Appendix R
Development of the Food Package Nutrient and Cost Profiles
To develop the nutrient and cost profiles of the food packages that are evaluated in this report, the committee created a series of linked spreadsheets representing the current and revised sets of food packages. These spreadsheets allowed the committee to determine the average per-participant cost difference between the current and revised packages to meet the charge of cost-neutrality. The basis for these profiles was a set of detailed assumptions based on the U.S. Department of Agriculture’s Food and Nutrition Service (USDA-FNS) price and redemption dataset, the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Food Package Report series, and information provided by individual states. The assumptions applied to develop composites for WIC food categories included ratios of substitution options based on available data or a conservative assumption. Assumptions also differed for some WIC food categories depending on the food package. All details are included in the tables that follow. Details related to costs at the program level are provided in Chapter 10, “The Regulatory Impact Analysis.” Spreadsheets generated for this report were reviewed by the committee members, as well as internally cross-checked by staff. The regulatory impact analyses used the revised package data, with the base year of 2015 as the starting point, and therefore re-created the revised package cost profiles and compared them to the profiles that were created for the cost-neutral assessment.
Food Category | Cost per Unit | Data Source | Assumptions |
---|---|---|---|
Juice | $0.05/oz | FNS redemption data* | CPI inflation factor to 2015: 1.0085 |
Milk and milk alternatives | Fat-free and 1% milk: $0.82/qt Whole milk: $0.86/qt Soy milk: $1.82/qt Lactose-free milk: $1.63/qt Yogurt, lowfat: $3.22/qt Yogurt, whole milk: $3.22/qt Cheese: $5.33/lb |
FNS redemption data* FNS redemption data* FNS redemption data* FNS redemption data* IRI 2014 qt-size yogurt IRI 2014 qt-size yogurt FNS redemption data* |
CPI inflation factor to 2015: 0.9826 CPI inflation factor to 2015: 0.9960 |
Weighted mean, lowfat milk: $0.84/qt Weighted mean, whole milk: $0.87/qt Current composite food package mean costs assuming full cheese/yogurt substitution: FP IV-A: $1.19 FP IV-B: $1.16 FP V: $1.08 FP VI: $1.16 FP VII: $1.06 Revised composite food package mean costs assuming full cheese/yogurt substitution: FP IV-A: $1.29 FP IV-B: $1.20 |
Quart prices for milk calculated by dividing gallon prices by 4 |
Lowfat milk weighting: 1% milk: 93% Nonfat milk: 4% Soymilk: 1% Lactose-free milk: 1% Tofu: <1% Whole milk weighting: Whole milk: 98% Lactose-free milk: 1% Tofu: <1% FP IV-A uses weighted whole milk cost; all other packages use weighted lowfat milk cost. Composite food package milk and milk alternative costs are weighted assuming maximum allowable substitutions of cheese and yogurt |
Food Category | Cost per Unit | Data Source | Assumptions |
---|---|---|---|
FP V: $1.15 FP VI: $1.15 FP VII: $1.16 |
This is a conservative estimate; no data are available on substitution rate | ||
Breakfast cereal | Current (redeemed cereals): $0.21/oz Revised (all whole grain): $0.23/oz | FNS redemption data* | CPI inflation factor to 2015: 1.0060 |
Cheese | $5.33/lb | FNS redemption data* | CPI inflation factor to 2015: 1.0390 |
Eggs | $2.17/dozen | FNS redemption data* | CPI inflation factor to 2015: 1.1576 |
Whole wheat bread and alternatives | Current: $2.35/lb | FNS redemption data* | Bread CPI inflation factor to 2015: 1.0061 |
Revised: Whole wheat bread: $2.65/24 oz Corn tortillas: $2.26/24 oz Instant oatmeal: $4.14/24 oz Weighted mean cost: $2.67/24 oz |
IRI 2014 calendar year for 24 oz container sizes | Bread alternatives CPI inflation factor to 2015: 1.0037 | |
Canned fish | $0.20/oz | FNS redemption data* | CPI inflation factor to 2015: 1.0123 |
Legumes and peanut butter | Peanut butter: $2.29/18 oz jar Canned beans: $4.06 per 4 cans (4 cans substitute for 1 lb dry) Dry beans: $1.50/lb |
FNS redemption data* FNS redemption data* FNS redemption data* |
CPI inflation factor to 2015: 0.9828 CPI inflation factor to 2015: 1.0026 CPI inflation factor to 2015: 1.0471 |
Current: Weighted mean cost (weighted average of peanut butter and weighted legumes): $2.45 Unweighted mean cost (average of peanut butter and weighted legumes): $2.37 |
Current: legumes versus peanut butter: Legumes: 50% Peanut butter: 50% |
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Revised: Weighted mean cost (weighted average of peanut butter and weighted legumes): $2.48 Unweighted mean cost (average of peanut butter and weighted legumes): $2.43 |
Revised: Weighted mean of peanut butter and legumes used for FP V, VI, and VII (participants receive a 3-month rotation of legumes, legumes, peanut butter) Unweighted mean of peanut butter and legumes used for FP IV (participants receive a 3-month rotation of legumes, peanut butter, nothing) Current canned versus dry weighting: Canned: 37% Dry: 63% From six states average redemption* Revised canned versus dry weighting: Canned: 42% Dry: 58% 5% shift of dry to canned due to recommendation that states allow more canned options |
Food Category | Cost per Unit | Data Source | Assumptions |
---|---|---|---|
Fruit and vegetable composite (CVV) | $0.55/c-eq | 2013 ERS data on fruit and vegetable prices, updated with CPI adjustment to 2015 | CPI inflation factor to 2015: 1.0380 |
NOTES: c-eq = cup equivalent; CPI = Consumer Price Index; CVV = cash value voucher; ERS = USDA’s Economic Research Service; FNS = USDA’s Food and Nutrition Service; FP = food package; IRI = Information Resources, Inc., Consumer Network data 2014; PC = WIC Participant and Program Characteristics Report. Food costs were found to be comparable to those reported in the fiscal year (FY) 2010 WIC Food Cost Report (USDA/FNS, 2013).
