Cash Rewards Improved Some Health Outcomes for Low-Income Families

March 6, 2018

A conditional cash transfer program in New York City had a positive impact on parents’ perceptions of their health, as well as their level of hope, partly through improvements in financial well-being, according to a new analysis led by King’s College London, Columbia University’s Mailman School of Public Health, and MDRC, part of LIFEPATH, a project funded by the European Commission. The program, Family Rewards—sponsored by the New York City Mayor’s office and evaluated by MDRC—had small but meaningful effects on the use of some preventive health services, especially dental care. Family Rewards was the first conditional cash transfer program for low-income families in the U.S. Findings of the study are published online in the journal Health Affairs.    
The three-year program, aimed at improving population health by making cash transfers, was conditional on families engaging in a number of activities, including children’s school attendance, family preventive healthcare use, and parents’ employment. Participants in the study, approximately 4,800 low-income families, came from six of New York City’s most deprived communities in the Bronx, Brooklyn, and Manhattan. Families in the program group (2,400 families) earned an average cash amount of $8,674 per household from 2007 to 2010.
Compared with control groups that did not receive cash transfers, these families had better access to their personal healthcare providers (an increase of 4 percent) and dental check-ups (up to 15 percent). The program also led to modest but significant improvements in parental level of hope and wellbeing.
Participation in the program was associated with an increased probability of having had at least two dental check-ups in the past year—by 13 percent in adults and by almost 15 percent in children 42 months after the program started. Family Rewards also had positive effects on health insurance coverage and receiving treatment for any medical condition. Participants were also less likely to forgo medical care due to cost. These effects translated into small improvements in health status as measured by parental self-rated health and level of hope.
“The program had shown some positive effects regarding reduction in poverty and material hardship, and improvement in perceived financial well-being,” said Emilie Courtin, research fellow at the Department of Global Health and Social Medicine, King’s College London, and lead author. “On top of New York City’s strong existing social safety net, the conditional cash transfers have led to some improvements in health care access and perceived health of poor families.”
“A key strength of the study is its design. Family Rewards was evaluated in a randomized controlled trial—the gold standard for finding out if a program like this works,” noted Courtin.
Conditional cash transfer programs have been proven effective in reducing health inequalities in Latin America, and are becoming a prevalent policy for improving the education and health outcomes of poor children in developing countries, since their introduction in Mexico and Brazil in 1997. Interventions across Latin America have led to significant increases in the use of health services, including the number of visits to health facilities and receipt of prenatal care and pediatric examinations. Evidence shows that the interventions have also improved some health outcomes – in particular, developmental, nutritional and cognitive measures among children.
“These programs aim to break the intergenerational transmission of poverty and generate individual as well as societal benefits,” said Peter Muennig, MD, MPH, professor of Health Policy and Management at Columbia’s Mailman School of Public Health and a co-author. “They are innovative by providing people with the financial resources and incentives to get help for themselves and their children. These resources include education and medical care, two powerful factors that make people healthier.”
“Conditional cash transfer programs have been increasingly popular in low- and middle-income countries in Latin America, Africa, and Asia,” explained Paolo Vineis, chair of Environmental Epidemiology within the School of Public Health at Imperial College London and coordinator of the LIFEPATH project. “However, programs with different types of behavioral conditionality are also gaining ground in various developed countries, and our study can help to encourage their establishment in Europe.”
Family Rewards was created by New York City’s Center for Economic Opportunity (now NYC Opportunity) in partnership with MDRC and Seedco. Privately funded, it distributed a total of $20.6 million in cash transfers to participating families over its three years of operation. The program was inspired by other conditional cash transfer programs that have been implemented with the support of the World Bank and other international financial institutions in many countries, particularly in South East Asia and Latin America.