Family First Act: a False Narrative, a Lack of Review, a Bad Law

The passage of the Family First Prevention Services Act (FFPSA) was greeted with joy and celebration when it passed as part of the Bipartisan Budget Act of 2018. “The Family First Prevention Services Act will change the lives of children in foster care,” crowed the Annie E. Casey Foundation.  The new law “will change foster care as we know it,” raved the Pew Charitable Trusts. But the Act took effect on October 1 to little fanfare. Based on contacts with all the states, the Chronicle of Social Change expects only 14 states and the District of Columbia to implement the Act and 36 to delay implementation for up to two years as allowed by the law. But as of two weeks before implementation, only four states had submitted the plan required in order to implement the Act.

An Act with Many Flaws

FFPSA has been revealed (as some knew all along) as a messy and poorly written piece of legislation. It starts with a misnomer. What the Act calls “prevention services” (“in-home parent skill-based,” mental health, and drug treatment programs for parents who have already been found to have abused or neglected their children) are aimed at prevention of foster care, not of child abuse and neglect before they occur. To most experts, these would be considered to be “intervention” and not “prevention” services. But beyond this misnomer, the legislation has multiple flaws which means it may create more problems than it solves.  Among these issues, covered in detail in a recent webinar from California’s Alliance for Children’s Rights and an article in Governing, are the following:

1. Lack of new funding: FFPSA was designed to be budget neutral, redirecting funds toward foster care prevention services from congregate care and a delay of an expansion in adoption assistance. The Congressional Budget Office has estimated that FFPSA will actually result in a $66 million reduction in federal spending over a ten-year-period. This comes on the heels of 20 years of federal disinvestment in foster care, leaving jurisdictions struggling to maintain reasonable caseloads and services.  Some states are anticipating crippling losses of of funds due to the loss of their Title IV-E waiver programs, which expire at the end of the year and were far more generous and less restrictive than FFPSA. For example, California anticipates the loss of $320 million in federal funding when the waiver ends, forcing service reductions in some of its largest counties. New York will lose support for a program that hired more social workers and supervisors and has been credited with allowing youth to leave foster care earlier.
2. Requirement that 50% of funding be spent on “well-supported” programs. FFPSA requires that 50% of funding be spent on programs that meet a rigorous set of criteria to be defined as “well-supported.” But so far, the clearinghouse created for the purpose of this provision has designated only six programs as “well-supported”: three mental health programs, three home visiting programs, and no drug treatment programs. Some states may prefer to adopt or expand in other similar programs that are not on the list. Therefore there has been a chorus of proposals that this provision be eliminated or delayed.
3. Interaction with Medicaid: Each state’s Medicaid program covers a different set of services, but many of the services meeting FFPSA criteria, especially mental health and substance abuse treatment, are already funded by Medicaid in most cases. Allowing Title IV-E to supplement Medicaid funds might have helped improve the quantity and quality of services available. But in its guidance on implementing the legislation, the Children’s Bureau specified Title IV-E as the payer of last resort for these services. That means that Medicaid must pay first before Title IV-E can be billed. Thus, in states with more generous Medicaid programs, the law will greatly expand the services available to families. Moreover, it appears, based on the federal government’s answer to one state’s question, that programs paid for by Medicaid may not count toward the 50% of programs that must be “well-supported,” leaving states that use Medicaid to fund these programs in a difficult situation. 
4. Restrictions on congregate care: One of the two main purposes of FFPSA was to restrict congregate care, which is basically any placement that is not a foster home. To do so, FFPSA cuts off funding after two weeks for any placement that is not a foster home, with four exceptions. Three of these are programs for special populations and the fourth is a new category called a Quality Residential Treatment Programs (QRTP)–a new category created by FFPSA. QRTP’s must meet numerous requirements, such as accreditation, 24-hour nurse coverage, and a “trauma-informed” approach. Moreover, a child must be assessed by a “qualified individual” as needing placement in a QRTP and that decision must be approved by the family court. Furthermore, a youth may not remain in a QRTP for more than 12 consecutive months without written approval from the head of the agency. As Child Welfare Monitor has discussed elsewhere, there is concern that some group homes will have trouble meeting the FFPSA criteria. Group homes are closing around the country due to insufficient funding and state-level policy changes. Many states have desperate shortages of foster homes, and closing group homes at the same time will worsen their placement crises. Furthermore many young people, especially those with more issues, may need more than 12 months in a group home and may lose all their gains if transferred prematurely to a foster home.  There is also a problem with Medicaid and QRTP’s, as it appears they will fall into a category of “Institutions for Mental Diseases” that are not payable by Medicaid.
5. Kinship Diversion: FFPSA creates an avenue for prevention of foster care by placing a child with relatives (often called kinship diversion) while the parents receive prevention services for up to 12 months. If reunification with the parents never happens, there is no requirement that the children be placed formally with the relatives, or that the relatives receive any assistance either financially or with services. They would be forced to rely on Temporary Assistance for Needy Families (TANF), which is much less generous than foster care payments, and to make do with any services they can find in the community. There is concern that FFPSA may encourage states and counties to use kinship diversion rather than licensing relatives as foster parents, thus entitling them to more services and assistance and ensuring that the agency does not lose track of the children.

How a bad bill was born

The passage of FFPSA was the outcome of many years of advocacy, under the mantra of “child welfare finance reform.” So how did such a flawed bill pass after so many years of proposals and discussions? The answer includes a truncated legislative process, an insistence on budget neutrality,  and a false narrative promoted by a wealthy group of organizations.