* FNS redemption data: The average prices of WIC foods redeemed in six states (Personal communication, K. Castellanos-Brown, USDA-FNS, April 7, 2016, and June 30, 2016) were adjusted for inflation to an average price for FY2015. The six-state prices provided were an average over the fiscal year August 2013 to July 2014. It was therefore assumed that the six-state average price was equivalent to the price for January 2014, the approximate midpoint of the August 2013 to July 2014 12-month period. This assumption is approximately equal to assuming the average of the nominal prices for the August to July 12-month period is equal to the price from redemption data. The average January 2014 price was then inflated to the average price for fiscal year 2015 using U.S. Bureau of Labor Statistics (BLS) CPI adjustments (see http://data.bls.gov/cgi-bin/dsrv?cu [accessed December 22, 2016]). This procedure was carried out using the FNS average prices for juice, milk, cheese, breakfast cereal, eggs, whole wheat bread and alternatives, canned fish, legumes, peanut butter, jarred infant fruits and vegetables, jarred infant food meat, and infant cereal. CPI inflation factors were matched to the closest BLS food category for each item.
Food Category | Cost per Unit | Data Source | Assumptions |
---|---|---|---|
Formula |
CPI-adjusted cost per prepared fl oz of formula without rebate: Powder: $0.18/fl oz Liquid concentrate: $0.19/fl oz Ready-to-feed: $0.23/fl oz |
Prescription percentages from PC 2014 Food Package Report Table II.2, which uses PC 2014 participant characteristics data. Scaled to 100% |
Composite formula costs are weighted by form: Powder: 77.9% Liquid concentrate: 11.8% Ready-to-feed: 10.3% Using prescription percentages, assuming 100% redemption and use |
CPI-adjusted cost per prepared fl oz of formula with rebate: Powder: $0.06/fl oz Liquid concentrate: $0.07/fl oz Ready-to-feed: $0.08/fl oz Composite formula cost with rebate: $0.07/fl oz |
IRI Consumer Network data 2014 Dilutions and preparation of formula: FNS WIC Works and Mead Johnson websites Source for % rebate: WIC Food Cost FY 2010 Report, Table 4 |
Before CPI-adjustment cost per unprepared ounce of formula: Powder: $1.32/oz Liquid concentrate: $0.38/oz Ready-to-feed: $0.23/oz CPI-U inflation factor to 2015: 0.999965 Powder reconstitution: 12.9 oz powder per 94 fl oz Liquid concentrate reconstitution: 1:1 dilution at 20 kcal/fl oz (standard dilution) Rebate percentage: 64.58% Food package III infant formula costs include nonexempt only and are assumed to equal FP I and II infant formula costs |
Food Category | Cost per Unit | Data Source | Assumptions |
---|---|---|---|
Infant food cereal | $0.26/oz | FNS redemption data* | CPI inflation factor to 2015: 1.0110 |
Infant food vegetable and fruit composite | $0.16/oz | FNS redemption data* | A substitution of 1 banana per 4 oz of jarred infant fruits and vegetables is a currently available option that covers 30% of WIC participants (USDA/FNS, 2015). The effect of this substitution on cost was considered and calculated to be nominal; therefore, the substitution is omitted in the current food package cost estimate CPI inflation factor to 2015: 1.0110 |
Infant food meats | $0.40/oz | FNS redemption data* | CPI inflation factor to 2015: 1.0110 |
NOTES: CPI = Consumer Price Index; FP = food package; PC = WIC Participant and Program Characteristics Report. Values were multiplied by a redemption factor, based on FNS redemption data for current packages and projected values for revised packages (see Table R-5). Food costs based on redemption were found to be comparable to those reported in the FY 2010 WIC Food Cost Report (USDA/FNS, 2013). Note that the maximum amount of formula was assumed for the purpose of these analyses, although USDA/FNS supports provision of the least amount of formula possible or that is needed.
* FNS redemption data: The six-state average prices (Personal communication, K. Castellanos-Brown, USDA-FNS, April 7, 2016, and June 30, 2016) were adjusted for inflation to an average price for FY2015. The six-state prices provided were an average over the fiscal year August 2013 to July 2014. It was therefore assumed that the six-state average price was equivalent to the price for January 2014, the approximate midpoint of the August 2013 to July 2014 12-month period. This assumption is approximately equal to assuming the average of the nominal prices for the August to July 12-month period is equal to the price from redemption data. The average January 2014 price was then inflated to the average price for fiscal year 2015 using U.S. Bureau of Labor Statistics (BLS) CPI adjustments (see http://data.bls.gov/cgi-bin/dsrv?cu [accessed March 10, 2017]). CPI inflation factors were matched to the closest BLS food category for each item.
