Child Welfare Financing: What Do We Fund,How,and What Could Be Improved?

Abstract

Government efforts toward the prevention, detection, and investigation of child abuse and neglect are carried out through the United States’ child welfare system—a complex web of programs that provide family assistance and promote child safety. Most funding for these activities is split among federal, state, and local governments and comprises specific child welfare–related funding (such as Titles IV-E and IV-B of the Social Security Act) and non–child welfare funding that is spent on programs that support poor and disadvantaged families (Medicaid and TANF). I provide an overview of these funding streams that finance the child welfare system, review the federal legislation since 1970 that has led to the current funding structure, and end with a discussion of how the Family First Prevention Services Act of 2018 has the potential to create better outcomes for children and families by promoting prevention activities and program support with strong evidence of success.

Keywords

child welfare financing child abuse and neglect child protection Title IV-E Social Security Act Medicaid Family First Prevention Services Act

The United States has a long-standing problem with children who are abused and neglected by family members and a public policy response that has never proven adequate to solving the problem. Major progress against the problem is not for want of trying. Both federal and state governments have developed a host of programs to prevent abuse and neglect, to detect it when it occurs, and to deal with its aftermath. The goals of the nation’s child welfare system are to prevent child abuse and neglect and to provide assistance (including temporary and permanent homes for children) to families involved in or suspected of maltreatment. To achieve these ends, the child welfare system has developed as a complex series of programs that serve the purpose of prevention of maltreatment and detection, investigation, treatment, and removal and placement of children when prevention fails. The constituent programs of the child welfare system divide responsibilities between the federal government and the states. The system is financed by federal, state and (in most cases) local dollars; and in most states, local government plays a vital role in planning and conducting the programs.

Among the best sources of information about child protection programs, spending on the programs, and evidence about the programs’ effects are the survey of state child welfare programs conducted by the independent, nonprofit organization Child Trends and various publications by foundations, like Casey Family Programs and the Annie E. Casey Foundation, that focus considerable attention and funding on child welfare. Government agencies, such as the Children’s Bureau within the Administration for Children and Families at the U.S. Department of Health and Human Services (HHS; 2019) and the Congressional Research Service (CRS; 2019), also conduct important work to analyze data provided by state and federal agencies, as do researchers in the private sector. The Child Trends state survey, which has been conducted seven times since 2004, most recently in 2018 (providing results through 2016), is exceptionally valuable because it collects information on spending by federal, state, and local agencies. One of the most complete sources of financial information from CRS is a fifty-page report, issued in January 2018, that provides an overview of nearly twenty federal programs focused on child welfare and their current funding.

In 2018, 7.8 million children were subjects of the 4.3 million child maltreatment referrals received by the child welfare system. Of these, 2.4 million were screened, meaning that 3.3 percent of all U.S. children were subject to a child welfare investigation. Child victimization rates rose between 2016 and 2018, reaching a reported 678,000 children—or 0.9 percent of all children determined to be victims in 2018. In that year, about 85 percent of victims suffered a single type of maltreatment: 61 percent were neglected only, 11 percent suffered physical abuse only, and 7 percent suffered sexual abuse only. The other 15 percent of victims suffered two or more types of maltreatment (HHS 2020). Moreover, that the child welfare system is not more than moderately successful is suggested by annual data on the number of children in foster care. Although the number of children in foster care declined from around 493,000 to 441,100 between 2007 and 2017, the number increased every year between 2012 and 2017, rising from about 397,300 to 441,100. The number fell for the first time in 6 years in 2018, but by fewer than 4,000 children. The total cost of conducting the federal-state system involving all child welfare activities was around $30 billion nationwide, with states contributing somewhat more than half the funds and the federal government somewhat less than half (Rosinsky and Williams 2018).

Overview of Spending by Child Welfare Programs

Although there are a host of minor programs that contribute to this total of $30 billion, the child welfare system features six major sources of funding and a seventh program (the Family First Prevention Services Act) that is just getting started. I begin with an overview of these programs and the spending on each. The largest programs include Title IV-E and Title IV-B of the Social Security Act, the Child Abuse Prevention and Treatment Act (CAPTA) state grants, the Temporary Assistance for Needy Families (TANF) program, the Social Services Block Grant (SSBG), and Medicaid. Table 1 provides an overview of federal funding for these programs. A review of each of these programs provides a broad understanding of the financing of the child welfare system.

Table 1

Federal Child Welfare Program Funding by Fiscal Year (FY)

Program	FY 2013	FY 2014	FY 2015	FY 2016	FY 2017
Title IV-E of the Social Security Act	7,072	7,784	7,681	7,913	8,041
Title IV-B of the Social Security Act	725	714	687	682	688
Other programs	190	199	197	192	189
Total	7,987	8,696	8,566	8,788	8,898

SOURCE: CRS (2018).

