Waivers Help Reduce Foster Care Reliance, Finance Committee Hears

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Four of the five states that have most reduced the number of children removed from their homes did so with waivers to experiment with federal funds, according to testimony at a Senate Finance Committee hearing today on the future of the waivers.

Since 1994, the Department of Health and Human Services has granted waivers to states to widen the options available under the Title IV-E funds, which otherwise are tethered almost exclusively to paying for foster care placements.

“The majority of federal funds for child welfare are directed at the least desirable outcome: removing a child or children from the home and placing that child in foster care,” said Sen. Orrin Hatch (R-Utah).

Seven states have active waivers right now, said committee chairman Sen. Max Baucus (D-Montana), but “congressional action is necessary to give HHS the authority to approve new waivers.”

California, New York, Florida, Ohio and Illinois all reduced the number of children placed out of the home by more than 30 percent between 2002 and 2009, said Crystal Allen, executive director for the Public Children Services Association of Ohio. New York is the only state that made the change without receiving a waiver.

“The number of children in the foster care system has declined by more than 80,000 over the last 10 years,” said Sen. Max Baucus (D-Mont.). “Many child welfare experts believe this success was achieved, in part, because of states’ use of demonstration waivers.”

Casey Family Programs CEO William Bell said his organization supports the expanded use of waivers, but favors a “comprehensive reform of child welfare financing” that would open the IV-E entitlement to include prevention and permanency activities. Such reform would allow all states to draw federal funds for the options available to waiver states.