Do You Understand Social Welfare Programs?

The WIC & Workman’s Compensation Programs

Do You Understand Social Welfare Programs?

Photo by Sean Roy on Unsplash

Many people misguidedly and pejoratively think of social welfare programs as welfare. This misguided perception gives rise to many biases and irrational decision making when funding programs placing these necessary programs at risk along with the populations they serve.

Social welfare programs are any government-sponsored programs that provide protection to citizens from economic or social risks. For example, social welfare programs such as WIC and workman’s compensation provide protection for individuals who may be in positions in which they cannot take care of themselves. The programs are characterized by their risk protections, target populations, eligibility criteria, specific forms and amount of benefits, methods of financing, and administration methods. WIC and workman’s compensation are characterized by these elements.

WIC

Women Infant Child (WIC) is a federal program that is managed by the USDA. This program is a nutrition supply and education program that targets women, infants, and children five and under. The program provides a stipend which allows mothers to purchase WIC approved foods and supplements. The USDA provides funding for the program through state and approved retailers. WIC is one of the largest social welfare programs that is implemented in every state along with 47,000 approved retailers across the US (USDA, 2016). WIC provides assistance to approximately 53% of all newborns in the US (USDA, 2016).

WIC was designed to reduce healthcare costs associated with malnutrition as well as reduce infant mortality rates. The USDA tracks the data from other healthcare agencies in order to show the impacts of WIC across its target population. The following improvements have been made in the US as a result of the WIC program:

▪ longer pregnancies; fewer premature births; lower incidence of moderately low and very low birth weight infants; fewer infant deaths; a greater likelihood of receiving prenatal care; and savings in health care costs from $1.77 to $3.13 within the first 60 days after birth.

▪ higher mean intakes of iron, vitamin C, thiamin, niacin and vitamin B6, without an increase in food energy intake, indicating an increase in the nutrient density of the diet; positive effects on the intakes of ten nutrients without an adverse effect on fat or cholesterol; more effective than other cash income or SNAP benefits at improving preschoolers’ intake of key nutrients; and decline in the rate of iron deficiency anemia from 7.8 percent in 1975 to 2.9 percent in 1985 which the Centers for Disease Control and Prevention attributed to both a general improvement in iron nutrition and participation in WIC and other public nutrition programs (USDA, 2016).

In terms of effectiveness, WIC is successful in changing outcomes for the target population that it serves. However, WIC only serves approximately 57% of the target population. The program is limited due to its budget and there are shortfalls for those who are eligible. Despite this shortfall in service, the program is extremely successful and has improved nutrition and mortality rates in children.

Workman’s Compensation

All states and the federal government maintain workman’s compensation through private and government insurers. Workman’s Compensation is described as a quasi-government system that provides for injured workers. The system allows for all employers to be eligible for workers compensation insurance. This is typically accomplished by these insurers and government establishing funds to pay for the cost of coverage. This allows for companies that are unable to afford insurance in the marketplace to still maintain coverage. Workman’s Compensation systems are characterized by the following elements:

· They are typically formed and operated as quasi-governmental bodies. In many cases, the formation of the fund occurs through enabling state legislation and the state may provide initial capital.

· Board members are usually appointed by one or more of the state government branches, and the fund may be subject to government oversight.

· As is the case for private sector workers, fund employees may not be subject to civil service laws.

· In nonexclusive states, funds compete with private insurers for policyholders and typically do not rely on government funding or appropriations for their ongoing operations and surplus support. Instead, they obtain funding from policyholder premiums (PricewaterhouseCoopers, 2013).

The effectiveness of workman’s compensation is difficult to determine because there are factors which complicate its metrics. For example, the cost of workman’s compensation is highly dependent on what state a business is located. There is also the fact that cost is adjusted by the number of employees as well as by ownership types and other factors. These differences can be seen in the comparison of states. A company operating in Hawaii must carry workman’s compensation if it has more than one employee. This is true whether they are part time or fulltime and the company must cover the owners. In states such as Arizona, the requirement changes to four or more employees. Another factor is population. As population of states increases, the cost of workman’s compensation also increases (NFIB, 2017). There is also the factor of litigation which is the risk of being sued. Businesses are categorized by there potential risk for lawsuits and this can have a tremendous impact on cost (PricewaterhouseCoopers, 2013). In the following chart, one can how basic prices for workman’s compensation change from state to state:

Do You Understand Social Welfare Programs?2

(NFIB, 2017)

The question is not whether workman’s compensation is effective but rather- is it cost effective? The answer is yes depending on what state is being considered. In California for instance, workman’s compensation is approximately 30% higher than the rest of the nation (NFIB, 2017). This drives up the cost of business and reduces the competitive advantage for businesses in California.

Social welfare programs provide for individuals who may be underprivileged or those who become injured or lose the capacity to work and earn. These programs provide stability to the economy and to society because they eliminate the risk of falling into poverty. Once of the largest benefits of social welfare is that it reduces the overall poverty in the US by allowing individuals the means to find work or to reduce other costs such as healthcare in the case of WIC (Wyland, 2014). Without social welfare programs, there would be larger poor populations and negative social outcomes.

References

NFIB. (2017, June 7). Workers’ Compensation Law — State by State Comparison. Retrieved from NFIB: https://www.nfib.com/content/legal-compliance/legal/workers-compensation-laws-state-by-state-comparison-57181/

PricewaterhouseCoopers. (2013). Benefits and Implications of State Workers Compensation Fund Modernization and Privatization. Retrieved from PricewaterhouseCoopers: http://www.pwc.com/us/en/insurance/assets/pwc-state-workers-compensation-fund-modernization-and-privatization.pdf

USDA. (2016). Women, Infants and Children (WIC). Retrieved from USDA: http://www.fns.usda.gov/wic/about-wic-how-wic-helps

Wyland, M. (2014, February 7). The Role of Nonprofits in Health Care: A Trends Summary. Retrieved from Non-Profit Quarterly: https://nonprofitquarterly.org/policysocial-context/23657-the-role-of-nonprofits-in-health-care-a-trends-summary.html

~Citation~

Vincent Triola. Sun, Mar 14, 2021. Do You Understand Social Welfare Programs? Retrieved from https://vincenttriola.com/blogs/ten-years-of-academic-writing/do-you-understand-social-welfare-programs

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