IV-E Change Needed, But Not in Block Grant Form

Much attention has been paid recently, and alarm bells sounded, at the expressed plans of the Trump administration and Congress to eliminate programs and cut back on entitlements that support the poorest and most vulnerable American families and children.

The Affordable Care Act stands to be repealed, and serious cuts to Medicaid, Medicare, and Social Security have been proposed. The future of the Children’s Health Insurance Program and the federal food stamp program are uncertain at best.

But so far, the largest chunk of federal funds that serve abused and neglected children, Title IV-E, has not been expressly targeted.

The bipartisan federal Commission to Eliminate Child Abuse and Neglect Fatalities (CECANF), which carefully studied the epidemic of thousands of American children dying each year due to child maltreatment, made a comprehensive series of recommendations last spring to save children’s lives. The commissioners all agreed that the current child welfare system is weak in part due to chronic underfunding and understaffing.

CECANF expressly supported the Family First Act, which would have opened up the Title IV-E entitlement for the first time to new prevention services. The commissioners had difficulty coming to agreement on the precise amount of money needed to have child protection agencies and programs run optimally.

But they never proposed to alter the structure of or compromise the entitlement itself.

Commissioner Wade Horn’s January 18th piece in The Imprint, “Three Ways Trump Can Make Children Safer,” puts forth several prudent steps the new administration could take to ensure the safety of American children. As a former assistant secretary of the Administration of Children and Families under President George W. Bush, he is uniquely knowledgeable and has valuable perspective on how we may best appeal to the new administration on this critical issue. The child welfare community would do well to look to Dr. Horn and his peers for guidance on the best way to move forward with this new administration.

His call to invest appropriate resources for the system to run in a more efficient and effective manner is fundamental to any improvements. Supporting real-time, multi-system data sharing is a wise common-sense proposition and one that may well appeal to our new executive branch. And the continued use of flexible funding through state waivers is a popular option that, while glazing over and putting off desperately needed comprehensive child welfare finance reform, has revealed some promising innovations.  All of these recommendations are consistent with the CECANF final report.

But Horn’s suggestion that the Trump administration ought to consider pressing for legislation to transform the foster care entitlement into a block grant is perhaps the most disastrous thing that could happen to child welfare in this country. Block granting foster care funds would eliminate the only entitlement available to help serve abused and neglected children, and would undermine the consistent and effective delivery of these services to children nationwide.

Child welfare agencies have always been able to count on federal matching dollars from the Title IV-E foster care entitlement to cover a portion of children who come into state custody through foster care. There is already an arcane eligibility formula which reduces the number of families that qualify each year, which increases the state’s financial obligation for foster care.

This is, in part, why Horn believes block granting is advisable: It would stop the bleeding caused by the the 1996 AFDC look-back requirement. Stakeholders across the spectrum agree that this formula should be abolished, but concrete plans on how to pay for that have been more elusive. In spite of the outdated and unfair eligibility formulas, the Title IV-E foster care entitlement is, in fact, the only guaranteed source of federal funds available to pay for the care of foster children.

At present, states don’t need to balance the provision of foster care with the number of children coming into or leaving the system. But if Congress changed Title IV-E’s structure to a block grant, which means sending the states a capped amount of money to serve however many children enter the system, nothing would be guaranteed. States would have to find space within a fixed amount of money for everyone served by the entitlement, without regard for the number of children in the system, and with no relief in sight should the number of foster children spike or their needs intensify.

This is particularly concerning with the current steep rise we are seeing in the number of children entering foster care due to the opioid abuse crisis. Massachusetts alone reported a 56 percent increase in removals over the past few years.

Horn may argue that these spikes could be controlled for by building a growth rate into the block grant formula, which would leave states flush during ebbs in placements and possibly strained when placement rates are high, but balance out overall. But if this administration is interested primarily in doing away with entitlements to save money, they may be disinclined to push for this sort of structural change if it is carried out in this manner. Given the low-visibility of children’s issues thus far in the new White House, it is difficult to know what they would be open to.

This is what we do know: Once an entitlement is gone, it is gone.

The scariest prospect of block granting this entitlement is the historical precedent which demonstrates that traditionally formulated block grants will decrease sharply in value over time. The Temporary Assistance to Needy Families block grant – formerly an open-ended entitlement called the Aid to Families with Dependent Children – is already worth 30 percent less than when it was enacted in 1996.

There is no historical precedent for block-granting an entitlement that builds in a growth rate. The only examples we have show that if Title IV-E were block granted as others have been, it would not bode well for the hundreds of thousands of abused and neglected children living in foster care, or for the state agencies already struggling to provide for them.

In addition, lessons learned from the ongoing movement to advance the Family First Act have taught us that we can, and ought to, continue to think creatively about how to utilize the IV-E entitlement to best serve children and families. If this stream of funding were to be block-granted, there would be no option down the road to alter the programs and services that it is used to fund. It would be set in stone.

Innovation is indeed sorely needed in the child welfare arena and should be encouraged, but this seems like an awfully big and risky gamble to make in already uncertain times.

Amy Harfeld
serves as the National Policy Director and Senior Staff Attorney for the Children’s Advocacy Institute at the University of San Diego School of Law. She is the former Executive Director of First Star and spent time representing the City of New York, as well as children and parents in abuse and neglect cases in New York City Family Court.

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