Cash & Counseling

What would happen if Medicaid recipients – poor people – were allowed to get cash directly?

That is, let’s say you were paralyzed. Traditional Medicaid would pay for a specified type of wheelchair; a specified type of therapy; a particular type of person to drive you places.

Our little thought experiment: what would happen if you basically controlled the cash? You were allowed to, say, spend a lot more on the super-duper wheelchair and cut back on some of car rides. You were allowed to pay your cousin Sal to drive you for $12 per hour instead of Medicaid paying the bureaucratic van program $37.50 per hour. Maybe you could cut back a bit on the in-hospital therapy and pay for this cool water aerobics class you heard about at the YMCA.

Well, Stalinists would fear the worst. No central control! Cousin Sal would get paid for rides he never provided! The YMCA lady would let you drown – or at least swallow a lot of water! You’d cut all your therapy out and go wheelchair racing for pinks!

But this is NOT a thought experiment. Robert Wood Johnson Foundation, Boston College, and others have collaborated to actually start this:

“The Cash & Counseling approach provides consumers with a flexible monthly allowance that is based on an individualized budget, which allows them to direct and manage their own personal assistance services and address their own specific needs. In addition, this innovative program offers counseling and fiscal assistance to help consumers manage their allowance and responsibilities by themselves or with the aid of a representative. These main features are adaptable to consumers of all ages with various types of disabilities and illnesses. Cash & Counseling intends to increase consumer satisfaction, quality, and efficiency in the provision of personal assistance services.”

So who cares?

Same idea, different industry: What would happen if we let students and their parents control part of their per-pupil allocation?

I.e., what if a Boston kid could control, say, $2,000 per year of the $14,000 per year spent on her education? BPS would strip back a bit to offer a $12,000 per year “basic education” – math, English, science, history.

And then the student, with parental permission, could choose: extra math tutoring, an English class size of 15 instead of the usual 30, guitar lessons, free Harry Potter books from Amazon, AP Psychology, counseling for her boyfriend problems, Spanish class with a year-end trip to Spain, college advising, the “Advisory” that progressives love so much, art class.

I know, I know. The Stalinists would freak out. In a high school where 1,000 kids made their choices, they’d I.D. the 5 stupidest uses of money – a kid who needs math tutoring spends all of the money on guitar lessons AND her mom signs off on it.

But that’s not the standard that Cash & Counseling uses, of course. The reasonable standard is: would this method improve student achievement and graduation rates (closely linked to student satisfaction) compared to the current centralized method of allocation, where the school district decides what electives and clubs to offer, in what quantities, with zero thought to perceived student quality.

If Alan Simpson High had a great part-time art teacher, it would quickly become oversubscribed, and the school would have the student-directed funds to make her full-time. Meanwhile, kids would vote with their feet to avoid the crappy college advisor, who would become de-funded.

If Robert Reich High had a wonderful college advisor, and an insane art teacher with 30 cats at home, the opposite would happen.

Student satisfaction up, student attendance up, graduation rates and possibly achievement up.

– Guest blogger Goldstein Gone Wild

Leave a Reply

Your email address will not be published.