NOTE: Data in millions of real 2017 dollars.

An important distinction is in order at the beginning of our inquiry. The programs reviewed in this section fall naturally into two groups: one group of programs is designed and funded exclusively to serve children and families involved with the child welfare system, and the other group serves children who qualify for services for reasons other than abuse or neglect. The former group of programs includes Title IV-B, Title IV-E (and associated programs), and CAPTA; the latter includes TANF, the SSBG, and Medicaid.

Title IV-E of the Social Security Act

Title IV-E is the biggest of the child welfare programs, both in terms of spending and the number of children and families receiving support. In 2017, the program, which primarily pays for out-of-home care, including both foster care and adoption, received about $8 billion from the federal government. Of this amount, $7.8 billion was for adoption, foster care, and guardianship payments to caretakers; $183 million was for payments in the Chafee Foster Care program for older youth, in large part to help them make the transition to adulthood; and $38 million was for adoption payments and legal guardianship incentive payments. The major share of this money is spent on monthly maintenance payments for the care and supervision of eligible children who have been removed from their homes, most of which goes to foster care or adoptive parents. The rest is spent on administrative costs, training of staff and foster parents and other providers, recruitment of foster and adoptive parents, and operation of an automated child welfare information system (called the Statewide Automated Child Welfare Information System or SACWIS),¹ which the federal government pays for if the states wish to use the system for improved case management and data tracking. To make these payments, IV-E is an open-ended entitlement program, meaning that states can qualify for open-ended federal funding as long as they meet all the program requirements and meet state matching payments.

The federal requirements for IV-E reimbursement are extensive. The most restrictive one is that the family must be considered “needy.” The definition of poor or needy used in the program is eligibility for the now defunct Aid to Families with Dependent Children’s (AFDC) program. Because that program was terminated by legislation in 1996, the poverty income required for qualification has remained the same since that time, and there has been no adjustment for inflation. As a result, only families with monthly incomes that range from $378 to $1,740 across the states are eligible. Not surprisingly, given these miserly family income requirements, the percentage of children in out-of-home care receiving IV-E fell from 60 percent in 2002 to 52 percent in 2012 and is almost certainly lower today, nearly a decade after 2010 (Child Trends 2014). Even so, the proportion of total child welfare spending from federal versus state and local sources held steady over the period from 2006 to 2016. Thus, the impact of the 1996 law has yet to have a major impact on federal versus state/local spending even though a lower percentage of children in foster care are receiving federal payments. It is easy enough to imagine that this surprising fact could change in the future, but so far it has not.

Additional and more complete information on child welfare spending is provided by remarkable reports from Child Trends (Rosinsky and Williams 2018; see also Stoltzfus 2019), which has, to date, produced eleven annual reports. These and similar reports by states and federal agencies provide the broadest picture of child welfare funding available, including spending by federal, state, and local government agencies. The most recent Child Trends report shows that total child welfare spending from all sources, as mentioned above, was $29.9 billion in 2016. The report also shows that spending within states across the years 2014 to 2016 varied widely: thirty states increased their spending, thirteen states decreased their spending, and seven states held steady.

Figure 1 shows the change in spending between 2006 and 2016 for twenty-nine states with comparable data. These data are not directly comparable with the data above because they include spending by only twenty-nine states rather than all states. The figure shows about a $0.5 billion decline in spending on child welfare across these twenty-nine states, although spending increased by almost $1 billion between 2014 and 2016 in inflation-adjusted 2016 dollars. The proportion of spending representing state and local funds compared with federal funds held steady over the 10-year period, with 56 percent of spending coming from state and local dollars and 44 percent coming from federal dollars.

Figure 1

Change in Total Child Welfare Agency Expenditures, State Fiscal Years (SFY) 2006–2016 (Twenty-Nine States with Comparable Data)

Although IV-E funding plays the primary role in supporting child welfare spending, there are controversial features of the program that have led to serious reforms over the years, especially in 2018. As I pointed out, the most important limiting feature of the program is that only poor children and families can qualify for coverage. This feature was even more important after the welfare reform legislation of 1996 because fewer and fewer families are likely to meet this financial criterion because of the lack of an inflation adjustment in family income needed to qualify for eligibility. Although this unfortunate feature of IV-E can be expected to continue in the case of foster care payments, Congress has taken timely and wise action to stem the flow in the case of adoption payments. The offending “look back” feature resulting from the 1996 TANF legislation, stipulating that the family income defining needy or poor families that would be eligible for child welfare subsidies did not include an inflation adjustment, is being phased out in the case of adoption payments (but not foster care payments). Provisions in the Fostering Connections to Success and Increasing Adoptions Act of 2008 (National Conference of State Legislatures 2008) contained this reform.

