Answer
a) No, I don't think most families would spend the money on health insurance.
b) The value of in-kind transfers should be disallowed in computing the poverty level.
c) We should continue to provide in-kind transfers rather than cash transfers.
Work Step by Step
a) Families who receive the 10,000 dollars that would have been used for Medicaid would likely spend the money on goods that would have an immediate impact on the family (fixing unreliable vehicles to be reliable, food, rent, etc.)
b) To truly see how much people really struggle (without government assistance), the value of in-kind transfers should be ignored. Government assistance that brings everyone up to the poverty line doesn't provide a true picture of how much people really struggle.
c) With cash transfers, those in poverty would have money to fuel possible issues (drugs or alcohol). With in-kind transfers, the true needs for those in poverty (medical, transportation, and/or food) are truly met.
