandate) states to require that agencies select the period that more accurately reflects the family s status, 209 but some states seem to have done a poor job encouraging WIC agencies to do so. Most WIC agencies simply seem to use the lowest income, whatever it is, in order to maximize eligibility. This failure to use the most appropriate income period could, by itself, expand eligibility over the base of those with annual incomes below 185 percent of poverty by about 20 percent. 210 An income-sharing household s income can be temporarily high or temporarily low. Income could be temporarily high, for example, if a member of the income-sharing household has only a temporary job, or has recently received a student grant, a one-time bonus, a reimbursement for expenses, or an unusual amount of overtime pay. On the other hand, income could be temporarily low, for example, if a member of the income-sharing household is between jobs, on strike, on an unpaid leave of absence (perhaps because of pregnancy), has been laid off for the summer only, is paid on a 10-month basis like teachers, and the application is made in the summer, or is a seasonal or migrant worker. (The latter could also result in a temporarily high income as well.) Constance Newman of the USDA used the 1996 panel of the SIPP to track income variability of households with incomes at or below 185 percent of poverty that were eligible to receive free or reduced school lunch. She found that, in 1996, 65 percent of all households that were eligible for free or reduced school lunch in at least one month of the year had their eligibility status change at least once in the year and 21 percent had their eligibility status change three or more times in the year. She also found 14 percent of households that had been eligible in July 1996 had become ineligible by September and 20 percent had become ineligible by December. There were also a number of households, however, that were ineligible in July that would have been eligible if annual income had been used as opposed to monthly. She concludes that households with greater volatility (even if only relative) may be more likely to cross the threshold of eligibility and be caught on the ineligible side when 1 month s income is used to determine eligibility.... The evidence here shows that income volatility is relatively more important for low-income households, and it is strongly linked to monthly changes in the characteristics of a household s labor force participation. To the extent that 208. See U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations, which state: However, persons from families with adult members who are unemployed shall be eligible based on income during the period of unemployment if the loss of income causes the current rate of income to be less than the State or local agency s income guidelines for Program eligibility Ibid This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix 2. 89

94 the USDA food assistance programs are to serve the needy, the volatility associated with low-income working households will become an increasing challenge to program administration. 211 Income volatility appears to have increased considerably for many groups over the last four decades, although the degree of the increase in that variability depends on the study. 212 Reasons include welfare reform, shorter periods of job tenure, and variability in hours worked because of self-employment. 213 Karen Dynan, Douglas Elmendorf, and Daniel Sichel used the Panel Survey of Income Dynamics (PSID) to estimate income volatility between 1970 and 2008, finding that, during this period, income volatility increased by about 30 percent. For heads of household with no high school degree, income volatility increased by about 50 percent. 214 Keshav Dogra and Olga Gorbachev also used the PSID and found that between 1980 and 2006, household income volatility increased by 44 percent. 215 Bradley Hardy and James Ziliak used the CPS to estimate income volatility by income level and found that between 1980 and 2009, income volatility doubled for households with incomes in the bottom 10 percent of the income distribution. 216 High levels of income variability have a significant effect on eligibility for means-tested programs. For example, Thomas MaCurdy, a professor at Stanford University, and Grecia Marrufo, a researcher at the SPHERE Institute, used the Monthly Income Dynamic SIPP simulation model to simulate food stamp eligibility in They found that the number of households eligible for SNAP declined by about 67 percent when determining eligibility using average monthly income over a six-month period as opposed to monthly income. In addition, 211. Constance Newman, The Income Volatility See-Saw: Implications for School Lunch (Alexandria, VA: U.S. Department of Agriculture, August 2006), /newman.pdf Some researchers have found little to no changes over time. See Scott Winship, Economic Instability Trends and Levels across Household Surveys (Ann Arbor: National Poverty Center, April 2011), See Keshav Dogra and Olga Gorbachev, Consumption Volatility, Liquidity Constraints and Household Welfare, Economic Journal (forthcoming), Karen Dynan, Douglas Elmendorf, and Daniel Sichel, Evolution of Household Income Volatility, The B.E. Journal of Economic Analysis and Policy 12, no. 2 (2012): 140; Bradley Hardy and James P. Ziliak, Decomposing Trends in Income Volatility: The Wild Ride at the Top and the Bottom, Economic Inquiry 52, no. 1 (January 2014): ; and Donggyun Shin and Gary Solon, Trend in Men s Earnings Volatility: What Does the Panel Study of Income Dynamics Show? Journal of Public Economics 95 (2011): Dynan, Elmendorf, and Sichel, Evolution of Household Income Volatility, Dogra and Gorbachev, Consumption Volatility, Liquidity Constraints and Household Welfare. See also Shin and Solon, Trend in Men s Earnings Volatility, Hardy and Ziliak, Decomposing Trends in Income Volatility,

95 they found that households were only eligible for an average of six months of the year when eligibility was determined using monthly income. 217 Recognizing such variations, some means-tested programs base eligibility on annual or annualized income. In many instances, they seek to identify people whose long periods of poverty bespeak or create other serious problems. For example, the Head Start Act requires that income eligibility be based on annual income either for the twelve months prior to enrollment or for the last complete calendar year before enrollment ( whichever more accurately reflects the needs of the family at the time of application ) presumably to identify those children whose long-term poverty status puts them at social and developmental risk and who therefore presumably need a compensatory early childhood education program. 218 Within that context, and also because Head Start has a nine-month curriculum, rises in family income after enrollment are ignored. 219 Other means-tested programs, such as SNAP and the school meals programs, base eligibility on immediate economic need, using income during the past 30 days 220 and in the prior month, 221 respectively, to determine eligibility. The original purpose of these programs was to help those who currently could not afford to purchase sufficient food. 222 Consequently, both programs originally required recipients to report specified changes in income as small as $50 depending on the circumstances Thomas MaCurdy and Grecia Marrufo, Food Assistance for the Working Poor: Simulating the Impact of the Nutrition Tax Credit on the Food Stamp Program, (paper, presented at Income Volatility and Implications for Food Assistance Programs II conference, Washington, DC, November 1617, 2006), 30, Head Start Act, U.S. Code 42 (1998), 9840, sec. 645(a) See Besharov and Morrow, Nonpoor Children in Head Start U.S. Department of Agriculture, Food and Nutrition Service, Food Stamp and Food Distribution Program U.S. Department of Agriculture, Food and Nutrition Service, Determining Eligibility for Free and Reduced Price Meals and Free Milk in Schools, Code of Federal Regulations title 7, sec (2015), pt &rgn=div Food and Nutrition Act of 2008, which states that its purpose is to alleviate such hunger and malnutrition, a food stamp program is herein authorized which will permit low-income households to obtain a more nutritious diet through normal channels of trade by increasing food purchasing power for all eligible households who apply for participation. See also Richard B. Russell National School Lunch Act, which states that its purpose is to safeguard the health and well-being of the Nation s children and to encourage the domestic consumption of nutritious agricultural commodities and other food, by assisting the States, through grants-in-aid and other means, in providing an adequate supply of foods and other facilities for the establishment, maintenance, operation, and expansion of nonprofit school lunch programs U.S. Department of Agriculture, Food and Nutrition Service, Food Stamp and Food Program ; and 91