In addition to Foster Care and Adoption Assistance, Title IV-E contains several smaller programs. These programs include Kinship Guardianship Assistance, the Chafee Foster Care Independence program, Chafee Educational and Training Vouchers, and Adoption and Legal Guardianship Incentive Payments (Stoltzfus 2018). The Kinship Guardianship program allows states to include payments to guardians under its IV-E plan. The program is optional, but in 2017 forty-four jurisdictions, including thirty-five states, the District of Columbia, and eight tribes, participated; and the caretakers of about twenty-five thousand children received maintenance payments. In a 2017 review, HHS estimated that the budget authority needed for this program for 2017 was $136 million.

Another IV-E program is the Chaffee Foster Care Independence Program. A special problem with foster care—and a major reason state programs work so hard to get children into a permanent placement (which usually means either back with their parents or in an adoptive placement)—is that research shows that youth who age out of foster care have worse outcomes than those with more permanent placements (Stott 2011). Thus, the Chaffee Independence program provides funds to states to identify children who remain in foster care until their 18th birthday and provides these children with services that prepare them for independence and living on their own. According to Stoltzfus (2018) of the CRS, these services can include financial assistance; help with housing, counseling, and education; and employment and mentoring. States are required to involve the youth in decisions about the services they receive. A total of $140 million is authorized for the Chaffee Independence program; this amount is scheduled to increase to $143 million in 2021. States also receive $43 million each year to support postsecondary education for children eligible for the Chaffee Independence program, which can be used for fees, books, room, and board at postsecondary institutions.

A final IV-E program is Adoption and Legal Guardianship Incentive Payments. The payments were originally established by the Adoption and Safe Families Act (ASFA) of 1997 and then revised slightly in the 2014 reauthorization bill. The long-standing goal of Congress, supported by nearly every child welfare expert, has been to increase adoptions because it is better for children to be in a permanent setting than in the temporary setting of foster care. Moreover, there has been a feeling among most experts that the adoption process in many states is too slow and cumbersome. For these reasons, the 1997 ASFA legislation introduced a financial incentive for states to increase adoptions and to perform them more efficiently. States were given cash payments for increasing the rate of adoptions of children in their state as compared with previous years. These incentive payments range from $5,000 to $10,000 per adoption depending primarily on the adopted child’s age (states receive higher payments for older children). The incentive payments have been associated with more adoptions by states. Since enactment of ASFA in 1997, adoptions have increased from about thirty thousand to about fifty thousand per year. Moreover, the average time states took to complete adoption of children from foster care was reduced by about one year. More kids adopted; faster adoptions. A double victory.

The increase in adoptions underlines one of the most fundamental goals of the child welfare system. Of course, child safety is the single most important goal of the system, but not far behind, and not unrelated to safety, is the goal of minimizing congregate care and maximizing placements in families because achieving permanent placements is vital to the long-run well-being of children. As I mention several times in this article, most experts and administrators believe that the way to promote both safety and stability is to increase the share of children in relative care or adoption, as opposed to congregate care (Casey Family Programs 2018b). Permanent placement with kin, usually grandparents, is widely believed to be the next best arrangement. Reliance on permanent placements with kin, even without adoption, may have benefits such as fewer problems with visitation with parents, visits could be more frequent, kin foster parents are likely to be similar to biological parents in important respects (racial, ethnic, and cultural background), permanence for children could increase, sibling ties would be promoted, older youth would have support in making the transition to further education or adulthood, and involvement of the child welfare system could be minimized (Epstein 2017).

Title IV-B of the Social Security Act

Despite being much smaller than Title IV-E in terms of funding for child welfare, the Title IV-B program is also of primary importance. In 2017, Title IV-B provided states with $668 million for the Stephanie Tubbs Jones Child Welfare Services Program, the Promoting Safe and Stable Families Program, and child welfare research and demonstration programs. Unlike Title IV-E, all children and families, regardless of income, are eligible for IV-B services. In what follows, I briefly summarize each of the three parts of Title IV-B.

Stephanie Tubbs Jones Child Welfare Services

In 2017, the Child Welfare Services Act provided about $269 million in formula grant funds to states, territories, and tribes to pay for services designed to protect the welfare of all children, prevent child abuse and neglect, allow children to stay in their own homes, and similar purposes. There are no financial eligibility requirements for families, and the program is designed to ensure that all children in foster care, regardless of family income, receive permanency services (services aimed at helping children achieve a permanent placement). The money can be spent on a broad array of services but, in FY2019, states reported that they intended to spend nearly 48 percent of the funds on child protective services that include investigations of abuse and neglect, caseworker activities on behalf of both children in their homes and children who have been removed, counseling, and emergency services, among other uses. States planned to spend about 30 percent of the funds on family support, family preservation, and family reunification. The remaining approximately 7 percent of funds would be spent on foster care maintenance payments, program administration, and services to promote adoption and guardianship (see Children’s Bureau 2019). The money is distributed to states in accord with a complicated formula that guarantees $70,000 to each state and distributes the rest in accord with the percentage of the national foster care caseload that is served by each state’s foster care system.

