Monday, March 14, 2011

The case for foster care finance reform, from those who know it best

It anyone still has any doubt about the need to reverse the perverse incentives in federal funding that encourage foster care and discourage better alternatives, they should take a few minutes to listen to Isha “Charlie” McNeeley and Jojo Murdock.

They are former foster children from Oregon and California who spoke eloquently about their own experiences at a hearing of the Senate Finance Committee last week.

The hearing concerned restoring the authority of the Department of Health and Human Services to grant waivers from foster care funding restrictions, waivers like the one that has done so much to improve child safety in Florida, according to independent evaluations.

Legislation to do this passed the House of Representatives in the final days of the lame duck session last year, but it got nowhere in the Senate.  Now, it seems, some in the Senate may be ready to take up the cause.

No one at the hearing actually spoke against restoring this authority. But that’s always the m.o. of groups like the Child Welfare League of America, the giant trade association for public and private agencies, including many that would go out of business without a steady supply of foster children: never say no, just “yes, but…” reform to death.  You can bet that’s what CWLA and its allies will be doing if there are any signs that restoring waiver authority actually might pass.

Ideally, of course, Congress would go well beyond simply restoring the authority to grand waivers.  At a time when good entitlements, like Medicare, Medicaid and Social Security are under attack, it would be nice if Congress turned its attention to an entitlement that actually does harm – the never ending open-ended entitlement to federal aid for foster care for every eligible child.

Ideally, Congress would end this entitlement, give all states what they’re getting now as a flat grant, indexed to inflation, and let the states keep any savings they achieved by reducing foster care.  But a state or county that caved in to a foster-care panic and started taking away lots of children needlessly would have to pick up the full tab for those placements. 

The Bush Administration wanted to give every state this option, on a purely voluntary basis, back in 2003.  As NCCPR reported in the trade journal Youth Today, had that passed Congress, and had every state taken the deal, states would have $5 billion more to spend on child welfare now than they got by sticking to the “entitlement.”

But CWLA and its BFFs at the Children’s Defense Fund, which is trapped in a 1960s entitlement = good, everything else = bad mentality, and their allies, killed the idea.  And it looks like they’ve learned nothing from their $5 billion blunder.

So odds are the best that young people like Ms. McNeeley and Ms. Murdock can hope for is that Congress might let HHS give more states the chance to reform foster care financing through waivers.  And given how the child welfare establishment really feels about this kind of reform, they might not even get that.

There is more about all of this in our briefing paper on child welfare finance reform.