96 Even in these programs, however, we can see a growing liberalization of reporting requirements that seem at odds with the purposes of the programs. In SNAP, for example, almost all states have taken advantage of the simplified reporting option. 224 This option allows states to extend the certification periods of most food stamp households (not including households that have no earnings and in which all adult members are elderly or disabled, households in which all members are homeless, or households that include migrant and seasonal farm workers ) 225 and to require a household to report a change during the certification period only if it results in income exceeding the food stamp eligibility limit of 130 percent of the federal poverty level. At 6 months, a state must recertify the household or, if it uses a 12-month certification period, require the household to submit a short semiannual report. 226 Similarly, for the school meals programs, in 2004 Congress extended certification periods from one month to the length of the school year for households that qualify for free or reduced school meals, eliminating the requirement for households to report monthly income changes that exceed $ What impact do these new rules have on enrollment and program costs? Maria Hanratty of the University of Minnesota found that the relaxing of certification requirements in the food stamp program that is, extending certification periods to six months and requiring food stamp recipients to report a change in income during the certification period only if it results in their income exceeding 130 percent of poverty led to a 9.2 percent increase in food stamp participation between 2001 and 2003 using the 2001 panel of the SIPP. 228 In the State and Local Agencies report from the National Survey of WIC Participants that reported on state policies from 2009, 48 percent of states indicated that they used current income U.S. Department of Agriculture, Food and Nutrition Service, Determining Eligibility for Free and Reduced Price Meals and Free Milk in Schools U.S. Department of Agriculture, Food and Nutrition Service, Program Development Division, Food Stamp Program: State Option Report, 10th ed. (Alexandria, VA: USDA, November 2012), Optio usda.gov/sites/default/files/10-state_options.pdf Carole Trippe, Liz Schott, Nancy Wemmerus, and Andrew Burwick, Simplified Reporting and Transitional Benefits in the Food Stamp Program Case Studies of State Implementation: Final Report (Princeton, NJ: Mathematica, May 2004), viii, Ibid Newman, The Income Volatility See-Saw: Implications for School Lunch Maria Hanratty, Has the Food State Program Become More Accessible? Impacts of Recent Changes in Reporting Requirements and Asset Eligibility Limits, Journal of Policy Analysis and Management 25, no. 3 (2006):

97 to determine eligibility for WIC, 30 percent indicated they used another method, 18 percent left the decision to the local WIC agencies, and 4 percent used annual income. In determining how to collect the most recent income, one-third of State WIC agencies (36.6%) use the latest pay stub/earnings statement (36.6%) and another one-third use the most recent 30 days or calendar month (32.9%). The remaining agencies use income from the previous 60 days (7.3%), previous 90 days (4.9%), previous 12 months (7.3%), or said the question was not applicable (11.0%). 229 In a 2012 review of ten state WIC policy manuals, the GAO found that states define current income differently: 2 define current income as income from the last 30 days, 1 defines it as income from the last 60 days, and 2 others do not clearly define it. In practice, this means families and income-sharing households with a temporary drop in income such as those in which a parent s work hours have been reduced may be found eligible for the program at the time of application, even if their annual incomes are above 185 percent of the federal poverty guidelines. 230 The other states they reviewed passed discretion on the matter to local WIC agencies. In response to the GAO report, in 2013, the USDA issued a policy memorandum to states with guidance for determining household income. The USDA encouraged states to define current income as income received by the household during the month (30 days) prior to the date the application for WIC benefits is made. 231 In addition, the USDA provided concrete examples of when the use of annual income is more appropriate than current income: when a member of the income-sharing household is on maternity leave, teachers who are on leave during summer months, and college students who only work during the summer. 232 Our review of twenty-three current state WIC policy and procedure manuals revealed that almost all states provide guidance on income that is in accordance with WIC regulations and the USDA guidance in the 2013 memorandum. Three states (Idaho, New Hampshire, and Utah) appear to instruct WIC agencies to use only current income. Instructions are unclear for two other states (Alabama and Connecticut). To ensure that states are implementing these policies, the USDA conducts management evaluations (MEs) of state and local WIC agencies. According to the GAO s review of MEs between 2010 and 2013: 229. U.S. Department of Agriculture, Volume II: State and Local Agencies (Final Report) in National Survey of WIC Participants II U.S. Government Accountability Office, WIC Program: Improved Oversight of Income Eligibility Determination Needed U.S. Department of Agriculture, WIC Policy Memorandum #2013-3: Income Eligibility Guidance (memo, U.S. Department of Agriculture, Alexandra, VA, April 26, 2013) Ibid. 93

98 Regional FNS reviewers found problems with or expressed concerns about income eligibility determination policies or procedures in 23 states (including 15 states, 6 Indian Tribal Organizations, and 2 U.S. Territories), despite the flexibilities allowed in federal regulations in this area. The most common finding related to adjunctive eligibility was insufficient proof of adjunctive eligibility in participant case files (5 states). Concerning other aspects of income eligibility determination, problems were found related to a lack of required income information in participant case files (6 states), the income sources included or excluded (5 states), and the determination of an applicant s family size (5 states). 233 According to Zoë Neuberger of the Center on Budget and Policy Priorities, since 2013 the USDA has focused its management evaluations on certification error and vendor error. 234 (The findings of these evaluations have not been made public.) A few states give some specific examples of when current income versus annual income should be used. Missouri, for instance, instructs local agencies to use annual income for teachers, military, self-employed, and irregularly paid. 235 But, in fact, it is impossible to capture in a simple word formulation all the variations involved, as illustrated by this example given by the NRC: One might believe that, armed with all the relevant information on a WIC applicant, it would be possible to determine whether an individual is eligible for WIC or not. However, the language of the program s eligibility rules and regulations does not lead to strict determination of who is eligible and who is not. Consider the following extreme example. A mother with a child who is 2 years old has annual income that exceeds 185 percent of the poverty guideline. However, in May, she loses her job and her income falls below 185 percent of poverty. In June, she finds a new job and her income again exceeds the WIC income limits. In this case, would the 2-year-old child be eligible for WIC, and, if so, for how many months? If the mother goes to the WIC office in May, her child will meet the WIC income eligible limits and will be certified to receive benefits for 6 months. WIC regulations 246.7(i)(10) state that a participant may not withhold or conceal information to obtain benefits. One interpretation of this regulation is that, in June, the 233. U.S. Government Accountability Office, WIC Program: Improved Oversight of Income Eligibility Determination Needed, Zoë Neuberger, Testimony of Zoë Neuberger, Senior Policy Analyst, Before the House Education and the Workforce Subcommittee on Early Childhood, Elementary, and Secondary Education (testimony, U.S. House of Representatives, Washington, DC, May 19, 2015), Missouri Department of Health and Senior Services, WIC Operations Manual (Columbia, MO: Missouri Department of Health and Senior Services, 2015), /wic/wiclwp/wom/pdf/er pdf. 94

