HOW FAMILIES OF CHILDREN WITH SEVERE DISABILITIES CHOOSE TO ALLOCATE A CASH SUBSIDY

This study examines how families raising children with severe developm ental disabilities use a cash subsidy. Eighty-one families were interv iewed prior to receiving the $225 monthly subsidy and again 1 year lat er Families reported no change in the number of services they used, no r did they significantly increase the amount spent on services. Althou gh families did not spend significantly more on purchases in the month prior to each interview, there was a significant increase in the amou nt spent on major purchases made in the year after receipt of the subs idy. The pattern and amount of expenditures are described. Lower incom e families reported the subsidy as significantly more helpful than hig her income families. The implications of the findings for social polic y are discussed and recommendations are made.