TABLE R-3 Assumptions Used in Nutrient Analyses of Current and Revised Food Packages for Infants
Food Category | Weighting and Assumptions* | Rationale | Products Included | NDB No. |
---|---|---|---|---|
Formula | Type weighting:
Milk-based: 64.9% Soy-based: 19.0% Lactose-free: 11.6% Hydrolysate: 4.5% |
Prescription percentages from PC 2014 Food Package Report Exhibit FP1, which uses PC 2008 participant characteristics data. Percentages in the report did not add to 100% as infants can be prescribed more than one type of formula. These percentages were scaled to 100% for weighting Overall redemption of infant formula was 97% according to five states average redemption | Powder, routine: | |
Enfamil Premium Infant | 33877 | |||
Similac Advance | 03950 | |||
Gerber Good Start Gentle | 33868 | |||
Powder, soy: | ||||
Enfamil ProSobee | 03826 | |||
Isomil Advance Soy | 03954 | |||
Gerber Good Start Soy | 33872 | |||
Powder, milk-based lactose-free: | ||||
Assumes prescription equals redemption | Similac for Spit-Up | 03999 | ||
Powder, hydrolysate | ||||
Similac Expert Care Alimentum | 03957 | |||
Brand weighting:
Mead Johnson: 43.7% Abbott: 42.7% Nestle-Gerber: 13.6% |
WIC infant formula brand shares for 2015, determined by dividing total number of infants under each contract (obtained from state contracts with manufacturers) by total number of infants participating in WIC (obtained from USDA/FNS website) for each formula manufacturer | Ready-to-feed, routine: | ||
Enfamil Premium Infant | 33876 | |||
Similac Advance | 03949 | |||
Gerber Good Start Gentle | 03989 | |||
Ready-to-feed, soy: | ||||
Enfamil ProSobee | 03823 | |||
Isomil Advance Soy | 03953 | |||
Gerber Good Start Soy | 03987 | |||
Ready-to-feed, milk-based lactose-free: | ||||
Form weighting:
Powder: 77.9% Liquid concentrate: 11.8% Ready-to-feed: 10.3% |
Prescription percentages from PC 2014 Food Package Report Table II.2, which uses PC 2014 participant characteristics data. Scaled to 100%. | Similac for Spit-Up | 03993 | |
Ready-to-feed, hydrolysate | ||||
Similac Expert Care Alimentum | 03846 |
Food Category | Weighting and Assumptions* | Rationale | Products Included | NDB No. |
---|---|---|---|---|
Infants 0–3 months: Composite powder formula weighted by type and brand | Powder form is recommended for partially breastfed infants 0–3 months in the Final Rule | Liquid concentrate, routine: | ||
Enfamil Premium Infant | 33865 | |||
Liquid concentrate, soy: | ||||
All other infants: Composite formula weighted by type, brand, and form | Enfamil ProSobee | 03854 | ||
Isomil Advance Soy | 03952 | |||
Gerber Good Start Soy | 03966 | |||
Liquid concentrate, milk-based lactose-free | ||||
Similac Sensitive | 03947 | |||
Estimates used the specified maximum monthly allowance (MMA) ounces in the Final Rule | In alignment with foods across other WIC food packages, the maximum monthly allowance multiplied by redemption was assumed in the absence of data on issuance | |||
Powder scoop to liquid conversion: 1 scoop + 2 oz water = 2.2 fl oz prepared formula | Mead Johnson website | |||
Liquid concentrate to prepared form conversion: 1-to-1 dilution at 20 kcal/fl oz (standard dilution) | Mead Johnson and Abbott Nutrition websites | |||
Infant food cereal |
Oatmeal: 38% Rice: 39% Whole wheat/multigrain: 23% |
Wyoming and Massachusetts redemption data, 2015 | Infant food cereal, oatmeal, dry, fortified | 03189 |
Infant food cereal, brown rice, dry, instant | 42285 | |||
Infant food whole wheat/multigrain, dry, fortified | 03996 |
Infant food, fruits |
Applesauce: 28% Banana: 27% Peach: 18% Pear: 18% Prunes: 9% |
Wyoming and Massachusetts redemption data, 2015 | Applesauce | 03116 |
Banana | 43546 | |||
Peach | 03130 | |||
Pear | 03132 | |||
Prunes | 03139 | |||
Infant food, vegetables |
Carrots: 23% Green beans: 8% Peas: 15% Squash: 23% Sweet potatoes: 31% |
Wyoming and Massachusetts redemption data, 2015 | Carrots | 03099 |
Green beans | 03091 | |||
Peas | 03121 | |||
Squash | 03104 | |||
Sweet potatoes | 03108 | |||
Infant food, fruit and vegetable composite | Vegetable: 44.3% Fruit: 55.7% |
Wyoming and Massachusetts redemption data, 2015 | ||
Infant food, meats | Beef: 27% Chicken: 34% Turkey: 24% Ham: 15% |
Wyoming, Chickasaw Nation, and Massachusetts redemption data, 2015 | Beef | 03002 |
Chicken | 03012 | |||
Turkey | 03015 | |||
Ham | 03008 |
NOTES: FNB = full nutrition benefit; NDB = National Nutrient Database for Standard Reference, Release 28 (USDA/ARS, 2016); PC = WIC Participant and Program Characteristics Report.
* State data were incorporated into weighting only when the committee judged the data to be reasonable and complete.
