President Joe Biden’s budget proposal includes a plan to fiscally prioritize foster care prevention, and placements with relatives and other kin, over non-relative foster homes and group settings, while also boosting annual spending on transition-age foster youth.
The appendix for the Department of Health and Human Services’ budget proposal includes the following outline:
The Budget proposes to increase reimbursement rates for the Prevention Services and Kinship Navigator programs. The Budget also proposes to increase reimbursement rates in the foster care and guardianship assistance programs for children placed with kin and to reduce reimbursement rates for children placed in most congregate care settings. The Budget proposes to increase Chafee funding by $100 million per year and add flexibilities in the program.
This suggests a major revising of state reimbursement under Title IV-E, the entitlement through which most of federal child welfare-related funding flows. Youth Services Insider went digging through more budget documents for some specifics, and indeed, that is the case. Here is a basic rundown of the plan.
States are reimbursed for foster care and adoption costs through Title IV-E based on their respective Federal Medical Assistance Percentage, or FMAP, which dictates funding in the much larger Medicaid entitlement. For wealthier states, the floor for FMAP is 50%, that’s the least a state can draw. For a “poorer” state, like Mississippi, the feds cover more than 75% of costs.
For a great basic explanation on FMAP, with illustration, click here for a feature we did with Mary Bissell of ChildFocus and artist Jonathan Muroya.
What Biden is proposing to do is go above the FMAP rate for foster care placements or guardianships with relatives or other kinship caregivers as an incentive to prioritize those options over others. He also proposed to disincentivize congregate care placements. Here is how it would shake out under this plan:
Kinship foster care or guardianship: FMAP plus 10 percentage points.
Non-relative foster homes: FMAP only.
Group settings: FMAP minus 5 percentage points.
Foster care prevention
Under the Family First Prevention Services Act, the allowable use of IV-E funding was expanded beyond foster care and adoption to include spending on programs and services aimed at preventing the removal of children in more child welfare cases. But funds can only be drawn by states for those models and programs that are approved by a recently established federal clearinghouse, which thus far has cleared about four dozen options.
Approved programs fall under three ratings: Well-Supported (the strongest evidence of impact), Supported, and Promising.
The Biden budget proposes several major changes to increase prevention services funding:
-Prevention services would retroactively be 100% covered by federal dollars for fiscal year 2022, and 90% from 2023 to 2026.
-After that, the reimbursement floor would be 75%, and significantly higher in poorer states. Right now, prevention services are pegged like foster care IV-E funds to a state’s matching rate for Medicaid; for many states, that is a 50-50 split.
-Currently, half of all prevention services spending by a state must be on Well-Supported programs; the Biden plan would alter that to say half must be spent on Well-Supported or Supported.
-States could use 15% of their prevention services money on programs or models that are not yet approved by the clearinghouse, with agreements to contribute to the knowledge base about the programs by conducting evaluations of the work. Biden would also appropriate $10 million to the clearinghouse each year “to support evaluation and technical assistance on evaluations to develop additional evidence-based programs.”
-All Native American tribes would be able to develop, via agreements with states, their own prevention services plans that are “adapted to the culture and context of tribal communities” and exempt them from the requirement to use only programs rated as Well Supported, Supported, or Promising.
The Biden budget proposed an additional $100 million for independent living services within the John H. Chafee Foster Care Independence Program, bringing the annual total there up from $140 million to $240 million. Chafee received a $400 million one-time boost in the pandemic relief bills, and many advocates have called for at least some of that increase to become permanent.
Ban on discrimination
In addition to increased funding around foster care prevention, kinship care and older youth in the system, Biden would prohibit state agencies receiving IV-E funds from “discriminating against current or prospective foster or adoptive parents, or a child in foster care or being considered for adoption on the basis of their religious beliefs, sexual orientation, gender identity, gender expression, or sex.” This would also apply to any providers that these state agencies contract with.
The most immediate impact here would be felt in the 11 states that have passed legislation that expressly allows faith-based providers to follow religious ideology in choosing which parents and/or kids they will and will not serve. Those laws would seem to put a state afoul of this proposal, and possibly jeopardize federal child welfare funding for the state.
With all of these proposals, it is important to note that in the bowels of a presidential budget request, they are little more than aspirations. It requires legislation to make any of these happen, either a standalone bill or, more often these days, appropriations bills that carry big changes to the actual appropriating in them. The Family First Act, for example, was a major overhaul of Title IV-E and became law as part of a temporary spending bill after failing to gain passage as a separate bill.
We are guessing that the White House has some legislators interested in carrying the ball on this. Youth Services Insider will continue to report as we get more details and reaction.