WIC EBT Feasibility Study and Cost‐Benefit Analysis

Virginia Department of Health WIC EBT Feasibility Study and Cost-Benefit Analysis
1. GENERAL INFORMATION
The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) is
designed to provide nutritious foods, nutrition education, and referrals to health and other social
services. WIC program participants are pregnant, breastfeeding, or postpartum women, infants,
and children up to the age of five who are determined to be eligible based on income.
In Virginia, the primary avenue for providing nutritious foods to WIC participants is through
Food Instruments (FIs) or vouchers. FIs are similar to checks but which state the specific food
items and quantities that may be purchased by the participant at WIC-authorized retailer
locations. Virginia also issues $5 vouchers for purchase of fresh fruits and vegetables at
designated Farmers’ Markets during the growing season as part of the Farmer’s Market Nutrition
Program (FMNP). Virginia WIC policies for staff, participants and retailers dictate the issuance,
redemption, and payment of FIs.
An alternative to the paper-based and largely manual FI process is electronic issuance,
redemption and payment of WIC benefits, referred to as e-WIC. The concept of e-WIC is
similar to that of electronic benefits transfer (EBT), which is being used in every State and
Territory to distribute Food Stamp Program (soon to be re-named the Special Nutritional
Assistance Program or SNAP) benefits and by many States to facilitate cash program payments.
Food Stamp EBT uses debit card technologies; participants are issued magnetic stripe cards that
can be used at Point-of-Sale (POS) terminals for the purchase of food items at authorized
locations. When Food Stamp EBT was first introduced, many grocery stores did not yet accept
credit or debit transactions. Today use of credit and debit cards is often more prevalent than cash
and the EBT card offers recipients and program participants greater privacy, dignity, and
security.
Because of the nature of WIC assistance, e-WIC is more complex than Food Stamp and cash
EBT and is considered the most complex transaction at the POS. Few States have implemented
e-WIC and among those States the technologies and implementation approach have varied
widely. On-line e-WIC uses magnetic stripe cards and direct communications with the host
system to verify and authorize the purchase of each food item. Off-line e-WIC uses cards
embedded with an integrated circuit chip (ICC), commonly referred to as smart cards. The ICC
stores the household’s WIC benefit data. When a participant purchases a food item with the
smart card, the POS terminal communicates directly with the ICC for verification and purchase
authorization and records the transaction on the ICC. The terminal uploads the data to the host
system at a later time (usually “pushed” to the host by the retailer). With either technology,
retailers are paid through the established Automated Clearinghouse (ACH) network. It is
possible for an e-WIC solution to be outsourced to a service provider or hosted in-house by the
State.
In 2007, Virginia received a grant from the U.S. Department of Agriculture (USDA) Food and
Nutrition Services (FNS) to conduct pre-planning activities for e-WIC. This document has been
prepared for the Virginia Department of Health (VDH), Office of Family Health Services,
Division of WIC & Community Nutrition Services (herein referred to as WIC Services) to assess
the costs, benefits and risks of automating Virginia WIC participant access to nutritious foods.
1 V 1.2 August 20, 2008