According to a new Government Accounting Office report, many states have continued provision of federal TANF and Medicaid benefits to immigrants, even though the 1996 Immigration Act allows them to do otherwise. Most states have continued to provide uninterrupted benefits to those receiving them in 1996, and extend them to new immigrants after they have been in the US for five years. A smaller number of states use state funding to provide benefits to immigrants before the five-year period is ended.

Because of the states' actions, the area where immigrants have lost the most welfare benefits is the federally funded food stamp program. After this program was changed in 1997, almost one million immigrants lost eligibility, and almost 200,000 of these were children. In response to this move, 14 states instituted state-funded food stamp programs, and recently the federal government amended the food stamp program to extend benefits to 250,000 immigrants, mostly children, the disabled and the elderly.

In California, even though the majority of immigrants are eligible for welfare benefits, many immigrants no longer seek government aid, largely because of misinformation and fear. According to Michael Fix, one of the authors of a welfare study in Los Angeles County, "one of the most far-reaching effects of welfare reform to date in Los Angeles County has got to be this decline in applications among legal noncitizens." The mistaken fear that applying for welfare benefits may affect immigration status has prevented many otherwise eligible people from applying.

Attempts at better educating legal immigrants about their right to receive government assistance are underway.