Food Category | Weighting and Assumptionsa | Rationale | Products Included | NDB No. |
---|---|---|---|---|
Juice |
Apple juice: 59% Orange juice: 11% Grape juice: 30% |
Wyoming and Massachusetts redemption data, 2015 | Apple juice, prepared from frozen concentrate, added vitamin C | 09411 |
Orange juice, prepared from frozen concentrate | 09215 | |||
Assumes women and children consume the same types of juice | Grape juice, canned or bottled, added vitamin C | 09130 | ||
Milk and milk alternativesb |
Mozzarella: 24% Natural cheddar: 34% Colby: 18% American: 24% |
Average of Texas, Wyoming, and Massachusetts redemption data, 2015 | Nonfat milk | 01086 |
1% milk | 01083 | |||
Whole milk | 01077 | |||
Soy milk | 16139 | |||
Lactose-free milk, 1% | N/A* | |||
Weighted low-fat yogurt:
Vanilla: 70% Plain: 30% |
Average of Texas and Massachusetts redemption data, 2015 | Tofu | 16426 | |
Yogurt, plain, low fat | 01117 | |||
Yogurt, vanilla, low fat | 01119 | |||
Weighted whole milk yogurt:
Fruit: 70% Plain: 30% |
Average of Texas and Massachusetts redemption data, 2015 | Yogurt, plain, whole milk | 01116 | |
Yogurt, fruit, whole milk | N/A* | |||
Cheese, mozzarella | 01028 | |||
Cheese, natural cheddar | 01009 | |||
Cheese, Colby | 01011 | |||
Weighted whole milk:
Whole milk: 98% Lactose-free milk: 1% |
Average of Texas redemption data July–August 2015 and Wyoming redemption data May 2015 | *Used Supertracker for items not found in the NDB (lactose-free milk, fruited whole milk yogurt) |
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Soymilk: 1% weighted low-fat milk: 1% milk: 93% Nonfat milk: 4% |
Average of Texas redemption data July–August 2015 and Wyoming redemption data May 2015 |
Soymilk: 1% Lactose-free milk: 1% Children receiving IV-A: 30.4% Children receiving IV-B: 69.6% |
Calculated from WIC PC 2014 Food Package Report (USDA/FNS, 2016) and FY2015 Monthly Data—State Level Participation by Category and Program Costs (FNS website) |
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Current FP IV-A (children 1 to <2 years receiving whole milk), per 16 qt: 12 qt weighted whole milk 1 lb cheese 1 qt whole milk yogurt |
Current food packages: Assumed max substitution of yogurt and cheese (1 qt of yogurt for 1 qt of milk; 1 lb of cheese for 3 qt of milk or 2 lb of cheese for 6 qt of milk in baseline FP VII). This is a conservative estimate; no data are available on substitution rate Revised food packages: Assumed max substitution of yogurt and cheese. In the revised package, an additional quart of yogurt may substitute for 1 qt of milk while maintaining the milk substitution limit, presenting additional max substitution scenarios. All scenarios and weighting are described Revised FP IV-A: Given the high redemption rate and public |
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Revised FP IV-A, per 12 qt:
8 qt weighted whole milk 1 lb cheese 1 qt whole milk yogurt |
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Current FP IV-B (children 2 to <5 years receiving low-fat milk), per 16 qt:
12 qt weighted low-fat milk 1 lb cheese 1 qt low-fat yogurt |
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Revised FP IV-B, per 14 qt (50%):
10 qt weighted low-fat milk |
Food Category | Weighting and Assumptionsa | Rationale | Products Included | NDB No. |
---|---|---|---|---|
1 lb cheese 1 qt low-fat yogurt OR (50%): 12 qt weighted low-fat milk 0 lb cheese 2 qt low-fat yogurt |
feedback received about whole milk, the committee made the assumption that substitution of 2 qt of yogurt may not be a likely scenario for food package IV-A. The substitution scheme used in the weighting, therefore, only represents the cheese and yogurt pattern. This is the higher price substitution scenario, so cost differences for this food package are most likely conservative | |||
Current FP V, per 22 qt:
18 qt weighted low-fat milk 1 lb cheese 1 qt low-fat yogurt |
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Revised FP V and VI, per 16 qt (50%): 12 qt weighted low-fat milk 1 lb cheese 1 qt low-fat yogurt OR (50%): 14 qt weighted low-fat milk 0 lb cheese 2 qt low-fat yogurt |
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Current FP VI, per 16 qt: 12 qt weighted low-fat milk 1 lb cheese 1 qt low-fat yogurt |
Current FP VII, per 24 qt: 17 qt weighted low-fat milk 2 lbs cheese 1 qt low-fat yogurt Revised FP VII, per 16 qt (33.33%): 12 qt weighted low-fat milk 1 lb cheese 1 qt low-fat yogurt OR (33.33%): 14 qt weighted low-fat milk 0 lb cheese 2 qt low-fat yogurt OR (33.33%): 10 qt weighted low-fat milk 2 lb cheese 0 qt low-fat yogurt |
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Breakfast cereal |
Current: Honey Bunches of Oats, Almonds: 34% Cheerios (whole grain): 13% Corn Flakes: 10% Frosted Mini-Wheats (whole grain): 13% Kix: 8% Life (whole grain): 8% Rice Krispies: 9% Dora the Explorer: 6% Revised packages include whole grain cereals only |
Average of Texas redemption data July–August 2015 and Wyoming redemption data May 2015 Cereals chosen for the profile represent the top five most redeemed cereals in Texas and Wyoming |
Honey Bunches of Oats, Almonds | 42240 |
Cheerios | 08013 | |||
Corn Flakes | 08020 | |||
Frosted Mini-Wheats | 08319 | |||
Kix | 08048 | |||
Life | 08049 | |||
Rice Krispies | 08065 | |||
Dora the Explorer | 08582 |
Food Category | Weighting and Assumptionsa | Rationale | Products Included | NDB No. |
---|---|---|---|---|
Naturally occurring sugars per 18 oz subtracted from cereals to obtain added sugars: Oats: 7.65 g Wheat: 2.05 g Corn: 7.71 g Rice: 0.61 g |
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Cheese |
Mozzarella: 24% Natural cheddar: 34% Colby: 18% American: 24% |
Average of Massachusetts, Texas, and Wyoming redemption data, 2015 | Mozzarella | 01028 |
Natural cheddar | 01009 | |||
Colby | 01011 | |||
American | 01042 | |||
Eggs | Large eggs | Large eggs | 01123 | |
Whole wheat bread and alternatives |
Whole wheat bread: 76% Corn tortillas: 19% Instant oatmeal: 6% |
Average of Chickasaw Nation, Texas, and Wyoming redemption data, 2015 | Whole wheat bread | 18075 |
Corn tortillas | 18363 | |||
Instant oatmeal, fortified | 08122 | |||
Note on folic acid in corn tortillas: A new federal rule (21 C.F.R. part 172) established on April 15, 2016, allows folic acid to be added to corn masa flour at a level not to exceed 0.7 milligrams of folic acid per pound of corn masa flour. The folic acid content in the nutrient profile for corn masa flour was thus recalculated from the value in the standard reference database assuming a corn tortilla recipe of |