99 mother is obligated to report to the WIC offices that she has gained employment and report her income. This interpretation implies that the child would have had only one month of eligibility. However, based on correspondence from Food and Nutrition Service (FNS) officials, it is WIC policy to apply the regulation only when the mother is applying for benefits. The mother has no subsequent obligation to reveal that her family s income has changed. 236 As a result, in determining income eligibility, local WIC staff have wide latitude in deciding what income to use, and the evidence indicates that they use the applicant s lowest income in determining eligibility. As Bitler, Currie, and Scholz describe: A WIC clinic visited by one of the authors was explicit about the fact that they used the lowest of monthly income, annual income, or year-to-date income in order to determine eligibility for the program. 237 (One of the authors observed similar behavior.) 238 According to the National Research Council (NRC): While the WIC regulations are vague about the time period for determining family income, many observers suggest that using monthly income of the family would be closer to the rules employed by states and local WIC personnel. 239 The difference between annual and current income can have a large impact on the number of eligibles. In 1998, according to Bitler, Currie, and Scholz, 12 percent more families qualified for WIC under an average monthly income test than under an annual income test. 240 That is based on the 1998 WIC regulations and also does not include the impact of certification periods. When the Urban Institute added the impact of certification periods to its adjustment from annual to average monthly income for 2003, the number of income-eligible infants increased by 35 percent and children by 12 percent. 241 Moreover, using an eligible-in-any-month income test dramatically increases eligibility estimates, 242 which would be closer to a current Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 237. Bitler, Currie, and Scholz, WIC Eligibility and Participation, Besharov and Germanis, Is WIC as Good as They Say?, Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Phase I Report, 240. Bitler, Currie, and Scholz, WIC Eligibility and Participation, 1162, table Edward Herzog, U.S. Department of Agriculture, Food and Nutrition Service, message to authors, June 14, The expanded methodology estimates eligibles using both CPS and SIPP data. For the estimate based on CPS data, the Urban Institute report states: To capture the impacts of monthly fluctuations in income and program participation as well as the impact of certification periods, the NRC Panel recommended that an adjustment factor be applied to the initial CPS-based counts of eligible infants and children.... Each factor is calculated by dividing a SIPP-based estimate that uses all the SIPP monthly data to determine monthly eligibility and that applies 95

100 income-at-application income test. Compared with the use of annual income, the SIPP data indicate that there would be between 52 and 64 percent more income-eligible infants in 1997 and 1998, respectively. The estimates for children are equally large 46 and 50 percent in the two years. 243 Variations in monthly earnings are even greater for pregnant women, a key target group for WIC services. Based on calculations from the SIPP panels, Aaron Yelowitz of the University of Kentucky concludes almost all households experience at least one month of decline in total family income during the pregnancy/postpartum. 244 Studies of family income trends before and after the birth show that the average and median incomes of both women and their families (1) fall slightly in the early stages of pregnancy, (2) fall sharply during the end of the third trimester, and (3) increase steadily for about twelve months after the birth of the child but, at least in that period, not to pre-pregnancy levels. 245 According to Yelowitz: For a woman with median earnings, [her] earnings fall from more than $800 per month during the first trimester, to zero at birth, and rebound to approximately fifty percent of their initial level by the end of the postpartum period. At the 75th percentile, earnings fall by about 40 percent during pregnancy, but rebound to approximately 90 percent of their initial level by the end of the period. 246 Modeling WIC eligibility rules, Yelowitz found that the number of eligible women rises by as much as 74 percent (from nine months before birth to five months after) because of income declines during pregnancy. In the scenario that is the closest approximation to the actual WIC eligibility process... [a woman s] eligibility is evaluated in each month, but once she is certified as WIC eligible either through income eligibility or adjunctive eligibility, she does not need to be recertified until birth, after birth, or up to six months postpartum. 247 At the onset of the certification periods by a SIPP-based estimate that mimics the type of estimates that can be computed from the March CPS. Giannarelli and Nelson, How Many Women, Infants, and Children are Eligible for WIC? Estimates from the CPS and SIPP, For the SIPP-based estimates, the report states that for each month, the SIPP data are used to determine if the income of the infant s or child s broadly-defined family (including all persons related by blood, marriage, or adoption) is below 185 percent of the applicable poverty guideline. Giannarelli and Nelson, How Many Women, Infants, and Children are Eligible for WIC? Estimates from the CPS and SIPP, Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 244. Yelowitz, Income Variability and WIC Eligibility: Evidence from the SIPP, See, for example, Yelowitz, Income Variability and WIC Eligibility: Evidence from the SIPP, 11 13, 17; and Gordon, Lewis, and Radbill, Income Variability Among Families with Pregnant Women, Infants, or Young Children, Yelowitz, Income Variability and WIC Eligibility: Evidence from the SIPP, Ibid.,

101 pregnancy, 29.6 percent of the women are WIC eligible. But that number rises to about 44.1 percent around one month before the birth of the child; at birth, 42.7 percent of women are eligible. From that point, WIC eligibility rises to 51.5 percent at five months postpartum, declines to 36.8 percent at six months postpartum and rises to 48.5 percent after that. 248 Earlier, Gordon, Lewis, and Radbill found similar patterns. Using 1990 and 1991 SIPP panels (but measuring family income instead of women s income alone, as Yelowitz does, and apparently not considering certification periods), they found that, for 1992, on average, family incomes fall in the period around a birth. Mean annualized family income for all women with a birth is approximately [$57,636] in the quarter before the pregnancy, falls steadily throughout pregnancy, and reaches its lowest point [(about $50,247)] right after birth [both in 2007 dollars], in the first quarter postpartum. The downward shift in income appears to occur throughout the income distribution. 249 As a result, the percentage of WIC eligible women increased by about 47 percent between the periods before pregnancy and zero-to-two months after birth. 250 The authors note the regressive consequences of using this temporarily low income to establish WIC eligibility: The characteristics of women income eligible before a birth are different than those of women income eligible after a birth. In particular, women who were income eligible after the birth, on average, were more educated, were more likely to live with the father, were more likely to be white, and had fewer children than those who were income eligible during pregnancy. 251 For these somewhat higher-income families and income-sharing households, WIC benefits could be considered as a modest form of paid parental leave for married mothers, albeit not as generous as its proponents would wish. We recommend that either regulatory or statutory changes be made to define current income and to provide categories of the types of professions or situations for which current or annual income would be most appropriate. Certification periods vs. income changes (especially during pregnancy). Once found 248. Ibid., Gordon, Lewis, and Radbill, Income Variability Among Families with Pregnant Women, Infants, or Young Children, Ibid., xvi. Gordon, Lewis, and Radbill estimate that the percent income-eligible of all women was 31.6 percent before pregnancy, 39.2 percent in the first trimester, 40.1 percent in the second trimester, and 42.3 percent in the third trimester. In the first two months after the birth, income eligibility increases to 46.3 percent and then declines to 43.7 percent over the next nine months Ibid., xv. 97