Promoting Safe and Stable Families (PSSF)

The PSSF program authorizes formula grant funds to states, territories, and tribes to help at-risk families by preventing maltreatment, preserving families, and ensuring children’s safety by providing services that allow children to safely remain with their families. In FY2017, $59.8 million in discretionary funds (money that must be appropriated each year) and $321 million in mandatory funds (funds authorized by Congress, usually for several years; the authorized funding remains available until the years specified in the original legislation are reached or Congress changes the law) were devoted to the PSSF program. The funds can also be used to help families whose children are in foster care and to support families that have adopted a child. To qualify for these funds, states must be engaged in a Court Improvement Program² and related activities. PSSF funds are roughly apportioned by about 25 percent for family support services, 25 percent for family preservation services, 20 percent for adoption and promotion services, and 20 percent for time-limited family reunification services. The rest of the funds, around 10 percent, are to be expended for administration.

Child Abuse Prevention and Treatment Act (CAPTA)

Created in 1974, CAPTA authorizes formula grant funding to states to provide social services to families that have abused or neglected their children. Under CAPTA, states receive funds to improve their Child Protective Services system. In the last several years, CAPTA state grants have remained almost fixed and provide a total of about $25 million per year for all the states. Compared with Title IV-B and especially Title IV-E, this is a small amount of funding. CAPTA also has a section for discretionary activities and for community-based grants to prevent abuse and neglect; but taken together, these two additional sections of the CAPTA law provide less than an additional $75 million.

Child welfare research, training, or demonstration projects

The Social Security Act authorizes HHS to sign contracts and other agreements to support research or demonstration projects that could have positive impacts on child welfare, encourage research-based experiments or special child welfare services, or advance training for child welfare workers. Although the funding of child welfare research, training, and demonstration under Title IV-B has been reduced since 2014, it was $18 million in both 2017 and 2018.

Each year since 2015, Congress has used funds from this source to support the National Survey of Child and Adolescent Well-Being (NSCAW), an important longitudinal survey that collects data on several aspects of foster care, adoption, and child well-being. NSCAW is a representative survey of families that have been investigated for child abuse and neglect. Two cohorts of children and families have been enrolled in NSCAW. By ignoring whether the report of maltreatment was confirmed, the survey provides a complete spectrum of information about families that come to the attention of child welfare agencies. In addition, by collecting information from parents, teachers, and caseworkers, the second round of NSCAW, which is being conducted by Abt Associates, a respected international research firm, is examining the education, health status, and socio-emotional condition of children reported as potentially abused or neglected.

This brief overview of the programs in Title IV-B shows that states are authorized to spend funds on a broad range of services, although much of the spending is restricted by federal requirements. In addition, the Title IV-B provisions overlap to a large extent, causing those who plan the use of program funds to see that they are not at all mutually exclusive and some to wonder why it is necessary to have programs with overlapping purposes. Still, states have enough flexibility in the use of the IV-B funding to make nonoverlapping funding decisions in their state plans for child welfare spending. Here, as elsewhere, it is states that must provide the direction in child welfare spending and to plan sophisticated uses of their federal and state funds to get the most out of their resources.

Non–child welfare programs supporting child welfare services

Some social programs provide states with flexibility in deciding who is eligible for program benefits, usually under the broad guidance of federal eligibility requirements. These programs make benefits available to a wide range of children, not just a group of children with specific problems. The programs discussed above are available only to children who are in foster care, adoption, or related programs. But the nation has very large social programs that provide benefits to a broad range of children and families. Many of these programs, such as Medicaid, SSBG, and TANF, provide their benefits to low-income children and families who are similar in many respects to children involved with child welfare programs. In fact, many children receive services from one or more of these programs before becoming eligible for benefits from the various child welfare programs. But regardless of previous participation in the programs, benefits from Medicaid, SSBG, and TANF play a vital role in child welfare financing.