2 cups of masa per 1.5 cups of water. Assumes no loss of folic acid during cooking | ||||
Canned fish | Tuna: 85% | Average of Massachusetts, Texas, and Wyoming redemption data, 2015 | Tuna, light in water Salmon, pink | 15121 |
Salmon: 15% | 15084 | |||
Legumes and peanut butter | Current: legumes and peanut butter weighting:
Legumes: 50% Peanut butter: 50% |
Specifically for FP IV and VI in which legumes OR peanut butter may be prescribed | Pinto beans, dry | 16042 |
Black beans, dry | 16014 | |||
Pinto beans, canned | 16146 | |||
Black beans, canned | 16316 | |||
Peanut butter | 16098 | |||
Revised: legumes and peanut butter weighting:
Legumes: 67% Peanut butter: 33% |
Weighted mean of peanut butter and legumes used for FP V, VI, and VII (participants receive a 3-month rotation of legumes, legumes, peanut butter) Unweighted mean of peanut butter and legumes used for FP IV (participants receive a 3-month rotation of legumes, peanut butter, nothing) | |||
Current: canned versus dry beans weighting: Canned: 37% Dry: 63% Revised: canned versus dry weighting: Canned: 42% Dry: 58% |
FNS redemption data |
Food Category | Weighting and Assumptionsa | Rationale | Products Included | NDB No. |
---|---|---|---|---|
5% shift of dry to canned due to recommendation that states allow more canned options Bean type weighting: Pinto beans: 75% Black beans: 25% |
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Naturally occurring sugars per 18 oz peanuts subtracted from peanut butter to obtain added sugars: 21.3 g | ||||
Fruits |
Apples: 16% Bananas: 25% Watermelon: 8% Oranges: 9% Strawberries: 23% Grapes: 19% |
Average of Texas redemption data July–August 2015, Wyoming redemption data May 2015, and Massachusetts redemption data June 2016. Assumes all fresh (no data available to determine percent of processed fruits redeemed). | Apples | 09003 |
Bananas | 09040 | |||
Watermelon | 09326 | |||
Oranges | 09200 | |||
Strawberries | 09316 | |||
Grapes | 09131 |
Vegetables |
Tomatoes: 31% Potatoes: 18% Avocados: 19% Peppers: 20% Lettuce: 12% |
Average of Texas redemption data July–August 2015, Wyoming redemption data May 2015, and Massachusetts redemption data June 2016. Assumes all fresh (no data available to determine percent of processed vegetables redeemed) | Tomatoes | 11529 |
Potatoes | 11354 | |||
Avocados | 09037 | |||
Peppers | 11333 | |||
Lettuce | 11253 | |||
No potato data in Wyoming; assumed to equal Texas % potato redemption | ||||
Fruit and vegetable composite (CVV) | Vegetable: 33% Fruit: 67% |
Texas WIC redemption, January 2016, Wyoming redemption data May 2015 |
NOTES: CVV = cash value voucher; FP = food package; NDB = National Nutrient Database for Standard Reference, Release 28 (USDA/ARS, 2016); PC = WIC Participant and Program Characteristics Report.
a State data were incorporated into weighting only when the committee judged the data to be reasonable and complete.
b Weighting for milk and milk alternatives for each food package do not total to 1 due to the 1:3 substitution of cheese for milk.
DESCRIPTION OF METHOD FOR CALCULATING REDEMPTION RATES
Two sets of redemption rates were applied in the cost analysis: rates for the current set of food packages and rates for the revised set of food packages. The primary data source for the current package redemption rates was data provided to the committee by USDA-FNS (herein referenced as the FNS redemption data) (personal communication, K. Castellanos-Brown, USDA-FNS, April 7, 2016 and June 30, 2016). The FNS redemption data included 12 months (August 2013 through July 2014) of price and redemption data from a convenience sample of six WIC state agencies, representing five of the seven regions of the country. The identity of the agencies was not known to the committee.1 Redemption rates were available for the following WIC foods: juice, breakfast cereal, whole grains, CVV, eggs, legumes/peanut butter, and fish. For foods for which redemption data were not available in the FNS redemption dataset, redemption rates were calculated as the average (unweighted) from several states that provided the committee with information (see Chapter 2, Table 2-14). Together, these sources resulted in a consensus list of redemption rates that were applied to develop the current food package nutrient and cost profiles.
Redemption rates for milk were a special case. The FNS redemption dataset did not include a separate redemption rate for whole milk. Considering that redemption might be different for milk in food package IV-A (because of the different fat level of the product, and the different age group of children), the average redemption rate from three states of 75 percent was applied to the current food package IV-A. For low-fat milk, the average redemption rate from the FNS redemption data was 65 percent. This represented average redemption of low-fat milk for women and children, combined. The difference in redemption rates for whole milk and low-fat milk, in combination with the committee’s data on dairy intake of children and women, suggested that redemption rates may be higher for children ages 2 to less than 5 years, compared to women. The group average rate of 65 percent redemption for low-fat milk was decomposed into values of 71 percent for children ages 2 to less than 5 and 56 percent for women, rates that were consistent with the observed 65 percent redemption when
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1 To keep maintain anonymity of the state agencies, USDA-FNS inputted average monthly participation by participant category for each state into a spreadsheet containing the redemption equations created by the committee, and returned the overall unweighted average redemption across the state agencies per food package item. Through this process, USDA-FNS identified one of the six states as a clear outlier, and removed it from the averages (personal communication, K. Castellanos-Brown, USDA-FNS, June 22, 2016). As such, redemption estimates represent five of the six state agencies included in the FNS redemption dataset. Sensitivity analysis (see Chapter 8) explores the effect of shifting specific redemption rates up or down.
weighted by the population proportion of WIC-participating children and women.