102 income-eligible, successful applicants do not have their income eligibility recertified for six months or more even if incomes rise during that certification period which would then make them otherwise ineligible. Because of WIC s one-year certification periods for infants and children (at state option) and six-month certification periods for postpartum and breastfeeding women, the failure to consider income rises could, by itself, expand eligibility over the base of those with annual incomes below 185 percent of poverty by as much as 30 percent. 252 Longer eligibility periods, which states may establish, further raise the number of eligibles. Legislation currently pending in the Senate proposes that WIC certification periods for children be extended to two years. 253 Recertification periods for receiving WIC benefits vary for the different categories of applicants. Although the formal rules round off periods to the end of the current month, 254 essentially: (1) pregnant women are certified for the length of their pregnancy plus an additional six weeks; (2) postpartum women are certified for up to six months; (3) breastfeeding women are certified at six month intervals up to the infant s first birthday or until the infant stops breastfeeding, whichever comes first; (4) infants are certified every six months up to their first birthday, and (5) children are certified for up to six months or a year, at state option, until age five (when they are no longer eligible). 255 (See table 1.) State agencies, however, may permit local agencies to certify infants who are under six months of age up to the child s first birthday, as long as the quality and accessibility of [WIC] health care services are not diminished 256 meaning that nutritional counseling and other services continue to be offered. States also may permit their local agencies to certify a breastfeeding woman up to the last day of the month in which her infant turns 1 year old or until the woman ceases breastfeeding, whichever occurs first. 257 In the Healthy and Hunger-Free Kids Act of 2010, Congress gave states the option to expand certification periods for children to up to one year as long as the states ensure that participant children receive required health and nutrition assessments. 258 As of July 2015, thirty states have expanded or are in the process of expanding child certification periods to one year. (See table 13.) 252. This is an independent effect and could be smaller when present in combination with the other practices discussed in this paper. See Appendix Improving Child Nutrition Integrity and Access Act of Technically, the certification periods always end at the end of the month, so, for example, a breastfeeding woman is certified until the end of the month in which her infant turns one. Thus, an infant born on June 8, 2014 would turn age one on June 8, 2015, but the mother would be certified until June U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations Ibid Ibid Healthy Hunger-Free Kids Act of 2010, P.L , 111publ296/pdf/PLAW-111publ296.pdf. 98

103 State Table 13 State Certification Periods for Children July 2015 Length of certification period for children Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana 6 months 1 year 6 months 6 months 1 year 1 year 1 year 1 year 1 year 1 year 1 year 6 months 1 year 6 months 1 year 1 year 1 year 6 months 6 months 1 year 6 months 1 year 6 months 1 year 1 year 1 year 1 year 99

104 Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming 6 months 1 year 6 months 6 months NA 6 months 1 year 1 year 6 months 1 year 6 months 1 year 6 months 6 months 1 year 1 year 1 year 1 year 1 year 1 year 1 year 6 months 6 months 6 months Source: Authors review of WIC state plans and operations manuals and phone calls and s to WIC state officials. Conversely, state agencies may authorize local agencies to use shorter certification periods than noted above on a case-by-case basis, as long as they provide guidance to local agencies on this matter. 259 Lastly, longer or shorter periods of up to thirty days may be granted when there are 259. U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. 100

105 scheduling difficulties. 260 WIC regulations require state agencies to ensure that local agencies disqualify individuals during the certification period if they are no longer income eligible. The WIC regulations, however, do not require local agencies to reassess income eligibility during the period of certification 261 unless the local agency receives information indicating that the participant s household income has changed. 262 But neither the WIC statute nor regulations require participants to report any changes (increases or decreases) in income to the WIC agency. 263 Some states, however, have rules requiring WIC participants to report changes in their income, household size, and other factors that could affect their eligibility for WIC during the certification period. Some require WIC applicants to sign a certification form saying that they will report changes in their income and other factors that affect their eligibility for WIC, even if these changes occur during the certification period. Idaho s form, for example, states: I will notify WIC with any changes to the information I have given. 264 There is no evidence, however, concerning the degree to which recipients report changes in income. Most states, moreover, ignore changes in income. According to the NRC, based on correspondence from Food and Nutrition Service (FNS) officials, it is WIC policy to apply [an income test] only when the mother is applying for benefits. The mother has no subsequent obligation to reveal that her family s income has changed. 265 Bitler, Currie, and Scholz made the same assumption, stating: Once an individual becomes eligible for WIC, we assume that person remains eligible for the relevant certification period.... We incorporate certification 260. Ibid., which states: In cases where there is difficulty in appointment scheduling for persons referenced in paragraphs (g)(1) (iii), (iv) and (v) of this section, the certification period may be shortened or extended by a period not to exceed 30 days The portion of the regulations that deal with changes in income makes no mention of any requirement for participants to report any changes in income, stating only: The local agency must reassess a participant s income eligibility during the current certification period if the local agency receives information indicating that the participant s household income has changed. However, such assessments are not required in cases where sufficient time does not exist to effect the change. Sufficient time means 90 days or less before the expiration of the certification period. See Ibid Ibid Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 55, states that based on correspondence from Food and Nutrition Service (FNS) officials,... the mother has no subsequent obligation to reveal that her family s income has changed Idaho State WIC Office, WIC Participant Rights, Responsibilities, and Consent, idahopublichealth.com/wic/files/participant-rights-responsibilities-and-consent-2013.pdf Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 101

106 periods in our eligibility and participation calculations. 266 One reason frequently given for certification periods of this length is that shorter ones could place an undue burden on mothers who must miss work or make burdensome trips to WIC offices, only to face long waiting times once there. 267 That does not, however, explain why there is no obligation to report rises in income. A better explanation, sometimes also given, might be the desire to continue the dietary counseling for those families and income-sharing households deemed to be at nutritional risk. 268 And, of course, there is also the pervasive aversion to making income determinations, which is shared with other social welfare programs. Many have argued that frequent redeterminations are not cost effective. 269 Adding the impact of longer certification periods to estimated eligibility based on monthly income by itself increases the number of estimated eligibles in all categories. Based on data from Bitler, Currie, and Scholz, for 1998, accounting for certification periods increases the number of eligible infants by about 31 percent, increases the number of eligible children by about 28 percent, increases the number of eligible pregnant women by 25 percent, and increases the number of eligible postpartum women by about 16 percent. 270 As mentioned above, Urban Institute researchers estimated that the combination of using current income and applying WIC s certification periods results in an eligibility increase of between 52 and 64 percent more incomeeligible infants in 1997 and 1998, respectively. The estimates for children are equally large 46 and 50 percent in the two years Bitler, Currie, and Scholz, WIC Eligibility and Participation, Oliveira et al., The WIC Program: Background, Trends, and Issues Nutrition education plays a crucial role in the WIC program and is viewed as an essential benefit directed toward achieving positive changes in participant knowledge, attitudes, and behavior about food consumption. FNS regulations require WIC service agencies to offer to participants (or their mothers or other care providers) at least two nutrition education sessions during each usually six-month certification period. Participants may be counseled in one-on-one settings or attend group classes on a variety of health and nutritionrelated topics. As part of nutrition education and counseling, breastfeeding is being promoted as the optimal source of infant nutrition. Thorn et al., WIC Participant and Program Characteristics 2014: Final Report See, for example, Mark A. Prell, Certification Duration For Food Assistance Programs: An Economic Model With An Application to WIC (paper, presented at Income Volatility and Implications for Food Assistance Programs II conference, Washington, DC, November 1617, 2006), income_volatility_agenda/prell_model2.pdf. Using the 1996 panel of the SIPP and administrative data, Prell estimated that the optimal WIC certification period (calculated by taking into account the administrative costs to the government of certification and of providing benefits to ineligible WIC recipients) is four months for children receiving WIC in households with high income volatility as opposed to the current six months Bitler, Currie, and Scholz, WIC Eligibility and Participation, 1162, table Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 102