Medicaid

Perhaps the most important of these programs is Medicaid, not only because of the value of medical and related benefits it provides to families and children, but because of the high cost of these benefits if families had to pay for them out of pocket. In fact, if poor families had to pay for these benefits, it is reasonable to assume that they would be forced to go without them, with especially serious consequences for children. The typical benefits provided to families by Medicaid are emergency and rehabilitative medical services, targeted case management, and various treatments or even therapeutic foster care home settings. Each of these services is likely to cost thousands of dollars per year, much more than poor families can afford. This and the information about Medicaid presented here is based on state surveys of spending on Medicaid. In 2016, the thirty-seven states that reported data for the Child Trends survey of spending on child welfare and related programs (Rosinsky and Williams 2018) spent $867 million on Medicaid benefits for children in child protection programs. Spending data collected by Child Trends for the years between 2006 and 2016 showed that Medicaid spending on child welfare services declined from $1.6 billion to $0.8 billion (adjusted for inflation). Even so, based on Medicaid spending data reported by all states for the years between 2014 and 2016, twenty-three states increased their spending on Medicaid for child welfare and only sixteen states deceased their spending; ten states did not change; and one state did not submit data. The decline in state spending on Medicaid might not represent actual declines in spending on Medicaid services. Rather, the declines could be caused by the way states administer the program (Rosinsky and Williams 2018, 2). A report from the CRS, for example, found that in 2014, total Medicaid spending on children involved with child welfare did not change significantly between 2005 and 2010 but that, while total spending remained relatively constant, spending on specific services, such as rehabilitative services and case management, did change substantially (Stoltzfus et al. 2019).

SSBG

Another source of federal funding for children and families involved with child welfare is the SSBG. Although the SSBG is a program of modest size—about $1.8 billion in 2018—it provides states with great flexibility in how the money is spent. The SSBG statute defines twenty-eight categories of spending that are allowed; many of them, such as preventing or remedying abuse or neglect, preventing inappropriate institutional care, and providing care to individuals in institutions, could be used for children and families involved with the child welfare system.

Thus, it is no surprise that a sizable portion of SSBG funds are spent on child welfare. According to the Child Trends 2018 survey, in 2016 states reported spending $1.5 billion of SSBG funds on child welfare activities (Rosinsky and Williams 2018). Although the $1.5 billion represents a 5 percent increase compared with 2014, it was a decline from the all-time high of $1.8 billion in 2010 (all figures adjusted for inflation to 2016 dollars). The five top services and activities funded in 2016 were foster care (twenty-seven states), child protection (twenty-one states), case management (fourteen states), administrative costs (thirteen states), and prevention and intervention services (twelve states).³ The 5 percent increase in spending in 2016 compared with 2014 is in line with the 4.8 percent increase in the foster care caseload between those two years.

TANF

The third of the non–child welfare programs that are commonly used for child welfare services is TANF. Enacted in 1996, TANF is a $16.5 billion block grant that provides funding to help needy families to end their dependence on government benefits, to prevent and reduce out-of-wedlock pregnancies, and to encourage the formation of two-parent families. The funding is designed to be flexible, as is the case with most block grants, so states have dramatic leeway in the use of TANF funds. This flexibility is strengthened by the fact that the Aid to Families with Dependent Children program that TANF replaced allowed funds to be spent on purposes related to foster care and by the TANF provision that allows states to transfer up to 10 percent of their annual TANF funds (around $1.65 billion each year) into the SSBG where spending flexibility is optimum.

To demonstrate the importance of TANF funds to the financing of child welfare, in 2016 states reported spending $2.7 billion in TANF funds on child welfare services. The TANF spending trend line for the decade between 2006 and 2016 shows that spending on child welfare was less than $2.5 billion only in 2014 and was as high as $3.2 billion in 2010. The four leading service categories related to child welfare for which these funds were used by states were family preservation (eighteen states), child welfare services (thirteen states), foster care payments (ten states), and emergency assistance (nine states).⁴

Major Federal Child Welfare Legislation, 1974–2018

As shown in Table 2, the basic laws and programs designed to form the nation’s response to abuse and neglect have been reformed many times. Table 2 provides a brief summary of nine major reforms enacted between 1974 and 2018. The themes of these reforms were providing more flexibility for states, keeping children at home if possible and promoting permanency, increasing equality of racial and ethnic treatment, allowing federal payments to youngsters after age 18, and emphasizing the importance of evidence-based programs and of program evaluation both of child removal and out-of-home placement and of child welfare issues more generally. The Family First Prevention Services Act (FFPSA) of 2018 is a kind of capstone of all these reforms, as it allows IV-E dollars to be used for prevention programs (for a more extensive treatment of the FFPSA, see Testa and Kelly, this volume). Beginning in October 2019, FFPSA made it possible for states to use federal funds from the Title IV-E program to provide prevention services (which include mental health services, substance abuse prevention and treatment services, and in-home parenting skill-based programs) for children who are “candidates for foster care.” At one stroke, the FFPSA allowed states to flexibly use several billion dollars for prevention, an approach that many, if not most, scholars, administrators, and policy-makers believe is superior since it addresses the needs of families before child abuse and neglect occur and can prevent the removal of children from their families. Historically, federal policy required that children be removed from their homes before IV-E funds could be used. Thus, the new legislation designed to promote prevention represents a major change in both IV-E policy and, given the prominence and the funding value of IV-E, in the direction of the nation’s child welfare system as a whole.