Accounting for the Distribution of Redemption Rates
The redemption rates for WIC foods in the revised set of food packages are based on a distribution of redemption practices among WIC participants that ranged from no redemption of a food to partial redemption to full redemption of the package allotment. In 2012, Altarum conducted a study of redemption rates in three states (Kentucky, Michigan, and Nevada) (USDA/ERS, 2014) that provided basic information on the redemption distribution. All three states had implemented EBT issuance systems. The study classified redemption practices in three groups: full redemption, partial redemption and nonredemption. As stated in the Altarum report:
The amount redeemed in a given month was subtracted from the amount issued to all participants in the family for that benefit month; if the remaining amount was zero or less than an approved minimum size food item, then the redemption was considered a full redemption. (USDA/ERS, 2014)
If the amount remaining was greater than the approved minimum amount but less than the amount issued, this was considered partial redemption. If none of the amount issued was redeemed, this was nonredemption. The redemption amounts were calculated for more than 14 individual food categories, for each of the food categories, and over all of the categories. Overall, 12.6 percent of the families receiving WIC benefits redeemed all of their benefits.
The information on redemption rates by product category from Altarum’s report can also be used to develop data-based assumptions for redemption behaviors, specifically those used to guide committee choices of redemption rates to apply for the revised packages. The committee used a combination of the Altarum and FNS data to develop a range of revised redemption rates, and the final rates used were close to the implied new FNS-based rates with some adjustments.
WIC-participating families that did not redeem a food category in the current food package (the nonredemption group) were assumed not to redeem under the revised package if there was no change to the food category or if the only change was to change the amount offered. This seems like a plausible assumption given that there was relatively little change in the type of foods offered for each food group. If WIC-participating families fully redeemed foods in the category (the full redemption group), the families were assumed to continue to fully redeem the benefits in the food category with the revised packages as long as the amount offered was less than in the
current package. This was also the case if the amount of the food provided increased, as in the case of the CVV, the full redemption rate was assumed to stay approximately unchanged. The CVV is the main category with a large increase in the amount of food provided. If there were partial redemption in the food category, the committee compared the revised amount offered in the package with the average partial redemption amount of the food before the change. (The average partial redemption amount redeemed can be derived from the redemption rates, the full amount offered, and the total average amount redeemed.) If the revised package amount was less than the average partial redemption amount, the partial redeemers were treated as were the full redeemers and assumed to fully redeem the revised package. If the revised amount was more than the average partial redemption amount, then a new implied average redemption rate consistent with the other numbers was calculated. The degree to which partial redemption affects the projected redemption rates can be derived from the available information.
Application of the Altarum Redemption Distributions (None, Partial, Full): Assumptions
To apply the Altarum redemption distribution information to estimate the revised redemption rates, several assumptions were applied, as listed below:
- The redemption rate patterns follow the distributions—full, partial, and none—observed in the Altarum study.
- The redemption patterns are constant and independent of the overall percentage redemption observed. That is, the Altarum distribution of rates of no, partial, and full redemption was applied to all redemption rates assumed for each food item, including the redemption rates based on the FNS redemption data provided to the committee as well as the observed state average rates included in the current food package consensus rates.2
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2 Note that the ideal data for this task would be nationally-representative redemption distributions across food items by package type. These data were not available. Although the Altarum redemption data and distribution of full, partial, and no-redemption are the best available, there are several limitations that should be noted. First, the Altarum report indicates the share of full, partial, and nonredeemers, but these percentages are not adequate to back-calculate anything other than the average amount redeemed by the partial redeemers without further more complex assumptions. Second, although there may be differences in the redemption shares (full, partial, and nonredeemers) by group across locations (e.g., states), the committee assumes that the shares are constant across locations. Finally, the committee assumes that the partial redemption average amount calculated from the Altarum study is consistent with the overall partial redemption mean and can be applied to overall redemption rates based on the FNS average redemption rates and state average rates.
- Implied adjustments occur because of changes in quantities only; adjustment for changes attributable to new products or available substitutions are made separately from the adjustments to the quantities.
The committee was interested in obtaining estimates for the implied new redemption rate (Redemption%New) for each food item. The relationship observed from Altarum is:
Redemption%Alt = (Partial%Alt × PartialAmtAlt + Full%Alt × FullAmt) / FullAmt
Where:
Redemption%Alt = the overall redemption rate observed in Altarum
PartialAmtAlt = the implied average partial redemption amount in Altarum
FullAmt = the full amount issued
Partial%Alt = the % (share) with partial redemption from Altarum
Full%Altarum = the % (share) with full redemption from Altarum.
In this equation, all of the numbers are known from the data except PartialAmtAlt. Solving for PartialAmtAlt (the implied average partial redemption amount in Altarum):
Redemption%Alt = (Partial%Alt × PartialAmtAlt + Full%Altarum × FullAmt) / FullAmt
Redemption%Alt × FullAmt = (Partial%Alt × PartialAmtAlt + Full%Altarum × FullAmt)
Rearranging terms:
Partial%Alt × PartialAmtAlt = [(Redemption%Alt – Full%Altarum) × FullAmt]
PartialAmtAlt = [(Redemption%Alt – Full%Altarum) × FullAmt] / Partial%Alt
Similarly, the committee knows the overall average redemption rates in the FNS (or state average) data and can combine it with the no, full, and partial rates from the Altarum data to calculate the implied average partial redemption amounts assumed for the FNS data as well (PartialAmtAssumed). As the same redemption shares are assumed to hold for different overall redemption levels across all locations, the value
Redemption%Assumed can be substituted in the below calculation for the overall redemption rate observed in the Altarum study (Redemption%Alt) to solve for PartialAmtAssumed if this leads to nonnegative amounts. In this case, replacing Redemption%Alt, the reported overall Altarum redemption rate, with Redemption%Assumed, the FNS reported (consensus) redemption rate, yields:
PartialAmtAssumed = [(Redemption%Assumed − Full%Altarum) × FullAmt] / Partial%Alt
As long as the PartialAmtAssumed, our calculated assumed partial redemption amount on average is positive, this calculation is not inconsistent with observed patterns and yet incorporates the distribution of redemptions rates across full, no, and partial rates.