107 Because it uses annual income as the base rather than monthly income, the NRC estimate is even higher: Unlike the CPS data, the SIPP panel data permit a more accurate representation of the WIC certification process. When this process is considered (e.g., if the monthly family income for a child is below the income eligibility threshold, the child is considered eligible for the next 6 months; for infants, someone who becomes eligible in a month is then considered eligible for the next 12 months or until the end of the calendar year for which the estimates are being made), combined with the use of SIPP monthly income, there remains a significant and large increase in the number of months that infants and children are income eligible compared with the situation when annual income is used. In 1997 and 1998, there are 46 and 54 percent more infants and 34 and 36 percent more children who are income eligible for WIC. 272 The NRC also separately estimated the impact of certification periods on eligibility. For example, a child may be income-eligible for only two months out of the year, though his certification period was six months or even twelve months. It found that about 18 percent of infants and 15 percent of children were income-eligible for fewer months than they were certified. 273 Of these, infants were certified for an average of 5.8 months but were eligible for an average of only 1.6 months and children were certified for an average of 4.5 months but only eligible for an average of 1.9 months. 274 Because the federal government pays all WIC costs, states do not have an incentive to determine whether income has increased during a certification period. Therefore, we recommend that state and local WIC agencies should be required to pay a portion of WIC s program costs so that they would have a stake in enforcing eligibility rules. Expanded adjunctive eligibility vs. income caps. Eligibility for WIC is also established adjunctively (in some other programs, called categorically ), that is, it is automatically granted to members of families and income-sharing households who are receiving 275 Medicaid, SNAP, or 272. Ibid Ibid., Ibid., Although the statute uses the word receiving, WIC regulations do not require applicants to actually be receiving assistance as long as they have been certified eligible to receive assistance under the programs. U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations. The certification is made by Medicaid, SNAP, or TANF, not WIC. Zoë Neuberger, Center on Budget and Policy Priorities, message to authors, June 29, Presumably, the difference is de minimus, and most researchers estimate adjunctive eligibility on the basis of being enrolled in or being participants of Medicaid, SNAP, or TANF. See Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 50; Bitler and Currie, Medicaid at Birth, WIC Take-Up, and Children s Outcomes. 103

108 TANF cash assistance, 276 if they can provide documentation of receipt of assistance. 277 When this provision was added to the law, income eligibility for these programs was set below 185 percent of poverty. Hence, the original purpose of adjunctive eligibility was simply to facilitate the enrollment process, not to expand eligibility. However, recent legislative changes to Medicaid and SCHIP authorized states to raise their eligibility thresholds for those programs to higher than 185 percent of poverty (and, in many states, higher than 300 percent of poverty), making adjunctive eligibility a potential source of substantially enlarged WIC eligibility. In fact, barring legislative change, there is no limit to how much WIC eligibility can expand via further increases in Medicaid and SCHIP. WIC s adjunctive eligibility was first established in 1989 as a convenient aid to eligibility determinations when applicants were already receiving benefits from programs whose income eligibility limits were then lower than WIC s. 278 Thus, during the Senate floor debate when this provision was added to the law, Senator Robert Dole (R-KS) explained that one of the purposes of adjunctive eligibility was to increase WIC s coordination with other public assistance programs, 279 and Senator Patrick Leahy (D-VT) added that it was also meant to reduce the level of paperwork involved in determining income eligibility. 280 Adjunctive eligibility did not increase the number of WIC eligibles because WIC s income-eligibility limit was higher than those of the three other programs. It merely facilitated eligibility determinations for those clearly eligible for WIC. Further evidence of this intent is the provision in the regulations that allows states to establish adjunctive eligibility for other stateadministered, means-tested programs, so long as eligibility for them is based on income at or below 185 percent of poverty. 281 Adjunctive eligibility satisfies only the income element of WIC eligibility; applicants must still establish that they are at nutritional risk (although, as described 276. As explained below, individuals receiving TANF nonassistance are not adjunctively eligible for WIC Child Nutrition Act of Dawn Horner, Wendy Lazarus, and Beth Morrow, Express Lane Eligibility, Health Insurance for Children 13, no. 1 (Spring 2003): 225, Senator Dole of Kansas, speaking for the Child Nutrition and WIC Reauthorization Act, on October 24, 1989, to the President of the Senate, HR 24, 101 st Cong., 1st sess., Congressional Record 135: S Senator Leahy of Vermont, speaking for the Child Nutrition and WIC Reauthorization Act, on October 24, 1989, to the President of the Senate, HR 24, 101 st Cong., 1st sess., Congressional Record 135: S See U.S. Department of Agriculture, Food and Nutrition Service, WIC Program Regulations, which state: The State agency may accept, as evidence of income within Program guidelines, documentation of the applicant s participation in State-administered programs not specified in this paragraph that routinely require documentation of income, provided that those programs have income eligibility guidelines at or below the State agency s Program income guidelines. 104

