Monday, January 25, 2010

Foster care or family preservation: You get what you pay for

Today NCCPR releases its briefing paper on financing child welfare. That way, if anyone planning to go to Capitol Hill on behalf of the Child Welfare League of America tomorrow wants to know the side of the story CWLA will never tell, it's readily available on our website here. And if anyone in government or elsewhere who's only heard CWLA's spin on these issues wants to know the rest of the story, it's available to them as well.

Here's an excerpt:

Understanding the issue requires a journey into a wonkish world filled with terms like "delinking" and "eligibility lookback." It's worth the trip, because the stakes are so high.

To understand those stakes, consider what a single mother in the Bronx named Rose Mary Grant had to do every week for months, just to see her then-11-year-old son, Issa, as described in a keenly-observed story in the Westchester County, N.Y. Journal-News (which, unfortunately is not available on the Journal-News website):

"Starting from her brick apartment tower, Rose walks a block to Gun Hill Road, takes the 28 bus to the subway station, catches the 5 train to Harlem, makes her way down 125th Street, boards the Metro-North train to Dobbs Ferry, and rides a shuttle … At each step, she places two metal crutches ahead of her and swings forward on two prosthetic legs."

The journey would have been worth it, had there been something worthwhile for Issa at the end of the line. But there wasn't. Issa was trapped in a "residential treatment center" a form of "care" that does little or no good, and was utterly unnecessary for Issa.

Issa was not paranoid, he was not schizophrenic, and he was not delusional. The only label pinned on him was Attention Deficit Hyperactivity Disorder. Sometimes, at home, he was seriously out-of-control. But his handicapped, impoverished single mother couldn't do what middle-class and wealthy families do: find a good psychiatrist and hire home health aides.

She couldn't do that because the federal government does almost nothing to help pay for such alternatives. But, in many cases, the federal government will gladly reimburse states between 56 and 83 cents for every one of the 86,000-or-more dollars per year it costs to keep children like Issa in an "RTC."

Issa finally did get home, and the RTC where he was housed is reforming its own practices to help more children in their home communities.

But the reason Issa couldn't be cared for in his own home by his own mother for so long is rooted in the way the federal government helps states and localities finance child welfare.

Foster care is funded by the federal government as an open-ended entitlement. It's known as Title IV-E. For every eligible child (and I'll get back to eligibility in tomorrow's post to this Blog) the states are reimbursed for anywhere from 56 percent to 83 percent of the cost of warehousing that child in a foster home, a group home, or an institution. (The percentage for each state is the same as whatever that state gets for Medicaid, which, in turn, is linked to the average income of state residents.) Aid for adoption subsidies also is an entitlement under the same program.

The only funding stream even partially reserved for prevention and family preservation, known as Title IV-B, is not an entitlement; and it is strictly limited.

The result, in Federal Fiscal Year 2010 the federal government is expected to spend, via Title IV-E, $4.7 billion to hold children in foster care and another $2.46 billion to subsidize adoptions. It will spend, at most, $660 million to help to keep children out of foster care through Title IV-B. The real figure is even lower because some money in the "prevention" funding stream can be spent on foster care and adoption.

This means that while safe proven alternatives to foster care cost less in total dollars, it sometimes can cost a state or locality less to throw a child into foster care.

So while this does not mean, as some have alleged that "government makes money on foster care" it does mean that there is a huge, perverse incentive to use foster care instead of better alternatives.