Now when the implied partial amount assumed is nonnegative, we use this calculation of the assumed Partial Amount (PartialAmtAssumed) to adjust our overall redemption rate for the revised package. Then we consider a further adjustment to our revised rates to account for whether the distribution of full and partial redeemers (based on the mean) is above the newly projected amount in the new package. If the revised amount is below the current amount and the current average redeemed partial amount, we assume the new redemption rate is 1 minus the share that has no redemption (that is, all participants except the nonredemption group will redeem the revised full amount). However, if the revised full amount is more than the current amount redeemed by partial redeemers, then the redemption amount is down-weighted to incorporate their lower levels.
Following this procedure generates implied new redemption rates based on the changes between the current and revised food packages (see Table R-5). These implied rates do not account for behavioral changes, such as those resulting from the offering of new substitutions. Slight adjustments were made (see the “Revised” column, Table R-5) to account for these changes.
TABLE R-5 Redemption Rates Applied to Generate the Set of Cost-Neutral Food Packages
Food Package and Food | Change to the Current Food Package | Redemption Rates Applied to the Food Package Cost and Nutrient Profiles | Rationale for Revised Package Redemption Rate | ||
---|---|---|---|---|---|
Currenta | Impliedb | Revisedc | |||
All packages for women and children | |||||
CVV | Mandate fresh + 1 processed form; allow flexibility wherever vegetable and fruits are mentioned (fresh, frozen, or canned) | 77d | 77 | 75 | Reduced rate of redemption because the additional CVV amount may not be redeemed at the same rate; accounts for time costs of preparation |
Legumes | Mandate provision of canned beans; provide once (children) or twice (women) every 3 months | 51d | 51 | 53 | Increased rate of redemption (approximately a 5% increase from the Altarum implied redemption that accounts for bimodale distributions) due to additional options and reduced amounts |
Peanut butter | Reduce to a rotation of 16–18 oz every 3 months | 51d | 51 | 53 | Increased rate of redemption (approximately a 5% increase from the Altarum implied redemption that accounts for bimodal distributions) due to additional options and reduced amounts |
RTE cereals | All adhere to whole grain-rich criteria | 60d | 60 | 54 | Decreased rate by 10% (6 percentage points) below current redemption because state-level redemption data indicate that whole grain cereals are less preferred in some states and the number of options are reduced |
Whole grains | Expand to allow 16–24 oz | 53d | 52 | 60 | Slight increase in rate of redemption (set to the current redemption rate for RTE cereals) with increased options and package size range |
Food Package and Food | Change to the Current Food Package | Redemption Rates Applied to the Food Package Cost and Nutrient Profiles | Rationale for Revised Package Redemption Rate | ||
---|---|---|---|---|---|
Currenta | Impliedb | Revisedc | |||
Eggs | Allow a 1 lb substitution of legumes | 80d | 80 | 80 | No change |
Cheese | No change | 70 | 70 | 70 | No change |
Infants–all relevant packages | |||||
Jarred veg/fr, formula fed, and partially breastfed | Allow CVV in place of 1/2 or all of jarred veg/fr | 51 | 51 | 65 | Increased rate of redemption with the CVV substitution option; the revised redemption rate is approximately the average of the implied redemption rate (Altarum) and the revised redemption rate for the CVV; it is also the average redemption rate from Altarum so represents a reasonable redemption rate |
Jarred veg/fr, fully breastfed | Allow CVV in place of 1/2 or all of jarred veg/fr | 51 | 53 | 65 | Increased rate of redemption with the CVV substitution option; the revised redemption rate is approximately the average of the implied redemption rate (Altarum) and the revised redemption rate for the CVV; it is also the actual average redemption rate from Altarum so represents a reasonable redemption rate |
Infant formula | No change | 94 | 94 | 94 | There are no available data to suggest that the redemption rate should be adjusted; no changes were made to formula amounts |
Infant meat/fish | Reduce to half; allow some portion as fish | 31 | 39 | 43 | Increase rate of redemption due to decreased amounts and fish option; used Altarum average to account for bimodal distribution; value is average redemption from the Altarum study so represents a feasible increase |
Infant cereal, formula fed, and partially breastfed | Reduce by 66% for formula-fed and partially breastfed | 47 | 45 | 57 | Increased rate of redemption with reduction in amounts; used the Altarum report average to account for bimodal distribution; average may increase because the amount of infant cereal was excessive; value is average redemption from the Altarum study so represents a feasible increase |
Infant cereal, fully breastfed | Reduce by 30% for fully breastfed | 47 | 41 | 57 | Increased rate of redemption with reduction in amounts; used the Altarum report average to account for bimodal distribution; average may increase because the amount of infant cereal was excessive; value is average redemption from the Altarum study so represents a feasible increase |
FP IV: Children | |||||
Juice | Reduce to 64 oz | 70d | 75 | 78 | Increased rate of redemption due to reduced amount (approximately a 5% increase from the Altarum implied redemption that accounts for bimodal distributions), and shift of individuals that prefer the CVV to that option (individuals that prefer juice will be issued and redeem juice) |
Milk (applies to composite of milk, cheese, and yogurt) | IV-A: Reduce to 3 gallons | 75 | 87 | 87 | Uses the implied new redemption rate based on Altarum distributions; public comments and redemption indicate that whole milk is a preferred food, so do not anticipate full yogurt substitution |
Milk (applies to composite of milk, cheese, and yogurt) | IV-B: Reduce to 3.5 gallons | 71d,f | 76 | 80 | Uses the implied new redemption rate based on Altarum distributions; increased rate of redemption 4 percentage points (a 5% increase from the Altarum implied redemption) due to additional yogurt option |