109 below, that is all but assumed by the program. Inversely, before recipients can be dropped from WIC because they are no longer adjunctively eligible, their possible income eligibility must be considered. 282 Medicaid has been the primary vehicle for the expansion of adjunctive eligibility. Since the adjunctive eligibility provision was added in 1989, many elements of the Medicaid program are allowed to have higher income limits at state option. In addition, states that use Medicaid to implement their SCHIP programs also create adjunctive eligibility. 283 Under SCHIP, states are reimbursed at a higher rate than for Medicaid benefits. Recent legislation has affected the incentives for states to expand the eligibility thresholds for pregnant women, infants, and children. In 2009, the Children s Health Insurance Program Reauthorization Act (CHIPRA) included a provision that limited the higher reimbursement rates to 300 percent of poverty. States that opt to provide Medicaid-expanded SCHIP programs to pregnant women, infants, and children with incomes above 300 percent of poverty are only reimbursed at the standard Medicaid rates. In 2010, the Affordable Care Act made two changes that affected eligibility for Medicaid and therefore WIC. The first was the modification of the income that states could disregard when determining eligibility for Medicaid. Prior to the ACA, Medicaid used net income to determine eligibility. States were allowed to disregard a certain amount or percentage of income in determining eligibility as well as certain kinds of expenses, such as child care expenses. 284 This resulted in wide differences across states. According to the Congressional Research Service, Two states, New Jersey, and New York, plus one California county used this income-counting methodology to expand their CHIP programs to 355% FPL, 405% FPL, and 416% FPL, respectively. 285 The Affordable Care Act changed the method for determining eligibility from 282. Ibid, which states that adjunctively-eligible WIC participants (as defined in paragraphs (d)(2)(vi)(a) or (d)(2)(vi)(b) of this section) may not be disqualified from the WIC Program solely because they, or certain family members, no longer participate in one of the other specified programs. The State agency will ensure that such participants and other household members currently receiving WIC benefits are disqualified during a certification period only after their income eligibility has been reassessed based on the income screening procedures used for applicants who are not adjunctively eligible Zoë Neuberger, Center on Budget and Policy Priorities, message to authors, June 29, 2007, which states: With regard to your first question, my understanding is that a state can use SCHIP funds either to expand its Medicaid program or to create a separate SCHIP program (or both). Medicaid expansions funded with SCHIP dollars create adjunctive eligibility for WIC. Separate SCHIP programs do not create adjunctive eligibility for WIC National Council of State Legislatures, Medicaid and the Affordable Care Act (Washington, DC: National Council of State Legislatures, 2011), Evelyne P. Baumrucker and Alison Mitchell, State Children s Health Insurance Program: An Overview (Washington, DC: Congressional Research Service, March 2015), misc/r43627.pdf. 105

110 net income to Modified Adjusted Gross Income (MAGI) with a flat 5 percent income disregard to be applied to a family s MAGI. 286 In addition, the ACA also requires states to increase their income eligibility thresholds for Medicaid to account for the loss of the income disregards. The purpose was to make the thresholds equal to what had been the functional equivalent of the threshold when using net income. According to the Department of Health and Human Services, Most states used a model that determines the average value of the disregards a state had in place and then added that amount to the old standard to create the new eligibility levels. 287 When determining the new eligibility standards, HHS issued regulations that stated that the 5 percent earnings disregard was not to be counted when considered the increase in the eligibility levels since the MAGI income conversion requirements... are independent of the 5 percent disregard. 288 The effect of this policy increased eligibility levels by five-to-seven percentage points, with the flat income disregard increasing the eligibility levels by another 5 percent. The second change in the Affordable Care Act was that the federal government increased its share of payment for SCHIP by twenty-three percentage points up to a maximum of 100 percent of the total amount. The federal government now pays for all costs of SCHIP in twelve states. 289 Because the federal government is covering most of CHIP costs, it provides states with an incentive to increase their eligibility thresholds up to 300 percent of poverty. (The ACA limits the increase in the federal government s portion of SCHIP spending to 300 percent of poverty.) 290 As described below, a number of states have increased their eligibility thresholds since University of California, Berkeley, Modified Adjusted Gross Income Under the Affordable Care Act (Berkeley, CA: University of California, Berkeley, July 2014), /MAGI_summary13.pdf Centers for Medicare and Medicaid Services, MAGI: Medicaid and CHIP s New Eligibility Standards, U.S. Department of Health and Human Services, Centers for Medicare and Medicaid, Medicaid and Children s Health Insurance Programs: Essential Health Benefits in Alternative Benefit Plans, Eligibility Notices, Fair Hearing and Appeal Processes, and Premiums and Cost Sharing; Exchanges, Federal Register 78, no 135 (July 15, 2013): 42188, Federal Financial Participation in State Assistance Expenditures; Federal Matching Shares for Medicaid, the Children s Health Insurance Program, and Aid to Needy Aged, Blind, or Disabled Persons for October 1, 2015 through September 30, 2016, Federal Register 79, no. 231 (December 2014), Centers for Medicare and Medicaid Services, Medicaid and CHIP FAQs: CHIP Financing (Baltimore, MD: Centers for Medicare and Medicaid Services, December 2013), Center/Downloads/Medicaid-and-CHIP-FAQs-CHIP-Financing.pdf. 106

111 In its final four budgets, the George W. Bush administration proposed capping Medicaid adjunctive eligibility for WIC at 250 percent of poverty, but the proposal was consistently blocked in Congress. 291 Besides substantive objections to limiting eligibility, a main argument against such caps is that local agencies have become so dependent on adjunctive eligibility that many have limited capacity to perform additional income determinations without an increase in staff which, it is sometimes argued, could cost as much as would be saved. As table 14 shows, in 2004 the primary route for adjunctive eligibility for infants in families with incomes above 185 percent of poverty was through Medicaid Office of Management and Budget, Budget of the United States Government (Washington, DC: Office of Management and Budget, ). 107

112 Table 14 Percent of Families Adjunctively Eligible for WIC, by Monthly Income All Families with an Infant and All Families Receiving WIC for an Infant Survey of Income and Program Participation (SIPP) All families with an infant <100% % % % 200% All families receiving WIC for an infant <100% % % % 200% % Medicaid recipients 44.4% 29.8% 22.9% 15.4% 8.0% 53.9% 36.2% 33.0% 28.8% 35.8% 2004 % Food Stamp recipients 39.6% 19.9% 9.1% 3.3% 2.3% 49.8% 22.4% 16.6% 8.1% 13.6% Source: Richard Bavier, message to authors, April 7, % TANF recipients 9.5% 3.5% 0.7% 0.0% 0.8% 12.7% 4.1% 1.3% 0.0% 4.5% % receiving Medicaid, Food Stamps, or TANF 61.8% 43.7% 29.0% 16.6% 9.4% 75.2% 49.9% 45.0% 31.7% 42.9% 108