False Narrative

This call for finance reform was based on the idea that, as expressed by one of its primary proponents, Casey Family Programs, in a white paper published in 2010:

 …the major federal funding source for foster care, Title IV-E, primarily pays for maintaining eligible children in licensed foster care, rather than providing services for families before and after contact with the child welfare system. The fact that no IV-E funding can be used for prevention or post-reunification services has created a significant challenge to achieving better safety and permanency outcomes for children.

This statement was literally true. Before implementation of FFPSA, Title IV-E funds were not available for services provided to families to help them avoid placement of their children in foster care. But plenty of other funds were available to cover these services. We’ve already mentioned that Medicaid currently pays for many or most of the services that will be provided under FFPSA, with the specifics depending on the state. Other funding sources  included Title IV-B, TANF, Social Services Block Grant, and CAPTA funds.

Moreover, Title IV-E does not cover all foster care costs. The federal government reimburses states for 50 to 75% of the cost of foster care payments, depending on the state. But only 38% of foster children were eligible for federal reimbursement under Title IV-E in 2016, down from an estimated 54% in 1999. The reason for this decline is an antiquated provision (often called the “Title IV-E lookback”) that links Title IV-E eligibility to eligibility for Aid to Families with Dependent Children, a welfare program that ended in 1996. Anything calling itself finance reform should have addressed this senseless linkage, but the framers did not.

So, between the availability of other funds and the fact that states had to pay a large share of foster care costs themselves,  it is hard to accept the narrative that states had an incentive to place children in care rather than provide services to their families to keep them at home. And indeed states have for years been providing in-home services to help families avoid foster care. According to federal data, 1,332,254 children received in-home or family preservation services in FY 2017 compared to only 201,680 children who received foster care services. So the argument for “finance reform” is simply a red herring.

The idea that a foster home is almost always better than a group home or residential placement is behind the other major part of FFPSA, the strict restrictions on funding for congregate care. But this narrative ignores the fact that there are not enough foster parents, especially those who are willing, loving and gifted enough to care for older and more troubled young people. Perhaps some supporters think that these foster parents will suddenly appear once group homes disappear. But this kind of wishful thinking failed when the mental hospitals closed in the 1960’s and the promised community mental health services did not appear, and there is no reason to think it will be more accurate this time around.

So how did a false narrative gain such a large following and become accepted as the truth? This idea has been supported by a powerful coalition of organizations led by Casey Family Programs, author of the white paper quoted above. Casey’s assets totaled $2.2 billion at the end of 2018 and it spent $111 million that year in pursuit of its goals, which include “safely reducing the need for foster care by 50 percent by the year 2020.” Casey has relentlessly promoted this narrative through publications, testimony, and assistance to jurisdictions that agree to implement its agenda.

Budget Neutrality

As mentioned above, FFPSA does not add resources to the system but instead redirects them from congregate care and adoption assistance to services designed to keep families together. Much of the savings will come from states taking on the full cost of group home placements that they cannot avoid. The Congressional Budget Office estimates that about 70% of the children residing in group home placements (other than residential treatment programs) would become ineligible for Title IV-E funding in 2020. So the cost of funding this placements will be shifted to states and counties that are often already struggling to fund these necessary placements. Moreover, the continuation of the TItle IV-E “lookback” means that the federal share of foster care funding will continue to decrease.

Much of the blame for the Act’s budget neutrality goes to Casey and its fellow advocates, who have been uninterested in increasing resources for foster care. As longtime Hill staffer Sean Hughes points out, “…Congressional staffers will tell you that child welfare advocates are perhaps the only group of federal advocates that consistently decline to even ask for new resources.” According to Hughes, these advocates have been unwilling to increase resources for foster care because of their bias toward family preservation. (Remember Casey’s goal of reducing foster care by 50% by 2020). They apparently hope that “starving the foster care beast” might result in fewer foster care placements, whether or not children might be left in unsafe situations. The framers wanted a budget neutral bill, and the advocates were happy to accept it in order to reallocate resources away from foster care (through the continuation of the “lookback” and the restrictions on group homes) toward family preservation.

Lack of review

Aside from a pair of hearings that were orchestrated by the bill’s sponsors to support their vision for the legislation, there were no hearings or floor debate on the Family First Act after it was introduced in 2016. In 2017, it passed the House by voice vote, and its Senate sponsors failed to get it passed. In 2018, after failing twice to attach it to larger bills without hearings of debate, the sponsors succeeded at the eleventh hour in getting it attached to the budget act. Young people whose lives were saved by group homes were never able to tell their stories. The technical problems with Medicaid eligibility were never discussed and may not have even been noticed until long after passage.

A bill called the Family First Transition Act has been introduced to ease the transition to the new legislation. It would delay for two years the implementation of the 50% “well-supported” requirement for services reimbursement,  provide a small amount of transition funding to help states implement the Act, and provide temporary grants to jurisdictions with expiring waivers to make up for a portion of their loss under FFFPSA. However, none of these temporary fixes would cure this fundamentally flawed bill, the inevitable result of a false narrative, inadequate funding, and a truncated legislative process.

This post was updated on November 7, 2019, to specify that the Children’s Bureau made the determination that Title IV-E would be the payer of last resort for prevention services to foster care candidates. This designation of Title IV-E as payer of last resort was not made in the Act itself.