Food Package and Food | Change to the Current Food Package | Redemption Rates Applied to the Food Package Cost and Nutrient Profiles | Rationale for Revised Package Redemption Rate | ||
---|---|---|---|---|---|
Currenta | Impliedb | Revisedc | |||
Fish | Include 10 oz every 3 months | NA | 68 | 68 | Uses the implied new redemption rate based on Altarum distributions |
FP V: P and partially BF women | |||||
Juice | Reduce to 64 oz | 70d | 76 | 79 | Increased rate of redemption due to reduced amount (approximately a 5% increase from the Altarum implied redemption that accounts for bimodal distributions), and shift of individuals that prefer the CVV to that option (individuals that prefer juice will be issued and redeem juice) |
Milk (applies to composite of milk, cheese, and yogurt) | Reduce to 4 gallons | 56d,f | 62 | 66 | Uses the implied new redemption rate based on Altarum distributions; increased rate of redemption 4 percentage points (a 5% increase from the Altarum implied redemption) due to additional yogurt option |
Fish | Include 10 oz every 3 months (V-A); 20 oz per month (V-B) | NA | 68 | 68 | Uses the implied new redemption rate based on Altarum distributions |
FP VI: PP (non-BF) women | |||||
Juice | Remove juice | 70d | NA | NA | NA |
Milk (applies to composite of milk, cheese, and yogurt) | No change | 56d,f | 56 | 59 | Uses the implied new redemption rate based on Altarum distributions; increased rate of redemption 3 percentage points (a 5% increase from the Altarum implied redemption) due to additional yogurt option |
Fish | Include 10 oz every 3 months | NA | 68 | 68 | Uses the implied new redemption rate based on Altarum distributions |
FP VII: Fully BF women | |||||
Juice | Reduce to 64 oz | 70d | 76 | 79 | Increased rate of redemption due to reduced amount (approximately a 5% increase from the Altarum implied redemption that accounts for bimodal distributions), and shift of individuals that prefer the CVV to that option (individuals that prefer juice will be issued and redeem juice) |
Milk (applies to composite of milk, cheese, and yogurt) | Reduce to 4 gallons | 56d,f | 65 | 68 | Uses the implied new redemption rate based on Altarum distributions; increased rate of redemption 3 percentage points (a 5% increase from the Altarum implied redemption) due to additional yogurt option |
Fish | Reduce to 20 oz | 69d | 68 | 68 | Uses the implied new redemption rate based on Altarum distributions |
NOTES: BF = breastfeeding; CVV = cash value voucher; FP = food package; veg/fr = vegetables and fruits; NA = not applicable; P = pregnant; PP = postpartum; RTE = ready-to-eat.
a These values were applied to estimate the costs of the current set of food packages. Values represent the unweighted mean values from five states provided by FNS, except for whole milk, cheese, and infant foods and formula. For these foods, the unweighted average of available state data was used.
b These values were generated using the method described in this appendix, and account for the redemption distributions reported in USDA/ERS, 2014. These values account for changes in amounts, but they do not account for changes in composition or substitution options.
c These values include upward adjustments to account for changes in composition or substitution options. Values represent the anticipated mean redemption over the course of the revised program.
d USDA-FNS provided the committee with 12 months (August 2013 through July 2014) of price and redemption data from a convenience sample of six WIC state agencies, representing five of the seven regions of the country (herein referenced as the FNS redemption data). The identity of the agencies was not known to the committee. The states were diverse in terms of size and did not include Indian Tribal Organizations or territories. Redemption values from the five states may be slightly underestimated: The PC2014 report indicates that 17.7 percent of minimally breastfeeding women are included in reported participants, but do not receive a food package. FNS indicated that these women are included in administrative data for participation. Because these women are not issued and, therefore, do not redeem WIC foods, the redemption rates may be slightly deflated.
e Bimodal distribution refers to cases where the tails of the distribution (none and full redemption) had a relatively large share of the redemptions and the “partial redemptions” were a small share (USDA/ERS, 2014).
f The group average rate of 65 percent redemption for low-fat milk (women and children, combined) was decomposed into values of 71 percent for children ages 2 to less than 5 and 56 percent for women, rates that were consistent with the observed 65 percent redemption when weighted by the population proportion of WIC-participating children and women.
SOURCES: Personal communication, USDA/FNS, June 30, 2016; USDA/ERS, 2014; redemption data provided to the committee by individual states, available in the public access file for the study (Email: paro@nas.edu).
REFERENCES
USDA/ARS (U.S. Department of Agriculture/Agricultural Research Service). 2016. USDA National Nutrient Database for Standard Reference, release 28. https://www.ars.usda.gov/northeast-area/beltsville-md/beltsville-human-nutrition-research-center/nutrient-data-laboratory/docs/usda-national-nutrient-database-for-standard-reference (accessed December 22, 2016).
USDA/ERS (U.S. Department of Agriculture/Economic Research Service). 2014. Transition to EBT in WIC: Review of impact and examination of participant redemption patterns: Final report. http://altarum.org/sites/default/files/uploaded-publication-files/Altarum_Transition%20to%20WIC%20EBT_Final%20Report_071614.pdf (accessed December 22, 2016).
USDA/FNS (U.S. Department of Agriculture/Food and Nutrition Service). 2013. Fiscal year 2010: WIC food cost report. http://www.fns.usda.gov/sites/default/files/WICFoodCost2010_0.pdf (accessed December 22, 2016).
USDA/FNS. 2015. WIC food packages policy options II. Final report. Alexandria, VA: USDA/FNS. http://www.fns.usda.gov/wic-food-package-policy-options-ii (accessed December 21, 2016).
USDA/FNS. 2016. WIC participant and program characteristics 2014 food package report. Alexandria, VA: USDA/FNS. http://www.fns.usda.gov/wic-participant-and-program-characteristics-2014-food-package-report (accessed August 30, 2016).