Cash program for mothers and babies expands across Michigan
A program to combat severe child poverty by providing cash payments to pregnant mothers and babies in Flint is set to expand to cities across Michigan.
Rx Kids is considered by authorities to be the first initiative of its kind in the country. It provides mothers with $1,500 during pregnancy for essentials such as food, prenatal care, cribs or other needs. After the birth, families then receive $500 during the first year of the child’s life, for a total of $7,500. The program has no strings attached and no income restrictions for eligibility. It was launched in January.
Thanks to $20 million from a recently approved state budget, the program will now expand beyond Flint to five counties in the eastern Upper Peninsula, including Alger, Chippewa, Luce, Mackinac and Schoolcraft; the cities of Kalamazoo, Saginaw, Dearborn, Highland Park, River Rouge and parts of Detroit. The budget has been sent to Gov. Gretchen Whitmer, who is expected to sign it, the Free Press reported last week.
If Rx Kids manages to raise the necessary funds, the programs could start in other cities as early as January.
“Rx Kids is a prescription for health, hope and opportunity,” said Dr. Mona Hanna, director of Rx Kids and associate dean of public health at Michigan State University College of Human Medicine. Hanna, a pediatrician who found high lead levels in children in Flint and was among the key people who exposed the water crisis, said she had wanted a “prescription” to eradicate poverty among her patients.
In Flint, where nearly 78% of children under 5 live in poverty, Rx Kids has so far distributed more than $2 million in cash to 828 families. About 60% of families have an annual household income of less than $10,000, Hanna said. With the money in hand, families can pay their rent, utilities, groceries and diapers. They can save the money.
“This is intergenerational, historic work,” she said.
Cash can alleviate poverty
There is evidence that cash benefits for children can lift them out of poverty.
Rx Kids co-director H. Luke Shaefer pointed to the child tax credit expanded during the pandemic, which provided $250 to $300 per month to each eligible child. The payments reached more than 61 million children and cut child poverty by nearly half in 2021 compared with the previous year, according to Columbia University’s Center on Poverty and Social Policy. After the benefits ended, child poverty rose sharply in 2022. In January of this year, 3.7 million more children lived in poverty than in December 2021.
“In that brief, shining moment, we lifted millions of children out of poverty. We saw food insecurity among families with children drop to the lowest levels we’ve ever recorded. We saw family credit scores reach their highest levels ever,” said Shaefer, a professor of public policy at the University of Michigan and director of the Poverty Solutions Initiative. “Then we reversed course and couldn’t extend that beyond the year, and we saw child poverty skyrocket – the highest single-year increase in history. We saw food insecurity increase and family financial security deteriorate.”
Shaefer said Rx Kids, a child benefit initiative, falls into the same category as universal basic income, recurring cash payments without targeting, and guaranteed basic income, which provides unconditional cash payments often targeted to those most in need. The latter two are largely untested, he said, but several countries have some type of child benefit transfer program.
“Investing in children pays off in the long run. In addition, families with children are often the most economically vulnerable,” said Shaefer.
The program is to be expanded but requires philanthropic funding
Lawmakers approved $20 million in funding from the federal Temporary Assistance for Needy Families (TANF) program for Rx Kids.
The five-year Flint program relies on a combination of public funds, including TANF, and philanthropic contributions from funders such as the Charles Stewart Mott Foundation. The program is expected to expand to other parts of the state, but organizers need philanthropic grants to make it available to mothers in those communities regardless of income.
“There is a private part that is necessary,” Hanna said. “We are not going to roll this out just for low-income people. It has to be a universal program.”
Dearborn, for example, would receive about $3 million from the state’s TANF program, which could be used to fund the first four cash payments for low-income families. To expand the program to the full 12 months and make it available to all mothers and babies in a given area — like the Flint program — Rx Kids would need to raise another $9.5 million. An alternative option would be to make it a perinatal program that provides the first four payments to families regardless of income. The perinatal version of the program would require nearly $2 million for Dearborn.
In Detroit’s case, of the $20 million it is allocated, the city would receive about $10 million from the TANF program, Hanna said, which would provide care for about 3,000 babies a year. To create a program similar to Flint’s, Rx Kids needs to raise another $32 million, including $7 million to start a perinatal program. In Detroit, Rx Kids will look at areas with the greatest need, likely based on the highest poverty rates by zip code. A spokesperson for the Detroit Department of Health said it is not currently involved in the Rx Kids program.
About 49% of children under 5 in Detroit live below the poverty line, according to the 2022 census. In River Rouge, the child poverty rate is nearly 68%.
In Wayne County, 52% of households earned more than the federal poverty level in 2022 but still struggled to make ends meet. In other words, they fall below the United Way’s ALICE threshold, meaning they are not technically living in poverty but do not earn enough to afford basic necessities where they live.
Dr. Abdul El-Sayed, director of the Wayne County Department of Health, Human Services and Veterans Affairs, said the county is eager to put the program into action.
“Stable housing, good healthy food, a safe living environment or transportation – addressing these issues is critical to giving every child the best possible start in life,” said El-Sayed. “So when you think about what government and charity, even society, can do to make sure everyone has an equal chance of living a dignified life, it’s about making sure that during this transition period, the resources that people need are available, and cash is the best way to do that.”
Ali Abazeed, founding director of the Dearborn Health Department, said there is no better intervention than investing in the pre- and post-pregnancy period, noting that having a child increases the risk of poverty, especially for first-time mothers.
“Giving people cash – especially when they are faced with this situation that is leading to a rise in poverty, both before and after the birth of a child – means redefining the social contract. That means redefining what we do for each other, that means redefining how we support each other and our residents,” Abazeed said.
Abazeed said the city plans to allocate $1 million in federal funds to the program and is in discussions with local and state partners about additional investments.
“We have quite a task ahead of us,” he said, but he is confident the program will take off for Dearborn residents.
In the southwest part of the state, the Kalamazoo Community Foundation has pledged $500,000 so far and is seeking funding from local government and philanthropic organizations for a full 12-month program. Consideration of an Rx Kids initiative is among the Kalamazoo City Commission’s top priorities as part of the city’s 2025 budget, but funding has not yet been determined, according to a Kalamazoo city spokesperson.
“Rx Kids will ensure that our newborn residents are born into a thriving community where their family’s income level does not negatively impact their life course,” said Grace Lubwama, CEO of the Kalamazoo Community Foundation, in a statement.
Rx Kids is currently exploring what the program might look like outside of Michigan. Hanna said there is interest in both red and blue states that have unspent TANF funds.
“We started this in Flint, but it was never the intention to end there,” Hanna said.
Contact Nushrat Rahman: [email protected]. Follow her on X: @NushratR.
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