113 A number of estimates have been made on the impact of adjunctive eligibility, but they are difficult to compare because they refer to different years (often before the major Medicaid/SCHIP expansions) and because of differences in how they treat other aspects of eligibility. As Bitler, Currie, and Scholz note, for 1998: The National Survey of WIC Participants implies that over 94 percent of WIC recipients have incomes below 185 percent of poverty, suggesting that most adjunctively-eligible WIC households would also be income eligible. The CPS data imply that roughly 13 percent of WIC recipients have incomes above 185 percent of poverty, while SIPP data imply that 23 percent have incomes above 185 percent of poverty. Hence, the data sets provide very different perspectives on the importance of adjunctive eligibility on the targeting of WIC benefits. 292 The NRC used both the CPS and the SIPP to measure the increase of those eligible from an annual income base, using TRIM-adjusted figures for enrollment in Medicaid, SNAP, and TANF cash assistance. Using the CPS, the NRC found that, in 1998, accounting for full adjunctive eligibility based on Medicaid, SNAP, and TANF cash assistance increased the number of infants who were eligible to receive WIC benefits by 19 percent, from 39.2 percent to 46.7 percent. 293 The number of eligible children increased by about 14 percent, from 40.4 percent to 46 percent. 294 The NRC s SIPP-based estimates were considerably smaller, however, apparently because the SIPP does not impute missing recipients in its counts (which TRIM does) and because the SIPP, which uses a monthly income measure rather than an annual one, found more people to be income-eligible for WIC. 295 According to the NRC: The marginal impact of using the SIPP-reported enrollment in TANF, food stamps, and Medicaid to simulate adjunctive eligibility is smaller in comparison to the impact of monthly income and is smaller in comparison with the impact that was found in the CPS. Compared with the estimates that incorporate monthly income and certification periods, adjunctive eligibility increases the estimates of the number of WIC-eligible infants by roughly 6 percent, while estimates of income-eligible children are increased by 5 percent. To the extent that comparisons between the CPS and SIPP can be made, these estimates suggest that a significant proportion of the impact of adjunctive eligibility found in the 292. Bitler, Currie, and Scholz, WIC Eligibility and Participation, Ver Ploeg and Betson, Estimating Eligibility and Participation for the WIC Program: Final Report, 294. Ibid Ibid.,

114 CPS reflected eligibility that also could be gained through consideration of low monthly income. 296 Linda Giannarelli and her Urban Institute colleagues have performed a number of eligibility analyses for the USDA. In the most recent, Giannerrelli, Paul Johnson, Erika Huber, and David Betson used 2014 CPS data to estimate eligibility. They found that adjunctive eligibility increased the number of eligible infants by about 29 percent (from about 1.6 million to about 2.1 million) and the number of eligible children by about 29 percent (from about 6.8 million to about 8.8 million). For both infants and children, about three-quarters of adjunctively eligibility was estimated to be due to Medicaid. 297 This is similar to estimates from Giannarelli and her colleagues using the 1998 SIPP (an increase of about 22 percent) and the 1998 TRIMadjusted CPS (an increase of about 25 percent). 298 Using the 2003 Medical Expenditure Panel Survey (MEPS), Patton Boggs projected the number of WIC recipients in 2008 that would also receive Medicaid and have incomes over 185 percent of poverty. Assuming that adjunctive eligibility and income distribution are proportional to the distributions observed in MEPS 2003, 299 the study projected that about 20 percent (or more than 1.6 million) WIC recipients would have incomes over 185 percent of poverty and about one million recipients would have incomes above 250 percent of poverty. The study also estimated that capping adjunctive eligibility at 250 percent of poverty would save about $550 million in FY Of course, the net savings would have to take into account the increase in administrative costs for verifying income. One of the primary arguments for adjunctive eligibility is the high cost of independently certifying each WIC applicant. Estimates of these costs, however, indicate that this may be less expensive than anticipated. Mark Prell, an economist at the USDA, estimated that the per case cost of WIC recertification for WIC agencies was about $78.37 per household. 301 Assuming this is accurate, even if every infant on WIC required an income determination, the cost would be 296. Ibid Johnson et al., National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report Giannarelli and Morton, Estimating the Number of Infants and Children Who Are Income Eligible for WIC ; Giannarelli and Nelson, How Many Women, Infants, and Children are Eligible for WIC? Estimates from the CPS and SIPP Karen Thiel, Estimating the Impact of Adjunctive Eligibility for WIC (presentation, National WIC Association, Washington, DC, March 9, 2008) Ibid Prell, Certification Duration For Food Assistance Programs: An Economic Model With An Application to WIC. 110

115 only about $190 million. And that does not take into account the presumed ability of states to make the eligibility determination electronically from Medicaid records and then make that information available to the WIC grantee. Table 15 portrays the results of one of the steps in the USDA s expanded methodology for estimating WIC eligibility. But it can easily be misinterpreted. It shows a steady increase in the number of adjunctively eligible persons with annual incomes above 185 percent of poverty compared to the number below. However, this reflects the individual impact of adjunctive eligibility when income eligibility is based on annual income. As mentioned above, the NRC found that, when income eligibility is determined based on current income and certification periods are taken into consideration, the impact of adjunctive eligibility is smaller. Thus, in 2005, the Bush Administration estimated that capping Medicaid adjunctive eligibility at 250 percent of poverty would reduce the number of WIC recipients by only 5, The explanation for the vast disparity in the estimates seems to be in the method of calculating eligibility. The Patton Boggs estimate calculates adjunctive eligibility without making adjustments for monthly income, certification periods, or subfamily income. The administration s estimate calculates adjunctive eligibility after making the aforementioned adjustments Zoë Neuberger, Center on Budget and Policy Priorities, message to authors, April 7,

116 Table 15 Adjunctively Eligible Persons with Annual Family Incomes above 185% of Poverty Year Number 1,712,061 1,848,243 1,956,422 2,149,413 2,177,102 2,248,808 2,288,524 2,401,251 2,949,681 2,824,923 2,708,662 2,770,397 2,769,996 3,158,842 All Infants Children Percent of 185 of poverty 118% 118% 120% 121% 120% 121% 121% 121% 126% 123% 123% 124% 124% 128% Number 332, , , , , , , , , , , , , ,105 Percent of 185 of poverty 121% 119% 119% 123% 119% 121% 121% 122% 131% 124% 122% 123% 123% 128% Number 910,938 1,085,395 1,263,946 1,244,446 1,371,689 1,364,984 1,415,409 1,411,291 1,613,741 1,707,596 1,698,673 1,738,211 1,766,699 1,992,824 Percent of 185 of poverty 116% 118% 120% 119% 121% 121% 121% 121% 123% 122% 123% 124% 125% 130% Number 249, , , , , , , , , , , , , ,829 Women Pregnant Breastfeeding Postpartum Percent of 185 of poverty 121% 119% 119% 123% 119% 121% 121% 122% 131% 124% 122% 123% 123% 128% Number 111, , , , , , , , , , , , , ,042 Percent of 185 of poverty 120% 118% 119% 122% 119% 120% 121% 122% 131% 123% 122% 122% 123% 128% Number 106, ,126 94, , , , , , , , , , , ,042 Percent of 185 of poverty Sources: David Betson, Michael Martinez-Schiferl, Linda Giannarelli, and Sheila Zedlewski, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, : Final Report (Washington, DC: Urban Institute, December 2011), Michael Martinez-Schiferl, Sheila Zedlewski, and Linda Giannarelli, Paul Johnson, Linda Giannarelli, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2010 Final Report (Washington, DC: Urban Institute, January 2013), Erika Huber, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2011: Final Report (Alexandria, VA: U.S. Department of Agriculture, March 2014); Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2012: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2015); and Paul Johnson, Erika Huber, Linda Giannarelli, and David Betson, National and State-Level Estimates of Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Eligibles and Program Reach, 2013: Final Report (Alexandria, VA, U.S. Department of Agriculture, January 2016). Note: The derivation of the number of women in each category (pregnant, postpartum, and breastfeeding women) uses the number of fully eligible infants (after the CPS data have been adjusted for CPS miscount and the number of infants in territories) as the starting point to calculate those who are adjunctively eligible and those who are below 185 percent of the poverty guideline. In this computation, we assume that the ratio of adjunctively eligible women to women at or below 185 percent of poverty is the same as the ratio for adjunctively eligible infants to infants at or below 185 percent of poverty. This assumption is the same as the one used by the current USDA methodology that uses fully eligible infants (after adjusting for adjunctive eligibility) as the base for estimating the number of women in each category. 121% 119% 119% 123% 119% 121% 121% 122% 131% 124% 122% 123% 123% 128% Over the past twelve years, there has been a steady rise in the number of states that have increased their Medicaid income eligibility caps for infants, children, and women. As of January 2016, for infants, thirty-eight states had Medicaid income eligibility caps above 185 percent of poverty (up from twenty-five in 2009), thirty-three have caps above 200 percent (up from nine in 2009), eleven have caps above 250 percent (up from seven in 2009) and eight have caps at 300 percent or above (up from five in 2009). 112