Table 2

Major Federal Reforms Bills Since 1970

Date	Title of Bill	Brief Description
1974	Child Abuse Prevention and Treatment Act (CAPTA) (Originally enacted in Public Law 93-247)	CAPTA was originally enacted in 1974 but has been amended several times. CAPTA provides federal funds to states to use on child abuse and neglect prevention and treatment activities. The act also defined the role for the federal government in providing guidance and assisting state in research, technical assistance, and capacity building.
1978	Indian Child Welfare Act (ICWA) (Public Law 95-608)	ICWA was enacted in 1978 after Native American and Alaska Native children were entering into the child welfare system at disproportionate rates. The Act provides guidance for states on the placement of Native American and Alaska native children in foster care or adoptive homes, with special attention given to the preservation of these families
1980	Adoption Assistance and Child Welfare Act of 1980 (Public Law 96-272)	The Adoption Assistance and Child Welfare Act of 1980 amended Titles IV-B and XX (grants to states for services) of the Social Security Act to establish a program and authorize spending for adoption and foster care assistance and created the new Title IV-E program, which required states to make reasonable efforts to prevent placement in foster care and find a permanent placement for a child in foster care.
1986	Independent Living Program as part of the Consolidated Omnibus Budget Reconciliation Act (Public Law 99-272)	The Consolidated Omnibus Budget Reconciliation Act of 1985, through the addition of Section 477 to Title IV-E of the Social Security Act, authorizes funds to States for service programs and activities to assist eligible children (age 16 and over) in Title IV-E foster care to make the transition from foster care to independent living.
1993	Family Preservation and Family Support Services Program, as part of the Omnibus Budget Reconciliation Act (Public Law 103-66)	The Family Preservation and Family Support Services Program aims to promote family strength and stability, enhance parental functioning, and protect children through funding a capped entitlement to states to provide family support and family preservation services, which the law defines broadly.
1994	The Multi-Ethnic Placement Act (MEPA) (Public Law 103-382)	MEPA was enacted in 1994 with a goal to promote permanency by prohibiting states from delaying or denying a child’s foster care or adoptive placement on the basis of the child’s or the prospective parent’s race, color, or national origin
1997	The Adoption and Safe Families Act (ASFA) (Public Law 105-89)	ASFA was enacted in 1997 in response to concerns that many children were remaining in foster care for long periods or experiencing multiple placements. The act addressed this issue by requiring timely permanency planning for children and emphasizes that the child’s safety is the paramount concern.
1999	The Foster Care Independence Act of 1999 (Public Law 106-169)	The Foster Care Independence Act amends Title IV part E (Foster Care and Adoption Assistance) of the Social Security Act to revise the program of grants to states for independent living programs providing education, training, employment services, and financial support for individuals between ages 16 and 18 leaving foster care for independent living.
2018	The Family First Prevention Services Act (FFPSA) as part of the Bipartisan Budget Act of 2018 (Public Law 115–123)	This groundbreaking legislation gives states the option to use Title IV-E funds for the purpose of preventative services (which include mental health services, substance abuse prevention and treatment services, and in-home parent skill-based programs) for children who are “candidates for foster care.”

SOURCES: Stoltzfus (2018); Committee on Ways and Means (2004); HHS (2019).

Congress has been aware for many years of the financial incentive to remove children from their homes created by the IV-E programs. In response to this flaw, legislation was enacted in 1994 that allowed states to apply for waivers that would permit IV-E funds to support prevention activities if the states met several requirements. The original legislation was extended so that by the time the FFPSA was enacted in 2018, the waiver legislation was supporting waiver programs in thirty jurisdictions. Because these waivers would be difficult to administer under the FFPSA law, they constituted a barrier to implementation of the new law. For this reason, Congress examined ways to neutralize the waiver law. Under the terms of the waiver legislation, waivers were set to expire on September 30, 2019. This date became a deadline for Congress, signaling that something had to be done on or before September 30, 2019.

While the new use of funds envisioned by the FFPSA has the potential to fundamentally change the way child welfare agencies operate, some states had already been moving in the direction of keeping more children with their families rather than removing them and placing them in foster care—this reflected the growing notion that it is better to provide families with services and keep them together longer than to prematurely remove children. As the field came increasingly to appreciate, removing children from their families often has negative effects on the child’s well-being and can leave children in settings that are less than ideal (Doyle 2007; Casey Family Programs 2018a, 2018b, 2018c). Thanks in part to the California Evidence-Based Clearinghouse (CEBC), and to other clearinghouses as well, states have a host of good programs based on quality evidence that they can use to help families improve their child rearing and avoid abuse and neglect. The FFPSA was enacted precisely for this purpose.⁵

Transition to FFPSA

This review shows that there are at least six major problems with the child welfare system about which there has long been widespread agreement among program operators and researchers:

Before FFPSA, IV-E funds were tied to removing children from their homes and were not available for prevention.

Too many children were being removed from their homes and placed in settings that often were questionable.

