How Might State Responses to the Pandemic Affect the Safety Net?

Significant federal relief efforts and better-than-expected revenue in many states have mitigated the effects of the economic recession during the pandemic despite COVID-19’s damaging personal cost, according to new analyses.

The Issue

When the pandemic began in the United States in early 2020, states braced for sharp budget cuts and skyrocketing needs for public assistance. To ensure equity, the briefs note that improvements to the health and social safety net must occur as policymakers lean on lessons learned during the pandemic.

Key Findings

Researchers examine how the pandemic and economic situation have impacted the need for well-funded supports, how states are responding, and the implications for racial and socioeconomic equity.

• The authors find that states are using federal funding to provide significant relief for residents who have been hit the hardest by the pandemic due to reduced wages or lost work.
  
• Additionally, the flexible funding allows states to improve access to food, rental and utility assistance; ensure childcare providers can remain in business; and expand options for telehealth.
  
• Experts argue that states can reimagine their safety net programs to be nimbler, more equitable, more holistic and focused on prevention to prepare for the next emergency.

Conclusion

States are now in position to equitably and efficiently spend the large and temporary influx of federal relief funds. Key next steps for policymakers include determining which policy investments and innovations to carry forward and addressing the racial and ethnic disparities and economic inequality that have worsened during the pandemic.

About the Urban Institute

The nonprofit Urban Institute is dedicated to elevating the debate on social and economic policy. For nearly five decades, Urban scholars have conducted research and offered evidence-based solutions that improve lives and strengthen communities across a rapidly urbanizing world. Their objective research helps expand opportunities for all, reduce hardship among the most vulnerable, and strengthen the effectiveness of the public sector. Visit the Urban Institute’s Health Policy Center for more information specific to its staff and its recent research.