For some expectant parents, the excitement of pregnancy is overshadowed by the reminder of the financial strain a baby will bring. We know, from both local and national research, that financial stress is the most common reported stressor in the months before birth and household income drops up to 10% pre- and post-childbirth – in part because of parents’ temporary or permanent withdrawal from the work force and inconsistent access to paid medical leave. Financial strain is also not distributed equally. Black and Hispanic women are more likely than white women to experience poverty around the time they have children. With rising living costs and an ongoing housing affordability crisis, financial pressures on U.S. families are intensifying. Expectant and new parents need greater support and stability during pregnancy and the critical early years of development. Guaranteed income programs may be one way to meet parents’ need for greater economic support and mitigate persistent racialized health disparities associated with parenthood.
Can Guaranteed Income Improve Perinatal Health?
Guaranteed income (GI) is defined as regular cash payments with no restrictions on how it is spent and no work requirements.
By providing much-needed financial security during and after pregnancy, GI holds promise for promoting both parental and infant health.
Recipients most often use cash to address basic needs like housing, food, and transportation costs. Research suggests that parents who receive GI are also able to spend more time with their infants and can allocate more resources toward their children’s development and education, including purchasing items such as books and educational toys. Overall, the combination of decreased stress and increased investment improves both parental and infant health.
The Philly Joy Bank, a pilot guaranteed income program (GI) based in Philadelphia, aims to solve the problem of financial insecurity during pregnancy. The Philly Joy Bank was conceived of by a collective action network of community members, organizations, researchers, policymakers, and other key maternal and child health stakeholders dedicated to reducing racial disparities in infant mortality in Philadelphia. All decision-making regarding its design, implementation, and evaluation is grounded in the lived experiences of Black birthing people in Philadelphia. The Philly Joy Bank provides selected participants with $1,000 a month, starting in the second trimester and lasting until 12 months postpartum. To date, the program has disbursed over $3 million in cash to participants and provided nearly 400 referrals to other care services available through the Department of Public Health. Perinatal cash programs have proliferated over the past five years; some estimates suggest that over 40 programs exist across the country. While the underlying commitment to providing cash to families during the perinatal period is standard across programs, there is variability in terms of who is eligible for these programs, when recipients can start receiving money, and how much money recipients receive.
While there is robust evidence that perinatal cash transfers improve newborn health outcomes in lower and middle-income countries, there is still a lot we do not know about how perinatal cash transfers affect parents and their infants in the U.S. Evaluation of many of these programs – including ours – is still underway. RxKids in Flint, Michigan published a recent study that found that prenatal and postnatal cash transfers improved maternal economic stability and mental health. On the other hand, Baby’s First Years, which provides cash transfers to mothers starting at birth in four metropolitan areas in the U.S., has published several studies indicating that the cash has had limited effects on maternal mental health, child health, and child development. These two programs differ in terms of who they serve, when they start providing cash, and the broader context in which they are delivered. Evaluations of programs in other contexts – like the Philly Joy Bank – can strengthen our understanding of the potential of perinatal GI as an upstream approach to reducing health inequities for parents and their infants.
Acting Locally to Protect Perinatal Health
Given that federal cuts to Medicaid, SNAP, and other public benefit programs are expected to widen health disparities in the coming years, local policy solutions to protect and promote health and health equity are more essential than ever.
While programs like the Philly Joy Bank are critical, it currently only serves 250 families who live in three of the neighborhoods with the worst birth outcomes. There are thousands more who could benefit from access to guaranteed income. In nearly 25% of Philadelphia’s neighborhoods, more than 1 in 7 babies are born with low birth weight—a troubling sign of deep-rooted health disparities. That’s roughly 33% higher than the citywide average and a staggering 65% higher than the national rate.
There are several indications that providing direct cash to families during and after pregnancy is both replicable and scalable at the local and state levels. While most perinatal GI pilots have been philanthropically funded, several programs have benefited from public-private partnerships that increase both their scope and impact. The Bridge Project, initiated in NYC, has successfully expanded with both city and state dollars and has been replicated in eight other states. At least two other GI programs (Abundant Birth Project and Rx Kids) have been scaled up after successful pilots. Programs have leveraged a mix of different public funding sources, including city general funds, TANF, and state funds earmarked for social services, indicating support among city and state leaders that perinatal cash programs are promising both in effectiveness and return on investment. Taken together, these programs have drawn millions in public dollars for their programs, increasing sustainability. Moreover, early findings from RxKids have shown that cash prescriptions during and after pregnancy generated strong economic returns and cost savings by reducing NICU admissions, child welfare involvement, and postpartum depression. Finally, additional national and/or state cash transfer policies that are not conditioned on earnings (such as the expanded child tax credit in 2021, Alaska Permanent Fund Dividend, Baby Bonuses, and Baby Bonds) highlight both feasibility and political will for family assistance programs across political contexts. Perinatal cash is a clear investment in the growth, development, and well-being of infants and their parents.
Now is the time for policymakers, funders, and community leaders to take decisive action by supporting and expanding guaranteed income programs for new parents. By investing in perinatal cash initiatives, we can ensure that families not only get by but truly thrive—giving babies and their families the lasting opportunity to flourish well beyond the moment of birth.
