Risking the Future Adolescent Sexuality, Pregnancy, and Childbearing, Volume II Working Papers only (1987) / Chapter Skim
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10. Estimates of Public Costs for Teenage Childbearing: A Review of Recent Studies and Estimates of 1985 Public Costs
10. Estimates of Public Costs for Teenage Childbearing: A Review of Recent Studies and Estimates of 1985 Public Costs
Pages 264-294
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From page 264... ...
These studies use quite varied methodologies and arrive at quite different cost estimates. Some studies calculate the public cost over a 20 year per iod of the family begun by a single teen birth, and the total cost for the sane 20 year per lad of the cohort of families begun by a teen birth in a single year.
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From page 265... ...
Other studies estimate the total public outlay in a given year that is attributable to teenage childbearing, including expenses for families in which the first birth occurred when the mother was ~ teenager, even though she may now be considerably older. Since approximately half of the AFDC caseload at any time consists of families begun by teen birth, but only 4 percent of these families are headed by women who are currently teenagers, this f igure~-total public cost for a single year -- is very large.
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From page 266... ...
Single Birth Cost: S18,710 S ingle Cohort Cost: at least S8 .3 billion Th is report serves as the model for many of the local studies den scribed below. SRI used a variety of published statistics to develop its estimates of cost and welfare and service utilization.
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From page 267... ...
Their single birth cost is calculated by dividing the total single cohort cost by the number of f irst births to teenagers. All higher order births to teenagers are treated as extended costs of a f irst birth to a teenager .
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From page 268... ...
This research study's primary goal was to project public sector costs associated with teenage childbearing to the year 1990, using assumptions about welfare eligibility based on the Omnibus Budget Reconciliation Act of 1981's more restrictive provisions, and to simulate the ef facts of alternative scenar ios on these costs. Among the alternative scenar ios tested were: What if births to teenagers under 20 (or under 18)
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From page 269... ...
Local Stud lea Single Birth and Single Cohort Cost Estimates T isle: IF inane ial Report: Adolescent Pregnancy. ~ Charlotte, NC: Mecklenburg Council on Adolescent Pregnancy, node (probably 1980)
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From page 270... ...
and assuming that second and higher order birth costs are part of the consequence of a first birth that occurred in an earlier year. I f, as the report states, the authors followed the SRI me~chodology, then the Single Cohort Cost should represent the cost of first births, with all their consequences over the next 20 years including subsequent births while the mother is still a teenager.
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From page 271... ...
533 per case no~teen-birth families: S15. 5 million; S5, 127 per case This study took advantage of Monroe County's highly automated public assistance data system to make estimates of single year costs attr ibutable to teenage childbear ing for the 2 years 1977 and 1978.
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From page 272... ...
the researchers were able to calculate public assistance costs separately for families begun by a teen birth, and for families in which the f irst birth occurred when the mother was 20 or older. These costs include AFDC payments, Medicaid, single issue, emergency and vendor payments, and estimated food stamp costs.
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From page 273... ...
Future efforts to estimate public costs might want to use these f figure to ad just a basic estimate, if the jurisdiction for which costs are being calculated makes significant use of special payments to AFDC families. This report contains many other elaborate analyses comparing the costs incurred for families begun by a teen birth and families for whom childbearing was delayed beyond the teen years.
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From page 274... ...
1 Combining public and private expenditures for children appears very confusing from ~ policy perspective, because the technique prom duces an estimate of total cost that will increase as the population improves its economic situation (to which reduced teenage childbearing is predicted to contribute) , because economically better~off families will spend more on their children.
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From page 275... ...
Businesses and private individuals will hopefully bear a greater prom portion of these costs than of the coats for teenage childbearing, because far fewer later childbearers require public support. Failure to use mars inal rather than full cost calculations and to take account of delayed births also greatly inflates the estimated benef it (cost savings)
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From page 276... ...
Which Babies? The issue here is, should the base consist only of f irst births when calculating single birth cost and single cohort cost (counting subseauent births as additional costs associated with a ~career.
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From page 277... ...
Totally eliminating childbearing to unmarr fed women 17 or younger would reduce 1990 costs by 17 percent: and a 50 reduction in births to young women aged 17 or younger would reduce 1990 costs by 10 percent. Clearly there is no ones throne relet ionship between teenage childbear ing and public cost, both because, as in reality, teen births in these simulation" are mostly delayed, not eliminated, and because factors associated with poverty still characterize many teenagers even when the computer simulation artif icially prevents them f ram having births.
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From page 278... ...
