Philadelphia is the poorest big city in America, where one in three children lives in poverty, most of them children of color. While service providers, health professionals, and government officials search for ways to support families through the pandemic, there is a clear public policy lever to meaningfully address child poverty: the Child Tax Credit. On Saturday, the Senate passed a temporary expansion of the Child Tax Credit that is expected to be signed into law this week and will pull millions of children out of poverty — but just for one year. If made permanent, the provision could improve the health and well-being of a generation of children.
Our primary care colleagues working at Children’s Hospital of Philadelphia (CHOP) are among the many health professionals who see the effects of poverty and social need every day in the children and families they serve. Yet, doctors can’t write prescriptions to address poverty. Instead, clinic- and community-based interventions are forced to triage the countless needs of vulnerable families to provide immediate relief. Meanwhile, the unequal economic recovery during this pandemic is exacerbating challenges for the city’s lowest-income families.
In recent weeks, politicians across the political spectrum have called for reforming the Child Tax Credit, which provides a cash benefit to some families with dependent children. Expanding the eligibility and maximum benefit of the Child Tax Credit has the potential to lift millions of families out of poverty and cut the child poverty rate nearly in half via direct cash assistance.
Due to the tax credit’s current structure, the maximum benefit goes to middle-income families, while families with the lowest incomes are excluded from the benefit entirely. In Philadelphia, half of all children do not receive the full benefit of $2,000 per child. The families hit hardest by the pandemic are not eligible for this assistance.
Providing direct cash assistance through a reformed Child Tax Credit is an evidence-based means of alleviating child poverty. In a comprehensive review of policy options to address child poverty, the National Academies of Science, Engineering, and Medicine found that a $3,000 per-child, per-year cash assistance program, similar to the proposal Congress is considering, produced a larger reduction in child poverty than any other policy choice.
And it would also go a long way in improving children’s health. A recent cost-benefit analysis of the proposal to expand the Child Tax Credit found that the monetary benefits are eight times the annual program costs, with the vast majority of the benefit stemming from improvements in children’s health. How? During early childhood, the hardwiring of a child’s brain is malleable, reorganizing and developing as they learn. A growing body of research shows that poverty’s persistent stress may alter a child’s brain function, contributing to the development of chronic psychiatric, cardiovascular, and immune disorders that can plague young people in the long term.
The American Academy of Pediatrics has compiled evidence showing that poverty-related experiences like food insecurity and poor housing conditions strongly influence a child’s growth and development. Yet, pediatric health-care systems have struggled to find sustainable and effective ways to address families’ social needs. In a new issue brief from CHOP’s PolicyLab, pediatricians and social workers explain that while programs that refer patients to community supports are crucial to getting families assistance, proactive public policy — such as direct cash assistance to families — is needed to address poverty itself and impact the key drivers of health disparities.
While there are differences between current proposals to reform the Child Tax Credit, the core intent is the same: ensuring that families with the lowest incomes are included in the cash assistance program and raising the maximum benefit to at least $3,000 per-year, per-child. The House’s COVID-19 relief legislation would do both of these things, but, if signed into law, the proposal would only remain in effect through 2021. Several Democrats and at least one Republican in Congress have called to make the reform permanent. Child poverty cannot be alleviated with a one-off. There needs to be a long-term policy change that puts cash in the pockets of our city’s families who need it, for the health of our children.
Tyler DeRubio, MPA, is a policy analyst at PolicyLab at Children’s Hospital of Philadelphia (CHOP). Leigh Wilson-Hall, MSW, LSW, is an improvement adviser for the Population Health Innovation Program and Division of Social Work at CHOP.
The Philadelphia Inquirer is one of more than 20 news organizations producing Broke in Philly, a collaborative reporting project on solutions to poverty and the city’s push toward economic justice. See all of our reporting at brokeinphilly.org.