Among these questionable settings was congregate care, which is widely seen as inferior to family and family-like settings.

Before children were removed from their homes, child welfare agencies should have effective ways to identify relatives available to provide a loving home for children, a principle of good practice that was often ignored.

Before removal, children and families should have the opportunity to participate in programs that high quality evidence shows to have produced positive impacts in previous evaluation studies.

If foster care becomes necessary, state and local child welfare agencies should have the experience and resources to recruit and train effective foster parents; a small amount of money was included in the FFPSA legislation for this purpose.

The FFPSA was, in part, designed to address these problems, and Congress—realizing the implementation challenges of FFPSA and the still-active waiver programs—enacted legislation that could ease the transition from the then-current law to the FFPSA. This action was necessary because, according to Emilee Stoltzfus of the Congressional Research Service, FFPSA amended almost every provision of Title IV-E and Title IV-B (Stoltzfus 2018). A good example of the changes is that the FFPSA required that at least 50 percent of the programs used by states be “well supported,” “supported,” or “promising” as indicated by rigorous research. The Transition bill delays the implementation of this requirement, which would be difficult to meet for many states, for two years (through FY2021). As a result, states can temporarily use programs that do not meet the high standard of being evidence-based required by FFPSA during the transition period.

A second provision of the FFPSA that helps with the transition is that the law provides states with $500 million in flexible funding to support their implementation of the legislation and to handle adverse effects that may occur due to startup costs, the waiver transition, and improving foster care safety and quality. Of the $500 million, 3 percent is set aside for tribes and the rest is distributed to states, with no requirement for state matching payments, in accord with the same formula used to distribute funds in the Stephanie Tubbs Jones Child Welfare services funding.

The Transition bill also provides funding to jurisdictions with expiring waivers that face loss of funds as they transition away from their waiver. In 2020, states will have received roughly 90 percent of the amount that they were guaranteed under their waiver for 2019; for 2021, they will receive not less than 75 percent of the amount they were guaranteed under their waiver for 2019. This funding is in addition to the regular transition funding provided to all states under the Transition Act, as I described.

In exchange for the much greater flexibility in designing and delivering prevention services to families and having greater flexibility in spending federal funds under the FFPSA, states must meet several conditions. They must first have a plan for their program approved by HHS. Second, their program must feature evidence-based interventions that have evidence they can succeed with families. The intervention program must feature a manual that details the program and how it should be implemented. Many such successful programs are surveyed in the CEBC.

A few programs have already been evaluated by HHS as part of the clearinghouse mandated by the FFPSA (evidence-based programs are reviewed by Testa and Kelly, this volume). This clearinghouse, called the Title IV-E Prevention Services Clearinghouse, would operate much like the CEBC. It would be sponsored by HHS, and HHS has already hired Abt Associates to run the clearinghouse.⁶ The child welfare intervention programs approved by the clearinghouse would be approved for state use and for IV-E reimbursement. The clearinghouse, which is just now getting started, has already identified several programs that have been shown by high-quality studies to have impacts on parenting or on families (see also Testa and Kelly, this volume). The Family Connects program has also been shown to have impacts on families in multiple settings (Dodge et al. 2013), as have several home visiting programs that have been implemented in multiple sites in one or more communities and appear to have maintained their impacts on children or families for a year or more. These and similar programs are now under review and many seem certain to be approved because the CEBC for Child Welfare has many parenting programs that have been rated as “well supported,” “supported,” or “promising.” Thus, any organization or community that wants to select and use evidence-based programs for parents would be likely to have little trouble finding a good program that suits their needs. In the months and years ahead, HHS will likely approve many additional evidence-based programs for use by state programs eligible for FFPSA funds. Evidence-based programs are expanding rapidly and can be expected to present many more options to states for effective interventions in the future.

FFPSA and the future of evidence-based programs

Arguably the most important innovation of the FFPSA, and the one that holds the greatest promise for strengthening the child welfare system over the long term, is the requirement that states use evidence-based programs and evaluate their outcomes. The FFPSA requires that only programs with evidence of success in previous studies can be reimbursed by IV-E dollars. Moreover, the statute provides a detailed definition of how to define an evidence-based program. Anyone who has followed state policy over the years knows that states can often overcome federal rules in qualifying to spend federal dollars, but the definitions and procedures outlined in the FFPSA statute seem much stronger than previous attempts to get states to follow federal guidelines. It is difficult to overstate the importance of these provisions because the advantages of states’ use of evidence-based programs depend on tight implementation of the new federal provisions. The field of child welfare will not benefit from use of evidence-based programs unless the use of these programs is actually increased, well implemented, and carefully evaluated.