In the Charlotte~Mecklenburg County study, it meant day care and school lunch programs. Social services are part of SPI ' s calculations and amount to 15 percent of single birth or single cohort cost, but the report does not def ine what services are included
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From page 279... ...
74~. However, the data necessary to include foster care costs as part of single birth or single cohort costs does not exist, because we do not have enough evidence of the probability that ~ given teen mother will have a child removed from her custody.
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From page 280... ...
The most easily comparable estimates f ram these studies are for single birth costs the range is from S13,852 to S18.710 in public cost, over the 20 years from the time a woman experiences a first birth as a teenager. For jurisdictions interested in determining their own outlays for teenage childbearing, these groundbreaking studies have contributed a great deal to our ability to recommend reasonably straightforward techniques to use.
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From page 281... ...
The rest of Part II presents two types of estimates: single year per public cost estimates and single birth/ single cohort public cost estimates. Each presentation has three sections: {1} the tabular statement of the cost est=ate; (2)
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From page 282... ...
Not included in this f igure are other services more likely to be used by families begun by a teen birth than by other families, such as publicly supported social services, housing, special educational servicer, and child protective services and foster care. Many of these figures are not available nationally, and may not be available locally.
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From page 283... ...
In light of all this, using a 5 pe rcent inf ration factor seems reasonable, and conservative. SINGLE BI RTH AND SINGLE COHORT COST ESTIMATES FOR FIRST BIRTHS TO TEENAGERS IN 1985 Table 3 presents the estimates of the full cost of public outlays over the 20 year period 1985-2004, for a single family begun by a first birth to a teenager in 1985 (single birth cost of S13, 902)
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From page 284... ...
The major reason for reduced cost is a reduced probability of receiving welfare (see below for an explanation of why this occurred}. ~us, changes in the availability of welfare support make a substantis1 difference in the long-term fiscal consequences of teenage childbearing.
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From page 285... ...
A teenager 18-19, who has a f irst birth, immediately receives welfare for her baby and for subsequent babies; also gets welfare for herself once she becomes an independent head of household; and stays on welfare continuously for 5 year s. D iscounting public costs in the same way we did for the basic 20year pro Section, we ar rive at the following f igures: the 14 year old would cost the public S46,456 over the assumed 10 year period of welfare dependency; the 15-17 year old would cost the public 84d,2-01 over the assumed 7.5 year period of welfare dependency; and the 18 to 19 year-old would cost the public 830,955 over the assumed S year period of welfare dependency.
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From page 286... ...
Such teenagers do not represent the majority of teenagers having children. SOU=ES AND ASSUMPTIONS E OR SINGLE: BE RTH AND SINGLE COMORT PUBLIC COST E STIMATE: S The approach used was, first, to estimate the cost for a single family begun by a first birth to a teenager in 198S, projected over the 20 year per iod 1985-2004, and then to multiply that estimate by the number of first births to teens in 1985 to get the cohort cost estimate.
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From page 287... ...
In the years of the projection when women are 20 and older, these probabilities are lower (by 4-1S percent, depending on the woman's age and age at first birth3 than those used by SR: and the other studies using the SRI method, because the estimates incorporate the more restrictive welfare eligibility criteria required by the Omnibus Budget Reconciliation Act of 1981. The biggest difference made by these new criteria involves the amount a head of household could earn and still retain her eligibility for AFDC and Medicaid.
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From page 288... ...
are assumed to result from doubling the reduction in teenage childbearing {from a 50 percent reduction to a 100 percent reduction)
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From page 289... ...
Medicaid administrative costs were calculated at 5 percent of benefits, also based on historical data. USING THE COSTS IN BE:NEFIT-COST ANALYSI S2 The public costs of teenage childbearing are rarely calculated as ends in themselves.
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From page 290... ...
. Recent estimates by Burt suggest that the Dresent discounted value of future public costs associain 1985, ~ ~ ~ ted with a f it st teenage bi rth are: TABLE 4 Present Discounted Value of Future Public Costs Associated with a First Teenage Birth Age at First Birth Public Expend itures 15 16 17 18 19 S18, 130 S17,851 S17, 464 S12,214 S10.
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From page 291... ...
If the girl had her first child this year, we would be confronted with public costs whose present value totals S17.851. Thin means that by putting S17,851 in the bank this year, we would generate enough revenue to cover all future costs.
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From page 292... ...
The future public costs of noosing from one to two children are less than the costs of moving from no children to one. These costs have not been estimated.
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From page 293... ...
2 Frank Levy contributed the basic outline and concepts of this reck tion. Burt contributed the estimates for public costs of teenage childbear ing .
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