RTCs At Front of Line to Squeeze Money Out of Family First Act

Wyoming: Robotic Claw on a white background grabs dollars

Pacharawi Imsuwan/Shutterstock


Remember the Family First Act? That’s the vastly overhyped federal legislation touted as a revolutionary change in how child welfare is financed. Supposedly, under Family First, lots of money that used to be reserved only for foster care will, at last, go to better alternatives. That was never going to happen. Very little additional money actually will go to those better alternatives.

Wyoming: Richard Wexler (headshot), executive director of National Coalition for Child Protection Reform, smiling balding man with white-gray hair in black top.

Richard Wexler

And now it looks like the very first to benefit from Family First may not be families at all. It may be “providers” of the worst form of “care” in a state that is always a candidate for foster care capital of America. Yes, the first beneficiaries of Family First may be residential treatment centers (RTCs) in Wyoming, a state that regularly tears apart families at a rate nearly triple the national average, even when rates of family poverty are factored in.

The money won’t actually be coming from the federal government. It’s even worse. The RTCs have found a way to use — sorry, I mean leverage — Family First to siphon off scarce state funds — funds that could be used for far better options.

The situation in Wyoming is a wonderful case study in how providers game the system every step of the way. 

  • First, they create “residential treatment centers” — or simply rebrand what used to be called orphanages.
  • Then one of their own trade associations creates a group to “accredit” RTCs and other agencies through a process that is meaningless — but expensive.
  • Then the RTCs’ agencies try to get taxpayers to help pay for the “accreditation” of institutions for which there is no evidence base; institutions that are at least as likely to harm children as to help them.

To understand how this all came to pass, we need to take a couple of steps back.

The Family First Act has two parts. One part allows the use of federal Title IV-E foster care money for a very limited number of prevention programs under very limited circumstances. The Congressional Budget Office estimates that an average of only $130 million per year in IV-E money will be made available for prevention thanks to the law. That’s less than 2% of the roughly $7 billion or more per year spent under IV-E on foster care and adoption. 

The second part of the law supposedly curbs the use of the worst form of care, group homes and institutions, including so-called “residential treatment centers.”

Residential treatment doesn’t work

The first thing to understand about residential treatment is this: There is overwhelming evidence that it’s a failure. There is nothing a residential treatment center does that can’t be done better, and at less cost, in a child’s own home or a foster home. Even the former head of a child welfare trade association that includes RTCs admitted there is a lack of “good research” showing residential treatment’s effectiveness and “we find it hard to demonstrate success …” 

But it’s worse than that. Institutions are the worst placement for a child, both because of the emotional harm inherent in institutionalization and also because institutions have the worst record for physical and sexual abuse of children in their “care.”

The second thing to understand about residential treatment centers is that they tend to be big, powerful institutions with lots of clout in state legislatures and in Washington. So when Congress tried to use the Family First Act to set limits on when federal taxpayers will help pay to warehouse children in such places, the residential treatment industry was able to shoot the bill full of loopholes.

The result: A law that says states can’t use federal foster care money to help pay for residential treatment for more than two weeks — except if the institution is a “Qualified Residential Treatment Program” — a new category created by the law itself.

And what does it take to be a QRTP? Almost nothing. You can read the actual requirements on pages 17 and 18 of the law here. But it boils down to this:

  • Write lots and lots of plans filled with appropriate buzzwords. (Drop the word “trauma-informed” into every third paragraph and you should be fine.)
  • Hire a nurse during working hours and have one on call the rest of the time. 

But if residential treatment programs don’t already meet these minimal requirements, what in the world are they doing — except warehousing kids? And even institutions that can’t meet these minimal requirements still may be able to get paid by governments using Family First funds thanks to other loopholes (My personal favorite is the “Presents for Pimps” loophole.)

Perhaps that’s why the Congressional Budget Office estimated in 2016 that the Family First Act would barely reduce the proportion of institutionalized foster children. It would decline from 14% to 11%, over 10 years.

And yet, all over America, news stories are popping up in which the local residential treatment industry wrings its hands and warns of dire consequences because they can’t possibly meet requirements to do things like, you know, actually treat people.

The sham of ‘accreditation’

Oh, there is one more requirement:

Get a rubber-stamp seal-of-approval from an accrediting agency. I say rubber-stamp because one of the groups an aspiring QRTP can choose is the so-called “Council on Accreditation.” COA is a creation of the Child Welfare League of America. (That’s the trade association of agencies themselves whose former director said they have trouble showing that residential treatment works, by the way.)

COA’s “site visits” are announced well in advance — in fact, COA recommends that institutions conduct a full-scale rehearsal before the COA “review team” visits. It should include, among other things “Rehearsing and otherwise preparing staff for their roles during the Site Visit.”

And then there’s the way the “review team” goes about interviewing people. As COA puts it in its “Accreditation Guidelines”:

“Arrange for Key Staff to be Available for their Scheduled Interviews While the Review Team is On Site.

In addition to making senior staff available, the review team will be seeking to interview other staff as well as persons served.” [Emphasis in original.]

Everything else is based on the agency’s paperwork. The Council on Accreditation doesn’t accredit agencies. It accredits file cabinets.

Perhaps that’s why, in the 1990s, COA accredited a private agency in Ohio in which, the Dayton Daily News found, children lived in squalid group homes and the agency director had a conviction for contributing to the delinquency of a minor. Public agencies like this one also can be accredited.

What the RTC industry wants from Wyoming

And now, in Wyoming, the residential treatment industry wants state taxpayers to divert scarce funds to help the RTCs pay for the cost of accreditation! They’ve gotten a legislative committee to introduce draft legislation to that effect

Exactly how much in taxpayer money this will divert from better purposes is not specified, but the “legislative findings” section of the bill says: “The costs and technical demands of becoming QRTP accredited and maintaining QRTP accreditation are significant.” The fee schedule published by COA confirms this.

That section of the bill goes on to make a claim that leads me to wonder if the lawmakers and staff talked to anyone other than residential treatment providers:

“Without the availability of technical and financial support, there is a significant risk that an insufficient number of Wyoming’s care provider organizations will be QRTP accredited and Wyoming’s children and families will not receive the services that are available through the Family First and [sic] Prevention Services Act.”

This appears to conflate the two parts of the Family First Act. The funds for services do not require RTCs to be accredited. In fact, they don’t require RTCs at all. The whole point of these funds is to keep children safe through alternatives that avoid the use of RTCs, or any other form of foster care.

The part of Family First that requires the sham of accreditation is the part that limits (slightly) the use of existing federal funds for RTCs. Even that does not prohibit states from simply picking up the entire tab themselves.

As for the fear that “an insufficient number” of RTCs will be accredited, that can only be a good thing. Since there is nothing an RTC can do for foster children that can’t be done better using other alternatives, the sufficient number of such institutions for foster children is: zero.

If Wyoming winds up with fewer institutions into which to dump children, perhaps the state will stop tearing apart families needlessly at one of the highest rates in America.

Richard Wexler is executive director of the National Coalition for Child Protection Reform.


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