Kokomo was one of the first areas of the state to adopt what Gov. Mitch Daniels calls the “modernized” welfare system, and so far, the numbers show the new system is having an effect.

According to advocates for low-income Hoosiers, that specific “effect” has been a denial of benefits to those who need it the most.

In response to the latest data from a 12-county pilot area, the advocates, grouped under the banner of the Indiana Home Care Task Force, are calling for a return of state caseworkers to places like Howard County.

The numbers tell a story, although officials in Daniels’ administration have a very different conclusion than the Task Force advocates.

For instance last year, as the economy tanked, the number of people receiving food stamps nationally rose by 16 percent.

But in the 12-county area — which includes Howard, Miami and Tipton counties — the number of recipients increased by just 6 percent.

In the areas of the state not yet under the new system — where state caseworkers still meet with applicants face-to-face — the number of food stamp recipients increased by about the national average.

“We’re saying it’s better to have someone who is trying to find ways to help people, rather than have someone from a private company trying to make some money,” said Elmer Blankenship, president of the Indiana Alliance for Retired Americans.

In March 2007, the state signed a $1.1 billion, 10-year contract with a coalition of companies led by IBM. Daniels obtained a waiver from Congress to allow Indiana to become the only state to attempt to privatize the system that processes welfare applications and determines eligibility.

Two-thirds of the state’s caseworkers either took positions with the IBM Coalition or quit. In March 2008, a second region of the state was put under the new system, and state officials have postponed, at least for now, rolling out the system over the rest of the state.

Indianapolis and the cities of the Chicago region still aren’t under the new system.

And in every category of benefits — food stamps, Temporary Aid for Needy Families and Medicaid — the areas under the new system are seeing a marked difference.

As a whole, the state’s unemployment rate has jumped by almost 5 percent in a year, with the 12-county region surrounding Kokomo particularly hard hit.

But Thursday, Task Force advocates said the new system actually took TANF benefits away from more than 5,000 individuals in that region last year.

Marcus Barlow, spokesman for the Indiana Family & Social Services Administration, said the state is simply using the new system to enforce federal “welfare to work” rules.

“Before the modernization, Indiana had a reputation as a horrible welfare-to-work state,” Barlow said. “People now have to live with the consequences of refusing to use the system as intended.”

But advocates say the system works mainly by placing a huge barrier between those in need and those with the power to help them.

Instead of meeting with a state employee — a caseworker — applicants now must either call a phone center in Marion or apply online.

They are offered help with the application process, but are never offered the option of discussing their circumstances with someone in a position to actually make a decision, the advocates said Thursday.

The result, they say, is that many people in each community — including ministers, social workers, United Way volunteers and others — are having to work as de facto caseworkers to help people unable to navigate the system.

That situation, they say, is the reason the numbers are down for the 12-county rollout area.

State officials say even the advocates don’t want a return to the inefficiencies and abuses of the old system.

“That system is there for efficiency and accountability, and when you place complete power to determine eligibility in one person’s hands, that erodes accountability,” Barlow said.

“We will never say the system is perfect, but we do feel it’s better,” Barlow said.

Scott Smith may be reached at (765) 454-8569 or via e-mail at scott.smith@kokomotribune.com