Casey Family Programs (2018a) has conducted notable work in determining which child welfare programs seem well qualified to received FFPSA funding. Because it will take a year or two before the federal government can evaluate the programs adequately (as I mentioned, only thirteen programs have been evaluated so far), Casey Family Programs’ work could have a big impact in getting states’ use of evidence-based programs rolling. Under the terms of FFPSA, the federal government can reimburse only for evidence-based programs. Table 3 presents a summary of Casey’s extensive work in summarizing evidence from the CEBC on the effectiveness of programs that would be useful in child welfare activities. These programs fall into the three categories created by the legislation, namely, mental health services, substance use prevention and treatment, and in-home programs for parenting skills and education. There is a certain level of risk that states that use the programs in Table 3 will be left holding the bag if the programs are not included on the HHS list of evidence-based programs when it is finally determined. If it turns out that the programs Casey determines are evidence based do not pass the eventual federal evaluation, the states might not be able to claim funding for use of the programs. However, this outcome seems unlikely because of the care with which the CEBC and Casey analyses were conducted and because the strength of the definitions of evidence-based policy used in the FFPSA statute.

Table 3

Ratings of Intervention Programs by Casey Family Programs

	Number of Programs per Rating Category
Intervention Program Type	Well-Supported	Supported	Promising
Mental Health Services for Children and Parents	29	22	19
Substance Abuse Prevention and Treatment for Children and Parents	4	15	7
In-Home Parent Skill-Based Programs: Parenting Skills Training and Parent Education	5	5	7
In-Home Parent Skill-Based Programs: Individual and Family Counseling	2	7	14

SOURCE: Casey Family Programs (2018a).

Casey Family Programs reviewed 136 programs across the three categories of programs defined in the statute. The programs had been scored as “well-supported,” “supported,” or “promising,”⁷ by the CEBC. Programs that fall into these three categories could be eligible for funding under the FFPSA statute if the evidence of impacts is strong enough. The Casey work demonstrated, as does the CEBC website itself, that states have an abundance of evidence-based programs with which to work. It seems certain that the future will bring many more evidence-based programs that will play a role in improving child welfare services, thanks to the requirement in the FFPSA that states use evidence-based programs.

Concluding Comment

Given the history of implementation of innovative federal policies, it would be foolish to label the FFPSA as “can’t miss legislation.” On the other hand, this review makes it clear that the development of federal and state child welfare policy and the funding now available point to the likely improvement of child welfare policy and outcomes in the years ahead. To a considerable degree, the FFPSA is constructed on the accumulated wisdom of previous child welfare policy and experience. Notable are the emphasis on evidence-based programs, the requirement for evaluation by states of its new programs, the emphasis on keeping children at home and providing services to families rather than removing children at the first sign of abuse or neglect, the requirement to avoid placing children in institutions unless they require treatment, and the emphasis on placing children who must be removed from their homes with relatives. Perhaps the most notable and fortunate feature of the FFPSA is the emphasis on program evaluation that will allow the field to know whether the extent to which the new legislation is having its intended impacts in protecting children and reducing the number of children in out-of-home care.

Footnotes

Notes

Ron Haskins was, until recently, a senior fellow in and held the Cabot Family Chair in Economic Studies at the Brookings Institution, where he codirected the Center on Children and Families. His research focuses on child and family policy, welfare reform, evidence-based policy, early childhood education, federal budget, marriage, child welfare, child support enforcement, poverty, inequality, and economic opportunity.

References

Casey Family Programs. 2018a. Interventions with a special relevance for the Family First Prevention Services Act (FFPSA). Seattle, WA: Casey Family Programs. Available from https://caseyfamilypro-wpengine.netdna-ssl.com/media/Family-First-Interventions-Catalog.pdf.

Casey Family Programs. 2018b. What are the outcomes for youth placed in congregate care settings? Seattle, WA: Casey Family. Programs. Available from https://caseyfamilypro-wpengine.netdna-ssl.com/media/SF_CC-Outcomes-Resource.pdf.

Casey Family Programs. 2018c. What impacts placement stability? Seattle, WA: Casey Family Programs. Available from https://www.casey.org/placement-stability-impacts/.

Child Trends. 2014. Federal, state, and local spending to address child abuse and neglect in SFY 2012. Bethesda, MD: Child Trends. Available from https://www.childtrends.org/wp-content/uploads/2014/09/SFY-2012-Report-for-Posting-July2015.pdf.

Children’s Bureau. 2019. Report to Congress on state child welfare expenditures. Washington, DC: Children’s Bureau.

Committee on Ways and Means. 2004. 2004 Green Book: Background Material and Data on the Programs within the Jurisdiction of the Committee on Ways and Means (WMCP 108-6). Washington, DC: U.S. House of Representatives. Available from https://greenbook-waysandmeans.house.gov/.

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Congressional Research Service. 2019. Child welfare: Purposes, federal programs, and funding. Washington, DC: Congressional Research Service. Available from https://crsreports.congress.gov.

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