117 For children, twenty-two states has Medicaid income eligibility caps above 185 percent of poverty (up from thirteen in 2009), twenty have caps above 200 percent (up from eight in 2009), nine have caps above 250 percent (up from six in 2009) and six have caps at 300 percent or above (up from five in 2009). For pregnant women, thirty-seven states had Medicaid income eligibility caps above 185 percent of poverty (up from twenty-two in 2009), twenty-eight have caps above 200 percent (up from seven in 2009), six have caps above 250 percent (up from three in 2009) and two have caps at 300 percent or above (the same as in 2009). State Table 16. Medicaid Eligibility and SCHIP-Funded Expansions of Medicaid 2016 Infants 01 Children 15 Pregnant women Postpartum women Alabama 146% 146% 146% 18% Alaska 208% 208% 205% 143% Arizona 152% 146% 161% 138% Arkansas 147% 147% 214% 138% California 266% 266% 213% 138% Colorado 147% 147% 200% 138% Connecticut 201% 201% 263% 201% Delaware 217% 147% 217% 138% District of Columbia 324% 324% 211% 221% Florida 211% 145% 196% 34% Georgia 210% 154% 225% 37% Hawaii 313% 313% 196% 138% Idaho 147% 147% 138% 26% Illinois 213% 147% 213% 138% Indiana 218% 165% 213% 138% Iowa 380% 172% 380% 138% Kansas 171% 154% 171% 38% Kentucky 200% 164% 200% 138% Louisiana 217% 217% 138% 24% Maine 196% 162% 214% 105% Maryland 322% 322% 264% 138% Massachusetts 205% 155% 205% 138% Michigan 217% 217% 200% 138% Minnesota 288% 280% 283% 138% Mississippi 199% 148% 199% 27% Missouri 201% 155% 201% 22% Montana 148% 148% 162% 50% Nebraska 218% 218% 199% 54% Nevada 165% 165% 165% 138% New Hampshire 323% 323% 201% 138% 113

118 Table 16. Medicaid Eligibility and SCHIP-Funded Expansions of Medicaid 2016 New Jersey 199% 147% 199% 138% New Mexico 305% 305% 255% 138% New York 223% 154% 223% 138% North Carolina 215% 215% 201% 44% North Dakota 152% 152% 152% 138% Ohio 211% 211% 205% 138% Oklahoma 210% 210% 138% 44% Oregon 190% 138% 190% 138% Pennsylvania 220% 162% 220% 138% Rhode Island 266% 266% 195% 138% South Carolina 213% 213% 199% 67% South Dakota 187% 187% 138% 52% Tennessee 216% 216% 200% 101% Texas 203% 149% 203% 18% Utah 144% 144% 144% 45% Vermont 317% 317% 213% 138% Virginia 148% 148% 148% 44% Washington 215% 215% 198% 138% West Virginia 163% 146% 163% 138% Wisconsin 306% 191% 306% 100% Wyoming 159% 159% 159% 57% Sources: Tricia Brooks, Sean Miskell, Samantha Artiga, Elizxabeth, Cornachione, and Alexandra Gates, Medicaid and CHIP Eligibility, Enrollment, Renewal, and Cost-Sharing Policies as of January 2016: Findings from a 50-State Survey (Washington, DC: Henry J. Kaiser Family Foundation, January 2016), Table 17 summarizes the expansions that took place between 2003 and (January) Infants (01) Children (15) Pregnant women 2009 (January) Infants (01) Children (15) Pregnant women 2016 (January) Infants (0-1) Children (1-5) Pregnant women Table 17 Number of States with Medicaid and SCHIP-Funded Medicaid Expansions >185% of poverty >200% of poverty >300% of poverty

119 Sources: For 2003, Donna Cohen Ross and Laura Cox, Preserving Recent Progress on Health Coverage for Children and Families: New Tensions Emerge (Washington, DC: Kaiser Family Foundation, 2003), For 2009, Donna C. Ross and Caryn Marks, Challenges of Providing Health Coverage for Children and Parents in a Recession: A 50 State Update on Eligibility Rules, Enrollment and Renewal Procedures, and Cost-Sharing Practices in Medicaid and SCHIP (Washington, DC: Kaiser Family Foundation, January 2009), For 2016, Tricia Brooks, Sean Miskell, Samantha Artiga, Elizxabeth, Cornachione, and Alexandra Gates, Medicaid and CHIP Eligibility, Enrollment, Renewal, and Cost-Sharing Policies as of January 2016: Findings from a 50-State Survey (Washington, DC: Henry J. Kaiser Family Foundation, January 2016), 115

120 To estimate how these changes affect the number of infants who would be adjunctively eligible for WIC through Medicaid eligibility, we used the CPS to apply the 2016 state Medicaid income caps to a two-year average (2012 and 2013) of the number of infants by state. We then compared these estimates to the number of infants eligible using the state Medicaid eligibility caps and found that the number of infants eligible for Medicaid increased from about 103,000 to about 213,000, or by about 107 percent. (See Appendix 3 for state-by-state estimates.) The CPS, however, reported discrepant numbers for the number of infants with incomes above 185 percent who were income eligible for Medicaid and the number of infants who were reported to be receiving Medicaid in 2013 (about 422,000 infants). The likely explanation is that the CPS asks if a member of the family has ever participated in Medicaid in the past year, a reflection of a family s monthly income, but asks for families annual income, so that the former would be a larger number than the latter. Because we cannot be sure where between these two numbers would be the best estimate, we use a mid-point estimate 303 which results in a 68 percent 303. To derive our estimate, we use the ratio of the number of infants adjunctively eligible for Medicaid over the number of infants receiving Medicaid in 2012/2013 to derive the estimated number of infants receiving Medicaid if the 116